The question is no longer “Is the condo market slowing?”
It’s now: “Are we heading toward a full-blown industry shutdown?”
Here’s what the data — and the insiders — say.
🔥 New Condo Sales Have Collapsed to Record Lows
In October 2025, only 54 new condos sold in the entire City of Toronto. To put that into perspective:
A healthy month is 1,500–2,000 sales
Even 2024 — the previous worst year — had more activity
Developers are sitting on thousands of unsold units
This isn’t a slowdown.
This is a freeze.
Buyers are stepping back, investors are exiting, and developers can’t make new launches pencil out at current construction and financing costs.
🧨 Developers Are Quietly Stopping Projects — and More Are Coming
Across Toronto and the GTA, industry insiders report:
Projects paused mid-planning
Launches “postponed indefinitely”
Pre-construction sites sitting empty
Low-rise builders refusing to break ground
Lenders reducing advance rates to developers
Escalating cancellations quietly communicated to agents
Many developers are financially overexposed and cannot risk launching in a market where buyers simply aren’t showing up.
If demand doesn’t return quickly, experts warn we could see more project cancellations in 2026 than any year since 2013.
🏗️ The Biggest Risk? Construction Financing Is Drying Up
Banks and private lenders are pulling back in a big way.
Common financing challenges right now:
Higher interest rates → crushing carrying costs
Slower sales absorption → longer sellouts
Stricter underwriting on construction budgets
Appraisals coming in below projections
Developers unable to secure mezzanine capital
Many projects cannot hit the pre-sale thresholds required to get financing. No financing = no shovels in the ground.
This is why experts are calling 2026 a potential “reset year” for development.”
📉 Investors Are Gone — And They Aren’t Coming Back Quickly
The Toronto condo market was built on investor demand. In some years, investors made up 60–70% of new condo purchases.
Now?
Pre-construction investors are sitting out
Assignment sales are flooding the market
Negative cash flow is pushing landlords to sell
High interest rates killed the “invest and hold” model
Short-term rental restrictions removed another demand source
Without investors, pre-construction math simply doesn’t work.
💣 Is the Market in Danger of a 2026 Shutdown?
Short answer: YES — for developers, not for end users.
Here’s what analysts expect moving into 2026:
❌ Fewer new projects launched
Expect a 60–80% drop from peak launch years.
❌ More cancellations
Marginal projects will not survive the economics.
❌ Delays across almost every major build
Developers will wait for rates to fall or construction costs to ease.
❌ A near-standstill in investor-driven sales
This is now a user-market.
But there’s ALSO a major silver lining:
💎 2026 Could Be the Best Buying Opportunity in a Decade
Serious buyers — especially end-users — may be entering the strongest negotiating market in years:
Developers offering incentives they never offer
Price softening in select downtown pockets
Assignment sellers desperate for exits
Private lenders stepping in where banks have pulled back
Appraisals stabilizing after two volatile years
For strategic buyers, this is the perfect mix of:
soft prices + motivated sellers + low competition.
🏦 Where Lendworth Fits Into This Market Shift
When traditional lenders tighten, the market turns to private capital — fast.
Lendworth is seeing a surge in:
Bridge loans for buyers needing flexible timelines
HELOC-style private loans for liquidity gaps
Construction & renovation financing where banks won’t step in
Investor refinancing to manage negative cash flow
Assignment financing
Land acquisition loans for developers waiting out the storm
If 2026 brings more market stress — and it likely will — private capital becomes essential.
🧭 Final Outlook: 2026 Will Reshape Toronto Real Estate
All signs point to 2026 being a transition year:
Projects freeze
Developers regroup
Prices soften
Buyers regain leverage
Private lenders fill the gap
The market slowly resets
We’re not calling for a crash.
We’re calling for a massive structural reset, and the condo industry knows it.
If you’re a buyer, investor, or developer looking at the 2026 landscape…
this may be the moment.