In the second quarter of 2026, a recently built Toronto-area condo had three different prices depending on who bought it. Individual buyers paid developers about $1,008 per square foot. Units resold in buildings registered within the past three years averaged $830. Investment groups buying five or more units at a time paid about $773. The asking price on developer inventory sat above all three, at $1,186 per square foot.
These figures cover the whole Greater Toronto Hamilton Area. The pattern still matters for anyone buying a downtown condo this fall, because the spread shows where the oversupply is building. Finished, unsold units on developers' books hit a record while resale listings fell. A set of tax rules that applies to buying from a builder but not to private resales then reshuffles which of the three prices is really the lowest.
Three Channels, One Product
Urbanation's July 20, 2026 survey shows how far the channels have drifted apart. Developer asking prices were down 2% from a year earlier, yet they sat at a record 43% premium over resale in recently registered projects. Developers that did sell often negotiated well below asking, and bulk deals closed "at prices even below resale."
| Channel, Q2 2026 | Average price per sq. ft. | Who sits on each side |
|---|---|---|
| Developer asking price, completed unsold units | $1,186 | Developer listing to anyone |
| Individual new-condo purchases | $1,008 | Developer and a single buyer |
| Resale, buildings registered in the last three years | $830 | Private owner and buyer |
| Bulk purchases of five or more units | $773 | Developer and an investment group |
The bulk line is small, but it isn't marginal. Urbanation counted seven bulk sales in the quarter, totalling 204 units and 30% of all new condo sales. One named example came on September 24, when the Toronto Star reported that High Art Capital paid $22.3 million for 43 unsold units at Line 5, near Yonge and Eglinton. That works out to about $518,600 per unit, or $797 per square foot. Line 5 is in midtown, not downtown, but the Star set that price against the $1,008 individual buyers paid for new units in the second quarter.
Downtown has its own example. The Star reported that Jesta Group, a Montreal-based family-owned firm, bought about $30 million of unsold units at a recently completed building near Toronto Metropolitan University. The firm plans to hold them as rentals until the market turns, which it expects in three to five years, and is aiming to buy $500 million worth over the next year.
Where the Oversupply Actually Sits
That pricing makes more sense once you see where the unsold units are. At the end of the second quarter of 2026, developers held a record 5,001 completed, unsold units, up 68% from a year earlier. Over the same period, active resale listings fell 21% to 7,105, a three-year low. That count is still 48% above the 10-year average. Months of supply across new and resale combined eased to 7.3, down from 8.5 a year earlier.
A lot of the "glut" talk assumes the city is full of tiny investor units. Urbanation's breakdown points the other way. Units under 600 square feet made up 20.4% of active resale listings in the second quarter, down from 24.3% in 2024. On the developer side, 54% of standing inventory is over 700 square feet, 57% has two or more bedrooms, and the average unit is 836 square feet.
In practice, a buyer looking at a two-bedroom downtown can choose between two pools: a resale owner who may have options and a developer carrying finished units at prices that so far have moved mostly through private negotiation. The 2% year-over-year change in developer asking prices hides how flexible those prices actually are.
The pipeline behind this inventory is shrinking. Combined pre-construction and under-construction inventory fell to 48,710 units in the second quarter, 37% lower than a year earlier. No new projects launched for a second straight quarter, and construction starts dropped to 448 units. Urbanation's president, Shaun Hildebrand, said condo supply "is set to see its largest ever decline in the coming years." Bulk buyers holding for three to five years are betting on exactly that gap.
The Tax Line That Changes the Comparison
The sticker gap between developer and resale units leaves out HST relief on new homes, which the Canada Revenue Agency says covers a unit bought from a builder but not a private resale.
According to the Canada Revenue Agency's August 2026 notice, which replaces the June version, Ontario's enhanced new housing rebate offers up to $80,000 of relief on the 8% provincial part of the HST. It is open to individuals buying a new home for their own or a relative's primary residence, and buyers don't have to be first-timers. It generally covers purchases from a builder with an agreement signed between April 1, 2026 and March 31, 2027. The full rebate applies up to $1 million. Between $1 million and $1.5 million it is a flat $80,000. It phases down after that and is unavailable at $1.85 million and above.
Ontario's New Home Affordability Payment adds up to $50,000 against the 5% federal part. Anyone entitled to the enhanced rebate can receive it without a separate application. It is reduced by any federal rebate the buyer can claim. The province puts combined relief for owner-occupied homes at up to $130,000. Separately, the Canada Revenue Agency says the federal First-Time Home Buyers' GST/HST rebate covers up to $50,000 for qualifying first-time buyers on new homes up to $1 million and phases out to zero at $1.5 million.
Three details decide which channel these rules favor:
- A finished unit still counts. The owner-occupier rules don't require the building to be unfinished when you sign. That means a completed, unsold unit bought straight from the developer can qualify if every other condition is met.
- A resale doesn't. A private resale isn't the new-from-builder purchase these rebates target.
- Assignments are narrow. An assignment qualifies for the Ontario rebate only if both the original builder agreement and the assignment agreement fall inside the April 2026 to March 2027 window.
Investors aren't shut out. A separate rental-property rebate route lets landlords qualify for a new unit held for long-term rental. That route has its own deadline: substantial completion by December 31, 2029. The 2029 date that has circulated in coverage belongs to the rental route. Owner-occupiers face December 31, 2031.
So an owner-occupier comparing a developer's two-bedroom with a resale two-bedroom in the same district isn't comparing like with like. One may come with up to $130,000 in provincial relief, and the other comes with none. Whether a builder's quoted price already includes HST, and who receives the rebate at closing, are questions for your lawyer and accountant. This is market mechanics, not tax advice, and individual eligibility depends on facts only your advisors can confirm.
What Resale Sellers Are Absorbing
The friction shows up on the resale side. The Financial Post tracked a 650-square-foot Corktown unit that was listed at $558,000 in early March 2026 and relisted at $399,000 on May 4. A penthouse at the Merchandise Building took eight months and six price cuts, then sold at a reported loss of $125,000. One assignment involved a contract bought for nearly $560,000 in April 2021 and later sold.
Interim occupancy adds to the pressure before a deal closes. The Condominium Authority of Ontario explains that buyers who take occupancy before the building registers pay the builder an occupancy fee. They pay it whether or not they move in, and it is capped at interest on the unpaid balance, estimated property taxes and projected common expenses.
Rents haven't eased the strain. CMHC's June 2026 mid-year update said newly completed condos that owners couldn't sell were being rented out in greater-than-usual numbers, and some units took months to lease. Toronto's average asking rent for apartments and condos was $2,570 in August 2026, down 3.7% year over year, according to Rentals.ca and Urbanation.
The Downtown Numbers in Their Own Window
TRREB defines the Downtown Core as districts C01 and C08. In the second quarter of 2026, average prices there were $490,000 for a one-bedroom, $565,000 for a one-bedroom plus den and $695,000 overall, with an overall median of $590,000. The average one-bedroom rent in the core was $2,420 that quarter, compared with $2,440 a year earlier.
TRREB's most recent monthly release, published September 3, covers August 2026. It puts the average condo apartment sale in the 416 at $651,648, down 2.1% year over year. The 905 dropped further, down 7.6% to $549,868. September figures weren't out as of October 4. Urbanation's third-quarter survey usually comes in mid-October and will show whether developer asking prices have started to close the gap with negotiated prices.
If you're also weighing the lakeshore west of the city, our comparison of Etobicoke waterfront condos and downtown Toronto covers the investor side. If you already own downtown and are planning a move, selling a Toronto condo to move west walks through the sequencing.
A Few Questions We Get
Can a downtown resale buyer get the HST relief? Generally not. The rebates target new homes bought from a builder, and private resales fall outside them.
Is the developer's asking price the real price? In the second quarter of 2026, the gap was wide. Developers asked $1,186 per square foot, and individual purchases averaged about $1,008.
When does the Ontario window close? Builder agreements have to be signed on or before March 31, 2027 to qualify for the owner-occupier rebate.
To compare a developer-held unit and a resale unit in the same downtown district on a level basis, before March 31, 2027 passes, contact Corrie Harding-Keizs and request a personalized market consultation.
