2. The Pre-Construction Condo Market Has Hit A 30-Year Low
The new condo market is in free fall. Recent BILD data shows only 155 new condominium units sold across the GTA in September 2025, roughly ninety percent below the ten-year average, with only a few dozen sales inside the City of Toronto itself. This is not a blip. We have effectively been in a pre-construction freeze since mid-2022.
For years, the pre-construction playbook was simple. Put 20% down, wait four to five years, and watch your unit appreciate. Sell or assign before occupancy, then repeat. But the math stopped working. Pre-construction in central Toronto often launches around or above fifteen hundred dollars per square foot, while comparable resale trades between nine hundred and twelve hundred dollars per square foot. Add in development charges, municipal levies, HST, double land transfer taxes, and builder margin, and a million-dollar unit can carry three hundred thousand dollars in taxes and fees alone.
On top of that, buyers are increasingly aware of the gap between marketing renderings and the delivered product. Suites often feel smaller than the floor plan, finishes are value engineered, amenities miss the mark, and design quality can feel compromised. Trust is eroding. Most purchasers also underestimate the flexibility written into developer contracts. Builders can delay, alter, merge, adjust, or in certain circumstances walk away entirely. In a declining price environment with higher borrowing costs, that risk becomes harder to justify.
There is also a cultural shift underway. Many agents built entire businesses selling pre-construction launches and assignments. When the music stopped, a good share of those agents exited the industry. What remains is a smaller, more sober cohort who cannot justify pushing clients toward products that are riskier, more expensive and often inferior to resale options. The Instagram bravado still exists, but the buyer skepticism is far deeper.
3. The One At Yonge & Bloor: Cancellations, Courtrooms and A Massive Reset
The most public example of pre-construction risk is centered at the symbolic crossroads of Toronto: Yonge and Bloor. After years of litigation and financial strain, nearly all of the original pre-construction purchase agreements at One Bloor West have been cancelled. Court filings and media coverage confirm that Tridel, the well-capitalized developer now controlling the site, received approval to unwind those contracts, refund deposits and re-launch the project with a new suite mix and strategy focused on the ultra-luxury market.
For buyers, getting deposits back is the best possible outcome, but the five to six years of waiting during a high-inflation period represents a significant opportunity cost. Many purchasers thought they were buying into an iconic flagship, not embarking on a multi-year detour filled with uncertainty.
For the market, the moment reveals three truths. First, contracts are not as ironclad as purchasers believe. In extreme conditions, developers can legally exit and restart. Second, ultra-luxury end-user demand in Toronto is deeper than many assume. The relaunch targeting larger residences and potential hotel programming addresses a gap in Yorkville where ten-million-dollar-class product is scarce. Third, price per square foot at the top will likely test new limits. If the building achieves a high enough standard, two thousand dollars per square foot or more realistic for a narrow segment of buyers.
We would not recommend this project to every client. But it will be a fascinating barometer for global wealth and confidence in Toronto over the next few years.
4. Purpose-Built Rentals Are Quietly Re-Wiring The City
With pre-construction condo sales stalling, a growing share of developers are pivoting to purpose-built rentals. Ontario and CMHC data shows that purpose-built rental starts have climbed from roughly one fifth of new apartment construction a decade ago to well over one third today, with the GTA seeing a notable rise in dedicated rental supply.
The shift matters. Professional landlords offer more stability than mom-and-pop investors, with far fewer sudden “I need you out in 60 days because I am selling” disruptions. Purpose-built buildings often deliver better amenities, stronger building systems, reliable on-site management and long-term tenancy security. For families who want to rent the same home for ten or twenty years, these buildings change everything.
From our perspective, the 28-year-old who once would have stretched to buy a small pre-construction one-bedroom will increasingly choose a purpose-built rental in a great location today, then pursue a larger freehold or spacious condo once life, career and finances stabilize. Meanwhile, many investors are sitting out entirely. Without their deposits, the old pre-construction playbook cannot resume at the same pace.
This raises deeper questions about the long-term shape of Toronto. Are we becoming more like Germany, where renting is common, stable and stigma-free? Or more like New York, where ownership concentrates among older wealth and everyone else rents for life? Either way, Toronto’s owner-to-renter mix is already shifting, and purpose-built rentals are playing an outsized role in that transition.
5. Affordability, Interest Rates and Buyer Psychology In 2025
On paper, affordability has improved. TRREB data shows prices across the GTA drifting downward month after month, with the home price index sitting under the one-million-dollar mark. The Bank of Canada has begun cutting rates, pulling the overnight rate into the mid-two percent range.
In reality, the psychology is far more complicated. Buyers know they have more leverage than in 2021, and they are deeply tuned into negative headlines and doom narratives. Many fixate on getting a deal, even when a property is already significantly below historical benchmarks. The result is a predictable pattern. A great home appears in tight micro-market. The buyer loves it. The buyer then hinges their decision on an additional discount driven by fear rather than comparables. Negotiations fall apart over ten or fifteen thousand dollars.
While weeks or months pass, new listings dry up and the same buyers remain in the same rental, still scrolling, still waiting for the “perfect” deal. The lifestyle cost of waiting becomes immense. A home is not a spreadsheet entry. It is the backdrop for years of actual life.
Sellers carry a different set of challenges. Many remain anchored to 2021 and early 2022 benchmarks. They remember their neighbour’s sale, track asking prices instead of sold prices, and have not internalized how far the adjustment has already gone. In 2023 and 2024, we described these as the years of tough conversations. In 2025, it feels more like acknowledging reality. Sellers who truly need to move must align with what buyers are actually paying today. Feedback is blunt, comparables go stale quickly, and the question shifts from what the home “should” be worth to whether the family wants to move at all.
This has forced us to be more selective with listings. It is no longer just about whether the property can sell. It is whether we can have a rational, collaborative partnership with a seller through what may be a difficult market journey.
6. Toronto Neighbourhoods: What Is Hot & What Is Not
Our day-to-day work is centered in the core, so our lens is micro and nuanced. On the east side, neighbourhoods like Leslieville, Playter Estates, and North and South Riverdale continue to show surprising strength for high-quality product. Well-renovated homes on quiet tree-lined streets with strong light, functional layouts, parks and transit access and top school districts still draw deep interest. Even in this market, the right home can attract multiple offers and strong sale prices, provided the property, pricing and marketing align. North Riverdale remains one of the most resilient micro-markets in Toronto. When the tide goes out, you can see who is wearing a bathing suit, and many of these streets still are.
The west side tells a more mixed story, though certain pockets remain strong. Bloor West Village maintains its small-town-in-the-city appeal. High Park North, Roncesvalles, the Junction and Wallace Emerson hold steady with character homes, green space, village energy and transit access. One emerging truth is that parking has become non-negotiable for most buyers. In the last cycle, many were willing to gamble on street permits or promises to “figure it out.” Not today. Lack of parking can dramatically reduce showing traffic and offer activity, and the gap between homes with parking and those without is widening.
This is ultimately about human trade-offs. If a buyer is going to stretch, they want a home that feels fundamentally bulletproof.
7. So What Do You Do With All Of This?
If you are still reading, you are likely not here for entertainment. You are trying to figure out your own next move. For buyers, the key is recognizing that timing the bottom is impossible. Focus on the micro-market rather than national headlines. Get clear on your non-negotiables including layout, light, location, school district, commute and parking. Understand that truly exceptional homes in A-grade locations will always attract interest, even in a down market. When the right property appears, ask yourself whether you will be comfortable waiting another three or four years for another one like it. The goal is not to win the market. The goal is to buy a home that fits your life, at a price that aligns with current data, and then move forward.
For sellers, pricing above the market to “leave room” is the fastest path to silence. Ask for real sold data and be prepared to adjust early, not after three painful months online. Ensure your listing team is strategically marketing the property across multiple channels. And if your expectations are tied to 2021, be honest about whether selling now is truly the right choice. Sometimes the best decision is to wait. Other times, the best decision is to realign with the current market and move with intention. The key is choosing consciously, not accidentally.
8. Where Fox Marin Fits Into this Messy, Interesting Moment
We called this the Seinfeld episode, a show about nothing, but in reality these conversations are about the future of how people live in Toronto. Corner shops and small cafes will reshape how we experience our streets. A pre-construction market at a thirty-year low will redefine what gets built next. Purpose-built rentals will transform what it means to rent long term. The One at Yonge and Bloor will test ultra-lusury demand in a cautious climate. Buyers and seller psychology will continue to swing between fear and FOMO, and smart decisions will require context, not noise.
Our job at Fox Marin is to live in these nuances every day. We are in the trenches with first-time buyers, downsizers, seasoned investors, renters seeking stability and families navigating change. We see the reality behind every headline, offer night and listing appointment. If you are trying to make sense of your path in this strange, upside-down 2025 market, we are here to talk strategy, not sales pitches.
Contact us (We’re Nice).
Fox Marin has earned its reputation as Toronto’s premier downtown luxury real estate team, backed by over *$580 million in sales, more than 1,000 successful transactions, and over 500+ glowing 5-star Google Reviews. Discover the advantage of working with a proven team with a track record for winning results.
(*Source: Jan. 1, 2018 – Sept 1, 2025, RE Stats Inc. & Exclusive)
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This article was written by Kori Marin, a Toronto Broker & Managing Partner at Fox Marin Associates. For high-energy real estate aficionado Kori Marin, a well-lived life is achieved by maintaining an “all-in” attitude that realizes every last ounce of one’s full potential. This mindset has driven successful results in every aspect of her life – from her corporate sales and account management experience to her international travels to her years of fitness training and leadership – and is the hallmark of the exceptional work that she does on behalf of her clients in the residential real estate sector in downtown Toronto.
