New condo sales drop 81% across southern Ontario

Sales on new condominiums in Mississauga, Hamilton, and southern Ontario are at their lowest quarterly in nearly 30 years.

According to a new report published Friday (Oct. 18) by Urbanation, condo sales have dropped significantly, falling 81 percent in the third quarter of 2023 compared to the same quarter last year.

The new Condominium Market Survey showed 567 condo sales in the Greater Toronto Hamilton Area (GTHA) in the third quarter, the lowest since the first quarter of 1995.

That’s 87 percent below the latest 10-year average for Q3 periods.

Year-to-date sales of new condominiums are down 63 percent compared to the same period last year and 84 percent below the sales of 2021.

With only 3,641 units sold, the GTHA condo market is on track for its slowest year since 1996.

“The new condo market is facing its toughest challenge in decades,” said Shaun Hildebrand, President of Urbanation. “Investors are inactive, and end-user buyers currently have plenty of lower-priced options to choose from in the resale market.

“It may take a while, but conditions will gradually improve as developers hold back supply, construction inventory continues to drop, and demand rises with declining interest rates.”

Unsold new condominium units in development decreased 4.4 percent quarter-over-quarter from the record high of 25,018 units in the second quarter of this year to 23,918 units in the third quarter.

That marks the largest quarterly fall in unsold inventory in two-and-a-half years. The main result is a lack of new condo launches, with only one project totaling 177 units brought to market in the third quarter of this year.

The number of condominium completions is expected to reach 24,386 units by the end of this year, edging out last year’s record high of 24,114 completions. That number is expected to climb to a record 29,409 units in 2025 but decline in the following years.

The price of unsold new condos averaged $1,349 per square foot in the third quarter of this year. That’s a 2.4 percent year-over-year decline from the same period last year.

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis, and consulting services to the real estate industry since 1981.