Toronto’s condo market takes yet another plunge
That’s left scores of buyers scrambling to make up the gap between the appraised value and what they agreed to pay, with some leaving their deposit on the table and abandoning the purchase – exposing them to potential legal action by developers.
“They’re just so far removed from what they were sold at that a lot of people, unfortunately, are in a bind,” Khaneka said. “Unless banks or institutions have blanket appraisals on it, people just don’t really have much of an option unless they have equities in other homes that they’re taking out to cover the deficit.”
The big problem: Canadians don’t want to live in micro condos
When demand for rental properties was booming in Toronto, those smaller units were seen as a lucrative investment – but that bubble seems to have concealed the reality that virtually no potential buyers actually want to live in those units.
A perfect storm of factors contributed to the market’s meltdown: immigration plunged, removing a key renter cohort, while interest rates jumped after 2022 and overall purchase demand cooled across the city.
“We know from our own research that most Canadians ideally want at least three bedrooms in a home, so microunits with one – or in many cases, zero – bedrooms have much more limited appeal for end users,” RPS-Wahi economist Ryan Mclaughlin said in remarks accompanying the company’s latest report.
