Ask anyone who has scrolled a Toronto condo search this summer and they will tell you the market is broken open. Prices are down, inventory is up, developers are practically giving units away. That story is true. It is also incomplete in a way that matters if you are actually about to sign something.
The number that gets left out of the headline is this: the same class of unit, in the same class of recently finished building, does not have one price in 2026. It has three. A developer asking price. A price that individual buyers actually pay. And a lower price still, reserved for buyers most people never compete against because they never see them at an open house.
The unit down the hall isn't priced the same as yours
Urbanation's second-quarter 2026 Condominium Market Survey, released July 20, 2026, put the average asking price for completed, unsold new condos across the Greater Toronto and Hamilton Area at $1,186 per square foot. In the same release, resale units in comparable buildings, those registered within the past three years, averaged $830 per square foot. That is a 43 percent gap between what a developer is asking for a brand-new unit and what the identical layout two floors down just sold for on resale, as reported by the Globe and Mail on July 20, 2026.
That gap did not appear overnight. Urbanation's Q1-2026 survey, released in April, had already flagged it at a record 38 percent, with developer asking prices at $1,189 per square foot against resale at $859 per square foot. The gap has since widened, not narrowed, even as the broader story is supposed to be recovery.
Here is where it gets specific enough to matter for an actual offer. The $1,186 psf figure is what developers are asking. It is not what most buyers pay.
Who actually captures the discount
Of the 702 new condo units sold across the GTHA in the second quarter of 2026, 204 were bought by just seven investors, according to Urbanation data reported by the Globe and Mail on July 20, 2026. Those bulk buyers negotiated an average price of $773 per square foot, below the $830 psf resale benchmark in the same class of building. Everyone else, the individual buyers, the owner-occupiers, the small investors, paid an average of $1,008 per square foot.
Lay those three numbers next to each other and the picture changes:
| Buyer type (Q2 2026) | Average price paid | Compared to resale ($830 psf) |
|---|---|---|
| Developer asking price | $1,186 psf | +43% |
| Individual buyer | $1,008 psf | +21% |
| Bulk institutional investor | $773 psf | -7% |
| Resale in comparable building | $830 psf | baseline |
The discount everyone is reading about in the news is real. It just was not built for a household buying one unit to live in. It was built for buyers who can absorb 200 units in a single transaction and take the developer's whole remaining inventory problem off its hands in one signature.
Urbanation president Shaun Hildebrand described how thin the pre-construction pipeline had gotten by the first quarter of 2026, when the standstill was at its worst:
"What stood out here was that there was for the first time in decades zero new project launches; the market basically came to a standstill."
That freeze is the reason developers need bulk buyers at all. A builder sitting on a record 4,295 completed and unsold units as of Q1 2026, more than double the year before, cannot wait for individual buyers to trickle in one condition-of-financing at a time. Bulk sales clear inventory fast. Individual sales clear it slowly, at a price the builder can still call an asking price rather than a fire sale.
What the HST rebate is actually offsetting
Some of the renewed activity in new-build condos this year is tied to Ontario's enhanced HST rebate, in effect for purchase agreements signed between April 1, 2026 and March 31, 2027, offering up to $130,000 in combined federal and provincial relief on eligible new homes priced up to $1.5 million. It is a real number and it matters on a $700,000 unit.
But the rebate is worth comparing against the right baseline. Resale condominiums in Ontario are already exempt from HST. They always have been. So a rebate on a new unit is not a discount relative to resale, it is relief from a tax that a resale purchase never triggers in the first place. Urbanation's own Q1-2026 estimate was that the rebate would shave roughly $100,000 off unsold new-condo prices, narrowing the new-versus-resale gap from 38 percent down to about 20 percent, not to zero.
There was also a timing problem that shaped who moved first. Ontario announced the expanded rebate on March 25, 2026, but the enabling legislation did not receive Royal Assent until May 12, 2026, the federal regulations followed on June 12, 2026, and the CRA did not publish its administrative guidance, Notice 346, until June 23, 2026. Through April and May, BILD's Justin Sherwood pointed to buyers sitting on the sidelines waiting for clarity on how the rebate would actually be administered before committing. Bulk institutional buyers, negotiating directly with developers and not waiting on individual mortgage and rebate paperwork, did not have the same reason to wait. That is a meaningful part of why the $773 psf bulk price got locked in during Q2 while individual buyers were still reading fine print.
By now, in August 2026, the administrative fog has cleared. If you are buying a new unit as your principal residence, the rebate mechanics are settled. What has not changed is the psf math underneath it.
The supply story behind the arithmetic
None of this is a permanent condition, and that is worth sitting with if you are timing a purchase rather than reacting to this month's listing. Condo completions across the GTHA, which ran close to 30,000 units annually in both 2024 and 2025, are projected by Urbanation to fall to 21,850 in 2026, then to roughly 14,600 in 2027 and 13,000 in 2028, with only about 2,000 completions scheduled for 2029. Pre-construction and under-construction inventory is already down 37 percent year over year, a 62 percent drop from the 2022 peak of roughly 127,000 units in the pipeline.
That decline is what eventually closes the exact gap described above. The resale-below-new arithmetic only exists because there is currently a large stock of recently completed towers where a developer is still holding unsold units and still setting an asking price next to yours. As completions shrink toward that 2029 trickle, the population of buildings where this comparison is even possible shrinks with it.
Reading this as a buyer or a seller right now
For a buyer choosing between a new unit and a resale unit in the same building class, the useful comparison is not the developer's asking price against your rebate. It is your likely purchase price, informed by what individual buyers actually paid last quarter, against the resale price per square foot in a comparable recently built tower. As of Q2 2026, that comparison still favored resale by roughly 21 percent for a typical, non-bulk buyer.
For an owner considering listing a resale unit in a building that is three years old or newer, the relevant competitor is not the headline developer discount. It is the price an individual buyer, not a bulk investor, is actually paying for new inventory nearby. Pricing a resale listing in reaction to bulk-purchase numbers that were never available to most buyers is a common way to leave value on the table.
A few things to keep in mind heading into the fall market:
- Ask what price a comparable unit in the building actually closed at, not what the developer is currently asking, before deciding whether new or resale is the better value.
- If the rebate is part of your decision, confirm your Agreement of Purchase and Sale falls within the April 1, 2026 to March 31, 2027 signing window, since eligibility is tied to that date, not your closing date.
- Treat the current resale-below-new gap as a feature of today's oversupply, not a permanent condition, if your timeline stretches past the next year or two.
FAQ
Does the HST rebate apply if I buy a resale condo? No. Resale condominiums are already exempt from HST, so there is no rebate to claim because there is no HST charged on the sale in the first place.
If new condos are so hard to sell, why haven't developers just dropped prices to match resale? Developers are working from construction-cost floors and existing debt tied to a project. Cutting prices to resale levels across an entire building would mean recognizing losses developers have so far avoided by selling in bulk to investors instead, at negotiated prices below the public asking figure.
Is now a good time to buy either a new or resale condo in Toronto? That depends on your timeline, your financing, and which specific building and unit you are comparing. The data above is meant to sharpen that comparison, not replace it.
If you are weighing a new-build purchase against a resale unit in the same building, or pricing a resale condo that is competing against a developer's remaining inventory, that is exactly the kind of building-specific read Amanda Beecham works through with clients every week. Let's Connect.
