January is always a quieter month for real estate in Toronto — but the January numbers this year weren’t just seasonal noise. They revealed a market that’s still adjusting, still cautious, and quietly reshaping expectations for 2026.

Here’s what stood out — and why it matters.

1. January’s Slowdown Was Structural, Not Just Seasonal

Home sales fell 19.3% year-over-year, with 3,082 homes sold across the GTA. At the same time, new listings dropped 13.3%, showing that sellers weren’t rushing to list either.

In a typical winter market, we expect lower sales — but this combination tells a deeper story:
👉 Both buyers and sellers are hesitant.

Buyers are being selective and deliberate. Sellers are watching the market closely and holding back unless they feel confident about pricing and demand. This kind of standoff usually shows up when markets are recalibrating, not collapsing.

2. Price Declines Were Broad — But Very Uneven

The average selling price fell 6.5% year-over-year, while the MLS® Home Price Index benchmark dropped closer to 8%.

But the correction wasn’t evenly distributed.

• Detached homes absorbed the largest price adjustments
• Condos and townhomes proved more resilient, especially at entry-level price points

This tells us the market isn’t moving as one — it’s segmenting. Buyers are prioritizing value, condition, and long-term livability over stretching for “top of the ladder” properties.

3. Buyers Gained Leverage — Without Urgency

Homes took longer to sell, with average days on market rising to about 45 days. Despite that, the average sale-to-list ratio held near 97%.

What does that mean in practice?

Buyers are negotiating — but they’re not lowballing across the board. When a home is priced correctly and shows well, buyers are still stepping up. When it’s not, they’re walking away.

👉 The power shift favors buyers, but quality still commands attention.

4. Inventory Quietly Tilted the Market Further Toward Buyers

Even with fewer new listings, active inventory rose year-over-year, while sales slowed. That kept months of inventory elevated, reducing competition and urgency.

January was defined by:

• More choice
• Less pressure
• Very few bidding wars

This environment rewards patience and preparation — especially for buyers who know what they want.

How This Affects Toronto Buyers

For buyers, January confirmed something important:
This is no longer a “rush or miss out” market.

• Negotiation is expected
• Conditional offers are common again
• Buyers can align price, condition, and location instead of compromising on all three

That said, the best homes — well-priced and well-presented — are still selling. Hesitation has a cost if you wait too long on the right opportunity.

What This Means for Move-Up Buyers

This is where January quietly mattered most.

Detached homes corrected faster than entry-level segments, which means the price gap between selling and upgrading has narrowed. For move-up buyers, this improves the math — even if headlines still sound negative.

In this market:

• Timing matters less than sequence
• Strategy matters more than sentiment
• Selling and buying decisions need to be planned together

For many move-up buyers, this is a relative opportunity window, not a market to ignore.

What We’re Watching Going Into Next Month

As we head toward late winter and early spring, we’re watching a few key signals closely:

1. Whether listings re-accelerate as confidence returns
2. If detached home absorption improves before spring inventory builds
3. Buyer response to stabilizing rates versus job market uncertainty
4. Early signs of price stabilization — or continued selective softening

January didn’t signal a bottom.
But it reset expectations — and markets often need that reset before they can move forward.

If you’re wondering how these trends play out in your specific neighbourhood or price range, a high-level headline won’t tell you enough. Strategy matters more than ever in this kind of market.

📩 Reach out anytime for a personalized breakdown.