August 21st, 2026 | Housing Markets

Toronto Real Estate Market Update: Is the Buyer’s Market Starting to Shift?

For months, Toronto home buyers have had something they haven’t always been accustomed to: choice, time and negotiating power.

Higher inventory and softer prices meant buyers could be selective. Homes that weren’t priced correctly could sit. Conditions returned to offers. And in many cases, buyers had room to negotiate rather than simply asking, “How much over asking will it take?”

But the latest Toronto real estate numbers are starting to tell a slightly different story.

Not a return to the frenzy.

Not a sudden seller’s market.

Instead, we’re seeing a gradual shift in leverage—and July’s numbers suggest it’s worth watching closely as Toronto heads toward the fall market.

What Changed From June to July?

The headline numbers can be misleading if you look at them in isolation.

In June, the GTA recorded 6,770 sales and 17,282 new listings. TRREB described conditions as improving, with seasonally adjusted sales increasing from May while new listings declined. The average selling price was $1,058,658. 

July recorded 5,995 sales and 14,484 new listings. On the surface, fewer transactions might sound like the market slowed considerably.

But July is summer.

Seasonality matters.

Once TRREB adjusted for those normal seasonal patterns, sales actually increased month-over-month while new listings declined. In other words, buyers continued absorbing a greater share of the homes coming onto the market. 

That’s the signal we’re paying attention to.

Fewer New Listings Are Changing the Equation

July’s 14,484 new listings represented a substantial 17.8% decline compared with July 2025. Sales, meanwhile, were essentially flat year-over-year at 5,995, down only 0.9%. 

That’s an important combination.

It doesn’t necessarily mean there aren’t enough homes for sale. But it does mean the relationship between available supply and active demand is beginning to change.

TRREB put it plainly: with sales accounting for a larger share of listings, buyers could find less room to negotiate going forward if current trends continue. 

That’s very different from saying bidding wars are back everywhere.

They’re not.

What we’re seeing instead is a market becoming increasingly selective.

Toronto Buyers Still Have Leverage—But It’s Property Specific

This might be the most important distinction for anyone buying a home right now.

There isn’t one “Toronto market.”

A beautifully prepared family home in a sought-after neighbourhood can behave completely differently from an outdated property two streets away.

Buyers can still have significant negotiating power when a home:

• Has been sitting on the market.
• Requires substantial renovations or maintenance.
• Has an awkward layout or other compromises.
• Is positioned above the price range buyers believe represents fair value.
• Competes against several similar properties.

Those sellers may need to negotiate.

But when a home is well-priced, well-prepared and located in an area with limited inventory, buyers may encounter a very different situation.

That’s where some of the leverage is starting to disappear.

The July Numbers Don’t Mean Prices Are Surging

This distinction is important.

Tighter market conditions do not automatically mean rapidly rising prices.

In fact, July’s GTA average selling price remained 4.5% below July 2025. 

So we would be cautious about interpreting July as the beginning of another major price run.

Instead, the data suggests something more measured.

The market may be working through the excess negotiating power buyers accumulated when inventory was rising faster than demand.

That can happen before prices meaningfully respond.

TRREB’s July outlook similarly suggested that if tighter conditions persist, average selling prices could begin to level off during the second half of the year. 

That’s something both buyers and sellers should be watching this fall.

What Does This Mean for Buyers?

If you’re hoping to purchase a Toronto home this year, we don’t think July’s numbers mean you need to rush.

They do, however, suggest that assuming conditions will keep getting better for buyers may be risky.

The opportunity right now is in being selective.

Rather than waiting for every home to become cheaper, look for properties where you have genuine negotiating leverage.

Sometimes that’s a listing that’s been sitting for 30 days.

Sometimes it’s a home with dated finishes that other buyers are overlooking.

Sometimes it’s simply a seller whose expectations haven’t caught up with today’s market.

And sometimes the right home comes onto the market at a fair price—and negotiating aggressively isn’t the winning strategy.

Knowing the difference is becoming increasingly important.

What Does This Mean for Sellers?

July’s numbers are encouraging for sellers, but they aren’t a licence to overprice.

Buyers still have choices.

And they’re still scrutinizing value.

The improving supply-demand relationship means good listings may have a better opportunity to create competition, particularly if fewer comparable homes are available.

But “good listing” is doing a lot of work in that sentence.

In this market, preparation matters.

Photography matters.

Pricing into the correct buyer search range matters.

And perhaps most importantly, week one matters.

A home that launches correctly can capture attention while it’s fresh.

A home that starts too high and requires multiple price adjustments can quickly become the listing buyers use to justify offers on something else.

September Could Be the Real Test

The fall market will tell us considerably more.

Summer typically brings lower activity, so July alone isn’t enough to declare a major market shift.

But June and July are pointing in the same direction.

In June, TRREB reported that sales increased month-over-month on a seasonally adjusted basis while listings declined. 

July did it again. 

That’s why September becomes particularly interesting.

If buyers return from summer while new supply remains restrained, competition could increase—particularly for desirable low-rise homes in family-oriented Toronto neighbourhoods.

If listings surge instead, buyers may retain much of their negotiating power.

We’ll be watching that balance closely.

Our Take: Don’t Confuse “Tightening” With “Hot”

If there’s one takeaway from the latest Toronto real estate numbers, it’s this:

The market doesn’t appear hot. It appears to be tightening.

That’s an important difference.

Prices remain below last year’s levels. Buyers remain selective. Some homes still require meaningful negotiation to sell.

But beneath those headline numbers, the relationship between buyers and sellers is changing.

Two consecutive reports have now shown seasonally adjusted sales strengthening month-over-month while new listings declined. 

For buyers, that means the negotiating window remains open—but shouldn’t be taken for granted.

For sellers, it means conditions may be improving—but strategy still determines the outcome.

And for anyone considering a move this fall, we’d pay less attention to predictions about whether Toronto is a “buyer’s” or “seller’s” market and much more attention to what is happening with your property type, price point and neighbourhood.

Because that’s where the opportunities are.