September did not deliver the strong fall-market rebound some buyers and sellers may have been expecting.

GTA REALTORS® reported 5,040 home sales in September 2026, down 9% from September 2025. New listings totalled 16,500, down an even larger 14.4%, while active listings fell 9.3% to 26,131. The average selling price was $1,006,409, down 5.1% year over year, and the MLS® Home Price Index benchmark was down 4.7%.

TRREB described buyers as being in a “holding pattern,” with uncertainty around the economy, inflation and borrowing costs continuing to weigh on activity. That description fits what I think we are seeing in the market right now: buyers have not disappeared, but many are being very selective and are not feeling much urgency.

The Fall Market Has Not Taken Off

The most important number to me is probably not the 9% decline in sales by itself. It is the fact that new listings declined 14.4% and active listings were also lower than a year ago.

That means fewer buyers were purchasing homes, but fewer sellers were bringing properties to market as well. On a seasonally adjusted basis, both sales and new listings also declined from August, so September did not produce a meaningful month-over-month surge in activity.

That creates an interesting market. Buyers generally still have negotiating room, but they may find fewer genuinely attractive properties to choose from. Sellers face cautious buyers, but in some neighbourhoods they may also be competing against less inventory than they were earlier this year.

This is why I would not describe the current Toronto market simply as either a buyer’s market or a seller’s market. Conditions can look very different depending on property type, neighbourhood and price range.

Prices Continued to Move Lower

The GTA average selling price in September was $1,006,409, compared with $1,060,036 a year earlier.

The MLS® HPI Composite benchmark was down 4.7% year over year, while the average selling price declined 5.1%. Both measures also edged lower from August on a seasonally adjusted basis.

The benchmark and average price measure the market differently, so I would not focus too heavily on the exact difference between those percentages. The broader message is more important: prices remain below last year and there was no clear upward price breakout in September.

That continues to improve purchase prices for buyers compared with recent years, although higher mortgage rates are offsetting some of that affordability improvement.

Condos Remain the Softest Major Property Type

Compared with September 2025:

• Detached: sales fell 8.7%, while the average price declined 5.1%.
• Semi-detached: sales fell 8.2%, while the average price was almost unchanged, down 0.2%.
• Townhouses: sales declined 12.8%, with the average price down 4.6%.
• Condo apartments: sales fell 7.8%, while the average price declined 7.7%.

The condo market continues to stand out because prices have adjusted more significantly than some other property types.

The average GTA condo apartment sold for $605,257 in September. In the City of Toronto, the average was approximately $640,248, compared with $533,654 in the 905.

For condo buyers, that may create opportunities that were not available several years ago. But investors in particular still need to look closely at maintenance fees, rent potential, carrying costs, building quality and future resale — not simply assume that a lower purchase price automatically makes a condo a good investment.

What Is Happening Inside the City of Toronto?

The City of Toronto recorded 1,937 sales in September, with an average selling price of $1,034,320 and a median price of $810,000.

There were 6,521 new listings and 9,865 active listings, with approximately 4.6 months of inventory. Average listing days on market were 33, while properties spent an average of 45 days on market overall.

There were also noticeable differences across Toronto. Toronto East had about 3.6 months of inventory, compared with 4.4 months in Toronto West and 5.1 months in Toronto Central.

I would not read too much into one month because the mix of homes sold can change these numbers considerably, but it is another reminder that there is no single “Toronto market.”

A house in Riverdale, a downtown condo and a detached home in North York can all be operating under very different conditions at the same time.

Mortgage Rates Are Working Against Lower Home Prices

The other half of the affordability equation is financing.

The Bank of Canada continues to hold its policy rate at 2.25%, with its next decision scheduled for October 28. The Bank has said that inflation risks have increased even as trade uncertainty creates more risk for economic growth.

Fixed mortgage rates, meanwhile, have continued to move higher as Government of Canada bond yields remain elevated.

This is important because a buyer may save tens of thousands of dollars on the purchase price compared with last year but still face a relatively expensive monthly mortgage payment.

That tension — lower home prices but stubborn borrowing costs — remains one of the biggest reasons buyers are taking their time.

The Bank of Canada Says Interest Rates Cannot Fix Housing Affordability

Bank of Canada Senior Deputy Governor Carolyn Rogers recently addressed Canada’s housing affordability problem and emphasized that there is no single policy solution.

Monetary policy can help by keeping inflation low and predictable, but interest rates are too blunt a tool to target house prices directly. Restoring affordability will ultimately require a combination of more housing supply, better planning and infrastructure, financial-system resilience and a Canadian economy that is less dependent on rising property values.

Homebuyers understandably focus on interest rates because mortgage payments affect them immediately. But Toronto’s affordability problem is much bigger than the Bank of Canada.

Land availability, development costs, municipal fees, taxes, construction costs, approval times, infrastructure and housing supply all play a role.

What This Means for Toronto Buyers

For buyers, I think the September numbers are generally encouraging — but not because I expect prices to suddenly fall dramatically.

Buyers have more negotiating leverage than they did during Toronto’s extreme seller markets, prices are lower than a year ago, and there is less pressure to make a rushed decision.

At the same time, the decline in new and active listings means I would not assume that waiting automatically creates more choice.

If the right property appears at a price that makes sense and the monthly carrying costs are comfortable, the current market can provide a good environment in which to negotiate.

What This Means for Toronto Sellers

For sellers, September reinforces something we have been discussing for months: pricing correctly at the beginning matters enormously.

There are fewer listings than last year, which can help reduce competition. But buyers remain cautious, and lower inventory does not mean they will overlook an overpriced property.

The first couple of weeks on the market are still extremely important. Showing activity, feedback, competing listings and recent comparable sales should be watched closely.

If the market is telling you the price is wrong, responding quickly is generally better than chasing the market downward several weeks later.

My Take on the September Toronto Market

I think the September report describes a market that is soft, selective and increasingly balanced by declining supply.

Sales are weaker. Prices are lower. Buyers remain cautious. But listings are also falling faster than sales, which is preventing the market from simply becoming more and more oversupplied.

That does not mean a price rebound is imminent. It does mean the next phase of the market will depend heavily on whether buyers regain confidence before sellers return in larger numbers.

Employment, inflation and mortgage rates will all play a role.

For now, Toronto buyers have negotiating opportunities, while sellers need to be realistic about value. And more than ever, the results will depend on the individual property rather than the headline market.