TRREB September 2026 Market Review

The Greater Toronto Area housing market remained under pressure in September, as economic uncertainty continued to discourage buyers despite lower home prices and a declining supply of available properties.

September would normally bring renewed activity following the quieter summer months. However, the anticipated increase in demand failed to materialize.

Home sales declined compared to last year, while seasonally adjusted activity also moved lower from August. Prices continued to soften, suggesting that the stabilization observed earlier in the summer has yet to develop into a sustained recovery.

The broader market picture, however, remains more complicated.

New listings declined substantially compared to September 2025, and active inventory also moved lower. This indicates that homeowners are becoming increasingly reluctant to sell into a market where buyers remain cautious.

The result is a market in which both buyers and sellers appear to be waiting.

For buyers, lower prices have created opportunities, but concerns surrounding employment, inflation, and borrowing costs continue to outweigh the immediate benefits of improved affordability.

For sellers, declining competition from other listings may provide some support, although realistic pricing remains essential.

September therefore reflects a market that is still searching for confidence rather than one experiencing a clear shift toward recovery.

Home Sales Decline as Buyers Remain Cautious

TRREB reported 5,040 home sales through the MLS® System in September 2026, representing a 9% decline compared to September 2025.

The annual decrease was considerably larger than the 2.1% decline recorded in August, indicating that transaction activity remained subdued heading into the fall.

On a seasonally adjusted basis, sales also declined from August.

This marks the second consecutive month of weakening sales activity following five months of improvement earlier in the year.

That change is significant.

During the spring and early summer, gradually increasing sales suggested that buyers were becoming more comfortable entering the market as affordability improved.

September's figures indicate that this confidence remains fragile.

Many prospective purchasers have benefited from lower prices and more manageable borrowing conditions compared to previous market peaks. However, purchasing a home involves a substantial long-term financial commitment.

When households remain uncertain about employment security, inflation, or future mortgage payments, improved affordability alone may not be sufficient to encourage a purchase.

TRREB has pointed to substantial pent-up demand among households that intend to buy but are waiting for greater economic certainty.

The challenge is determining when that demand will translate into transactions.

Until confidence improves, the market may continue to experience relatively weak sales despite more favourable purchasing conditions.

New Listings Continue to Decline

The supply side of the market presents a different picture.

A total of 16,500 new listings entered the MLS® System in September, down 14.4% compared to the same month last year.

This represents another substantial annual decline following similar reductions in July and August.

On a seasonally adjusted basis, new listings also moved lower compared to August.

Active listings reached approximately 26,131 properties, representing a 9.3% decline from September 2025.

These figures suggest that homeowners are also responding cautiously to current conditions.

Some sellers may be delaying their plans in anticipation of stronger demand or more favourable prices. Others may simply be unwilling to accept valuations below their expectations.

The reduction in supply matters because it can help prevent weaker demand from creating an increasingly large inventory surplus.

However, fewer listings do not automatically translate into stronger market conditions.

Sales remain weak, and buyers continue to have meaningful negotiating opportunities in many property segments.

The important distinction is that supply is declining alongside demand.

If buyer confidence improves while homeowners remain reluctant to list, the market could tighten more quickly than current sales figures suggest.

For now, September reflects a market where reduced participation on both sides is limiting activity.

Home Prices Remain Under Pressure

The September price figures provided further evidence that the GTA housing market has not yet established a sustained recovery.

The MLS® Home Price Index Composite benchmark reached approximately $917,600, representing a 4.7% decline compared to September 2025.

The average selling price was $1,006,409, down 5.1% from $1,060,036 a year earlier.

Although the average price moved back above $1 million after falling below that threshold in August, the increase does not necessarily indicate improving property values.

Average selling prices can fluctuate depending on the composition of homes sold during a particular month.

A greater proportion of detached home transactions, for example, can increase the average even when underlying prices remain relatively weak.

The seasonally adjusted figures provide a clearer indication of market direction.

Both the benchmark and average selling price edged lower compared to August.

This interrupts the relatively stable pricing pattern observed during the summer and suggests that downward pressure has not entirely disappeared.

Nevertheless, the market is not experiencing the rapid price adjustments associated with more severe downturns.

Instead, values continue to move gradually as buyers and sellers reassess expectations.

For prospective purchasers, the decline from last year's prices remains meaningful.

For existing homeowners, particularly those considering selling in the near term, September reinforces the importance of understanding current market conditions rather than relying on valuations established during stronger periods.

Recovery Remains Uneven Across Property Types

The broader price decline continues to conceal important differences between housing categories.

Condominium apartments experienced particularly significant weakness, with the GTA average selling price falling 7.7% year-over-year to approximately $605,257.

Detached homes recorded an average price of approximately $1,292,016, down 5.1%.

Townhouses declined 4.6% to approximately $820,637, while semi-detached homes showed greater resilience, with average prices declining just 0.2%.

These differences reflect the varied conditions affecting individual market segments.

Condominium buyers may have greater flexibility to compare properties based on location, maintenance fees, building condition, and investment potential.

For first-time buyers, lower condominium prices may provide opportunities that were less accessible during previous market peaks.

However, the possibility of further price adjustments remains an important consideration.

The figures also reinforce the need to distinguish between the overall GTA market and individual neighbourhoods.

Property type, location, affordability, and available inventory continue to influence outcomes.

A broader recovery is unlikely to unfold uniformly across every segment.

Economic Confidence Remains the Primary Obstacle

September's market performance cannot be separated from the broader economic environment.

Trade tensions with the United States, continuing tariff uncertainty, inflation concerns, and geopolitical developments have contributed to an unsettled outlook.

Higher energy costs and uncertainty surrounding future borrowing rates have also complicated household financial decisions.

For prospective homebuyers, the concern extends beyond whether mortgage payments are manageable today.

They must also consider whether employment income and household expenses will remain stable over the coming years.

This helps explain why lower home prices have not generated a stronger rebound in sales.

The financial incentive to purchase may be improving, but confidence has not recovered at the same pace.

That distinction is important.

A sustained housing recovery will likely depend not only on affordability, but also on households becoming more comfortable with the economic outlook.

Until then, many buyers may prefer to preserve flexibility rather than commit to a major purchase.

Municipal Housing Policy Returns to Focus

The upcoming October 26 municipal elections introduce another important consideration for the GTA housing market.

Decisions made by municipal governments over the next four years could influence housing supply, development costs, and the overall affordability of homeownership.

Restrictive zoning, development charges, approval timelines, and transaction-related taxes remain important structural challenges.

TRREB has specifically raised concerns about Toronto's Municipal Land Transfer Tax and the possibility of similar measures expanding across surrounding municipalities.

These issues extend beyond the current slowdown.

Lower resale prices can temporarily improve affordability, but lasting improvements require sufficient housing supply and a reduction in barriers that increase the cost of delivering new homes.

Municipal policy alone cannot determine the direction of the housing market.

However, it can influence the conditions under which future supply is developed and purchased.

Market Outlook

September reflects a GTA housing market where caution continues to outweigh improving affordability.

Sales declined more sharply than in August, new listings remained significantly below last year's levels, and home prices experienced further modest downward pressure.

Taken together, these developments suggest that the recovery anticipated earlier in the summer has become more uncertain.

For buyers, conditions remain favourable in several respects. Prices are lower, selection remains meaningful, and opportunities to negotiate continue to exist.

However, declining inventory may eventually limit those advantages if demand strengthens.

For sellers, reduced competition from new listings offers some support, but buyers remain selective and sensitive to pricing.

For investors, September reinforces the importance of evaluating individual properties and long-term fundamentals rather than assuming that lower prices automatically represent a market bottom.

The GTA housing market is not experiencing a decisive recovery.

It is waiting for greater certainty.

The gradual reduction in supply could support future stabilization, but sustained improvement will require stronger buyer confidence and more consistent transaction activity.

September serves as a reminder that lower prices alone cannot restore a housing market.

Confidence remains the missing ingredient.

Until households feel more secure about the economic outlook, the transition from adjustment to recovery is likely to remain gradual and uneven.