A Cold and Cautious Start to 2026
January is always a difficult month to read too much into — and January 2026 came with a few extra asterisks. In addition to the usual post‑holiday slowdown, Toronto experienced two significant snowfalls and extended stretches of freezing temperatures which resulted in fewer showings and delayed listings.
With that in mind, January should be viewed less as a verdict on the year ahead and more as an early signal of how buyers and sellers are behaving under current conditions.
The January 2026 Snapshot
Sales across the Toronto market totalled 3,082 transactions in January, reflecting a year‑over‑year decline. New listings came in at 10,774, also down compared to last January, while active listings remained elevated at 17,975.
The average selling price finished the month at $973,289, down year‑over‑year (the time we saw a monthly average this low was November 2023 – cue the headlines), while average days on market stretched to 67 days — a noticeable increase that reinforces the slower pace of decision‑making across the market.
Sales & Inventory: Supply Still Setting the Pace
Sales softened again in January, but seasonality, affordability pressures, and weather all played a role. What’s more telling is that inventory remains relatively high for this time of year, keeping buyers firmly in control of timing and negotiations.
The increase in average days on market reinforces that point. Homes are taking longer to sell not because buyers aren’t looking, but because they’re willing to wait — and often pass — unless pricing and presentation align.
For buyers, this environment continues to offer leverage. For sellers, the margin for error on pricing is thinner than it’s been in years!
Market Breakdown by Property Type
Detached Homes
Detached homes recorded 290 sales in January, with an average selling price of $1,541,791. While sales volumes were softer compared to last January, pricing proved more resilient than in other segments. End‑users continue to dominate this category, particularly in established neighbourhoods where long‑term value remains the priority.
Buyers are taking their time and negotiating harder, especially on homes that need work. Sellers who priced realistically and prepared their homes well were still able to transact, while aspirational pricing struggled to gain traction — and in some cases, attracted no showings at all.
Semi‑Detached Homes
Semi‑detached homes saw 96 sales in January, with an average selling price of $1,146,188. This segment remained one of the more stable areas of the market, supported by move‑up buyers and families seeking freehold ownership without detached‑home pricing.
That said, stability does not mean immunity. Buyers are still value‑driven, and pricing accuracy matters. Well‑located semis continue to perform best, while over‑priced listings face longer market times.
Townhouses
Townhouses posted 113 sales in January, with an average selling price of $876,585. Sales were softer relative to both semis and detached homes, reflecting buyer hesitation and increased comparison shopping across property types.
For buyers, this has translated into increased choice and negotiating room. For sellers, positioning against both condos below and semis above is increasingly important.
Condo Apartments
Condo apartments accounted for the largest share of total sales in January, with 568 transactions, but they also told the clearest story of price adjustment. The average condo selling price declined to $624,886 — a level not seen since January 2021.
Investor hesitation, higher carrying costs, and financing conditions continue to weigh on this segment. At the same time, end‑users are finding more selection and leverage than they’ve had in years.
For buyers, this remains the most opportunity‑rich segment of the market. For sellers, patience or sharp pricing is required — rarely both.
Economic & Rate Backdrop
The Bank of Canada held its overnight rate steady in January, maintaining the current borrowing environment. However, several major banks are forecasting the possibility of rate increases later in 2026.
That expectation alone is influencing behaviour. Buyers are factoring future affordability into decisions today, while sellers are adjusting expectations based on what financing may look like later in the year.
Rates may not be moving — but expectations are.
What January Sets Up for the Months Ahead
January rarely sets the tone for the full year, but it does reveal behaviour. As weather improves and spring approaches, February and March will be far more telling.
Key indicators to watch include:
- Whether sales volume begins to accelerate
- How quickly new listings are absorbed
- Whether condo inventory continues to build
A shift in any of these areas would signal a change in leverage.
Bottom Line
January 2026 delivered a market that rewards realism. Buyers have time and choice, but the best opportunities won’t last indefinitely. Sellers can still succeed — but strategy, pricing, and preparation matter more than optimism.
If you’re thinking about buying or selling in the year ahead, understanding how these conditions affect your specific property type and neighbourhood is key. We help clients make sense of the data, set realistic expectations, and move with confidence — whether that means acting quickly or waiting for the right moment.
If you’d like to talk through your plans for 2026, we’re always happy to help… send us a message below!
