Dina Thakkar envisioned one day gazing out at Lake Ontario from the window of her two-bedroom, 700-square-foot Pickering condo.
So, she paid extra for the view.
Unfortunately, she never got to enjoy it.
“It’s almost a nightmare,” she said. She and her husband have been trying to sell since last fall, calling their realtor constantly for updates.
“We are very much stressed.”
The entire GTA real estate sector has struggled over the last four years, after prices reached dizzying heights during the pandemic peak in February 2022.
While Toronto’s cratering condo market gets a lot of the attention, condos in the 905 have seen some of the biggest losses, with benchmark prices dropping over 30 per cent in several communities including Markham (40 per cent), Milton (36 per cent), and Vaughan (37 per cent), over the last four years, according to numbers from the Toronto Regional Real Estate Board (TRREB). That’s compared to 28 per cent for condos within the city of Toronto.
If anywhere is ground zero, it might be Pickering, the Durham city of just under 100,000 people that’s home to waterfront trails and a nuclear power plant. The benchmark price of a condo there has dropped a staggering 57 per cent from February 2022 to February 2026.
The huge decline does make these homes more affordable for buyers. The catch is many of them are very small. They were aimed at investors, who have deserted the space, and demand has plummeted. That means developers are struggling to sell inventory in completed buildings, and have less incentive to break ground on new projects, leaving governments to fall behind on ambitious housing targets.
Owners like Thakkar, who purchased pre-construction units that didn’t exist yet, are caught up in the crash.
Unlike some pre-construction buyers who planned to sell their contract for a profit before their condo was ever completed, Thakkar said she and her husband intended to live in their unit in the Universal City development, a new master-planned community of five condo towers near Highway 401 and the Pickering Go Station.
“The market was like — boom,” recalled the 46-year-old, who immigrated from Gujarat, on the west coast of India, in 2013.
The couple agreed to buy the condo for $587,000 in 2019. It was supposed to be completed a few years later. They put 20 per cent down to seal the deal.
The realtor who sold it told them by the time the unit was built it would be worth close to $1 million, Thakkar said.
Indeed, in February 2022 the benchmark price for a condo in Pickering was over $1.1 million, per TRREB, with 2,359 new condos sold in the GTA that January, according to the Building Industry and Land Development Association (BILD).
Benchmark price is an estimate of the typical home price, using the methodology of a mass appraisal, and is less influenced by extremes than the average, according to TRREB.
But because of the pandemic, construction on Thakkar’s condo was delayed. Her unit closed just last year.
By that time the music had stopped. Higher interest rates and lower prices had flattened investor interest in condos, particularly in new buildings, which in the lead up to the peak were sold at a premium.
This February, with historically low new condo sales and cancelled projects popping up across the region, the benchmark condo price for Pickering plummeted to $468,800.
Unfortunately, the bust coincided with a blow to Thakkar’s family income.
After they closed on the condo, her husband lost his job in inventory at Hudson’s Bay. The company laid off thousands of employees when the once iconic stores closed in the summer.
Thakkar is self-employed and her husband’s employment insurance is running out. The bills, from the mortgage to the maintenance fees and property taxes, are mounting. They are currently living in a Scarborough rental, but desperately need to unload the condo.
“If we cannot sell it by the end of April, we will be in big trouble,” she said.
Today’s losses “certainly are dramatic, and they’re more dramatic than the last fall, which was in the 1980s,” said Carolyn Whitzman, an adjunct professor and senior housing researcher at the University of Toronto’s School of Cities.
That downturn saw an almost 30 per cent drop from a high in 1989, and prices tumbled for seven years in a row. From there, they climbed steadily, except for a small blip around 2017. Then, during the pandemic, prices exploded, fuelled in part by intense speculative interest in pre-construction condos.
“People were doing seminars, saying, ‘Here’s how you get rich quick. Buy a condo, flip a condo,’” Whitzman said. It was “a bit of a Ponzi scheme,” she added, based on the assumption that you’d be able to sell a unit for more money.
Tosha Pigeau, a sales representative with Keller Williams Energy Real Estate who is selling Thakkar’s unit, said Pickering is “in a league of its own” when it comes to new condos.
“With the amount of Chestnut Hill developments that have gone up there and are going up there, the development of Pickering in terms of the condo world, far exceeds anywhere else,” she said. They include the Universal City project, and the nearby SF3 condos and San Francisco By the Bay community, according to the developer’s website.
“I think everybody wanted to be an investor in 2022,” added Jessie McLellan, a sales representative with the Lisa Abbott Team, Re/Max Jazz, in the Durham region.
“Even if they weren’t targeted at investors, which I think a lot of the new projects are, I think everybody was sort of considering what it would look like to have an investment property.”
But, as Thakkar discovered, it’s much harder to find buyers now. There’s a lot of unsold inventory in new developments, added Pigeau.
According to BILD, there were only six sales of new condos in Durham region in the month of January.
Developers are offering incentives Pigeau has never seen before, like no maintenance fees, property tax or mortgage payments for three years to buyers at The Grand, Universal City’s fifth tower of around 37 storeys.
Pigeau said developers have “deep pockets” though, and will likely be able to rent unsold units as the locations are “solid.”
Ralph Del Duca, CEO of Chestnut Hill Developments, said the Grand incentives were in reaction to slowing sales.
“We had to basically get more people through the door,” he said, adding they have over 2,000 more condo units in the pipeline in Pickering and have not had to cancel any projects. He confirmed they plan to rent unsold units in the Grand, but said they have sold over 90 per cent.
McLellan said her recent clients have not been looking for condos, because they can get a semi-detached home in the area for a similar price.
“The maintenance fees on some of these buildings, especially the older buildings, are just so astronomically high,” she said.
The newer developments, she said speaking generally, have lower maintenance fees, but they are tiny, around the 800-square-foot mark for a two bedroom — even smaller for a studio or one-bedroom — and the layouts are “a challenge.”
McLellan has shown a lot of newer condos in Pickering but has never had a client purchase a unit.
“The living rooms are like bowling alleys,” she said.
These condos were once seen as a stepping stone towards something bigger. But now some of these owners feel stuck, McLellan added.
While from a prospective buyer’s view a price drop of over 50 per cent can only be celebrated, nearly $470,000 is still out of reach for many people in the region, added U of T’s Whitzman.
With projects cancelled and stalled due to a lack of sales, developers in the region are losing, she said. And governments will not be able to meet bold housing targets to increase housing supply.
The silver lining is that unsold condos may end up converted to purpose-built rentals, and maybe even more affordable stock, Whitzman added. While existing condos were always a source of rentals, they didn’t offer tenants much stability as landlords could suddenly sell.
There was a record number of condo cancellations, 28 projects with more than 7,000 units, last year across the Greater Toronto and Hamilton Area, according to market research firm Urbanation. But eight of them were converted to rentals, representing more than 8,000 units.
With fewer condos being built, banks will be looking for other residential projects to fund. This could result in more lending for housing that’s actually big enough for families, she added, such as multiplexes.
But it’s been tough for owners like Thakkar.
Looking back, she feels like they made the biggest mistake of their lives.
“All our dreams are dead,” she said. “We will never advise someone to do this.”
The unit is listed for $499,900. As of press time it was still on the market.
