Toronto’s housing crash hits the suburban home — with one recent sale seeing a $560,000 loss

But they weren’t using all the space, and “were contemplating whether to keep such a huge house with the big mortgage,” said Sanjay Gupta, a real estate agent at eXp Realty who sold them the property. They put it back on the market earlier this year.

Unfortunately, by the time they made decision to walk away, everything had changed.

“The market is not good,” said Gupta. “Certainly, my clients lost money, quite a bit of money.”

Roughly $560,000, according to real estate website HouseSigma, as the home sold in February for $1.7 million.

The boom and bust of the Toronto regional real estate market has had devastating consequences for some buyers, who purchased new homes in fledgling subdivisions that sprawled into farmer’s fields in suburban communities like Milton.

The drop in values, along with rising interest rates, has increased the strain on residents. It’s contributed to a spike in food bank use and left owners building basement apartments as they struggle to hold on to their homes. 

Unlike in downtown Toronto, where condos built during the boom were often tiny and marketed mostly to investors, these newly-built houses offer plenty of space, and many buyers intended to live in them.

But they have become another casualty of a real estate downturn that has rippled far beyond Toronto condo towers, and is now reaching places like Georgetown and Brantford.

A heavily mortgaged town

The five-bedroom home was originally built in 2019 by developer Country Homes in the town of Milton, north of Oakville. It includes parking for up to six vehicles, a main floor in-law suite that’s attractive for multi-generational living, and backs on to a pond, according to the listing.

The original owners bought it for $1.085 million, according to property documents. It was a preconstruction sale, which probably took place around 2017, said Gupta.

Soon after that, prices, which had been climbing since 1996, recovered from a small blip and entered a period of wild growth. When Gupta’s clients bought the home in 2022, the original owners had more than doubled their money.

Milton saw intense development of new neighbourhoods over that period, putting strain on resources like schools. There are subdivisions so recently built there’s even an avenue named after the current mayor.

It’s a young community, with an average age of just 35, according to Statistics Canada, and it’s a heavily mortgaged one. Almost 80 per cent of Milton homeowner households hold a mortgage, the highest percentage in the country, according to StatCan numbers analyzed by Andy Yan, the director of the city program at Simon Fraser University, in 2023. 

In February 2022, average home prices were up 32 per cent in Milton compared to the previous February, according to historical numbers from the Toronto Regional Real Estate Board.

But there was a long way to fall.

Not a condo but still a crash

Following the 2022 peak, as interest rates rose from pandemic-era historic lows and prices began to tumble, growth in Milton has slowed, said local councillor Colin Best.

The average benchmark price for a new single-family home across the Greater Toronto Area was $1.859 million in February 2022. By February of this year it had fallen to $1.423 million, a drop of about 23 per cent, according to the Building Industry and Land Development Association.

In Milton, the average price for all homes dropped about 28 per cent over the same period, according to sales data from the Toronto Regional Real Estate Board (which doesn’t include preconstruction sales). 

Other 905 communities have seen similar drops: 25 per cent in Oakville, 32 per cent in Whitby, 35 per cent in Oshawa, and 27 per cent in Halton Hills (home to Georgetown and Acton). 

“Anybody that bought two to three years ago is caught in a bind, especially if they’re renewing their mortgage, because the property’s now worth less,” Best said.

Jonathan Zadegan, managing partner and sales representative at The Zadegan Group, said that newly built homes can have some of the same appraisal problems as condos.

When buyers agreed to buy the homes years ago, the prices were higher, and now that they’ve dropped, it’s difficult to get a mortgage as the properties are valued at a lower price.

The upside is that it takes less time to build new homes than tall condo towers, so there was less time between presales and when the owners took possession for prices to fall, he said. As well, because they are not as dense, there’s not a glut of units coming onto the market that were started in better days.

Investors bought some of these homes. Some are now on the assignment market, where contracts to buy homes before they were built are resold, a phenomenon that was characteristic of the condo market, Zadegan added. 

But most people intended to live in their homes once they were built. Many of these homes were marketed towards these people, known as “end users” in real estate jargon. 

And they are struggling to hold on however they can.

Food banks see uptick in use

Milton is starting to see power of sales, forced sales by a lender when a borrower defaults on a loan, Best said. 

Some homeowners, he said, are “putting in basement apartments even before they complete the house,” he said, looking to these units to help pay the bills.

While there are still “extremes” and people “building monster homes,” Best added, the downturn has hit some in the community hard. 

“As mortgage costs and overall financial pressure increased, many people found it difficult to manage their expenses,” said Irshad Ahmad of the Milton Halal Food Bank, in an email. This has contributed to spike in people turning to the food bank for help.

“There has been a noticeable shift. Individuals who once supported food banks are now seeking assistance themselves, which reflects how significantly circumstances have changed,” he said, adding that some individuals have faced bankruptcy due to the decline in home prices.

A 2025 survey from Community Development Halton found that there was a 25 per cent increase in use of charitable food programs from 2023 to 2024 in the region, citing housing challenges, as well as rising costs and stagnant wages, as one of the factors “reshaping hunger” in the community.

While Gupta said his clients who sold the five-bedroom home weathered the loss and are happy in their new, smaller home, he said there are some people who bought multiple properties “based on the FOMO (fear of missing out), based on the greed.”

He knows of some who have had to delay their retirement or start working again.

Shahrukh Baig, a realtor with Re/Max Excellence, recently advertised a new detached home in south Milton on the assignment market.

He said he could not disclose the price it went for, but according to a Facebook post, the advertised original contract was for $1.6 million with a new asking price of $1.2 million, a difference of $400,000.

“Of course we’re seeing big losses, it’s part of the market, it’s a very deep buyer’s market,” he said. “A lot of people who had bought originally $1.6-1.7 million, they’re going to take a hit right now.” 

In Facebook groups where assignment sales are advertised, tiny Toronto condos are a dime a dozen. But detached and townhomes in places like Whitby, Georgetown, Oakville and Oshawa are also popping up.

Zadegan added he’s seen quite a few assignment sales in Oakville, and there were some bought by investors attracted by low price points as far west as Brantford.

A silver lining for first-time buyers

Milton is still one of the fastest growing communities in the region, and the country, the official town website notes, with a projected population of 335,000 by 2051.

“But what we’ve started to notice now is that our projected and previously forecasted growth is starting to almost flatten a little bit,” said Adil Khalqi, another city councillor. It will still happen, he said — it will just take longer. 

Developers are “building at their own pace,” and “delaying putting shovels in the ground based on the current conditions of the market,” he said. 

New homebuilders are hesitant, and in a “wait-and-see” mode, added Best. 

Gupta said with return-to-office mandates, demand for far-flung suburban homes has dropped, as people who work in downtown Toronto are trying to be as close as possible to their workplaces, or at least a GO station. 

“A lot of people are moving back,” he said. 

But Gupta feels like the market is starting to turn around again, with some investors coming back, especially after recent government policy announcements on HST and development fees.   

Baig, the assignment sale realtor, agrees, saying they’re seeing a lot of first-time homebuyers in the market in general.

They “have been on the sidelines for years,” he said, and are getting in now while prices are lower.

“They have been waiting for the right opportunities to come along.”