As the city of Toronto continues to struggle with a housing crisis, hundreds of planned new condos will never get built.
But some of these cancelled units will be converted to rentals.
Eight Toronto projects encompassing 1,899 condo units have been cancelled since the beginning of 2024, according to new data from research firm Urbanation.
Three more projects, with 338 units, are on hold; and six developments, with 1,434 units, are being converted to rentals.
“The condo market has cratered almost overnight,” said Matti Siemiatycki, director of the Infrastructure Institute and professor of geography and planning at the University of Toronto. “It’s completely been flipped on its head.”
A total of 28 projects and 5,734 units in the GTA and Hamilton region were either cancelled, put on hold or placed in receivership, or converted to rentals, according to the data, released in mid April. That’s up from seven projects in all of 2023.
Outside Toronto, there was one project put on hold and one cancelled in Halton; three placed on hold in Peel; two placed on hold and one cancelled in York; and two put on hold and one cancelled in Hamilton.
Condos that have been placed under receivership, where a court-appointed third party takes over, are typically on the public record, said Urbanation’s Michael Niezgoda, senior manager of market research.
Cancellations are confirmed through word-of-mouth in the industry, he added.
Why are so many condos being axed?
“Pre-construction projects may not be able to attain the necessary sales in order to start construction, or they’re finding that they have a price floor that they cannot drop prices below in response to the changing market conditions,” said Niezgoda.
Developers generally need to get 70 per cent of the units sold to get financing for construction.
Jonathan Zadegan, managing partner and broker at real estate agency The Zadegan Group, said developers just can’t get the prices they used to, and aren’t seeing the same profit margins.
“If they’re sitting then developers are obviously burning cash, and they’ve got to do something with them,” he said.
Niezgoda said projects defined as “on hold” have formally stopped their sales process, and are not in active construction, but have not yet returned deposits to buyers.
These projects are effectively in limbo.
Condos in receivership are considered on hold until there is a formal declaration by the receiver on whether they will be cancelled.
Niezgoda added that Urbanation saw about 40 per cent of new condos being rented out in 2024. “If the total number of condo completions continues to fall, then that means the new pool of rental units in the market likewise decreases rapidly.”
But one interesting part of the equation is developers converting to rental. The city has a new incentive program to encourage building rentals that some are taking advantage of, he added.
U of T’s Siemiatycki said the condo has been “king” for the last decade, and the main way that housing was built in the city. Developers would sell units one-by-one to owners, in many cases investors, and units got smaller to ensure they remained affordable to this group. But now prices have softened, interest rates have risen from historic lows during the pandemic, and there’s a glut of shoebox-sized condos.
“What’s happened more recently is that that model has just completely collapsed,” he said. The math just doesn’t add up anymore, “and yet we still have this housing crisis.”
While it’s encouraging to see some projects being converted to rentals, they need to be repurposed early enough to redesign if they’re going to be big enough for families, said Siemiatycki.
As well, most of these projects are offered at above market rent because they are new. That means they’re out of reach for many people.
That’s why the role of government and non-profits “is really important” in adding housing, he said, through mechanisms such as land trusts or co-ops, “as a complement to the private market.”
Sales of new condos are also down to levels not seen in 30 years.
There were just 533 sales in the GTHA in the first quarter of 2025, the lowest of any quarter since 1995, according to Urbanation.
Zadegan added it’s clear that developers are “going through a lot of pain,” especially the smaller ones.
The ongoing trade war is also impacting consumer confidence.
He hopes if things stabilize over the next year or so, with several months of unsold inventory to work through and fewer new units coming up closer to 2030, the outlook should be more balanced.
