Back in April 2022, the City of Toronto saw our average price hit what remains an all-time high of $1.249M.  Flash forward to January 2026 and our average price in the city is now $966,000.  That’s a drop of $284,000 in average property values in the city since that time.

Make no mistake, real estate prices in Toronto and most of the GTA grew so much over the past twenty years that affordability became a tremendous issue.  A drop – even a substantial drop of over a quarter million dollars – is not necessarily enough to make housing affordable for most people.

There is a prevalent way of thinking in the GTA when it comes to real estate, which is that whatever is happening now, will continue to happen forever.  If prices are rising, speculators buy up real estate because prices will always rise.  If prices are dropping, only a fool would buy real estate as it will be worth less in the coming months and years.

The truth is that real estate markets do shift, and we’ve certainly seen that shift happen in the past five years in GTA.  Despite the recent proof that was is currently happening doesn’t keep happening forever, we’re seeing many would be buyers hold off on making a purchasing decision out of fear that the asset they buy will lose value after they own it.

Housing is a spectrum, with different types and different price points, and at the bottom of the ladder is the much-maligned condominium.  It is the most affordable option for anyone looking to get into the housing market and it makes up more than half of the housing stock in Toronto, and about a quarter in most other parts of the GTA.  While some purchasers of condo units are moving from one condo to another, it is more likely to be a renter who is able to make the move to home owner.

Is the math still mathing?

We thought it was worth examining the current math around buying versus renting to see if now is the time for people to get off the sidelines.  It’s always better to talk about specific properties than the market in general, so let’s get into the math on a specific building.

50 Eglinton Avenue West is a condo building that went up in 1992 and has just over 200 units, ranging in size from 549 sf to 1,500 sf.

A one-bedroom unit in the building leased for $2,000 recently.  A very similar unit sold for $390,000 this month, so we have a great opportunity to run the numbers and compare the costs.

Below is the chart for the monthly costs for owning the unit.

As you can see, the cost for the mortgage on a monthly basis is pretty much equal to the cost to rent it.  The $1,989 monthly mortgage cost is based on a good current (as of February 6, 2026) mortgage rate of 4.74% for a five-year fixed term with a 25-year amortization schedule.  We’ve assumed a 10% downpayment of about $39,000, so a mortgage of just over $350,000.

The total monthly costs of about $2,800 include the maintenance fees of about $640 and a monthly contribution of about $190 to the annual property tax bill.  Where the math becomes interesting is if you take the principal component of the $2,000 mortgage payment into account.  As of the first mortgage payment, the principal being paid down is $768 a month, which equals 38% of the monthly mortgage cost.  That number goes up each month and can be viewed as sort of forced savings account that the homeowner is putting money into each month.

If you do the simple math that incorporates that principal repayment, we’re not far off from an effective monthly cost to own of about $2,000, which happens to be the same amount it costs to rent.  While not all purchase versus rent calculations will return such a relatively even result, it is a striking example of how the decision to buy, or rent can be about more than the monthly costs.

If it costs the same, why wouldn’t you own?

There are obvious reasons why all renters are not suddenly snapping up condos.

In order to qualify for a mortgage, they need to have stable income of a sufficient amount and of course they need to have a downpayment saved up for the purchase.  Whether that downpayment is 5%, 10%, 20% or even more, it is a challenge for many renters to save up enough for a purchase.

In addition to qualifying for a mortgage, some renters have plans for their future that make buying a property unappealing.  There are significant transaction costs associated with buying and selling real estate, with land transfer tax on the buy side and real estate commissions on the sale side.  If your future involves a change in geography, then renting is in fact the best option.

We’ve already discussed the biggest reason renters aren’t jumping into the housing market, which is fear about what is coming next.  Even if you have the income to qualify for a place, the downpayment has been saved up and your plans are set for the next number of years, no one wants to buy an asset that is going to decrease in value.

If we’re clear on why lots of renters are not taking the plunge right now into home ownership – even if the math shows that it can be more or less the same to carry on a monthly basis – the question becomes why is buying now a good idea?

Security and appreciation?  Sounds good.

We use the term “housing insecurity” in the real estate industry to describe the uncertainty of being a tenant rather than a landlord.  With some rare exceptions, tenants are mostly at the mercy of their landlord as to whether they can stay in the home they are renting.  While there are protections in place to prevent unscrupulous evictions, it is fundamentally true that landlords hold the power of whether a tenant stays or goes.

When you own a home, you get to decide your future – as long as you’re paying your mortgage that is!  Being in control of that fundamental decision of your housing is hugely impactful on your peace of mind as to what comes next in your life.

The opposite side of the fear of the market going down after you buy, is the hope that the market will rise after your purchase.  While we have seen average prices drop recently, the long-term averages for real estate values have always shown growth.  If you are able to buy in a market where prices are lower and you can hold onto the property until you sell in a market where prices have grown, you benefit from that market appreciation.

If you’re considering making the move from tenant to homeowner, we’ve helped a number of our clients make that leap.  We’re bullish about the opportunity for appreciation over the next five years and if you’re keen to be a homeowner and benefit from a rising market, get in touch with us to discuss next steps!