Pre-Construction Condo Data
The Canadian pre-construction condo crisis in charts and numbers. All data sourced from CMHC, Urbanation, OSFI, Bank of Canada, and major Canadian publications.
Key Metrics at a Glance
- Developer Loans (All Banks)
- $85.1B
- Bank of Canada
- Big 6 Developer Loans
- ~$30B
- Globe & Mail
- Big 6 Loan-Loss (Q2 2025)
- $6.36B
- Wealth Pro
- Private Funds Frozen
- $12.8B+
- Multiple
- Units Sold 2020-2023
- 83,240
- Urbanation
- Failed Closings (2025)
- ~3,000
- Urbanation
- Investors Cash-Flow Negative
- 82%
- CIBC/Urbanation
- Avg Monthly Loss
- -$597
- CIBC/Urbanation
- RE Insolvencies (2024 proj.)
- ~240
- Globe & Mail
- TO Delinquency (YoY)
- +60%
- CMHC
- Completed Unsold (2025)
- 3,897
- Urbanation
- Deposits at Risk (2025)
- ~$500M
- Estimated
Part 1
The Pipeline Crisis
What was built, what sold, what got cancelled, and what comes next.
The Completion Wave
Nearly 30,000 units completed in both 2024 and 2025, roughly 50% above the 10-year average (~19,000). These were pre-sold during the 2021-2022 pandemic boom at peak prices.
GTA Condo Completions by Year
Units completing and hitting the market. Source: Urbanation
2028 estimate. 10-year average ~19,000 units/year.
| Year | Units | Note |
|---|---|---|
| 2023 | ~22,000 | |
| 2024 | 29,924 | Record high |
| 2025 | 29,291 | 50% above 10-year avg |
| 2026 | ~22,066 | Projected |
| 2027 | ~14,366 | Projected |
| 2028 | ~2,000 | Near zero |
New Sales Collapse
Only 1,599 new pre-construction condo sales in the GTA in 2025, the lowest since 1991 and down 91% from the 10-year average. Only 2 projects launched in Q1 2025.
New Pre-Construction Condo Sales (GTA)
2025 sales lowest since 1991, down 91% from 10-year average. Source: Urbanation
Project Cancellations
A record 28 projects (7,243 units) were cancelled in 2025, more than double 2024. Total inventory under construction fell to a 10-year low of 50,479 units.
GTA Condo Project Cancellations
Record 28 projects (7,243 units) cancelled in 2025. Source: Urbanation
| Year | Units | Projects | Note |
|---|---|---|---|
| 2018 | 3,598 | 15 | Previous record |
| 2022 | 1,100 | 5 | |
| 2023 | 2,400 | 12 | |
| 2024 | 3,469 | 14 | |
| 2025 | 7,243 | 28 | New record (2x prior year) |
The Supply Cliff
Construction starts have plunged 88% over three years. By 2028-2029, there will be virtually zero new completions in the GTA. Today's oversupply is creating tomorrow's shortage.
The Supply Cliff: Starts vs. Completions
Today's oversupply creates tomorrow's shortage. Source: Urbanation
2026-2028 starts are estimates based on current trajectory. Starts down 88% from 2022.
Part 2
The Price Gap
What buyers paid vs. what units are worth today.
The Appraisal Gap
Pre-construction buyers closing in 2025 face appraisal shortfalls of 10-30%. Toronto resale condo prices declined 13.4% from 2022 to Q1 2025. The average GTA condo lost $37,000 in value in 2025 alone.
The Appraisal Gap: Purchase Price vs. Current Value
Pre-con buyers closing in 2025 face 10-30% shortfalls. Sources: Globe and Mail, MPA Magazine
Illustrative examples based on reported shortfall ranges. Documented case from Globe and Mail (Feb 2025).
Toronto vs. Vancouver
CMHC's June 2025 report compares condo market risks across Canada's two largest markets. Toronto is far more distressed, but Vancouver cancellations surged 10x.
Toronto vs. Vancouver: CMHC Risk Snapshot
Source: CMHC "Condominium Apartment Market Risks" (June 2025)
Sales Decline (2022-Q1 2025)
Toronto
-75%
Vancouver
-37%
Price Decline (2022-Q1 2025)
Toronto
-13.4%
Vancouver
-2.7%
Carrying Cost Increase
Toronto
+24%
Vancouver
+29%
Cancellation Increase (2022-2024)
Toronto
5x
Vancouver
10x
2024 Completions
Toronto
25,572
Vancouver
12,442
Pre-con Unsold (Q1 2025)
Toronto
55%
Vancouver
N/A
Part 3
Follow the Money
Who funded the developers, how much they lent, and where the risk sits.
Bank Developer Exposure
Chartered bank loans to real estate developers doubled in a single year to $85.1 billion. Interim construction lending surged 383% to $32.9 billion.
Bank Loans to Real Estate Developers
Chartered bank exposure doubled in one year. Source: Bank of Canada data via Better Dwelling
Total Developer Loans ($B)
+105% YoY
Construction Lending ($B)
+383% YoY
Big Six Developer Lending Books
The Big Six hold ~$30B of the $85.1B total. The remaining ~$55B is held by credit unions, smaller banks, and private lenders.
| Bank | Developer Loans | % of Book | Note |
|---|---|---|---|
| RBC | ~$13.9B | <1% | Largest dollar volume |
| National Bank | ~$7-8B | 4% | Highest concentration |
| TD | ~$2-3B | <1% | |
| BMO | ~$2-3B | <1% | |
| Scotiabank | ~$2-3B | <1% | |
| CIBC | ~$2-3B | <1% | |
| Big Six Total | ~$30B | 35% of $85.1B total | |
| Other lenders | ~$55B | Credit unions, private, smaller banks |
Key finding: National Bank has the highest concentration at 4% of its loan book in developer lending, 4x higher than the other Big Five. RBC has the largest dollar exposure at ~$13.9B. TD, BMO, Scotiabank, and CIBC are each below 1% but individual amounts are not publicly disclosed.
Source: Globe and Mail, "Builders taking on more debt as some in residential sector struggle" (June 2025)
Blanket Appraisals
Banks that funded developers are offering mortgages at the original purchase price, not the current market value. This converts one large construction loan default into many individual (potentially underwater) mortgages.
How Blanket Appraisals Work
The mechanism banks use to prevent mass pre-con defaults
Construction Loan
Bank lends $500M+ to developer to build the tower
Pre-Sales (2021-2022)
Buyers purchase units at peak prices with 15-20% deposits
Market Drops 25%
By completion (2025), units appraise 10-30% below purchase price
Blanket Appraisal
Bank values entire building at original prices so buyers can close
Loan Conversion
One $500M problem becomes 200 individual mortgages (some underwater)
Key insight: The bank would rather hold 200 slightly underwater mortgages than face a single $500M developer default. The blanket appraisal protects the bank's construction loan exposure.
Known Blanket Appraisal Partnerships
RBC + Gairloch Developments
Developer emailed all buyers about RBC blanket appraisal partnership. Documented $595K gap on a single unit.
RBC + CentreCourt
Advertised "exclusive full project blanket appraisal with RBC" across 5 condo towers (March 2024).
RBC + Sakmet Developments
Blanket appraisal protection on 41 townhomes at Manors on Mayfield, Whitby.
OSFI position (July 2025): Warned that blanket appraisals may not meet Guideline B-20 expectations for "timely, realistic, and substantiated valuations" but did not ban the practice. New-build condo purchases make up ~1.2% of national mortgage originations but are concentrated in Toronto/Vancouver.
Private Lender Fund Freezes
Over $12.8 billion in private real estate lending funds have frozen investor redemptions. These funds provided construction loans and bridge financing to condo developers. When projects went into distress, the funds couldn't meet redemption requests.
Private Lender Fund Freezes
$12.8B+ in funds frozen. Investors cannot withdraw. Sources: Globe and Mail, Bloomberg
FSRA Ontario Private Lending Market
- Licensed administrators
- 266
- Private mortgages outstanding
- ~$32B
- Classified high risk
- 12 firms
- Private market share (by count)
- 15.8%
Source: FSRA Private Residential Mortgage Lending Report 2024
Part 4
Borrowers & Investors
Who bought these condos, how much they're losing, and what happens when they can't close.
Who Bought These Condos
83,240 pre-construction condos were sold in the GTA between 2020-2023. Approximately 70% were purchased by investors. These buyers are now closing into a market that has dropped 13-25% from their purchase prices.
GTA Pre-Construction Sales by Year
83,240 units sold 2020-2023. These buyers are now closing. Source: Urbanation
Dark bars: buyers now facing closings. Coral bars: post-crisis sales collapse.
Who Bought These Condos?
Most pre-con buyers were investors. Sources: StatsCan, CMHC, Urbanation
All TO condos investor-owned
38.9%
StatsCan 2022
Small units (<600sqft) investor-owned
64.5%
Toronto
Pre-con buyers who are investors
~70%
Industry est.
TO condos rented by owners
41%
CMHC Fall 2024
Units sold 2020-2023 (GTA)
83,240
Urbanation
Est. investor units in pipeline
~58,000
70% of 83K
Borrower Impact
~3,000 buyers failed to close in 2025 (10% of pre-sold units). Developers are suing. Those who do close are overwhelmingly cash-flow negative.
The Closing Crisis in Numbers
- Failed closings (2025)
- ~3,000
- 10% of pre-sold
- Developer lawsuits
- 130+
- Just 2 developers
- Deposits at risk
- ~$500M
- 2025 estimate
- Unsold completed units
- 3,897
- Year-end 2025
- Buyer sued for
- $1M+
- 10-unit speculator
- StateView deposits lost
- $77M
- 765 buyers
- Avg deposit at risk
- $120-160K
- 15-20% of price
- Tarion protection cap
- $20,000
- vs $120K+ deposits
Leveraged Condo Investors: Cash-Flow Negative
82% of investors losing money monthly by H1 2024, avg -$597/mo. Source: CIBC/Urbanation
2020
Break-even
2022
-$223/mo
2023
-$597/mo
H1 2024
-$597/mo
Monthly Carrying Cost Breakdown
Typical $700K unit, 20% down, closing in 2025. Source: CIBC/Urbanation
| Mortgage payment (4.5%, 25yr) | $3,100 |
| Condo fees | $500-600 |
| Property tax | $250 |
| Insurance | $50 |
| Total monthly cost | $3,900-4,000 |
| Average 1-bed rent (Toronto) | $2,000-2,200 |
| Monthly cash-flow loss | -$1,700 to -$2,000 |
Mortgage Delinquency
Toronto CMA delinquency hit 0.24% in Q2 2025, a 60% year-over-year increase and the worst since 2012. Private lender arrears are 5x the bank rate.
Mortgage Delinquency by Lender Type
Private lender arrears 5x bank rate. Toronto up 60% YoY. Sources: CMHC, OSFI
Part 5
The Fallout
Developer insolvencies, major receiverships, and what the banks are setting aside.
Developer Financial Distress
Real estate insolvencies were projected to reach 240 in 2024, 57% above 2023 and 13% above the 2009 global financial crisis peak. Over $2.3B in projects are in receivership.
Canadian Real Estate Insolvencies
2024 (projected): 57% above 2023, 13% above 2009 (GFC peak). Source: Globe and Mail
Major Developer Receiverships
Over $2.3B in distressed projects. Sources: Globe and Mail, CBC, RENX
The One (Mizrahi)
Lenders: Multiple secured
$1.6B
ReceivershipStateView Homes (7+ projects)
Lenders: KingSett, Dorr, Atrium
$300M+
Receivership + fraudEllie Condos (G Group)
Lenders: Romspen
$185.3M
ReceivershipMaplequest Ventures
Lenders: KingSett, First Source
$90M
ReceivershipSanctuary Lofts (260 High Park)
Lenders: Multiple
$42M+
ReceivershipStateView Homes: 765 buyers had $77M in deposits "dissipated." TD Bank accused StateView of a $37M cheque-kiting scheme.
Economic Impact of Cancellations
BILD estimates every 1,000 cancelled condo units erases $400 million in GTA economic activity.
- Units cancelled (2025)
- 7,243
- Economic impact
- ~$2.9B
- Jobs lost (est.)
- 35,000
Bank Earnings Impact
Credit loss provisions rose for eight consecutive quarters. Banks hold $60B in excess capital above regulatory minimums, but the condo segment is flagged as the "greatest weakness."
Big Six Loan-Loss Provisions (Q2 2025)
Total: $6.36 billion in a single quarter.
- RBC
- $1.42B
- Scotiabank
- $1.40B
- TD
- $1.34B
- BMO
- $1.05B
- CIBC
- $605M
- National Bank
- $545M
Source: Wealth Professional, reporting on public bank earnings.
Big Six Annual Provisions (All Sectors)
| Bank | FY2024 PCL | Q2 2025 | Note |
|---|---|---|---|
| RBC | $3.2B | $1.42B | $568M on performing loans |
| BMO | $3.76B | $1.05B | CRE flagged specifically |
| TD | -- | $1.34B | |
| Scotiabank | -- | $1.40B | ACL $6.7-7.3B range |
| CIBC | -- | $605M | +18% YoY |
| National Bank | -- | $545M | Incl. CWB acquisition provisions |
Sources: Globe and Mail, MPA Magazine, Wealth Professional
Credit Rating Agency Assessments
DBRS Morningstar
Condo segment is "greatest weakness" in residential mortgage market
OSFI
"Rising delinquencies, condo market weakness" but institutions remain resilient
Moody's (2021)
Mortgages "riskier" for lenders after stress testing
Fitch
Big Banks "well positioned to face macro headwinds" with $60B excess capital
Part 6
Data Sources
Every chart and data point on this page is sourced from publicly available reports.
Urbanation
IndustryGTA condominium market research. Recognized authority on new condo sales, completions, starts, and cancellations.
Data used: Completion pipeline, new sales, cancellations, construction starts, unsold inventory
https://www.urbanation.ca/news/new-condo-sales-fall-4th-year-lowest-1991CMHC
GovernmentCanada Mortgage and Housing Corporation. Crown corporation providing mortgage insurance and housing research.
Data used: Price declines, carrying costs, cancellation rates, unsold pre-con %, investor losses, Toronto vs Vancouver comparison
https://www.cmhc-schl.gc.ca/observer/2025/condominium-apartment-market-risks-toronto-vancouverOSFI
RegulatorOffice of the Superintendent of Financial Institutions. Federal banking regulator.
Data used: Blanket appraisal regulatory position, mortgage origination share (1.2%), Guideline B-20 expectations
https://www.osfi-bsif.gc.ca/en/risks/real-estate-secured-lending/osfis-view-blanket-appraisals-appraisal-timingBank of Canada
GovernmentCentral bank of Canada. Developer lending data from chartered bank reporting.
Data used: $85.1B developer loans, $32.9B construction lending, micro-unit mismatch analysis
https://www.bankofcanada.ca/2026/02/whats-behind-the-slowdown-in-torontos-condo-market/Globe and Mail
JournalismNational newspaper of record. Investigative reporting on blanket appraisals, appraisal gaps, and bank developer exposure.
Data used: Big Six ~$30B developer loans, RBC $13.9B (largest), individual bank exposure breakdown, blanket appraisal cases
https://www.theglobeandmail.com/real-estate/article-builders-taking-on-more-debt-as-some-in-residential-sector-struggle/Toronto Realty Blog
IndustryReal estate analysis and commentary. Detailed blanket appraisal mechanics.
Data used: Blanket appraisal mechanics, $500M construction loan rationale, $50K vs $500K gap comparison
https://torontorealtyblog.com/blog/what-is-a-blanket-appraisal-and-why-is-this-problematic/Better Dwelling
JournalismIndependent Canadian real estate data journalism. Reporting on Bank of Canada lending data.
Data used: $85.1B total developer loans (+105% YoY), $32.9B interim construction lending (+383%)
https://betterdwelling.com/all-in-canadian-bank-loans-for-real-estate-development-double-in-one-year/Wealth Professional
JournalismFinancial industry trade publication. Bank earnings and loan-loss provisioning.
Data used: Big Six bank loan-loss reserves (Q2 2025): RBC $1.42B, Scotiabank $1.4B, TD $1.34B, BMO $1.05B
https://www.wealthprofessional.ca/news/industry-news/big-six-banks-lift-reserves-and-dividends-as-profits-diverge-in-second-quarter/389302MPA Magazine
JournalismCanadian mortgage industry trade publication.
Data used: 10-30% appraisal shortfall range at pre-construction closings
https://www.mpamag.com/ca/mortgage-industry/market-updates/toronto-condo-buyers-abandon-units-worth-less-than-they-paid/524217CIBC / Urbanation
IndustryJoint research report on GTA condo investor economics, published annually.
Data used: Investor cash-flow analysis: 82% negative, -$597/mo average, carrying cost breakdown, investor ownership share
https://www.urbanation.ca/news/new-condo-investors-losing-average-605-per-monthFSRA Ontario
RegulatorFinancial Services Regulatory Authority of Ontario. Regulates private mortgage lenders and mortgage investment corporations.
Data used: 266 licensed administrators, ~$32B private mortgages outstanding, 12 firms classified high risk, 15.8% market share by count
https://www.fsrao.ca/industry/mortgage-brokering/private-residential-mortgage-lending-ontarioToronto Star
JournalismCanada's largest circulation newspaper. Investigative reporting on developer lawsuits against buyers.
Data used: 130+ developer lawsuits filed, $1M+ claims against individual buyers, deposit forfeiture cases
https://www.thestar.com/real-estate/this-condo-investor-is-being-sued-for-860-000-for-failing-to-close-hes-one/article_e0442c6a-dec0-4f72-8fce-c67d32942135.htmlCBC News
JournalismCanadian Broadcasting Corporation. National public broadcaster.
Data used: StateView Homes receivership: 765 buyers, $77M in deposits at risk, Tarion $20K cap vs actual losses
https://www.cbc.ca/news/business/stateview-homes-deposits-1.7100000BILD
IndustryBuilding Industry and Land Development Association. GTA's largest homebuilder trade association.
Data used: Economic impact: $400M per 1,000 cancelled units, 35,000 estimated construction jobs lost
https://www.bildgta.ca/government-relations/housing-supply/DBRS Morningstar
IndustryCanadian credit rating agency. Risk assessment of Canadian mortgage and housing markets.
Data used: Credit rating assessments: condo segment as "greatest weakness" in residential mortgage market
https://dbrs.morningstar.com/research/canadian-banking-sectorBloomberg / Financial Post
JournalismFinancial news reporting on private real estate fund freezes and developer distress.
Data used: KingSett $4.9B CAD fund freeze (Nov 2024), Romspen $2.7B freeze (Nov 2022), Hazelview $1.4B frozen twice (2023-2024), Trez Capital $3.8B (5 funds, Aug 2025)
https://www.bloomberg.com/news/articles/2024-11-21/canada-s-kingsett-freezes-payments-on-3-5-billion-property-fundRENX
IndustryReal Estate News Exchange. Commercial real estate industry publication.
Data used: Major receiverships: Stateview $300M+, Ellie Condos $185M, Maplequest $90M, Mizrahi $1.6B (The One)
https://renx.ca/receiverships-development-projects-toronto
Working with pre-construction clients?
bips matches borrowers to lenders across A, B, and private tiers, including lenders with blanket appraisal programs and alternative qualification paths.