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The 2026 Condo “Crash” Is a Mirage — What Toronto Is Telling Vancouver Next

Everyone keeps saying the condo market crashed. Prices down, sales at generational lows, nobody buying. And the headline numbers back it up.

But here’s what most people miss. Tom Storey runs one of Toronto’s busiest condo teams, and he’s spent this year pulling apart those headline numbers zone by zone. His read? There’s no condo crash. There’s a sub-500-square-foot investor crash — and it’s dragging down the average for everything else.

Toronto matters to Vancouver because Tom calls them near-twins. Same investor boom, same clogged inventory, same split between what’s dying and what’s flying. So when he says the “crash” is really one narrow slice of the market masking a turn that’s already underway, Vancouver buyers and sellers should probably lean in.

Strip out the shoeboxes, and the picture changes fast.

What You’ll Learn

• Why the “condo crash” headline is really a story about one tiny unit type
• The market signal Tom watches that most buyers ignore in 2026
• How one market splits into two — and why they no longer move together
• Why family-sized condos sell in under 30 days while shoeboxes sit for a year
• The single question Tom now asks before buying anything
• What Tom expects for condo prices between now and 2029

The Crash Everyone Sees Is an Inventory Illusion

Start with the numbers that scare people. Almost 70% of active listings in Toronto are condos. Sales volume is near a 30-year low. Last month, in roughly 80% of the city’s 35 zones, nothing on average sold over asking. Everything went under.

Sounds like a crash. It isn’t — not evenly, anyway.

Because that average is being crushed by one thing: tiny investor units. Bachelor condos are sitting at 10 to 12 months of inventory. You can technically sell them, but the buyer pool barely exists. They were always sold investor to investor, and with rents down, those investors walked away.

“If you took the under-five-hundred-square-foot condos out of our market, the numbers would look pretty good.” — Tom Storey, founder of The Storey Team, Toronto

That’s the whole trick. So much of the for-sale pile is shoeboxes that they rewrite the narrative for everything else.

Move one rung up and it already looks different. A one-bedroom with a parking spot can sell — figure roughly 60 days on market. A one-plus-den with parking in an older, mostly owner-occupied building is closer to a sweet spot. Same “condo market,” wildly different outcomes.

Look past the shoeboxes and Tom points to something buyers keep overlooking: five straight months of rising sales, with new listings falling year over year. Compared to a 30-year low, sure. But that’s the direction that matters. Quietly, the fundamentals are moving the right way.

One Market, Two Completely Different Realities

Here’s the part that breaks people’s mental model. Toronto isn’t one condo market anymore. It’s two, and they’ve stopped moving together.

On one side: the shoeboxes above. Ten-plus months of inventory. No urgency. Keep cutting the price and hope.

On the other side: end-user product. Two-bed, two-bath, parking, over 800 square feet, in an established building that’s mostly owner-occupied. Tom says that stuff usually sells in under 30 days. Big price drops? Mostly done.

And freehold? Different world entirely. Detached homes sit at about three months of inventory. Semis — what Vancouver would call a duplex — around two and a half. In the city’s most-wanted family neighborhoods, semis have already bottomed and started climbing. Not fast. But up.

Even the “over asking” wins are misleading. Of Toronto’s 35 zones, only six still sold over asking on average last month — and Tom’s blunt about why. Those places list low and hold offer dates. It’s manufactured. Buyers only play that game when there’s nothing else to choose from, and in most of the city, there’s plenty.

So the buyer chasing “the market” is chasing a fiction. There’s the part that’s still falling and the part that already turned. Which one are you actually watching?

Why We’re Here: The Wrong Housing Got Built

Tom’s biggest takeaway from this whole downturn is uncomfortable, and it’s the root of everything above.

“We built condos for investors and sold to investors, and that’s the way they got built.” — Tom Storey, host of the Tom Storey Show

Think about what that means. A huge share of the supply was designed around a spreadsheet, not around a person who wanted to live there. Small footprints. Renter-friendly, sure. But hard to resell to anyone who isn’t running the numbers.

And it’s not that developers didn’t gesture at community. Tom remembers the big master-planned launches — the marketing showed parks, daycares in the buildings, families. The pitch was a neighborhood. The units, though, stayed small. Renters didn’t mind; they’d sign for a year near work and the gym. Selling that same box later to someone who actually wants to live there? Much harder.

And Tom’s a little worried the industry just does it again. Right now the only things penciling out to get built are purpose-built rentals — thanks to an HST incentive — and high-end luxury condos. Investors will eventually come back. Nobody else is building. Sound familiar to a Vancouver reader? It should.

The One Question That Changes What’s Worth Buying

Here’s where Tom flipped his own thinking, and it’s the most useful part for anyone deciding what to buy in 2026.

Stop asking what rents well today. Start asking: when I sell this in five or ten years, who’s the buyer?

Watch what that reframe does. Those larger 1,000-to-1,500-square-foot units in older buildings that used to sit? They’re selling fast now. Why? The buyer is a downsizer who just sold a house, sitting on cash, completely unbothered by mortgage rates. End-user demand, not investor demand, sets the floor.

Investors aren’t gone. But Tom says they’re under 10% of his business, and the ones circling now need 35 to 40% down just to make the math work. He doesn’t see investor demand hitting even half its old level for a decade. So the future buyer is the person who wants to live there. Build your purchase around that person.

What It Actually Means Through 2029

So where does this leave you?

Freehold in good areas is at or near bottom, in Tom’s read. Not about to rocket up, but the drops have mostly happened. Condos are the split story: strong end-user product holds, shoeboxes keep sliding.

On timing, he doesn’t sugarcoat it.

“I don’t see a world where condo prices go up in any way that would make a difference to anybody’s life until 2029.” — Tom Storey, The Storey Team

That’s not doom. Sales volume has likely bottomed — it can’t get much worse than a 30-year low. New listings keep shrinking. Stack those trends up for another year or two and prices eventually firm.

There’s a hard edge to that math for sellers, though. If you plan to sell a condo at any point in the next couple of years, Tom’s advice is to list now. It isn’t getting better in the short term, and even when the market does bottom, he doesn’t expect prices to snap back the month after. They bottom, then hover. Waiting for a number stuck in your head could mean waiting years.

The real open question, and Tom admits he’s never worked in this market, is whether things bottom and then just… go sideways. For years. Flat. Would that be so bad? For a lot of Vancouver owners, honestly, it’d be a relief.

Full Podcast Transcript – Interview with Tom Storey

This transcript has been lightly edited for clarity and readability.

Adam Scalena: We’re here with Tom Storey. He is the leader of The Storey Team in Toronto, a very successful real estate team in the GTA, and of course host of the Tom Storey Show, a very popular podcast where you cover not only Toronto but almost right across the country. You do a lot on Vancouver as well. Matt and I have both fortunately been guests on your show, so it’s great having you. Thanks for taking the time.

Tom Storey: Thanks, boys. I’m excited to be back. I did your show a few years ago, and I’ve got to tell you, it’s nice to do podcasts with someone other than Steve for once. Switch things up, people that have good attitudes. No, I’m excited to be here. I’m excited to figure out what we’re going to talk about.

Adam Scalena: It’s interesting, but you and Steve have different personalities. You’re like the warm hug of the show, and then Steve is the hard punch. I love how he engages with the comments on YouTube. Very few people are willing to do that.

Tom Storey: One of the best things he does is he’ll engage with the comments, and then when he’s proud of himself with one of his responses, he’ll screenshot it and put it as his Instagram story. And so many people are like, “Steve, I don’t care about your listings, I don’t care about anything else you’re posting, just keep posting those. That’s what we enjoy.” So I stay out of it. I think everyone’s entitled to their opinion, and I go on with my day.

Matt Scalena: I feel like that would ruin my day, engaging with comments of any kind. So more power to you, but not for the faint of heart. Tom, we just kind of covered what you do, but for our listeners, can you talk a little bit about yourself and how you got into real estate?

Tom Storey: I started real estate in January 2014, so coming up on thirteen years or so now in the industry. I got my license when I was twenty-two years old. I’m no longer twenty-two years old, so it’s been a bit of a change over time. Turning thirty-five this summer. I pretty much work the city of Toronto exclusively. Toronto proper is where we do most of our business. We’ve built a team now that between editors, assistants, and everyone else, in total there’s like eight or nine of us right now. We’ve kind of built it over the years, do a lot of condo sales downtown, very active in that side of the market, and then lots of upsizers as well.

So it’s been a fun ride, and then obviously doing the podcast with Steve, running my own YouTube channel, watching the market evolve. Educating myself so much more on what’s going on by forcing myself to record videos every week has been a massive help for my business, not just because my education level gets better, but because it’s allowed me to meet new people. I’ve already had two calls this morning from people who were both like, “Hey, I watch your videos, we want to buy a place.” I’m like, great, you called the right person. So that’s basically what it’s been like the last thirteen years.

Adam Scalena: You got into real estate really young. What was the draw? How’d you get started?

Tom Storey: When I was growing up, my mother was in sales but never in real estate sales. And I remember very distinctly when she quit her corporate job and started her own business and worked out of our basement. It meant that I didn’t have to go to daycare anymore after school. I could just go home because my mom was there. I remember the very early seeds of thinking, that’s cool, she’s in charge, she gets to decide. And then you learn further into the future once you actually do it, you’re like, actually you give away way more of your time and it’s way more difficult.

I went to university, the University of Guelph, and as I was graduating, in my mind it was always… it wasn’t like I had this massive love for houses or architecture. I liked the business side of it. But I was like, you know what, I’m twenty-two, I had just graduated, I’m just going to go all in now. I was living with my parents, literally in their basement, when I got my real estate license. I tried to save up so I wouldn’t have to pay rent, and bought my first little condo.

And one of the things we have here in Toronto that I know is slightly different from your market is realtors can do rentals here, and you can survive early in your career. So I built up my entire clientele by doing rentals, running ads on Kijiji and Craigslist, meeting strangers and helping them rent places. And that over time builds up. All those people came back as first-time home buyers, and now we’re helping them buy their second property to move to the house because they’re having kids. So it’s been a really fun evolution over the years. I think it was good that I started so young because I didn’t know anything. I was super naive about it. I’m like, this will just work. And thankfully it did.

Matt Scalena: And you were right.

Tom Storey: Well, thank goodness, because there are no other skills around here anymore. This is it.

Adam Scalena: Do you still do rentals, your team?

Tom Storey: Our team does, yeah. We’ll still do over a hundred rental transactions a year. The formula of our team is whenever we bring on a new team member, they become the rental person, because a lot of our clients own investment property, so there’s helping them rent out and find tenants on the landlord side. And it’s a way to keep busy and put food on the table. You’re not making massive money from this, but to keep yourself going in the early stages of real estate, a lot of realtors will do rentals.

Adam Scalena: Does that translate into actually managing the property, or is it more just placing a tenant and then you’re done?

Tom Storey: Some realtors have built big property management businesses surrounding it as well. We purposely didn’t do that. So we find you the tenant, but you’re managing the property.

Matt Scalena: Interesting. So Tom, maybe a jumping-off point here. We’re literally halfway through July. There’s been a lot of talk about Vancouver and Toronto over the last three years being the epicenters of the downturn. How’s the market there, and specifically in the areas you’re looking at, the GTA, Toronto proper, the condo market?

Tom Storey: It’s so confusing. That question used to at least be somewhat easy to answer generally. It was like, it’s pretty good, or it’s really good, or it’s really slow. But it’s so property-type and price-point specific now. The swings between what one section of the market’s doing and another go from intense seller’s market to a year of inventory. I don’t think I’ve ever seen this much difference depending on what it is.

So basically right now, I was just looking at the numbers that came out for June. For the city of Toronto, we break it up as real estate agents. If you saw a map of the city, I’m sure it’s the same for you guys for Vancouver, we put them into different zones. For Toronto, if any listing starts with a C, it just means central, probably in the middle of the city. E means east, W means west. There are thirty-five distinct zones, and then little neighborhoods in each zone.

And last month, in almost 80% of every zone in Toronto, on average nothing was selling over the asking price. Everything was selling under asking. So generally, if we’re just talking about averages and tracking the headline numbers, it’s a slow market. Almost 70% of our active listings in the city of Toronto have a stratophy, so condo apartments and condo townhouses are really clogging up the overall inventory. And then you look at detached homes or semi-detached homes, which I know you guys would call duplexes in your market. Detached homes are sitting at like three months of inventory. Semis are like two and a half.

What we’ve noticed is, of the thirty-five zones that exist in Toronto, there were only six that on average, when properties are selling, are still going over the asking price. Now, they’re only going over the asking price because they’re listing low and holding offer dates. It’s not like they all just go over asking, it’s manufactured, it’s meant to be that way. And the argument is always, well, they went over asking but they were never going to take the price they were listed at, which I agree with. But I’ve always pointed to the fact that, yeah, but it works. Buyers are not willing to play that game if they have fourteen houses to choose from. If there are two of them and they like one, they’re going to bid on one and probably be up against other people.

So I started digging further into it. I was like, okay, why is it that in a market where sales volume is almost at a thirty-year low, and you can’t even give a small condo away no matter how low you put the price, there are certain pockets of the city that are still feeling like 2021, 2022 on the competitive side as a buyer? What’s interesting is the three areas were E01, E02, and E03 on the East End. That’s Leslieville, Riverdale, the Beaches, the Danforth, East York. If you know anything about Toronto, you’ve probably heard those neighborhoods before. And then the other three are all on the west end of the city: High Park, Roncesvalles, the Junction, Bloor West Village, Dovercourt Village. All these areas that, when you really break it down, are single-family homes that I would call first-choice neighborhoods.

When you have a client that starts their search, in the first conversation it’s like, ideally where do you want to live? 95% of the time, if we’re talking to a buyer that’s upsizing, they’re going to say one of these different neighborhoods. They’re good school districts, they’re family-oriented, family-friendly, and still relatively close to downtown. What happened is all these newer parents who are pregnant or have the second one on the way, they’ve lived downtown for five to ten years and now they’re ready to buy the single-family home. But they’re not willing to go too far, they still want to be relatively close.

So overall, the general market in Toronto, you’ll expect to see no price increases, honestly not anytime soon. Smaller condos are still hurting, and I don’t think that’s going to change for a couple of years at the earliest. Pre-construction condos are the worst of the worst, that’s where the most damage has happened. And then single-family homes, probably sub one-point-five, but you could even argue up to two in some neighborhoods, are still getting multiple bids and selling in seven days. So it really depends on what area you want to be in and what the price point is.

Adam Scalena: That’s so funny, that’s exactly what we’ve been talking about, just our version of those neighborhoods. Your Kitsilano, maybe Mount Pleasant, Fairview, parts of the North Shore, Grandview-Woodland. Areas that are top-tier, always highly desirable, blue-chip real estate combined with entry-level end-user product.

Tom Storey: Well, when you break it down even further, the reason these neighborhoods on average are going over asking isn’t because of the detached homes. Detached homes are selling quickly, it’s what you guys would call duplexes. It’s less expensive, but it still has all the amazing things that this other home down the street has that just happens to be detached, but I can get it for four hundred grand less and still get it in that neighborhood. That’s where the most competitive side of the market is happening.

Matt Scalena: Some people would say these prices aren’t missing-middle prices, but in the context of Toronto, that’s basically that missing-middle-type product in great neighborhoods.

Tom Storey: These aren’t massive houses, by the way. Our typical downtown east or west semi-detached house could be fifteen feet wide. A twenty-five-foot semi is huge in Toronto. I know it’s different in different markets, but they’re usually twenty feet wide or less, a hundred deep. They’re all the same floor plans just flipped. Every semi kind of looks the same based on how they build them. Not including the basement, these are usually thirteen hundred to seventeen hundred square feet, perfect for that family.

And when I was thinking about this, I’m like, okay, it’s obvious these neighborhoods have always been in demand. But why is there such a discrepancy now, where they’re so much more in demand than all the other asset classes? You just have to look at who the buyer is. The buyer’s not an investor looking at their spreadsheet running the numbers. It’s, “We’re pregnant with our second kid, and this is a school district we want to get in.” It’s an emotional buyer, which you could argue might pay more or get more involved in the bidding process, because it’s, “Yeah, it’s fifty grand more, but this is the third house we’ve bid on, and our kids start school in September.”

Adam Scalena: And seventeen-hundred or two-thousand-square-foot homes are perfect, because most people we’re helping, it is a one-to-two-kid family. If you have three kids or more, it’s like, what, are you on a farm? It’s a very different family dynamic now. So a couple of things you highlighted. One thing you said that we’ve been saying is one-bed condos, it’s almost like you can’t find bottom. So you’re experiencing the same thing there.

Tom Storey: Yeah, we’ve run pretty extensive data on this for every segment of the condo market. Your bachelor condos, which mostly don’t have parking spots anyway, are sitting at like ten to twelve months of inventory. You can sell them, but it doesn’t even really matter what the last one sold for, because just keep subtracting from that, the buyer pool’s so small. Those were always sold from investor to investor. And if you’re trying to sell it with a tenant still in it, good luck, it’s so difficult.

So I believe that segment of the market is going to have to continuously keep dropping. It’s funny, they are still technically the most affordable real estate you can buy, but no one has any interest in buying it. And because rents have come down as well, the investors that used to be the ones buying it aren’t interested.

You look at one-bedrooms. If they have a parking spot, they can sell, but even if you’re bang on, you’re sixty days on the market, it’s going to take some time. A one-plus-den with parking is a bit of a sweet spot in the market, mostly in buildings that were built at least ten years ago, but usually fifteen-plus years ago. That’s your six-fifty to seven-fifty square foot one-plus-den with parking in an established building that’s not all rented out, that’s mostly owner-occupied. That’s okay, but not great.

And then it’s funny, I was chatting with a guy this morning who was looking to invest into the condo market, because we are starting to slowly get those calls now, but they don’t want the bottom-end stuff. They don’t want the bachelor units. They’re like, what’s doing well now? Because if it’s doing well now, it’s also going to be doing the best in five years. So we’ve flipped the mindset. If you want to invest in Toronto condos, and this would probably work the same for your market, let’s pretend you’re not an investor. What would an end user be looking to buy right now? Because that’s your buyer in five, ten years who’s going to buy your property.

For the end-user product, it’s basically two-bed, two-bath with parking, over eight hundred square feet, in these specific neighborhoods, looking for these specific floor plans. That’s the part of the market I would define as the best of the worst. You’re not seeing massive price drops anymore, but they’re still selling usually in under thirty days if they meet all those criteria points.

Matt Scalena: It’s striking how similar these markets are right now. If I was just listening to you, I would think you’re talking about Vancouver in so many ways. I would rather have a thirty-year-old six-hundred-and-fifty-square-foot one-bed right now than a brand-new, even good floor plan, four-hundred-and-eighty-square-foot one-bed in a concrete tower. There’s a sweet spot in the one-bed market for sure. It’s also interesting how the logic has flipped. Before, it was cheap and cheerful, entry cost is what everybody was focused on, price per square foot in terms of rent was important. Whereas now, the downturn has really… the tide’s out and it’s like, okay, what do people actually want? What has stood the test of time? And it’s those larger units.

Tom Storey: I think we’ve learned a good lesson here that there are certain property types that sell in markets that are only end-user driven, and then there are investor properties. So if you’re betting on the future of either of our markets right now and wanting to get back into the condo market, buying at a price that’s obviously way lower than it previously was, you want the future buyer… I’ve almost switched my whole thinking on this. When you sell this in five or ten years, who’s the buyer?

I can give you another real example that we see. These larger units that are a thousand to fifteen hundred square feet, in even twenty- or thirty-year-old buildings, you’d be surprised how fast these sell. And it’s like, that makes no sense, these used to sit on the market. Why, and inventory’s not wildly low, there’s enough to choose from. Then you take a step back: well, who’s buying it? It’s a downsizer who just sold their house and isn’t impacted by mortgage rates. They’re sitting on cash. So I’ve almost flipped my whole thinking. All those other things are obviously very important, floor plan and the rent you’re going to get and all the other factors. But if you’re going to hold it forever, it’s maybe a different conversation. If the idea is I’m going to sell this in ten years, I want to know who the buyer profile is going to be, and are they going to be people who are impacted?

Even though I do strongly believe investors will return, it’s hard to believe it’s going to be even 50% of what we previously saw, at least for the next decade. They’ll come back, but not like it was.

Adam Scalena: Another thing we’ve been thinking about a lot is it can be a fantastic time to move through the market, and specifically move up the market. And it’s tricky because a lot of people, if they’re in condo units, are feeling trapped right now because they can’t sell. Are you seeing that in Toronto, this idea of people who maybe have to sell something to buy something and just being in a position where, even though it might make sense with the numbers, at the end of the day it’s not getting sold?

Tom Storey: That’s fifty percent of my business. I’ve become very good at having those initial conversations, and it’s tough, because typically they’re selling a property type like a condo, even if it’s a two-bedroom that they bought five, seven, ten years ago. But most condos in Toronto are selling at 2018 prices right now, maybe 2019 for some property types. So the first thing is, it’s not worth much more than you paid, if not a lot less than you paid, depending on when you bought it. And then what you want to go buy next is probably in one of those six neighborhoods we talked about, and you’re going to be competing with eight other people on each property. And they’re like, what? I’m entering the most competitive market and trying to sell the side of the market that’s the most difficult.

So what we’re doing a lot now is going to them and saying, okay, if you have to sell first, assuming there’s equity in the property and they can make the move… because if there’s no equity, then the conversation becomes, well, if you sell it now you’re just realizing your loss. Can you afford to hold onto this and just rent it out and make the next jump without selling it? There are lots of people who can’t do that and then would be stuck, because they’d have no other option. But for the people who have the equity and don’t love the price but can do it, what we’re saying is, let’s say the last one sold for eight-twenty-five for that same unit. I would say, go to your mortgage broker, tell them you’re going to sell this condo for seven-seventy-five, I’m going to give you a very conservative number, let’s work off that. Based on that, what would you be approved for on the next property?

And then, I got this idea years ago from a realtor in Collingwood. He said, before you ever show buyers properties, get them out and show them anything, send them a reverse search. All it is is pulling a list of properties that have sold in the last thirty days that fall in their criteria. So it’s, go to your mortgage broker assuming you’re going to sell for less than you actually think and get pre-approved for the next purchase, that’s step one. Then once you tell me the neighborhoods you want to buy in and your criteria, I’m going to send you a list of, let’s say, the last ten properties that have sold. You can see the sale price and you can see the house. Go through that list and tell me if you would have bought any of those homes if you were ready when they came to the market.

I’ve found that exercise is probably saving me hours and hours of explanation about what’s going on in the market. And it’s cool, because the husband and wife will sit down and email me back on the list. They’re like, “Okay, we wouldn’t have bought any on this list.” It’s like, okay, then maybe we don’t put the condo up for sale yet, or can we increase the price point? But if they come back… I just did this last week. It’s actually funny, it was someone referred to me who’s selling their condo in Kelowna right now, having a little difficulty selling it, which I guess is not news to you guys, and they’re moving to Toronto and have to sell that one first. He’s like, “Hey, I want to be ready when this condo sells that I can jump on something.” I sent him a list and he’s like, “I would have bought eight out of the ten, I would have considered making an offer on eight.” I’m like, great, we know what we’re looking for and you’re happy with it.

So maybe that’s a long-winded answer to tell you, yeah, this situation is happening a lot. I really believe that’s the biggest opportunity in the market right now. The upsize, if you’re financially in a place to do it. I don’t want to guarantee anything, but you’re likely going to regret it in the next three to five years if you don’t want to… if you want to get to the next one now, because it’s going to be more expensive if your current property goes up as well.

Adam Scalena: Right. And just to continue down that line of reasoning on the people who are trapped in the market: you’re a big brand in the downtown market, obviously a big brand in the condo market. People are approaching you in markets where there’s tons of inventory and you can’t find bottom. How are you approaching a listing like that right now?

Tom Storey: We’ve actually dubbed this formula for Toronto condos. You guys are welcome to steal it and call it your own, it’s called the STAMP formula. We go through the criteria points of what we believe is important, what is making a condo sell or not sell in today’s market. S is size, so it has to be over six hundred square feet, that gets you a check mark. T is tenancy, who’s currently living in it. If it’s vacant or owner-occupied, you get a check. If it’s currently tenanted, you get an X. A is asking price, which we’ll come back to. M is maintenance fees. And P is parking.

If I look back at all my condo sales this year that sold in under two weeks on the market, they were all at least four out of five, but most were five out of five. So when you go through that, it’s like, okay, we’re a difficult sale, we’re a smaller unit, it’s vacant, it doesn’t have a parking spot, maintenance fees are okay but not great. The only thing we can solve for in that equation is asking price, we’re in control of that. The other things we have no control over, the property is what it is.

And again, we’re really just taking a different approach where we’re flipping it. I’m pulling up my computer, sitting with a seller, and going, okay, in a declining market you want to be the next sale. Everyone wants to feel like they’re not giving their property away, that they’re getting the best outcome. But if you wait and the next one sells before you, then you’re chasing that one down. The escalator analogy I found is the best one. If you get on an escalator at a mall, the only way to get off is to sell your house. But if you hold on too long and you hope for something that doesn’t exist, you’re going to end up in the basement and you’re still going to be holding your house, when everyone else was slowly getting off the escalator at different stops because they took a price they didn’t love, but then it keeps sliding down, and you don’t want to get stuck at the bottom holding the bag.

That doesn’t get through with every seller, but really what we’re doing is going, if you were a buyer, let’s look at what’s actively for sale that we’re competing with. Let’s say there are twenty options. We know right now for your property type, if you have a smaller unit, let’s say it is a bachelor condo and it’s a tough sale, we know there are ten months of inventory. One in ten is selling every thirty days. Well, if there are twenty on the market, we need to be in the top three choices. We have no other choice. If we’re not in the top three, you’re not even showing up on the radar.

That usually goes over very well. I think enough time has passed now that when I tell people prices, no one’s jumping for joy, but the best is, “It’s not that bad, I was expecting maybe a little worse than that.” Most people understand, enough time’s passed that they get it. And the people who don’t like the price, then the next question is, well, how long am I going to have to wait to get this number, whatever’s stuck in their head? And I think they’re waiting years. I really do.

So our biggest thing now, and this isn’t a sales tactic, I truly believe what I’m saying: if you want to sell a condo at any point in the next two years, get it on the market now. It’s not getting better in the short term. We don’t know when the market’s going to bottom out, but even when it bottoms out, it’s not just going to magically start going up the month after. It’s probably going to bottom out and hover there for a period of time.

Matt Scalena: It’s funny, we put out an episode late last year, “What do you wait for, April/May,” which was traditionally the time to wait for to list, or do you list in January or early February? Our logic was exactly that: beat the rush. And we had a really successful start to the year in terms of people being happy to be sold, before there was this new glut of inventory. It speaks to that point. We’re seeing a bit of an uptick in Vancouver. June was the first month of, across the board, things seeming to get better. Part of the logic there, you spoke to it, is sellers are like, “That’s actually what I was expecting,” or, “Man, I thought it might even be worse.” So there’s a moment now where finally buyers and sellers are potentially on the same page, at least more so than they’ve been in years. But you still sound very pessimistic. So are you seeing the uptick?

Tom Storey: For some condos, yeah. Listen, if you look at the overall market and properties people actually want to buy, consistently now every month this year, new listings are down and sales are up. There are positive signs in our market. If you took the under-five-hundred-square-foot condos out of our market, the numbers would look pretty good. It’s just that there’s such a massive amount of the active listing inventory that it’s completely changing the narrative on the sales numbers. Because so much of it… I just feel like, yeah, this isn’t great, sales volume’s low, but the things we would watch, absorption rate, months of inventory, new listings, active listings, sales, we’ve now had five months in a row where sales volume is up. Yeah, compared to a thirty-year low, so it’s not celebrate, but it’s early steps, and there are fewer listings coming to the market. If that remains for another year, year and a half, you eventually will see prices go up.

And actually, semi-detached homes in the areas we talked about, they’ve bottomed. It’s clear. They’re going up. Not crazy in value, but they’re going up. Good detached homes in choice neighborhoods are selling. I don’t know percentage-wise if it’s the same in both our markets, but there was just such a condo boom here for so long that you almost have to separate the condos from the freehold properties when you’re talking about the market right now. Because if you put them together, really what you’re saying is 70% of your statement is condos, because that’s our inventory, that is what’s for sale.

Adam Scalena: So Tom, we’ve experienced a significant downturn, for sure the largest downturn since you’ve been a licensed agent. And it would be hard to say, even if you were in your sixties and seventies and had been doing this for forty years, which market do you reference as the worst downturn? It’s really a first for every agent. What have been the biggest takeaways from this downturn? What are the biggest lessons learned?

Tom Storey: The biggest thing for me is that the way we built condos in Toronto didn’t create the housing anybody actually wanted. We built condos for investors and sold to investors, and that’s the way they got built. Now there’s maybe a big conversation that needs to happen: can we change the model in which we build these properties, in terms of not needing to get to a certain percentage of sold to get the construction financing, so they can actually get off the ground sooner? Because right now, the only thing penciling or being built in our market is purpose-built rentals, because of the government incentive with removing the HST, and that was done a few years ago now. Or high-end luxury condos.

So it’s funny, we’ve gotten to this point where we had this market that went up and down and sideways and then down again, and we’re coming out of it, and my biggest takeaway with the downturn is I’m kind of worried we’re just going to do it again. Eventually investors will come back. Nobody else is building anything. The government’s bailing out all the developers right now. There are a lot of different ways you could look at that, but that is what’s happening. In Vancouver, how it’s happening is more clear. In Toronto, it’s that they’re removing the HST, so it’s not the government buying it all, but that’s the reason they’re actually selling. So what I’ve learned is bigger family-style floor plans and specific neighborhoods. If I’m investing my money in real estate moving forward, that’s all I would be focused on.

Adam Scalena: The other thing I think about too, with condos in Vancouver, is how many people want ground-oriented in Toronto versus condos? A larger condo is better than having a one-bed listed, but condos are fairly challenged across the board, even if there are larger footprints. Do you think there’s a… have we really embraced the condo for young families and for the middle, or is it more ground-oriented housing needed?

Tom Storey: I think it’s absolutely more ground-oriented housing, but we don’t have any land here. Neither do you guys. We can complain and say they did it the wrong way, but what options did they have? You look back at a lot of the condo communities, these big master-planned communities. When they launched, at least in the marketing, they’d show you it’s family-oriented and they were building a park and you’d have some daycares in some of the buildings. They were built around this community idea, but most of the units were still relatively small. So I think what we learned is that the actual living space, the footprint, probably needed to be more specifically towards people who were going to live there. Because smaller units still rent out fine, renters were less picky about it. They’re like, yeah, I’m going to be here for a year, it’s close to my work, my favorite gym’s over there, I’ll rent this place for eighteen hundred bucks a month. But to sell them again to someone else who isn’t just looking at the numbers is very, very difficult.

Matt Scalena: What about the maintenance fees there? Because that’s the other thing that consistently comes up right now. Here, I think we have some of the lowest maintenance fees in North America in Vancouver. People often cite Toronto as, “You think our maintenance fees are high, you should see Toronto’s.” If you’re paying eight hundred or a thousand or twelve hundred bucks for these family-home-style condos, if you actually look at what that does to your mortgage payment, a semi-detached or detached, maybe with a suite, is actually a smarter buy. What are the maintenance fees? What’s an average maintenance fee in that STAMP situation, what’s a good one?

Tom Storey: On the STAMP checklist, if your maintenance fees are under a dollar per square foot, you get a tick. And this includes a parking spot, because you pay maintenance on the parking spot as well, and the locker. Roughly, when I started my career thirteen years ago, I was seeing most maintenance at sixty to seventy cents a square foot. Something happened during the pandemic, everything went up across the board, like crazy, in every building. So I used to say over a dollar a square foot worries me. Now I’m like, just under a dollar a square foot probably is okay, depending on the age of the building.

There are some buildings in Toronto… there’s one specific one, and I don’t want to throw them under the bus, it’s in the St. Lawrence Market area. It was built in 2017, it’s not that old, and their maintenance fees are currently a dollar-thirty a square foot. I would never ever recommend anybody buying that building.

Matt Scalena: So on a thousand-square-foot two-bed, you’re at thirteen hundred dollars a month.

Tom Storey: A thousand bucks a month.

Matt Scalena: That’s a couple hundred thousand dollars in mortgage, right? Every month going out. Not to put too fine a point on it, Adam.

Adam Scalena: When I first got into real estate, the average price per foot in Vancouver was thirty-seven cents a foot. I haven’t looked recently, but I’d say we’re probably closer to maybe sixty, seventy cents a foot, would you say, Matt? Now, my understanding is we were also late to the game with depreciation reports or reserve fund studies. The way it was explained to me many years ago was that Ontario and Alberta at least were better planners around contingency funds. Whereas Vancouver was very… we always had buildings running with very low funds, and we were often a special levy market. A lot of the repairs in Ontario, would you say, are taken out of the CRF, or are these fully funded buildings? Because then it makes a lot more sense.

Tom Storey: It’s a good question. It would be interesting if someone did a full breakdown on this, percentage-wise, size of building and all the different factors, what’s the average in the reserve fund, which we’d call it here, versus what you guys have. A special assessment, although they do happen, absolutely, is not as common as maybe you see in the YouTube comments. Normally when repairs are done in buildings, it’s taken from the reserve fund. There are some older buildings that do special assessments. There was one condo we sold where each unit paid a hundred and nine thousand dollars for a special assessment.

Adam Scalena: Wow.

Tom Storey: And it was to redo all the windows in the building, but it was a forty-five-year-old building and they decided that was the path they were going to go. Most buildings, the reserve funds are fairly healthy. I don’t know, maybe because… I guess our condos wouldn’t even really be bigger than yours or have more units, it’d be pretty comparable. But most of the time we’re seeing millions of dollars in the reserve fund when we’re looking at the strata documents.

Adam Scalena: See, that says everything right there, doesn’t it, Matt?

Matt Scalena: No kidding. That’s exactly it. So it sounds like the costs are almost the same, it’s just how you’re funding the maintenance costs.

Tom Storey: Is a special assessment pretty common? Is that a normal thing?

Adam Scalena: We’re playing Russian roulette over here.

Matt Scalena: Do you want to replace the carpets on a three-story building? There’s a special assessment. Or clean them.

Adam Scalena: It’s very much… well, I don’t want to say that, because we have changed a lot. The introduction of the depreciation report was a really good thing for our market, because a lot of buildings were running blind, resting on their laurels. And then you’d have these buildings where they’d be close to the twenty-five-year mark, where major expenses were coming, and then you’d have a buyer that would buy into it and maybe in the first three years of ownership get hit with something dramatic, like a forty-thousand-dollar assessment. And also a lot of buildings and stratas were just neglecting or deferring work. So now we’re in a position where we’re doing a better job, but it’s been a long road getting there.

I think that’s why we’ve seen a dramatic increase. We have the mandatory now ten percent contribution to the CRF annually, and now we’re starting to see some buildings doing more than that based on depreciation recommendations. So we’re moving towards a model like Toronto. However, that concerns me, because there are a lot of people complaining about sixty cents a foot right now on a maintenance fee.

Tom Storey: Yeah, that’s interesting. Special assessments obviously exist here, they happen, but it’s not as common as it sounds like it would be in your market. I’d be curious to get your guys’ opinion on this. One of the big things we always focus on with first-time home buyers buying condos: let’s not buy in investor buildings, because they’re eighty percent rented out, and the person beside you renting’s not the problem, it’s that when you want to sell in five years, an investor’s quicker to dump it than an end user. But if eighty-five or ninety percent of a building in Vancouver was bought by investors, wouldn’t you just have a board of absentee owners? They technically own the unit, but most of the board members don’t even live in the building, so they wouldn’t be as involved. Is that then worrying in the future?

Matt Scalena: So we just had a couple guys on from First Service Residential, and we asked, what are the things, if you were buying, that you’d look for? A lot of people don’t think about it. It’s like, how much is in the contingency, that type of thing. And one of the points they made was, is it hard to get quorum, how active is a council? And it makes a lot of sense. Because it’s not even that investors are… I think people think of parasitical investors, like they’re unwilling to put any money into the buildings and that’s the problem. And I don’t necessarily see that. I think it’s just a level of engagement, or lack of engagement, that’s probably the problem. I’m involved in a condo building in East Vancouver, and every time I talk to the building manager he’s like, “Well, come to the meetings, no one comes to the meetings, we’ve never seen you at the meetings.” And I’m like, shh, and then I hang up and go on my day.

Tom Storey: Whenever I meet with a condo seller, normally if they’re on the board they’ll tell me very early in the meeting, and then they’ll go on a five-minute tangent about something that’s going on that’s not good. The difference in the meetings between condo sellers not on the board who don’t pay attention and the people who are on them are wildly different.

Adam Scalena: Another thing that used to exist in our market that doesn’t exist anymore, and it’s frustrating: we used to get on the Form B document, which is a snapshot of the building, a percentage of rentals in the building. It was useful because sometimes it would allow you to shape an understanding of the more investor-oriented buildings versus end-user buildings. And now they don’t do that anymore. That changed probably five years ago.

Tom Storey: Wait, why do they not do that?

Matt Scalena: I think it was the province that made that change, and I think it was because it stigmatized renters, was the logic. I think literally it was at the provincial level, and it made zero sense to anyone, and that was the logic.

Tom Storey: That sounds like a BC rule change to me. That sounds pretty normal. See, in our market, rentals go on MLS. So we can just look and be like, there have been sixty-four rentals in the last two years, there are probably mostly renters here. It’s pretty obvious, you can’t really hide from it.

Adam Scalena: I wonder also, because I would say a lot of the buildings downtown, it would still be roughly fifty-fifty. It would be surprising to see a building that’s eighty percent investor-owned. I think so.

Tom Storey: Really, in Vancouver? That would be pretty normal here for all the new ones.

Adam Scalena: And here, just in real time, because we can: Bill 44 kicked in rental restrictions in 2023, and since strata corporations can no longer restrict long-term rentals at all, the old Form B disclosure fields, number of units rented, became meaningless. So I guess they were doing it because it was meaningless in the way they thought. If there was a max of thirty percent rental, then you’d see they’re at the max of the number of rentals. So they weren’t actually doing it to gauge whether this is a good buy as an owner-occupant. So they removed it, but it took that away, which was a very useful thing to have.

Tom Storey: You know what is interesting too, now that I think about it, in our MLS system, when we set clients up on the automatic searches, it doesn’t allow us to choose not to send them tenanted properties. There is a workaround you can figure out pretty easily, but the way the system is built, it doesn’t allow you to only say vacant or owner-occupied. You have to show them all of them on the automatic search, which I guess is some regulatory thinking as well.

Matt Scalena: We definitely can’t do that either. There’s no way for us to… we can’t even just do freehold on MLS, which is weird. We have to send leasehold as well. Don’t ask me why.

Tom Storey: Really?

Matt Scalena: That is definitely true. You can do that for Interface, but you can’t do it on MLS, which is strange.

Adam Scalena: I barely use… I use Interface, so you can obviously do that. Hey Tom, maybe as a final question here, a little forecasting moving forward. What do you think for the next one to three years in the Toronto market?

Tom Storey: I think for freehold properties, they’re close to bottoming if they haven’t already for most neighborhoods. Of course, the undesirable stuff will sit on the market, and the overpriced stuff, but in general I feel pretty confident about that outlook. I don’t expect them to go up rapidly anytime soon either, but I also think most of the drops have probably happened, based on what we’re seeing on the ground level.

For condos, you have to break it into different sizes and all the other things we talked about today. I don’t really see a world where, let’s talk general condo market just to make it easy, I don’t see a world where condo prices go up in any way that would make a difference to anybody’s life until 2029. I do think there are opportunities. But what’s been encouraging, because we do work with a lot of first-time home buyers as well, is when I take a call with a first-time home buyer and we talk through the criteria, I say, okay, I just want to let you know there’s a chance you could buy this condo and it could go down in value in the first year or two that you own it, so you should own this for at least five years. And every single person will be like, “No, we get it.” They’re not… the biggest sticking point for most people is they don’t want it to go down. Even people who want prices to go down, they want it to go down so they can enter, but they want proof that it stopped going down before they enter. I’ve seen enough people who are now like, “No, we’re going to own this minimum five years.” Whether they do is a life-situation thing, but at least the mindset going in, I’ve been encouraged to see.

So over the next at least three years, I think sales volume for sure has bottomed out. It can’t really get too much worse than it was last year, so maybe that’s not saying much. But you’re slowly seeing things come back. And if those trends we mentioned earlier, if new listings continue to be down on a year-over-year basis and sales volume is at least even if not going up, and that maintains, I think eventually you’ll see a leveling off here.

What I’d be very curious to see for both of our markets: a lot of people talk about when it’s going to bottom out. I want to know, is it actually ever going to stay sideways? Have you guys ever seen a perfectly sideways market? I haven’t. I want to know, if we bottom and then trade sideways, even for three years, which would be wonderful for my life, it’d be nice to work in that market. I just don’t know. Maybe it goes down and trades sideways for a little bit and then slowly grows again, or it really does truly go sideways for a few years, because that’s a market I haven’t worked in before.

Adam Scalena: And you’re right, every market presents new challenges, but the sideways one might be the easiest.

Tom Storey: It should be nice not to work in an extreme. Let’s just find a little bit of middle balance here.

Matt Scalena: Going back to your point about investors coming back into the market, which we’ve seen a little bit of as well, but they’re coming back in with a different goal or a different property type in mind. So it’ll be interesting to watch the bifurcation that takes place over the next three to five and maybe even eight to ten years, where investors come back, maybe not at the level they were, but with very different ideas of what they want to own. It’s going to be interesting to watch that investor-grade stuff and how long it sits.

Tom Storey: It’s a good point, because investors are definitely less than ten percent of my business, maybe five percent. They’re not coming back massively, but we are helping a few. They don’t want to buy new construction, unless they can get some developer inventory at really good deals because of the HST change we had here. They’re looking to buy resale, and I will say most of them have pretty healthy amounts of cash to put down. This isn’t… even at today’s prices, you’re not investing with twenty percent down and breaking even on your asset. It’s thirty-five, forty percent to get to that range. And without guaranteed appreciation in the future, with a huge question mark on when that’s going to happen, I just think it’s still going to take some time. But you’re seeing early signs of people asking questions, sniffing around, being like, “Hey, if you find this, send it to me.” I’m having a lot of those calls. So there are early signs that the first movers are slowly coming.

Adam Scalena: Tom, we’ve kept you longer than we said we would, but we do have this segment called the Five Wire, five lighthearted questions that we end every show with. Can you stick around for that?

Tom Storey: Yeah, absolutely. Has anyone ever said no when you asked that?

Matt Scalena: We may have had one or two, actually.

Tom Storey: Like, “No, it’s gone too long, I’m out.”

Adam Scalena: And then we edit it out, and Matt says, “I’d be delighted,” and we add it in. Anyways, question number one: one book you would recommend for our listeners?

Tom Storey: Project Hail Mary. Have you seen it? The movie’s out right now too.

Adam Scalena: Who’s in the movie?

Tom Storey: Ryan Gosling.

Matt Scalena: I’m unfamiliar with this. Give me the Coles Notes.

Tom Storey: It was like the biggest movie of the year. The earth is dying, our star, the sun, is dwindling, and we’ve got to go find… he goes to space to save us and lots of things happen. And if you’re an audiobook person, the narrator who does it is amazing. Such a good book and great movie as well.

Matt Scalena: Is this fiction or nonfiction?

Tom Storey: This is not real. It’s the same guy who wrote The Martian, which became a movie as well. Same author.

Matt Scalena: Right on.

Matt Scalena: Second question for you, Tom. What new belief, behavior, or habit since you’ve been on the show have you adopted that’s had a positive impact on your life?

Tom Storey: I’m going to give you the lamest answer you’ve ever had. I’m turning thirty-five in a week, and stretching has become a big part of my life.

Matt Scalena: No, that’s a smart one.

Adam Scalena: I’m turning forty-five in two months. I got… I’m not still, but I hope to be by the time I’m fifty-five, so we’ll see.

Tom Storey: So you’re an active stretcher then?

Matt Scalena: If I could go back, that would be one thing I would probably adopt. I haven’t adopted it yet, but I would.

Adam Scalena: Question number three: what are you binge-watching these days, or a TV or movie recommendation?

Tom Storey: I can’t give the same answer, but you should watch the Project Hail Mary movie as well. What are we binge-watching? I don’t even know if we’ve got a show going on right now. Let me think of it, I’ll come back to that answer.

Matt Scalena: While you’re thinking about that, Tom, when you’re not listening to audiobooks driving around the big smoke, what music are you bumping right now?

Tom Storey: I like anyone like Noah Kahan, Mumford and Sons, that kind of folky music. I’m into that.

Adam Scalena: So he doesn’t have the subwoofer in his vehicle like you do, Matt. Nothing’s bumping, but it’s good stuff. And last but not least, Tom, something you’ve purchased for under, say, five grand recently that has had a positive impact on your life.

Tom Storey: My entire business and all the videos we make are off this laptop, which was fully loaded at the time, this Apple laptop, for four thousand dollars. It doesn’t have to be a Mac computer, it can be any computer that does what you need. Amount of money spent versus output I get from it, it’s not even close. This is the best thing I’ve spent money on.

Adam Scalena: That’s a great one.

Matt Scalena: That is a great one, especially considering we started this with my microphone not working and me explaining that my entire laptop is in Spanish because I bought it in Spain.

Tom Storey: You know what, I’ll give you another one. Having someone build out this studio in my basement to do these videos was probably the best money spent on ROI.

Adam Scalena: And you do everything from your basement then?

Tom Storey: Pretty much. I joke with people that when I started my career I lived in my parents’ basement, and now I make videos but it’s my own basement.

Matt Scalena: Hey, that’s called success, Tom.

Adam Scalena: Yeah, well, we’re still operating out of our parents’ basement. Anyways, we’ll leave it there. Tom, how can people find out more about what you’re up to?

Tom Storey: If you like this kind of stuff and want to listen to a podcast, that’s the Tom Storey Show, Toronto and Vancouver. You can just type my name into YouTube for all the other videos.

Matt Scalena: Right on. Thanks again for your time, Tom. That was, as expected, a great conversation.

Tom Storey: Thanks, guys, that was fun.