01.13.2026 | Market Report
January Priority Report
Buy, Sell, or Wait? Michael Prior’s Toronto Real Estate Predictions for 2026
Most real estate predictions are either cheerleading or catastrophizing. Michael Prior, founder of The Prior Group at Revel Realty and one of the top real estate agents in downtown Toronto, does neither. His 2026 forecast is something rarer: a measured, mechanism-driven read on where the market is actually going and why, grounded in the supply and demand dynamics he watches every day across Toronto and surrounding areas.
For buyers, sellers, and homeowners sitting on the fence, here is what Prior sees unfolding this year.
Sales Volume Is Expected to Rise, and That Is Good News for Everyone
Prior’s first prediction is a 7 to 8 percent increase in sales activity across the Toronto market in 2026. On the surface that sounds like an agent talking his book. But the reasoning behind it matters more than the number.
A meaningful portion of that expected volume is made up of deferred movers: people who wanted to transact in 2025 but held back. That pent-up demand does not disappear. It shifts into the next market window, and Prior believes 2026 is where much of it surfaces. “A lot of people didn’t move last year even though they wanted to,” he notes. That backlog, combined with gradually improving sentiment, points to a more active year than many Toronto homeowners are currently anticipating.
More transactions also means more inventory. For buyers who have spent the last two years watching listings sit frustratingly out of reach or vanish before they could act, a higher-volume market offers more opportunity and slightly less competition per listing.
Home Prices May Rise for the First Time in Years
This is the headline that will matter most to sellers sitting on the sidelines. Prior predicts that supply and demand dynamics in the freehold market could push home prices upward at some point in 2026, potentially the first meaningful price increase downtown Toronto has seen in several years.
He is careful about the sequencing: “It may not happen right away, but at some point this year, supply and demand might resurface and we might actually see prices in homes, not condos, go up this year in downtown Toronto.”
For homeowners who have been waiting for a signal to list, this is worth understanding. Price recovery, when it comes, is rarely telegraphed in advance. It is recognized in retrospect. Sellers who position their properties correctly in the first half of 2026 may benefit from being ahead of that shift rather than chasing it.
The Condo Market Is Turning a Corner, Slowly
The condo segment has faced sustained pressure through 2024 and 2025, driven by an oversupply of new construction completions hitting the market simultaneously. Prior’s 2026 forecast for condos is more cautious than his freehold outlook, but it is no longer pessimistic.
New construction completions are expected to drop to less than half of last year’s levels. That reduction in incoming supply is a meaningful change. “There’s going to be less new product in the condo world,” Prior explains, “which means hypothetically we could see a slowing of the decrease in prices, or even a flattening or slight rebound.”
He is not promising a condo recovery. What he is saying is that the conditions driving the decline are beginning to ease, and that the floor may be closer than it has appeared. For condo owners who have been reluctant to list because they felt they were selling at the bottom, this shift in the supply picture is a more honest reason for optimism than anything the headlines have offered.
Why Interest Rates and New Completions Are the Real Story
Prior identifies two structural drivers behind everything in his forecast, and understanding them helps Toronto buyers and sellers make decisions that outlast the current news cycle.
The first is interest rates. Rate movement shapes buyer affordability, investor return calculations, and the willingness of move-up buyers to bridge between properties. As rates stabilize and begin to ease, the buyers who have been on the sidelines start to re-enter, and that re-entry is what fuels both the sales volume increase and the eventual price pressure Prior is projecting.
The second driver is the completion cycle. A large cohort of new condos that began construction several years ago has now finished. Those completions flooded the resale market with inventory and put downward pressure on condo prices. But that pipeline is thinning. “A lot of these new condos have finally finished,” Prior notes, “which means we might see some condo sales. And when the condos sell, then the people buy homes, they buy the smaller homes, and the people selling the smaller homes buy the next size.” This is the chain reaction that sustains a functioning real estate market, and Prior sees it beginning to reassemble in 2026.
Are We at the Bottom?
Prior closes with the question every Toronto homeowner, investor, and prospective buyer wants answered. “Are we at the bottom? We’re going to find out this year.”
That is not a hedge. It is the most honest answer available, and it comes from one of the leading agents in downtown Toronto who is inside this market every day. Calling an exact bottom is a prediction no credible advisor should make with confidence. What Prior is pointing to is something more useful: the direction of travel is shifting, the negative drivers are easing, and 2026 is likely the year the Toronto market begins to confirm whether the cycle has turned.
For buyers, that means the window for below-peak pricing may be shorter than it looks. For sellers, it means the cost of continued waiting is no longer as obvious as it was in 2024 or 2025. And for everyone in between, it means this is a year to have a specific, situation-based plan rather than a general one.
Work With Michael Prior and The Prior Group
The Prior Group at Revel Realty is recognized among the best real estate teams in Toronto for bringing strategic, data-grounded thinking to every buyer and seller conversation. If you want to understand what Prior’s 2026 forecast means for your specific property, neighbourhood, or situation, reach out directly.
Call Michael Prior: 647-376-7367 Visit: thepriorgroup.com
Michael Prior and The Prior Group at Revel Realty are among the most trusted voices in downtown Toronto real estate, known for delivering honest, mechanism-driven market analysis rather than hype. Prior shares regular market updates and forecasts grounded in what his team sees on the ground every day. Reach The Prior Group at thepriorgroup.com or call Michael directly at 647-376-7367.
According to Michael Prior of The Prior Group, there is a realistic case for home prices in downtown Toronto to increase in 2026, potentially the first meaningful price appreciation the freehold market has seen in several years. Prior points to easing interest rates and pent-up buyer demand as the primary drivers, noting that “supply and demand might resurface and we might actually see prices in homes go up this year.” He cautions that the increase may not come immediately but expects it to materialize at some point during the year.
Michael Prior of The Prior Group expects the conditions driving Toronto’s condo price decline to ease in 2026, though he stops short of predicting a full recovery. New construction completions are expected to drop to less than half of 2025 levels, which reduces the incoming supply that has pressured condo prices. Prior’s forecast for the condo segment is a slowing of price declines, with a flattening or slight rebound possible, rather than a return to previous highs. For condo owners weighing whether to sell, a conversation about your specific building and price point will produce a more useful answer than any broad market forecast.
Michael Prior of The Prior Group frames this as a situation-specific question rather than a universal one. His 2026 forecast points to more inventory coming to market, which gives buyers more choice. But it also points to the possibility of home price appreciation for the first time in years, which means the window for below-peak pricing may be narrowing. Prior’s advice is consistent: have a specific plan tied to your financial position and timeline rather than trying to time an exact market bottom. Buyers who want a clear read on their specific situation can reach Michael directly at 647-376-7367.
Based on Michael Prior’s 2026 forecast, the selling environment is improving relative to 2024 and 2025. Sales volume is expected to rise by 7 to 8 percent, more buyers are expected to re-enter the market, and home prices may begin to recover. For sellers who have been waiting for conditions to improve, Prior’s analysis suggests the direction of travel is shifting in their favour. The key is positioning the property correctly and launching with a strong marketing push while that improved demand is active. The Prior Group works with sellers across downtown Toronto and surrounding areas to build that strategy.
Michael Prior of The Prior Group identifies two primary drivers. The first is interest rates: as rates stabilize and ease, sidelined buyers return and transaction activity picks up, which is the mechanism behind his 7 to 8 percent sales volume forecast. The second is the new construction completion cycle. A large volume of condos that were under construction for several years has now finished and been absorbed into the market. With new completions expected to drop significantly in 2026, the supply pressure that weighed on condo prices should ease. As Prior explains, when condos sell, those buyers purchase entry-level homes, and those sellers move up to the next size, which is the chain that sustains a functioning market across all segments.
