Condominiums in the Queen St. East and Mutual St. area in downtown Toronto.Fred Lum/The Globe and Mail
In Toronto and surrounding areas, real estate buyers are unwavering in their determination to carve out a deal.
For Robin Pope, broker with Pope Real Estate, shaky appraisals, lowball offers and deep knowledge of the seller’s financial stake have proved useful tools so far in 2026.
In one case, Mr. Pope accompanied buyers on a tour of eight houses in the affluent town of Oakville, west of Toronto.
One detached five-bedroom home in the south-east stood out. Mr. Pope saw the potential to drive a hard bargain.
The seller was asking $5.6-million for the property, which had been on the market since October.
Mr. Pope learned that the homeowner was living overseas and had never moved in. The house on a half-acre lot had been occupied by tenants for the past 14 years. The seller wanted to simplify his life.
“Hence we sharpened our pencil,” Mr. Pope says.
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He submitted an offer not far above $4-million and the seller responded with a counter-offer.
“He signed back. To me that was a sign he was interested in selling,” says Mr. Pope. “He wasn’t testing the market. If he wasn’t interested in selling, he would have told us to fly a kite.”
The two sides wrangled their way to a deal with the condition that the property pass a home inspection.
The inspection revealed a number of deficiencies, Mr. Pope says, and the buyers were able to secure a substantial abatement.
At the end, they pared nearly $1-million from the asking price.
Another buyer with a budget around the $650,000 mark was interested in purchasing a small two-bedroom condo listed with an asking price of $699,900 in the Leslieville neighbourhood.
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During protracted negotiations, Mr. Pope reminded the unit’s owners that many deals today run into trouble when lenders require an appraisal, and the value comes in below the amount the buyer agreed to pay.
Some stubborn sellers will relent when they consider the prospect of the deal falling through on appraisal, he says.
“How can the buyer move forward if they are told they paid too much?”
Some buyers have enough cash to cover the shortfall, and the lender will approve a mortgage, but not all buyers are able or willing to do so.
In Leslieville, the two sides hammered out a deal at $655,000, with the condition that the buyers be able to secure satisfactory financing.
“If it doesn’t appraise, we will be going back trying to negotiate a better price,” Mr. Pope warned.
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In this case, the appraiser signed off and the deal firmed up.
Mr. Pope sees parallels today to the early 1990s, when he was starting out in the real estate business as the country sank into a deep recession and the late-1980s housing bubble deflated.
One pair of homeowners had purchased a four-bedroom house in Oakville’s upscale Glen Abbey area for $500,000.
When it came time to sell, the couple’s $400,000 mortgage far exceeded the home’s value of $250,000, and they were required to close the gap.
“There were many sellers who had to cut a huge cheque to walk away,” he recalls.
In 2026, people who purchased condo units in the preconstruction phase face closing on completed units which are worth less than they paid five or six years ago.
Some of those buyers no longer qualify for financing with today’s higher interest rates and tighter lending standards. In addition, appraisals are coming in significantly below the purchase price.
People who attempt to walk away may be sued by the builder and forced to cover the shortfall, with legal fees piled on.
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Some buyers try to detect owners who are selling at a loss in the belief that they will be the most desperate.
Mr. Pope would much prefer to negotiate with a seller who will end up with a profit.
In the current environment, most condo owners who bought in preconstruction before 2020 are still above water, he points out. If they sell in 2026, they will receive a reduced payoff compared with a sale within the past five years, but most won’t realize a loss.
An owner who purchased in preconstruction in 2021 or 2022 will certainly be selling at a loss, Mr. Pope points out.
When one set of clients was looking for a condo in midtown, Mr. Pope investigated the clients’ first choice property and determined the seller would be losing money.
“They’re trying to lose as little as possible – and they’re not in tune with the market,” was his assessment.
Mr. Pope launched an offer for the clients’ No. 2 choice because the listing agent indicated the seller was motivated and had a good grasp of current values.
“No. 2 was going to make money – just not as much.”
The 710-square-foot condo near Yonge Street and Eglinton Avenue was listed with an asking price of $678,000.
The clients purchased the two-bedroom, two-bathroom condo with parking for $650,000.
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Toronto has a high level of condo inventory, says Mr. Pope, but the market is not awash in two-bedroom, two-bathroom units in the mid $600,000s.
The downtown area, for example, is packed with towers full of bachelor and one-bedroom units.
“In some neighbourhoods, such as Leslieville, you can count on two hands – maybe three – the number of condos for sale. In some neighbourhoods, there’s a village of hands.”
Mr. Pope says buyers today remain anxious about their job security, the health of the economy, and geopolitical conflict.
“We live in a very volatile world.”
Some aspiring buyers are concerned about the potential for interest rates to rise amidst the current conflagration.
Mortgage broker Victor Tran, a real estate expert for Rates.ca, does not see a rebound for real estate this spring.
Earlier this month, the Bank of Canada announced it will hold its key rate steady at 2.25 per cent.
The hold means some stability for variable rate mortgages, he notes, but fixed mortgage rates have been on the rise recently.
“The current conflict in the Middle East is likely to push fixed mortgage rates higher the longer it goes on,” Mr. Tran says.
He notes that the ongoing affordability crisis is also likely to put downward pressure on activity.
“Prolonged geopolitical and domestic economic uncertainty likely mean another slow spring housing market.”