Toronto Micro Condos Are Depreciating Twice as fast as Larger Units

Smaller Toronto condos are getting much cheaper.

By Josh Sherman | 3 minute read

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In the Greater Toronto Area’s currently unforgiving condo market, the smallest units are experiencing the largest price drops.

So suggests new analysis from RPS-Wahi that digs into the per-square-foot appraised values of GTA and Greater Vancouver condos over the past five years. For the analysis, which is based on RPS data, condos were broken into five size categories, from under-500-square-feet micro condos to units in excess of 1,200 square feet. 

By a large margin, Toronto’s micro condos have consistently seen the strongest depreciation in recent years. Declines in 2025, when these units lost an average of $152 per square foot in value year-on-year, reached the highest point of the five-year period.

Smaller condo values became a bellwether for a wider market correction. Values began dropping on a year-over-year basis for the smallest units, in 2023, before declines became more widespread. Until this year, which includes the first four months, the largest units (+1,200 psf.) had still been increasing in value on a year-over-year basis.

“Without investor demand to support the market, condos have become a tougher sell across the GTA, particularly for the smallest units,” says RPS-Wahi Economist Ryan Mclaughlin.

“We know from our own research that most Canadians ideally want at least three bedrooms in a home, so micro units with one — or in many cases, zero — bedrooms have much more limited appeal for end users. Add to that the fact that there are so many deals on the condo market right now, and buyers who are still active have the opportunity to purchase larger units than they may have been able to afford previously.”

In July, condo prices were bid down in 98% of neighbourhoods in the GTA where at least five units changed hands. While both the single-family home and condo segments, respectively, have experienced reduced demand (92% of neighbourhoods were in underbidding territory for single-family homes), the latter has been especially sensitive to the exodus of investors.

Prior to the pandemic pricing peak — which saw a surge of new condos launch — purpose-built rental construction had been lagging for decades. The condo market had effectively become a secondary rental market, with investors purchasing smaller high-rise units to lease out. This supported a significant level of activity, but when interest rates began climbing, in early 2022, and the investment math no longer added up, the market was left with a glut of investor-friendly units and nobody to buy them.

Interestly, in Vancouver, which has reportedly seen more end user demand post-pandemic — and was less investor-dependent than — Toronto, values of smaller units remained above water until 2025. But here, too, micro condos strongly depreciated on a year-over-year basis more recently.

Other key findings:

• Between 2020 and 2025, average square foot values of GTA condos sized less than 500 square feet plunged 12.2%, followed by units between 500 and 700 square feet, which were down 6.2%.

• Over the same period in Vancouver, micro condos were up marginally (+4.9%), while 500-700-square-foot units appreciated substantially (+19.4%).

• Despite recent annual depreciation across all asset types in both cities, with the exception of all but the smallest condos in Toronto, appraised values stand higher than five years ago.