Comparing New Construction Homes in Toronto and Calgary

New construction is usually sold as the low-surprise option. A buyer picks finishes, waits for possession and takes on a house nobody has lived in. In Toronto that description stopped matching reality around 2024, and the two cities now offer such different versions of the same purchase that comparing them on price per square foot misses almost everything that matters. One market is building at a record pace. The other has almost stopped launching anything new.

The Toronto Condo Freeze

Greater Toronto and Hamilton recorded 1,599 new condominium sales across all of 2025, down 60% from the year before and the weakest annual total since 1991. The first quarter of 2026 produced 246 sales, a 35-year low, and no developer launched a single project during the quarter. That had not happened in at least 30 years.

Starts and Unsold Inventory

Construction followed sales down. Condominium starts fell 63% in 2025 to 3,272 units, and the inventory under construction reached a 10-year low. At the same time, completed and unsold units hit a record 4,295 in the first quarter of 2026, roughly double the level a year earlier. A buyer looking at new construction in Toronto is mostly looking at finished units a developer already failed to sell. The pipeline behind those units is thin enough that Urbanation has warned of quarters later this decade with no condominium completions at all in the region, which changes what a resale buyer 5 years out will be competing against.

Finished Homes and Pre-Construction Units

A completed spec home and a pre-construction unit are two different purchases on the same street. The first has a firm closing date. The second has an estimated occupancy that can move by a year or more, and a deposit schedule that ties up cash before anything exists.

Anyone buying a home in Calgary can still choose between the two, because output has been high enough that finished product is available alongside pre-sales. That choice narrowed in Toronto once launches stopped.

Development Charges and the Cost of a Toronto Unit

Municipal fees explain much of the price difference between the two cities, and Toronto has spent the past 2 years trying to bring its own down. The city froze indexing at 2024 levels for 2025 and 2026, cancelled a conditional permit policy and exempted developments of up to 6 units.

The larger move came in June 2026, when Toronto secured up to $1.5 billion from Ottawa and Queen’s Park in exchange for cutting residential development charges by 40% to 60% between 2026 and 2029. The province put the effect at roughly $83,000 off the cost of building a new single or semi-detached home, and the city estimates $1.95 billion in relief for builders against a target of 44,000 additional units. Calgary levies its own off-site charges, and they have never approached that scale, which is a large part of why an equivalent Alberta lot costs a builder less before a shovel goes in the ground.

Calgary Output and the Slowdown That Followed

Calgary spent 2025 doing what Toronto could not. The city granted occupancy to 27,952 homes, more than double its 10-year average and the highest count on its books, while Alberta passed 53,000 starts for the first time. A record build of that size arrived alongside slowing migration, and the result is a market with real inventory and buyers who can negotiate.

The pace is coming off in 2026. Ground-oriented starts are forecast to decline slightly and apartment starts a little more, with total activity levelling out above 20,000 units for the year. Builders have roughly 26,000 units in progress. That combination is useful to a purchaser, since it leaves enough supply to compare several similar homes in the same quadrant and enough builder caution that incentives are back on the table.

Warranty Coverage and Cancellation Risk

Both provinces require warranty coverage on a new home, and the mechanics differ enough to matter at the inspection stage. Alberta has mandated coverage under the New Home Buyer Protection Act since 2014, with a standard structure of 1 year on materials and labour, 2 years on delivery and distribution systems, 5 years on the building envelope and 10 years on structure. Ontario runs its own program through Tarion under a separate regulator that licenses builders and handles complaints.

The practical difference is age of the stock. A 2026 Calgary purchase is often a house completed inside the last 12 months by a builder still actively selling, which keeps the warranty relationship live. A Toronto standing unit may have been completed in 2024 by a developer with no remaining projects in the city, and a warranty claim against a company that has wound down its local operations is slower to resolve.

The sharpest difference between the two markets is what happens to a signed contract. Toronto recorded 28 condominium project cancellations in 2025, covering 7,243 units, more than double the 2024 figure and above the previous record set in 2018. A cancelled project returns the deposit, sometimes with interest, and returns it into a market where prices have moved since the contract was signed. The condo sales collapse and the cancellation record are two measures of the same problem.

Price protection is the other exposure. Toronto developers have begun cutting asking prices on unsold units, and some buyers who signed in 2022 are closing on units now worth less than their contract price, with lenders appraising against current value rather than the old agreement. Calgary pre-sales hold the same structural risk, though a market where finished product is still moving gives a buyer somewhere to go if a project stalls.

Deposit Risk in Calgary and Toronto

In Calgary, new construction in 2026 means a real choice between finished and pre-sold homes, a builder with reason to negotiate, and a completion date with a reasonable chance of holding. In Toronto it means picking through standing inventory at cut asking prices while a developer shakeout works through the industry behind it. Both are legitimate purchases. They hold opposite risks, and the buyer who treats them as one product because both are new will price the Toronto risk at zero and get it wrong. Ask what happens to the deposit if the project dies, and ask it before the offer, in whichever city.

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