Some tidbits:

>While the market for condos of all sorts is depressed, it is the smallest condominiums where prices have fallen the farthest and the fastest. And there are few signs that a bottom is in sight.

>When rents were rising, studio apartments were very attractive to investors who wanted to be landlords. But studio rental rates have fallen fast, undermining the logic for investor purchases. According to the Rentals.ca/Urbanation rent report in August, studio rents were down an average of 9.6 per cent (the steepest year-over-year drop among condo apartment types) and are currently sitting at about $1,594 per month across the country.

>Mr. Watt said another part of the studio market has also been disrupted: End-users, or those who actually want a studio apartment for themselves, and not a tenant. Changes to local tax rules, such as the vacant home taxes, has cut demand from those who used to own a studio apartment for occasional use. “I’ve done this for 21 years. In Yaletown, a lot of people would live in Calgary, live in Victoria, and have a studio \[here\]. People would love to fly into Vancouver and have a crash pad. But with all the taxes, it’s cheaper to stay at the Fairmont,” he said.

>That has translated into a frozen market, where so far in the first four months of 2026, not a single studio under 500 square feet has sold in Vancouver, according to Wahi’s data. According to Realtor.ca, there are more than 150 studio condos for sale in the city with prices between $250,000 and $650,000.

>Meanwhile in Toronto, there are more than 1,000 condos under 500 square feet for sale as of September, with prices ranging from $300,000 to $900,000. According to Wahi, in the first four months of 2026 saw only 48 studio units sold in the city, with an average price of $413,135, or $953 per square foot. That is the first time this decade that per-square-foot prices have dropped below $1,000. At the current pace, Toronto will see fewer units sell this year than in 2025, when 299 studios sold for an average sale price of $1,048 per square foot.

>A popular narrative in Toronto’s real estate market is that small “dog-crate” condos are on their face undesirable. But while most Ontario condo builders have backed away from launching new multifamily apartment buildings, Sean Mason, founder of home builder Sean.ca Inc., is preparing to launch sales in Barrie, Ont., at a 134-unit project on 405 Essa Rd., with a thesis that it’s not the size of a condo that matters, but the price.

>“The rest of the world does this. When you go to Europe, they are used to smaller. North Americans are energy pigs, ground pigs, material pigs. We design big, massive stuff,” said Mr. Mason.

>Mr. Mason’s fundamental argument is not about size, it’s about affordability. When he began marketing and collecting information for preregistration interest, he noticed there was a growing pool of thirtysomething first-time buyers who are unable to pull together $500,000 or $700,000 for a townhouse.

The smallest condos are being hit hardest by the market decline