According to the Financial Post, Toronto condo sales have pushed to record highs as buyers increasingly get priced out of detached houses and other low-rise products. The overall increase in the average price for houses and other low-rise options have meant that condos are now the highly more affordable option for investment.
There seems to be a consensus regarding this assertion, as: “The new condo market is experiencing broad-based demand that will carry forward in 2017,” said Shaun Hildebrand, senior vice-president of Urbanation Inc., a research firm. “Buyers, priced out of the low-rise segment, a surge in rental demand and increased attention from investors are placing downward pressure on condo inventories which will support strong price growth this year.”
Matthew Boukall, senior director of residential products with Altus Data solutions noted there has been almost a complete flip from low-rise units to condo units. A decade ago sales were 70 percent low rise to 30 per cent condo and now those numbers are reversed.
The research firm Urbanation Inc. said 27,217 new condo apartment units were sold across the GTA in 2016, a 34 percent increase from 2015 and enough to break the record set in 2011. Urbanation said the record was set with fewer new pre-construction launches — there were 18,466 in 2016 versus 28,204 in 2011 — but the lack of new buildings and strength of demand helped push the unsold inventory levels down.
According to tallies recently reported by the firm, sales of new condo units surged 32 percent in the first quarter of 2016 in the Greater Toronto Area compared with the same period last year.
Also, Toronto Real Estate Board President Larry Cerqua announced that condominium apartment sales reported by Greater Toronto REALTORS® in the fourth quarter of 2016 were up by 22.3 percent year over- year to 6,831.
This trend seems to be continuing in the near future, as Barry Fenton, President of Lanterra Developments, has conveyed to people that there’s going to be a 30-40% increase in average condo values over the next 3-4 years. This means one simple thing, as an investor you cannot afford to miss these gains, and as a new homeowner you cannot afford to wait out the market for that much longer or you could see yourself priced out of both homes and condominiums very quickly.