As per experts, Toronto’s red-hot condominium market may witness varying levels of moderation in 2019. 2018 was widely perceived as the year with a pronounced condominium boom in Toronto and prices of these units have been on the upswing for the last 3 years or so. Demand was automatically higher for condominiums due to several cooling measures in the market including stringent mortgage stress tests and higher rates of interest. Condos were the first choice for several first-home buyers and also the overall workforce that has been increasing in downtown Toronto and several 905-zone municipalities as per reports.
Prices of new construction condos (inclusive of stacked town houses) increased by a whopping 12% on a year-on-year basis to stand at $768, 602. Resale condominiums had an average price point of $595, 678 which indicates an increase of 7.5% in the same duration as per TREB and the Building and Land Development Association. However, signs of moderation may be seen in the condo segment this year according to several experts. A record phase of completion of condominium units all throughout Toronto will soon begin and this will naturally lead to supply levels going up exponentially in this category, thereby leading to slower increases in prices and rentals alike.
Prices will still increase more than 5% in this category for H1 2019 as predicted although they may be lower in the second half with more supply. However, buyers will benefit from a market which is more balanced and stable as per experts. Growth of 5-8% is expected in the condo segment in 2019 and the balance in the market in terms of pricing will attract more buyers and drive higher sales volumes in turn. The best-selling condo units in Toronto are the ones priced lower than $800, 000. There are several unique projects being built in Toronto and these are set to be completed this year. Rentals will also be kept limited to levels that are more sustainable by the influx of new condo supply. Some experts predict more traction for this segment in areas like Etobicoke and Scarborough where prices of condos are slightly more affordable as compared to downtown Toronto.
In the last three years, 150, 000 condominium units have been sold in the city while 120, 000 condo units are in the development stage. 5.2 months’ worth of new condominium inventory is currently available for sale in the entire Toronto with the average annual income required for buying a condo standing at $125, 000. Naturally it is clear that this is the major growth driver for the Toronto real estate market and one that will keep growing albeit in a more balanced manner this year. Some of the most popular condo projects in Toronto include 8 Elm Street, Queen & Sherbourne and Sugar Wharf Condos to name only a few.