It seems this year, more so than in the past three or four years, people are more concerned than ever about our city’s condo market, while at the same time more eager than ever to delve into it. I’m sure that everyone from your best friend, to your neighbour, to your boss, to your dog walker has given you their opinion on the market. If you’re anything like most of my friends and clients you’ve heard a lot of different stories out there.
Here are a few hard facts that may be of interest to you. Last month a total of 8,762 resale homes were sold in the GTA. Last year’s record high was 9,452. One of the major contributing factors was the dramatic decline in the 416 area, which is a direct result of the new Toronto Land Transfer Tax. The 416 area dropped more than double the rest of the GTA. As important as it is to be aware of the change, it’s more important to understand why. The fact itself can be regurgitated at will but the “why” is what gives you knowledge and eventually wisdom. Understanding the “why” behind the change in these numbers means better assessing between a market adjustment and a market crash.
Before we assess, here’s another fact. The average sale price in the Greater Toronto Area, for April, was $398,687. This number was actually a 5 per cent increase from last year’s record April. Even in tax stricken 416 the average price rose 6 per cent to $446,781.
Of course these numbers include both houses as well as condos and that brings us to the real focus of this article — assessing the condo market.
First, the hard condo specific facts. The number of actual condo sales downtown Toronto has decreased by approximately 200, from about 1,200 last year to 1,000 this year. This time last year the average sale price of a downtown condo was $326,175. This year that number is $363,673.
The assessment means deciphering why such a reality exists. One assessment reveals that the driving reasons behind this phenomenon is the number of brand new condos bought from builders last year (not counted in these resale stats), which have made their way on to the resale market this year and successfully, it seems, judging by the jump in average sale price. That’s the “why” behind the numbers.
The point is that if there’s one thing these numbers show it’s that the condo market, in terms of an investment at the very least, continues to be a successful one. While it may not be for everyone, it has not left its investors disappointed, and shows no signs of doing so at this time. Keep in mind that this dramatic price increase has occurred while the ink on the new Toronto tax remains wet.
Condo builders are aware of the market in infinitely more detail than most. It is no surprise therefore that Tridel plans to release North York’s most anticipated new development The Hullmark Centre, soon.
I have been keeping up to speed on this development and can say that North York’s skyline and general ambiance will dramatically change in the name of increased style and class, once The Hullmark Centre takes form.
In the meantime, remember what Neo was trying to achieve in the Matrix — every time you hear a so called fact, remember to try and enlighten yourself on the “why” behind it. Happy Hunting!
For any questions/comments on this article or anything in general please feel free to e-mail Amit at amitp@rogers.com. Amit is a Realtor/Developer with Re/Max.
