Last Updated on October 24, 2023 by Ephraim Vecina
Several pressures have led Toronto’s condo market to a hotbed of volatility, if new data from the Altus Group is any indication.
Transactions in the asset class fell by 38% year-over-year to reach 21,330 sales. Although the total number was only 4% below the 10-year average, another report by Urbanation pointed to more potential issues ahead, with supply-side problems taking center stage.
“The slowdown in activity last year can partly be attributed to less demand from investors, who typically represent the largest component of new condominium purchasers [in Toronto],” Urbanation noted.
The market insights firm emphasized that competition for condos will be intense, as 98% of new units are already pre-sold, and more than half of the new supply has been purchased for investment purposes.
Urbanation stated that the total number of condos scheduled for completion this year is 21,991 units, representing a record high. This will also be 29% greater than 2018’s completions.
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Toronto’s single-family properties, on the other hand, experienced a significant 50% year-over-year fall in sales activity, down to 3,831 transactions – fully 74% lower than the 10-year average.
“Real estate investment in general had a bit of a quieter year after an exceptional 2017,” Altus vice president (data solutions) Matthew Boukall said, but added that the firm is expecting “the downturn will be short-lived, with the rebound in homebuying intentions, the pause in interest rate increases and continued interest in commercial real estate as an investment asset class.”
Ephraim is currently a journalist at Mortgage Broker News, Real Estate Professional and Canadian Real Estate Wealth.
Ephraim is a highly accomplished news reporter whose work has been published across North America and the Asia Pacific region. Before joining Key Media, Ephraim spent eight years working as a journalist with Reuters TV. His areas of expertise include real estate, mortgage, and finance.
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