Austin Birch survey reveals upbeat real estate outlook
Toronto’s top real estate advisors provide powerful insights for those considering new-development real estate in the GTA
In these uncertain times, discerning what the coming year holds for new-development real estate in the GTA may seem like gazing into a crystal ball. There are mixed messages abound, and for key decision makers in the high-velocity world of urban real estate, the future can look hazy.
To help clarify what’s to come for 2021 and inspire incisive decisions based on accurate forecasts, Austin Birch — Toronto’s top real estate advisors — tapped into their immense network of elite realtors. More than 3,000 of the GTA’s top-performing preconstruction condominium and new-home brokers were surveyed about their expectations for this year’s real estate market. These experts, with unique frontline insight into changing customer needs, provided answers that enable the real estate industry to see a clear path ahead for the spring 2021 market.
The results of the survey are intriguing and informative, and you can read all about it simply by signing up at austinbirch.com for the Spring Edition of The Austin Birch Report. To whet your appetite, here is a preview of some of the most compelling findings from the survey:
Most telling was that many of the definitive insights gleaned from the survey contradict some currently held popular viewpoints, such as predictions that condominiums will lose their appeal in the near future. As well, most respondents expressed a belief that home prices will remain steady or increase, and therefore remain a robust investment.
This means the current narrative that condo pricing is or will be declining — and subsequent logic to wait to purchase — should be reconsidered. There is no “COVID pricing.” In fact, most respondents believe condo prices will increase 3 to 5 per cent in the next 6 months. With current low interest rates, this may be a prime opportunity to purchase a pre-construction condo.
Another fascinating piece of news emerging from the survey is that there is a definite shift in demand away from the core of the 416 and into the further reaches of the 905. More than 50 per cent of respondents said they believe the strongest investment opportunities right now are resale condos and new singles and towns in the 905 market. This is a marked departure from the pre-pandemic era when investment focus centred on the core of downtown Toronto.
Survey respondents also unanimously agreed that new single detached/townhome pricing will remain flat or increase by 5 to 10 per cent in the next 6 months. Homeowner desire for more space and with a greater focus on the home at large is uncontested. Along with a shift in demand from the 416 to the 905 with the new reality of work-from-home, the spring market demand for new singles and towns looks strong.
Split across the board, industry experts believe the strongest factors needed to stimulate consumer confidence are increased immigration, low interest rates and herd immunity. The good news story is that all three of these factors are reflected in current public policy.
As for how purchasers’ needs and priorities are changing in today’s environment, they are looking for more space to allow for a home office or outdoor living in the post-pandemic era. Developers will need to account for this change in customer appetite when planning amenities and suites.
Realtors said the biggest objections to purchasing a pre-construction condo they’ve encountered are negative cash flow for investors (rents less than carrying cost); reconciling resale (cheaper) vs. preconstruction; and negative perception of condos due to media headlines.
To get ahead of these objectives, realtors need to partner with a dedicated sales and marketing team with deep relationships with the brokerage community and uncommon knowledge of market insight, to devise razor-sharp strategy and positioning. With the market changing so quickly in unpredictable ways, Austin Birch believes it’s necessary to dig beneath the headlines and listen to those who have boots on the ground to understand what’s happening in the pre-construction market.
The survey results are a strong foundation to inform builders, developers, realtors and potential purchasers of what may be in store for the 2021 spring market.
Austin Birch’s mission is to enable their clients to what they do best: develop superb real estate. Austin Birch handles the rest, with a hands-on approach that encompasses the entire sales and marketing process. Austin Birch understands how crucial a custom strategy is to success and therefore has developed a highly attuned methodology that guides clients through every step of the process with precision. For development sales and marketing in Toronto and the GTA, Austin Birch is your ideal strategic partner.
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Discover powerful insights on the spring new development market from Austin Birch. Sign up at www.austinbirch.com for The Austin Birch Report, a seasonal outlook on the Greater Toronto market.