Real Estate Cheat Sheet: condo sales are down (but one section of the market is thriving)
In the debate over whether Toronto’s condo market is headed for a collapse, expert opinions range from gloomy to chipper. The latest stats from Urbanation score another point for the pessimists, suggesting Toronto’s love affair with condos—at least with the brand new ones being flogged in sales centres—is starting to cool.
• Out with the new…
Sales of new condos were way, way up in the first quarter of the year (reaching a record high of 6,070 sales), but slowed significantly—by 21 per cent—from April to June. Comparing those second quarter numbers to the same period last year, new condo sales were down a staggering 50 per cent.
• …and in with the old
Resale condos, however, were doing pretty well. There were 5,050 condo resales in the second quarter, 30 per cent more than in the first three months of the year, and nine per cent more than the same time last year. Urbanation’s Ben Myers suggested buyers are looking to the resale market because they’re turned off by the small sizes of new suites (they are, on average, 159 square feet smaller than resale condos).
• There are far too many condos up for sale
A whopping 18,123 condos went unsold in the second quarter—a new high. And the city’s absorption rate (which compares the supply of new condos built to the number sold) hit its lowest point since the uneasy days of late 2008.
• Developers continue to build, build, build
Construction on new condo buildings hasn’t slowed at all, which, in light of those 18,000 unsold condos, may be cause for concern. In fact, 7,343 units started construction in the second quarter, which is the highest level in over a year. Altogether, there are 13,000 condos scheduled for completion by the end of 2012.
• Reversal of strong markets from Q1-2012, when new was hot and resale not [Urbanation]
• Summer chill cools Toronto, Vancouver property markets [Globe and Mail]
• Toronto condo market loses steam [CBC News]