In time COVID-19 Following the pandemic, the hot housing market saw insane demand for single-family homes and cottages as buyers sought more space away from urban centers. Smaller apartments in downtown Toronto languished in the marketplace.
But in 2021, the situation began to change.
According to the latest figures from the Toronto Regional Real Estate Board (TRREB), condominium sales in the spring quarter were up 155% year-over-year, while the average selling price over the same period was up 10.8%.
“This is largely due to the purchase of a home for the first time. Younger households have been slightly slower to recover or recover from the initial phase of the pandemic, ”Jason Mercer, chief market analyst at TRREB, told Global News.
He says that at the end of 2020, the real estate council conducted a purchase intent survey that showed that 40 percent of respondents who said they would like to buy a home this year will be first-time home buyers.
New entrants to the housing market are only the first part of the condominium return story, analysts say.
Data from the second quarter condominium market survey released on Tuesday shows that the new condominium market in the Greater Toronto area has fully recovered from the lull associated with COVID-19 and has since returned to near-record sales. Urbanation says the so-called “905” neighborhoods outside downtown Toronto continued to be a driving force as developers and buyers shifted to more affordable options.
“Attention has shifted back to the condominium market,” Urbanation President Sean Hildebrand said in a statement emailed to Global News. “Condominiums are seeing an increase in demand as single-family home prices have risen beyond the reach of many buyers, while the resurgent economy is drawing more people to the city.”
Hildebrand says he expects prices to rise in the near future because the number of new condos in the Toronto area is at a three-year low.
Condominium recovery in the Vancouver metro has been more subdued, according to the Greater Vancouver Real Estate Board (REBGV), with apartment sales up 19% in July from a year ago. But condominium prices followed the trend of overall house prices in the region and fell slightly between June and July.
However, new condos are showing signs of recovery. According to real estate research firm MLA Canada, 3,000 apartments were commissioned in June under 20 new projects, which were sold prior to sale, the highest since November 2018.
The cost of condominium insurance has skyrocketed in parts of Canada over the past year. That’s why
Mercer says Toronto condo prices are poised to rise. He expects a larger increase when international borders are fully reopened and federal target immigration, which welcomes more than 400,000 visitors annually between 2021 and 2023, will resume.
“The Greater Toronto area will continue to be Canada’s largest metropolitan beneficiary of this population growth, and all of these people will need housing,” says Mercer.
More careful planning will be required from all levels of government, he says, because housing supply issues, in particular the so-called “missing middle” that existed before the pandemic, have not been addressed.
The American architect Daniel Parolek is credited with coining the term “missing middle” to describe a range of housing types that fall somewhere in density between a detached house and a mid-rise building. In recent decades, such buildings are said to have been absent in major cities, including Toronto and Vancouver.
“If we want to see sustainable affordability in the long term, we need to increase the supply of housing,” says Mercer. “We also need to see greater diversity in the housing supply to better bridge the gap between traditional single-family homes and condominiums.”
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