To get some perspective on these viewpoints, Urbanation asked their clients and a selection of real estate savants (lenders, brokers, and developers) what they thought about city condos in December 2012. The results of the questionnaire reveal the concerns and predictions of those in the know.
Some highlights from the survey:
The next big thing
- Forget downtown mega-towers and skyscrapers: 53 per cent of respondents believe six to eight storey condos along the city’s avenues represent the next big opportunity. Coming in second was high-rise construction in suburbs such as Mississauga, Vaughan, Richmond Hill and Markham. About 20 per cent of those surveyed thought this was the next market frontier.
The biggest (short-term) worry
- When asked what was causing them the greatest amount of trepidation for the near future of the condo market, 34 per cent signaled a flattening out of prices. The other main concern at 18 per cent was construction financing becoming more expensive and harder to obtain.
The biggest (long-term) worry
- About 37 per cent of experts felt that the biggest, long-term issue facing the market was income. End users aren’t seeing their salaries rise in step with the index price growth. This was followed by nearly 23 per cent feeling concerned about an unbalanced supply of smaller suites catering to investors instead of more move-up buyers or families.
- Exact numbers about investors are hard to come by and at this point, it’s still anyone’s guess. Last year, more experts seemed to be sure that investors had a bigger piece of the market pie. In the 2011 survey, the largest group of respondents pegged investors as making up a whopping 61 to 80 per cent of the market. That’s changed. Now, only 25 per cent think that many investors are involved. Most people surveyed believe investors represent 45 to 60 per cent of buyers.
Blame the Media
- It looks like the real estate industry doesn’t have much love for the fourth estate. When asked whether they believed the media’s coverage of the market was fair, nearly 91 per cent of respondents thought reporters sensationalized real estate stories and or skewed their coverage to the negative to attract more readers.
The Big Picture
- Moving into 2013, 53 per cent of those surveyed thought the city is headed for an average sales year, based on the five-year data (17,500 to 20,000 sales). Roughly 42 per cent thought sales would dip below average to 14,000 to 17,500 sales.
For more information on the Urbanation survey and the complete tallies from both the 2012 and 2011 surveys, click here.