A record 10,368 new condo units were completed in the GTA in January, or eight times the 10-year average, according to the Bank of Montreal (BMO). In the bank’s recent snapshot of economic trends and events, Senior Economist Sal Guatieri noted that most of the completed units are pre-sold, but this huge increase in supply has boosted the total amount of unsold suites to 1,602, the highest amount in the 21 years.
What’s behind the surge? According to the brief, after experiencing construction delays, builders are now “playing catch up with the record number of multiple-unit dwellings” first started up in 2012. After seeing a record 28,190 condo sales in 2011, builders followed up with 37,406 starts in 2012, a significant surge over the 10-year average of 25,000 (the tally for 2014 was much more in line with the average at 20,099).
Take a look at the chart from BMO demonstrating the dramatic increase:
As far as the market ramifications, Guatieri says price growth for new condos will slow. But as long as demand is strong, they should hold steady.
According to BuzzBuzzHome Market data, Toronto-proper has 37,722 condo units under construction at the time of publication. Mississauga has 2,494 units being built while 2,338 are under construction in Richmond Hill and 2,195 in Markham.