Photo: James Bombales
September was a strong month for the GTA new condo market, thanks to a surge of buyer interest, according to the latest release from the Building Industry and Land Development Association (BILD).
There were 1,747 new homes sold last month, up from August’s 974, with 1,494 new condos sold. Meanwhile, in keeping with the ongoing trend of month-over-month sales gains and year-over-year sales declines, sales were down 20 percent for September 2017. It was also a busy month for project launches, with 10 condos and seven single-family home developments opening, up from August’s two.
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“It appears more buyers — and builders — are starting to come in from the sidelines,” writes Patricia Arsenault, executive VP of data solutions for Altus Group, BILD’s source for new home information. “The increase from August in both new condominium apartment sales and the number of units in new projects launched was somewhat stronger than the typical September bump alone would suggest.”
As demand for units rose, so did prices. The benchmark price for a new condo jumped a whopping 19.4 percent year-over-year to $789,643 last month. There are currently 8,820 condo units on the market, representing 5 months worth of inventory. According to BILD, a healthy new home market should have nine to 12 months of supply.
“In the lead-up to the municipal elections, BILD succeeded in raising housing supply and affordability as major election issues,” writes David Wilkes, president & CEO of BILD, in a statement. “Some straightforward steps include making sure that government charges on new homes are fair, funding and building critical infrastructure, cutting red tape and speeding up building permits and inspections.”
The relative strength of the new condo market is echoed by the sales of luxury condos over the past year. Condos in the $1-2 million range saw a 2 percent sales bump in 2018, while prices soared. The most expensive condo sold in Toronto in 2018 so far went for $11.5 million, up from $8 million in 2017.
“Many Canadian Baby Boomers saw the strength of the real estate market over the past two years as an opportunity to cash-in, downsize and upgrade into the luxury market for retirement,” writes Christopher Alexander, executive VP of the RE/MAX INTEGRA Ontario-Atlantic Canada region, in a recent data release. “We’re also seeing an emerging trend of Millennials entering the lower end of the luxury condo market, as they tap into their inheritance to invest in this popular property segment.”