Photo: Paulo O/Flickr
It was a great, though not quite record-breaking year for the GTA new condo market.
There were 25,097 new condo units sold across the region in 2019, the third highest annual total on record, according to data released this week by housing data consultants Urbanation. This total represents growth of 27 percent over the previous year, with a pronounced spike in the final months of the year that nearly broke a new condo sales record for the fourth quarter (it was off by about 700 sales).
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One of the most impressive figures released by Urbanation was the surge in units sold in newly launched condo projects in 2019. There were 18,232 units sold in developments that launched last year, a 17 percent increase over newly launched units sold in 2018.
In a media release, Urbanation President Shaun Hildebrand noted that this is a “good indicator of growth in demand from investors, who tend to be most prevalent within newly launched projects.”
Hildebrand also observed that end-user demand also rose dramatically in 2019, with the strength evident in the number of units sold in projects that had launched in years prior but were still on the market. There were 6,865 units in projects launched before 2019 sold last year, a spike of 70 percent when compared to the previous year.
Unsold new condo inventory in the GTA declined year-over-year to 13,373 in 2019, which according to Urbanation, is below the 10-year average for the region. The firm also noted that new condo inventory fell to 6.4 months of supply, well below the 10-month level which is considered “balanced.” With inventory consistently not meeting buyer demand, prices for available units rose to a record high of $1,073 per square foot. Hildebrand wrote that this means new condo prices have effectively doubled over the last 10 years.
When it comes to trends to watch for 2020, the key data point is how a potentially record-breaking number of condo unit completions will impact the market in the months ahead.
The approximately 29,500 new condo units scheduled for completion in 2020 is twice the number of units completed in 2018, according to Hildebrand. The current record-holder is 2014 with 21,000 completions, so 2020 is expected to top that figure by a considerable margin.
Why are all of these completions hitting at once? Hildebrand wrote that years of low condo unit completions and high construction starts meant that by the end of 2019, there was a record of 78,112 units at various stages of construction across the GTA. Many are set to be completed in 2020.