Toronto region new condo sales in the second quarter sank to the lowest level seen since the Great Recession.
There were 1,385 units sold in the Toronto region between April and June this year, according to new data published today by real estate research firm Urbanation. That’s down 85 percent over the same period in 2019 and rivals the first quarter of 2009 when, at the height of the Great Recession, only 885 units were sold in the region.
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Unlike the Toronto resale housing market, which saw a significant rebound in sales in June, activity in the new home market was severely curtailed by a lack of project launches during what is typically the busiest season for bringing new product to the market.
During the three month period, only six projects and 1,176 units were launched, said Urbanation. This pales in comparison to the 40 projects and 11,415 units brought to market during the same time in 2019.
But, despite the spectacular drop in sales volume, prices remained on an upward trajectory. Average selling prices for units that were being actively marketed across the Toronto region during the quarter saw an 8 percent increase from the previous year to $867 per square foot. This also represents a three dollar bump from the previous quarter.
Pricing for the relatively few units launched in the second quarter also saw an increase when the location of the launches is taken into account.
“Selling prices within new project launches in the second quarter were notably higher than projects launched in the same submarkets since the second half of 2019, setting new highs for their respective market areas in most cases,” wrote Urbanation in a press release.
However, while he acknowledged the second quarter performance was strong considering the broader environment, the firm’s president, Shaun Hildebrand, believes all eyes should be on the second half of the year to determine the true fundamental health of the market.
“The GTA condo market showed resiliency in the second quarter, albeit with much lower than normal activity,” said Hildebrand.
“More telling will be the second half of 2020, which will see supply pick up from growth in new launches and the nearly 14,000 units that are scheduled for completion in the next six months,” he continued.