The latest episode of the Livabl Launch podcast features an interview with Pauline Leirman, vice president, Market Research (ON/QC) for Zonda Urban.
Pauline is a sought-after commentator on the GTA market and is a member of the Urban Land Institute and a former chair of the High-Rise Committee for Bild GTA.
Join Matthew and Pauline for an enlightening conversation about what’s happening in the market, what’s launching now and how on earth we’re going to build 1.5 million homes by 2031.
How have amenity spaces changed over the last 10 years?
“Some of it is pandemic-driven. It’s that emphasis on having complementary and flexible spaces. So, large party rooms that you can use different ways, indoor-outdoor complementary spaces. So, you have an indoor co-working space, you might have an outdoor area, indoor kitchen, outdoor kitchen, indoor fitness area as you would expect, and an outdoor fitness area. All these spaces kind of blend together as well as co-working space. So co-working space is a massive thing.”
How are builders moving inventory in such a tough market?
“It’s not just pricing, it’s also flexibility in terms of down payments. So, deposit structures are much more flexible. There are some places that are hedging on the condition of having easy rentability. But obviously a lot of times these rental guarantees end up being like credits at closing. So, it really is reducing your pricing overall.”
How are we going to build the 1.5 million homes that the Ford government has promised we’ll build by 2031?
“Well, Lego sets maybe. It’s a very ambitious, very tough number to get to. Unless something’s changed on labor and technology, I can’t see us meeting that number. We’re in a, what I would call a mirage.”
“This year into the first half of 2025, we’re going to deliver a lot of the units that were sold anywhere from 2018 all the way up to 2022. Those units are being delivered now. But anything that comes out now […] really, we’re seeing marketing that says we’re not going to be closing before 2028. And big buildings are complex in the city of Toronto. They’re going to take five years to finish, so 2030 is where you’re looking at. But our date for 1.5 million homes is 2031. If we’re going to have a dearth of units that aren’t going to be delivered until the middle of 2025, into 2026 or 27, we’re not going to see a lot of units come to the market.”
Have there been more cancellations in the current market than before?
“No, I would say about the same amount. We had about 500 units cancel in Q4 directly – a couple of products that had been out for a while that came off the market. We had two that were kind of just shelved, so I wouldn’t say they’re cancelled, they’re just recalibrating. One has already come back at a reprice stage. Typically, what happens in a market like this is everyone just holds back. They’re in prep state. They don’t come to the market.”
Is there really an exodus out of Toronto towards Ottawa and Calgary?
“Yeah, there is for both. Calgary has been an interesting one. What I’ve noticed from the marketing side is just the sheer bombardment of getting stuff from brokerages for product in Calgary that’s not just townhouses but ground related. It’s inexpensive out there – you can get a unit for $300,000 and under. So, also rental units and condo apartments. One of the biggest launches was an apartment building in downtown Calgary that brokerages have been pushing through Toronto. And you and I well know that comes down to a couple of key brokers that are working out there who have banked on that exodus.”
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