The Canada Mortgage and Housing Corporation (CMHC) has released its Housing Market Insight Report for the Greater Toronto Area. The primary finding of the report is that the risks in condo building in Toronto seem to have been mitigated.
“Condo building activity in Toronto seems to be well-managed,” said Dana Senagama, principal, market analysis for the GTA. In spite of this encouraging information, future inventory management will be critical.”
According to the report, more than three-quarters (79%) of condo projects in the Greater Toronto Area didn’t start construction until they reached a pre-sales threshold of 70 per cent sold, and the majority of the other projects are smaller, or later phases of other developments.
Most of the unsold inventory in the GTA is in Markham or in Toronto Centre, where the condominium markets are the most active.
Read the full report here.
A new report from condo statistics firm Urbanation reveals that the average cost of renting a condo in Toronto has increased during the first quarter of 2016 compared to the same time last year.
During the first three months of the year, the average rent was $1,891 per month, which breaks down to $2.53 per square foot. Year over year, that’s a 6.8 per cent increase. The first quarter of 2016 saw the highest number of rental transactions and the highest dollar amount per square foot for Toronto condos since the first quarter of 2012.
Both the cost of rent and the number of rental transactions have been increasing significantly over the past few years, and there were 40 per cent more applications to build rental buildings during the first quarter.
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The number of condominiums being rented in Toronto increased by 22.6 per cent in the third quarter of 2015 over the same time last year according to the Toronto Real Estate Board, which is good news for condo investors: Demand is high.
“Investor-owned condominium apartments remained a very popular option in the third quarter and, indeed, over the past year as well,” said the president of the Toronto Real Estate Board, Mark McLean, in a press release. “Strong growth in rental listings were matched by strong growth rental transactions. This tells us that there are a lot of households looking to rent in the Greater Toronto Area and that many of these renters are choosing units in recently completed condominium apartment projects.”
In addition to an increase in the number of condos being rented, the average rental prices are also up. One bedroom condo rents were up by 1.9 per cent to $1,657, and two bedroom condo rents were up by 2.2 per cent to $2,241.
The director of market analysis for the Toronto Real Estate Board, Jason Mercer, said that, “There was enough competition between renters in the third quarter to prompt moderate growth in average rents. Furthermore, rental market conditions through the first three quarters of 2015 suggest that condo rental vacancy rates have remained low from a historic perspective. With this in mind, it is reasonable to assume that positive average rent growth will be sustained through to the end of the year and into 2016.”
According to the 2015 Q1 Resale Condominium figures report from the Toronto Real Estate Board, condominium sales increased by 11 per cent compared to the same time last year, for 4,940 total sales up from 4,447.
The average price for a condo in Toronto was $363,973, up 3.5 per cent compared to last year’s selling average of $351,452.
“Despite very strong condominium apartment completions over the last two years, we have not experienced a glut in inventory,” said Jason Mercer, the Toronto Real Estate Board’s Director of Market Analysis. “The number of buyers has more than kept up with the number of units available for sale. This is why we continued to experience above-inflation average price growth in the condo segment.”
The Canada Mortgage and Housing Corporation has said in its latest rental-market survey that Toronto has the highest number of foreign investor-owned condos in Canada, but that the number is quite small – 2.4 per cent, with Vancouver coming in second at 2.3 per cent.
Other highlights from the report include:
- The average age of a first-time homebuyer in the GTA is 37.
- The average rent for a two-bedroom condo downtown is $2,285
- The average rent for a two-bedroom apartment is $1,238
- The average rent increase for a condo downtown is 8%
- The average rent increase for a condo in the GTA is 4.4%
The Toronto Real Estate Board has released its rental market figures report for the second quarter of 2014, finding that there was an increase of 25.7 per cent in rental transactions during this time compared to the same time last year, for a total of 7,342 transactions. Listings were also up.
“Condominium apartments rented out by investors represent an important component of the overall rental pool in the Greater Toronto Area,” said Toronto Real Estate Board President Paul Etherington. “These units account for the majority of newly completed apartments listed for rent in the marketplace today. Renters looking for apartments located in popular neighborhoods with up-to-date designs and modern finishes are increasingly renting investor-owned units. This is why the number of rental transactions continued to increase last quarter.”
The average rents for one-bedroom apartments dropped slightly to $1,583, while two-bedroom rents decreased to $2,142.
“Last quarter we saw stronger growth in the number of units rented relative to the number of units listed. This suggests that competition between renters increased,” said the Senior Manager of Market Analysis for the Toronto Real Estate Board, Jason Mercer. “If this trend continues, we will likely experience renewed growth in average rents in the second half of 2014.”
In the second quarter of 2014, Toronto condo sales increased by 10.4 per cent compared to the second quarter of 2013.
“Condominium apartments represent an affordable entry point into the market for first time buyers,” said the president of the Toronto Real Estate Board, Paul Etherington. “On top of this, some condo properties cater to households looking to move out of their traditional low-rise home, and we are increasingly seeing households choose condos as the place where they will raise a family. This diversity of buyers explains why sales more than kept up with increased listings in the second quarter.”
New condo listings increased by 4.4 per cent, while prices increased by 5.5 per cent to an average price of $367,010. However, in the City of Toronto, the average was up by 5.3 per cent to $392,739, accounting for 71 per cent of sales.
Jason Mercer, the senior manager of market analysis for the Toronto Real Estate Board, said that, “Even though inventory levels for condo apartments have been higher compared to inventory of low-rise home types like singles, semis and towns, there has been enough demand relative to supply to see strong price growth. Even as inventory levels increase due to record occupancies in 2013, we should see enough demand to sustain price growth above the rate of inflation in the second half of this year.”