May 07 2012
The GTA condo market continues to shatter records with more sales, new projects and new units pushing their way into the stratosphere in the first quarter of 2012 than ever before, according to market research firm Urbanation.
Any “anxiety” about the health of the condo market, or fears a bubble is about to burst, did nothing to slow demand.
In fact, the year has started out even hotter than last, when the first quarter of 2011 kicked off what would turn out to be a record year for condo sales and construction across the GTA with some 28,000 new units sold by year end, according to statistics released Monday.
“There have been a few new projects opened that haven’t done so well, but nothing that says to me ‘this is it,’” says Ben Myers, pointing to prevalent fears — mainly among the media, he points out — that the GTA’s sizzling condo market is on the verge of a cool down. Myers is editor and executive vice president of the condo research firm.
“The probability of a market crash or major price correction is very small.”
Some 6,070 condos sold in the first three months of this year, up from the previous sales record of 5,415 units set in 2010, Urbanation says.
The number of active projects in the first quarter hit 338, up from last year’s 284.
But the number of “active” units — those in pre-construction sales, under construction or in newly constructed condo towers yet to be completely sold out — stood at almost 85,000 units in the first quarter, up from 73,643 during Q1 of 2011, says Myers, The average GTA condo now costs $393,000 and is 757 square feet in size. That’s down from 774 square feet and up in price from $372,000 a year ago, according to Urbanation.
Condos now cost an average of $519 per square foot across the GTA, up 8.1 per cent from a year ago.
The resale market has shown some signs of slowing, although Myers suspects that just means investors aren’t as jittery as the media about a potential meltdown in the market and are simply holding onto, and renting out their units, anticipating they will be worth more over time.
Resale condo values fell just slightly in Q1 to $396 per square foot, to first drop since the recession impacted Q1 2009, down from $400 per square foot at the end of 2011.
But, overall, the average resale price climbed almost 4 per cent during the first quarter over a year ago, up from $358,000 to $361,000.
Urbanation still anticipates that, by the end of 2012, the condo market across the GTA will cool slightly, although as many as 40 new projects are set to launch this quarter alone, with more than 11,000 new units.
That would see unsold inventory rise to over 17,000 units, which could come close to setting a somewhat more worrisome new record — the 17,600 unsold units racked up during the height of the 2008 recession.
