Lisa Van de Ven – National Post

High-rise sales are down. Low-rise sales are up. But do the new-home sales numbers for February mean the end of one market trend and the beginning of another?

Low-rise made up approximately 65% of the new-home market in February, according to numbers released by RealNet Canada. New high-rise sales plummeted by 59% across the Greater Toronto Area from February 2011, with only 913 units sold. Low-rise sales, meanwhile, improved by 16.2% GTA-wide, with 1,666 units sold.

It’s a dramatic switch from last year, which saw condo sales make up 62% of the total new-home market.

While one insider expects the high-rise market to level off, he doesn’t think condo sales will leave low-rise in their dust like they did last year: “We think we’re going to be at a 50/50 split this year,” says Joe Vaccaro, acting president of the Building Industry and Land Development Association (BILD). “There are a number of low-rise projects coming to the market, and there’s a great demand for low-rise family housing, so that’s what we think will happen this year.”

Low-rise lands that were formerly caught up in the municipal approvals process are now seeing the light of day, he adds, meaning there are new places to build, at least in the short term. Just don’t expect it to be a long-term trend, says Jasmine Cracknell, partner with Toronto real estate consulting firm N. Barry Lyon Consultants. While she sees low-rise and high-rise switching back and forth over the next few years, each taking turns to take the lead in new-home sales, eventually there’s only one winner. “I think after the five-year mark in the GTA, there just won’t be any more low-rise land, and from that point it will just be high-rise that dominates,” she says.

As far as this year goes, both Mr. Vaccaro and Ms. Cracknell suggest high-rise sales won’t stay as low as they were in February. There were fewer project launches early this year — which, Ms. Cracknell says, is actually a normal occurrence during the winter but one that was interrupted last year thanks to the busier-than-normal market.

With approximately 40 condo projects scheduled to be released by the end of June — and more than 100 by the end of the year — Mr. Vaccaro says the GTA should expect to see new-condo sales numbers rise, though still below last year’s. “It’s stabilizing — showing some stability both on the low-rise side, where we seem to have found a natural trend line, and then on the high-rise side, I think it’s stabilizing as to where it will probably be in terms of current market conditions and the launches coming forward,” he says.

Ms. Cracknell agrees. “It’s not this drastic decline, it’s more just returning back to normal conditions.”

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Contact the Jeffrey Team for more information – 416-388-1960

Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
They did not write these articles, they just reproduce them here for people
who are interested in Toronto real estate. They do not work for any builders.
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