Rebound for condo sales this spring
223% Gain; Second-quarter sales leapfrogged over first quarter
If there was any question about the strength of this spring’s sales of condominiums in Toronto, the second-quarter results from Urbanation should prove to be the answer.
Urbanation Inc., the firm that issues the quarterly roundup that condo developers rely on not only for planning purposes but to determine comparative sales successes, released results that could only be called remarkable.
In the second quarter of 2009, sales in the new-unit market hit 2,963 — a 223% increase over the “dismal” 917 sold in the first quarter.
Urbanation editor and executive vice-president Ben Myers said “… it appears the recessionary conditions in the CMA condominium market came to an abrupt end in Q2/09.”
That number is still off 40% from the craziest days of the boom in the second quarter of 2008. Even with that, only three projects were shelved. Only two new ones went ahead with construction, but Urbanation says most of the activity shows that developers “remain optimistic and committed.”
“Some credit is due,” Mr. Myers said in a release, “to developers’ and brokers’ quick reaction to the recession, reflected in the redesign, repricing and relaunching of projects with smaller suites, fewer amenities and lower prices.”
First-time buyers reacted to the changes, as did investors. The level of inventory by the end of the second quarter had fallen to its lowest level since the first quarter of last year (to 14,854 units, which represented a 9% drop from the first quarter of 2009).
The level of inventory for sale at any one time is indicative of the state of the market. Reduced inventory means a shift to a more balanced market from the strong buyers’ market of last winter, while reduced supply slows falling prices.
Despite the strength in sales, Urbanation predicts that the resale Toronto condo market will outperform new-build this year as buyers remain hesitant about the state of the new-construction market.
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