Category Archives: New Toronto Condos & Lofts
Ben Myers – Toronto Sun
Last month I published my semi-annual Market Manuscript, a robust 50-page report that covers major housing markets in Canada, with a focus on the Toronto housing market. The report was downloaded over 1,500 times by many of the who’s who of local builders, developers and real estate lenders, in addition to “mom and pop” investors. I believe this speaks to the value of the Manuscript’s predictions.
Comment: I wish it were 150,000 downloads. It is one of the only publications that speaks the truth about real estate.
One of the forecasts worth noting from the Market Manuscript was the Conference Board of Canada calling for population growth of 1.9% in the Toronto Census Metropolitan Area (CMA) in 2015. It doesn’t sound like much, but when you consider we have over six million people in the Toronto area, you realize the population could increase by 115,000 people this year. And all those people need places to live.
Comment: And the GTA gains 100,000+ new residents every year.
It doesn’t look like we’re building enough housing to match demand, either. The Toronto CMA has expanded on average by over 90,000 people annually over the past 10 years. During that same period, the CMA has built and completed about 33,000 new housing units per year. So if the Conference Board of Canada is correct in their forecast, we are going to need a lot more residential completions to satisfy housing demand from these new residents – perhaps as many as 42,000 units. My current forecast calls for 38,500 housing completions in 2015, so we may be considerably under-building again in the Toronto area.
Comment: And some people still wonder why demand so far outstrips supply. We are create only 30% of the housing we need to house the annual influx of people. Overbuilding? Try UNDERbuilding!
In fact, Urban Futures has forecast the need for 42,000 to 46,000 new homes per year over the next decade to match demographic demand for residential properties. If the development industry continues to under-supply the market, we will continue to see significant price growth, especially for low-rise housing. In 2014, the average price of a new single-detached house in the Toronto CMA was $835,000, an increase of 10.4% over 2013. In the first two months of 2015, that figure has increased to $842,000. And it gets more expensive. If you’re looking for a completely built new home that is currently unsold, you can pick from about 250 of those homes at an average asking price of $1.8 million!
Comment: How about the new infill homes in the 416? They must average $1.5-2m or more.
With these enormous prices, consumers are responding by moving to Toronto’s outer suburbs. We see demand expanding in both the outer suburbs of the CMA, and in areas within a 30 minute drive of the metro area. This includes areas like Burlington, Georgetown, King City, Nobleton, Oro Medonte and Guelph. We are actively looking for more projects in areas like east Durham Region, Hamilton and Kitchener-Waterloo.
Even if you are not looking to move out to the suburbs, the trend of people trading a longer commute for less expensive housing options is an important one. If you are looking to buy a home for yourself or for investment, keep these market trends in mind.
We have many affordable condominium projects in urban settings for those folks delaying the decision to move farther afield, plus many reasonably priced single-detached and townhouse communities in more suburban settings, check out Fortress developments for a selection of our projects.
I’m forecasting another year of positive price growth in the under-supplied new low-rise housing market in the Toronto CMA in 2015. Keep that in mind, and happy house hunting.
Contact Laurin Jeffrey for more information – 416-388-1960
Laurin Jeffrey is a Toronto real estate agent with Century 21 Regal Realty.
He did not write these articles, he just reproduces them here for people who
are interested in Toronto real estate. He does not work for any builders.