Hot or cold? What to expect in Toronto’s condo market in 2021

Toronto’s housing market has been riding high for about 15 years now. When the COVID-19 pandemic touched down around this time last year, many of the glass-half-empty types began predicting the bubble was about to burst. Of course, that didn’t happen, and today the market is back on its steady climb, just like the TSX, Nasdaq, S&P 500 and other indices of financial health.

How does Toronto keep outperforming? Crack the spine on that Economics 101 textbook from high school and you’ll see it’s largely a matter of supply and demand, combined with historically low interest rates. Demand remains steady relative to supply, and this will continue to be true, particularly for the condominium market. Our supply issues stretch back a decade, and we’re still not close to catching up.

Exciting communities

I’ve seen this demand remain steady first-hand through our work with a couple of exciting communities located in different desirable pockets of the city. Currently under construction, the KING Toronto community by Westbank Corp. along King West, would be a hot commodity even in the coldest of times; the development’s inspired glass-block design by starchitect Bjarke Ingels looks like a range of pixelated mountains, creating ripples of excitement and steady sales from across the globe. The 900 St. Clair West condominium community by Canderel is another ongoing success, for finally infusing a breath of fresh air on the cusp of Forest Hill along the St. Clair streetcar line. Appealing to a range of buyers, St. Clair West’s suites are right-sized for those looking to move up or down in this sought after area.

Pandemic or not, it’s easy to see why Toronto’s condo market still shows so much potential. Immigration may have slowed down for now, but the city’s existing population base still has a great need for quality condominium housing. Just wait until immigration picks up again: Canada is projected to welcome 401,000 new permanent residents in 2021, 411,000 in 2022 and 421,000 in 2023. As Canada’s economic heart and most diverse employment metropolis, we can realistically expect Toronto to absorb a healthy number of those 1.2 million-plus future residents, which will continue to feed the city’s condo demand.

What about all those people we hear about that have responded to the pandemic by moving away from the city core? It’s true that there is some migration underway, but it’s likely a short-term trend that will not bear much influence on Toronto’s condo market. In fact, at the end of 2020, the global management consulting firm Kearney’s issued their Global Cities Outlook (GCO) rankings – which determine “cities on the rise” – and Toronto ranks second in the world, behind only London.

Anticipated demand

If anything, I’m experiencing even greater anticipation and demand. Canderel’s elegantly designed Bayview at The Village is launching this spring in the tony Bayview Village neighbourhood; between its ideal location and the limited supply in the area, a condo such as this practically lives outside market forces. Another sought-after building is One Delisle by Slate Developments, which is also creating quite the buzz for its daring architecture by Jeanne Gang of world renowned architectural firm, Studio Gang. This project will set a new bar for design excellence in a neighbourhood bordered by Rosedale, Forest Hill, Summerhill and Deer Park – all of which have experienced a serious shortage of condominium supply since 2015.

Meanwhile, Canadians are stockpiling their savings. In fact, a recent CIBC Capital Markets report estimates households and businesses are sitting on no less than $170 billion in excess cash.

Toronto’s condo market isn’t the only thing that I expect to enjoy a bright and successful future. Once the COVID vaccines are administered en masse, my glass-half-full outlook will be practically overflowing with eagerness and ambition for a strong conclusion to 2021.