Why the hot condo market is about to get even hotter

We have all read the headlines in every major newspaper across the country. The Toronto real estate market was hot in 2016, to say the least. The Toronto Real Estate Board released figures in January showing resales achieved a record for the GTA. Over 113,000 homes changed hands, an 11.8-per-cent increase over 2015. Overall pricing was up 17 per cent compared to 2015, with detached homes achieving 20-per-cent year-over-year price increases. So, what does the future hold for those looking for ground-orientated housing product, and how will this impact the GTA's already-hot condo market?

The news unfortunately is not good. Altus came out with their year-end 2016 report showing a record low of 1.3 months of supply of available ground-related product in builders’ inventory across the GTA. That is an outstandingly low number. There are many reasons for this decline, including the reduced availability of serviceable land in the GTA, outdated government policies that are increasing approval times, and the Province of Ontario’s new intensification targets to favour highrise development over lowrise.

Further adding to the above-mentioned issues is the fact that resale listings for ground-orientated product are at historic lows. A reason for the shortage of listings is the perception that if you sell today, where will you move to? Homeowners are just more inclined to renovate their existing home than run the risk of selling and not being able to find another home in the price range they are looking for. This perception is constraining supply further in the lowrise segment, putting more upward pressure on housing values.

As a first-time buyer or a move up/down buyer, 2017 will be the year of the condominium. A number of would-be homebuyers are looking at condominiums as a great lifestyle choice. Whether living in the core of Toronto, or in locations outside the city such as Mississauga, Vaughan, Burlington, there are plenty of affordable options in the condominium segment to suit all types of buyers.

The GTA’s development community is the most sophisticated in the world. The type of product builders are designing is truly cutting edge, from interior spaces and architecture, to amenities and technological features. Locations close to transit, condos with a hotel component, intimate midrise buildings or highrise buildings with spectacular views, the GTA has it all. Condos are now becoming a choice for those looking to live closer to work, or close to transit; ideal for those who are tired of long commutes that take away hours from their daily lives; for those looking to be close to dining establishments, entertainment and shopping; for those looking to raise a family around great schools, parks and kid-friendly establishments.

Condo living was a new concept a number of years ago but is now a mainstay in our province. The results are seen in the new home and resale market, as condos across the region are being purchased at record rates.

So, if you want to know what the trend in housing will be for 2017, look no further than the condominium market. Builders across the province will be delivering more innovative product, and increasing numbers of buyers who are looking for an affordable or luxurious lifestyle will be choosing condominium living.

As intensification policies continue over the next decade, we will see an even more vibrant and exciting region than we see here today.