20,000 Toronto Condo Market Occupancies 2014
This is due to the fact that the sales of pre-construction condos reached record highs in 2011.
Since that time, the pre-construction sales numbers have dropped. However, there’s still lots of evidence that the condo market is “hot”.
New projects are still coming onstream and there is an active secondary market for the re-sale of unbuilt, unfinished and unregistered condos, often referred to as the “assignment market”.
This year, it is expected that upwards of 20,000 units will be completed in 2014. That just means the building is finished and ready for occupancy. Final closing following registration of the condominium will likely take another year. So, you can see that if you want to “work the numbers”, you have the raw material in the statistics:
2011 – 20,000 sales
2014 – 20,000 occupancies
2015 – 20,000 closings
There are lots of new projects in the works and some have be held back, in terms of timing to become available in a better market. This really is not about fine tuning. Once committed to building a huge project, the developer is building it. Stopping mid project is costly and just not a viable option.
So, we should be watching for the “big numbers”:
- Interest rates
- Affordability ratios
- Household formations in the GTA
These are all factors that influence the demand side of the equation.
There’s a continuing need for housing. Some is old and rather decrepit, right now. That makes condos attractive. Some housing is not well-located. That makes condos attractive. Some is not situate close to transit. That makes condos attractive.
This interest in condos will continue in 2014. Some temporary adjustments to the supply side may present some purchasers and investors with attractive opportunities.
However, you will have to do your homework. If you buy the wrong one, you could be stuck for a long time. And, by the way, aren’t you glad you didn’t buy a condo in the Trump Tower?
Brian Madigan LL.B., Broker
If you are buying or selling in the GTA, either residential or commercial properties, buying from a builder, investing in a condo, or just require general advice about the market, then please give me a call.