Baker Real Estate has been selling new construction condominiums, townhomes, and resorts since 1993; they have been one of the largest players in the new construction industry in Toronto in the past 15 years.
Epoch Times talked with the company’s principals—president and CEO Barbara Lawlor, VP Jeff Clark and VP Harley Nakelsky—about changes in the real estate market in Toronto and the GTA between 2000 and 2015.
The three agreed that one of the biggest changes in the industry has been in the luxury sector. Fifteen years ago there were few luxury condominiums on the market, but One Post Road on Toronto’s famed Bridal Path changed all that.
“One Post Road was a leader in luxury living—there was so little luxury in our city—One Post road really captured the imagination. It was the beginning of the luxury market in Toronto,” says Lawlor. “Today, we have five 5-star hotels with residences atop and we have other really glorious buildings like One Bloor and The Ritz Carlton, so the luxury market has really grown.”
According to Nakelsky, one of the biggest changes in the market has been pricing.
“Real estate prices have consistently gone up over the years and condominium prices have risen exponentially as well. It’s fantastic for the industry, it’s fantastic for investors and it’s especially fantastic for the first time buyer who is making appreciation on their home,” he says.
Nakelsky explains the difference between condo suites in the year 2000 and today. “We’ve actually made more efficient suites,” he says.
“Before, people would get these larger suites with separate rooms for their kitchen and separate rooms for their dens. Now we are seeing more open concept designs which allow people more flexibility with their space. This allows us to put less square footage in each unit but create more units in the building with the same amenities within the unit. This smaller footprint gives people the ability to actually afford it. As prices continue to rise (which is great for our city) the smaller units are enabling first time home buyers to get into the market.”
Lawlor agrees. “When we were selling back in the 90s our 1-bedroom suites were 800 sq. ft. and our two bedroom suites were 1200 sq. ft. Today our 1-bedrooms are 450 sq. ft. and our 2-bedrooms are 650 sq. ft. That’s a huge difference between 2000 and now.”
She emphasizes that the floor plans are far more efficient today. “You don’t waste a square inch,” she says.
“Another thing that has changed is the governance of our condominiums. There was a time back in the 90s that we didn’t have a Condominium Act. When the Condominium Act came into effect it made our industry so much more credible and business-like. This was a great change for both the buyer and the builder.”
Another thing that has changed over the years is the standard of finishes. “What we call standard today was luxury back then. Back at the turn of the century, laminate flooring and arborite countertops were standard finishes. Today you have gorgeous hardwoods, granites, ceramics, stones—there’s no comparison,” Lawlor explains.
Parking is another big change.
“Back in the late 90s and early 2000s we wouldn’t dream of selling a condominium suite without parking. But today we’re building buildings that don’t have parking period. And most buildings have far less parking,” Clark says.
“It’s very much related to the fact that Walk Score has become hugely important,” interjects Lawlor. “People are living downtown where they can walk to work, to amenities, to cultural venues, to parks, to all the necessities they need to lead their daily lives. That is a major change. Today we have far less demand for parking. This is a good trend for the city.”
Clarke adds that transit is important—particularly to the investor.
“Any condominium development along the subway lines and the LRT has flourished. Transit is an amazing change in our city and it has impacted condominium sales tremendously. That’s where the investors want to buy and that’s where the renters want to be.”
Nakelsky continues, “Another significant change is the use of infill sites. Because land is so scarce in the city, development of existing sites has become more and more necessary. This is especially true downtown: if you want a site that is on transit and close to amenities, it is most likely an infill site.”
“It’s also giving us more interesting buildings architecturally,” says Lawlor. “When you add in some boutique buildings, some midrise buildings, the streetscapes are more interesting. I think that’s a great thing for the city.”
Growing Up, Not Out
Another big change is the government’s mandate of Places to Grow.
“We are mandated to grow up and not out,” Lawlor explains. “This has resulted in condo towers being far more the norm than they used to be. We have less and less space for low-rise homes. Because of that, low-rise has become more and more expensive so condos have become the only affordable home for a first-time buyer. It’s very hard to start in real estate with a house whereas 15 years ago it was still possible. Today affordability has driven us to build more high-rise.”
Jeff notes that another significant change is with balconies. “Back in the early 2000s, buildings didn’t have balconies. Today it’s very difficult to sell a unit without outdoor space.”
Lawlor talks about multi-generations coming together in a condo. “We see young couples with a child or two, their parents and even their grandparents buying in the same building. Back in the early 2000s we rarely saw children in condos.”
So has the buyer has changed since 2000?
The answer was a resounding yes. Condos used to be the housing of choice for couples without children and retirees, but that’s no longer the case.
“Today it’s first time buyers, young people who have busy lives who may never have and don’t aspire to having a house. Before, condos were a stepping stone to a house, but today people want to stay in the city. Also, people are right-sizing themselves sooner. They want to be able to take advantage of the city’s amenities, to walk to cultural destinations,” says Lawlor.
The Baker team sees a lot of Asians buying condos for their children for university. What will the city look like 10 years from now?
Lawlor replies, “Our skyline will be magnificent. We will be an even greater international city. Our architecture will be awe-inspiring because a lot of it will be built. And I would say that condominiums will take up 70 percent of the market.”
Overall, the team believes units will get smaller and building heights will go up. There’s also a trend for three-bedroom suites, reflecting the needs of families who are buying condos.
Prices, Lawlor says, are going to continue to go up.
“Compared to other world class cities, Toronto is still a bargain. We’re not seeing the runaway spikes that you see in other cities—it’s a gentle incline, it’s much healthier and more sustainable.”
Judy Hazan is an experienced writer for the real estate industry based in Toronto.