Sorry doomsayers, but the GTA real estate market refuses to cool down.
With detached-home prices soaring amid a scarcity of product, comparatively more affordable condos continue to be the region’s most popular housing option.
The Toronto condo world is especially attractive to investors, who are snapping up units and leasing them out to desperate apartment-seekers in a city where vacancy hovers around 1 percent.
“It’s a very robust market,” Baker Real Estate president and CEO Barbara Lawlor tells Epoch Times in an interview at the brokerage’s new Yonge and Lawrence headquarters.
“Pretty much everything we’ve worked on this year was a sellout. It speaks to how hot it is out there.”
Prices won’t be dropping anytime soon, despite prognostications of an impending crash. “But we’re still a bargain compared with the West Coast and other international cities,” adds Lawlor.
More and more people want to live near city centres, in close proximity to work, community amenities, shopping and transit. And investors are taking note, purchasing units at Baker-marketed projects like Riverside Square on Queen Street East, 111 Bathurst, and Canary District, formerly the site of the Pan Am Games athletes’ village.
Investors are also flocking to developments in Vaughan and Markham, suburban centres whose transit-oriented cores have been rapidly intensifying. Vaughan will soon be served by an extended TTC subway line, with connections to its new downtown, Vaughan Metropolitan Centre, anchored by a 100-acre mixed-use mega-project that’ll boast 16 million square feet of residential, office, and commercial space. Downtown Markham, even farther along in its downtown intensification, is already the beneficiary of dedicated bus rapid transit service along Highway 7.
“There’s been lots of activity in the 905,” says Lawlor, pointing to the “huge success” of York Condos in Markham, where York University is opening a satellite campus, and Cosmos Condos in Vaughan: two 35-storey buildings and 400 units that sold out in “very short order, like in six weeks—gone.”
Chinese investors continue to drive Toronto condo projects. “We’ve seen a strong increase in the number of sales from China,” Lawlor says, noting her firm recently opened an office in Shanghai to assist Baker Realty partners traveling there to visit clients.
“We can facilitate them being able to write deals for us, and the office also helps us to coordinate with brokerages on the ground in China.”
Baker is gearing up to launch several projects this fall, including 75 on The Esplanade, a condo tower at the southwest corner of Church Street and The Esplanade, U-Social, a townhouse project in Richmond Hill, and the third phase of Cosmos in Vaughan.
The GTA continues to be an attractive investor destination for a host of reasons, says Lawlor, with multiculturalism and quality of life at the top of the list. “And we’re a steady market that’s economically sound,”
The low loonie is adding to Toronto’s appeal for investors with currencies tied to the US dollar. “They’re buying at a really big discount.” This includes Americans themselves, who are establishing a stronger real estate presence north of the border. “A lot of them are thinking about moving here, too,” notes Baker vice-president Harley Nakelsky, pointing to a recently launched downtown project that drew several US buyers. “The most I’ve ever seen on a site.”
A lack of condo product could be the only thing threatening to thwart the Toronto condo market’s performance moving forward. “We have all these buildings going up but an absolute lack of inventory,” Nakelsky says. “So people are having trouble finding places.” It’s leading to a lack of rental product and resulting in bidding wars for apartments, too.
Some condo projects are being postponed as the result of lagging municipal approval processes. But the issue is also systemic. “We can only build a certain number of units in Toronto each year, maybe 25,000 at the most,” says Nakelsky. “But we’ve got about 40,000 people coming here looking.”
Ryan Starr is a Toronto-based freelance journalist.