Toronto Condo Sales Plunge by More than Half in First Quarter
When comparing the real estate years of 2012 and 2013 in Toronto, especially the beginning of the years and taking the condo market into consideration with it, you know there’s going to be a huge gap. Last year condos were the talk of the town, and anyone who bought one the newest beau or belle of the ball. Now though, those same units are referred to as being “cookie cutter,” and the market “overcrowded.” This sentiment is now evident when you compare first quarter condo sales for both years.
According to Urbanation Inc., Toronto condo sales fell a whopping 55 per cent in the first quarter of 2013, when compared with the same quarter of last year. And compared to the previous quarter, sales were down 29 per cent.
Prices still climbed in the first quarter, but slower than what we’ve been seeing over the past year or so. While price per square foot climbed 2.5 per cent when compared with last year, that number is well below the 6.4 per cent increase that’s been seen over the past ten years.
And while sales are falling and prices are climbing, there is still a major amount of overstock inventory on the market. The number of unsold units has jumped by 21 per cent when compared with the first quarter of last year, many of which are still in pre-construction mode. That has led to a slowdown in construction starts and new condos in general, says Shaun Hildebrand, senior-vice president at Urbanation.
“The industry has been cautious in bringing new units to market as sales centre traffic has slowed,” he said in a statement when presenting these latest stats.
He also believes that the city’s condo sector will start to pick up steam once again later on this year, as more resales start to enter the market, overstock inventory will be sold off, and interest will return to the condo market.
However, resale numbers when comparing quarters year-over-year aren’t that great either. Resales were down 18 per cent in the first quarter of this year when compared with last year; and resale prices also fell 0.5 per cent, to $394 a square foot.