My Real Estate Blog - Market Trends, Tips & Updates

Investors may have written off this busy housing market, but new data suggests those who put their money in it will likely earn major profits.

The Toronto condo market – which many argue has been over-built – recorded a drop in inventory and an increase in demand in the first quarter of this year.

According to Urbanation’s Q1 market results, a total of 5,615 condo units were sold in the GTA during the first quarter, up 32% year-over-year and just shy of the first quarter record of 5,680 set in 2012.

“The inventory shortage experienced for low-rise housing has spread into the high-rise segment," Shaun Hildebrand, Urbanation’s Senior Vice President. "More and more buyers priced out of the single-family home market are looking for alternatives in the condo market, providing a clear opportunity for new development.”

Increased demand and a supply shortage forced unsold inventory to drop 16% year-over-year to 15,587 units. The decrease was even more pronounced in the city of Toronto, which saw its unsold inventory fall by 22%.

Supply also tightened, with 86% of units in development being sold; pre-construction projects were 70% sold; recently completed buildings were 96% sold.

There was also good news for investors looking to sell.

Resale activity increased by 21% year-over-year and total listings declined by 5%.

“In a sign that price pressures are starting to build, projects under construction increased their asking prices for unsold units by 8% from last year to $618 psf, including a 14% jump in the former City of Toronto,” Urbanation said in a release.