Toronto Neighbourhood Guide

RENT GROWTH MODERATES AS SUPPLY STABLIZES

Apr 16, 2017

TORONTO – April 12, 2017:  Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its first quarter 2017 rental results today.

 

The average rent for condo apartments leased through the MLS system increased by 8.3% in Q1-2017 from a year ago to $2.75 psf, moderating from the 11.6% annual growth recorded in Q4-2016. At an average of $1,993, monthly rent levels held steady from the record high reached during the previous quarter. Excluding the impact of new units, same sample annual rent growth was 5.5%, down from 6.8% in Q4-2016. Accounting for the higher than normal growth witnessed in recent quarters, same sample rents have grown by an average of 2.3% annually over the past five years.

 

An improvement in condo supply growth alleviated some of the recent pressure on rents. The 11,315 newly completed condo apartments that reached their final closing during the past six months represented a 33% annualized increase, which stabilized total rental listings as turnover of existing condo rentals continued to decline. As a result, market conditions showed a bit more balance, as the ratio of leases-to-listings edged down to 77% in Q1 from 78% a year earlier, the average days on market increased to 20 from 13 in Q4-2016, and the percentage of units that were leased for above asking rents declined to 9% from 17% in the previous quarter.

 

“Although the rental market remained undersupplied in the first quarter, market forces worked together to temper rent increases” said Shaun Hildebrand, Urbanation’s Senior Vice President. “A return to previous highs for condo deliveries and a rise in purpose-built rental completions are expected to keep a lid on rent growth over the next few years. However, without more meaningful growth in purpose-built rental construction, even greater supply shortages will likely emerge in the post-2019 period.” added Hildebrand.

 

 

Purpose-built Rental Survey

 

Urbanation’s survey of purpose-built rental buildings completed since 2005 revealed that average rents for available units increased by 5.6% annually to $2.52 psf in Q1-2017. Excluding the impact of new completions, same sample rents grew by 2.5%, maintaining a modest pace despite recording an average vacancy rate of just 0.5%.

 

Purpose-built rental development applications increased to a total inventory of 29,360 proposed units, up from 27,812 units during the previous quarter. Growth in proposals has slowed after more than doubling during 2016.  Meanwhile, the number of purpose-built units under construction fell to 5,290 units, down by 8% or 455 units from a year earlier.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

ABOUT URBANATION

 

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the condominium industry since 1981. Urbanation uses a multi-disciplinary approach that combines empirical research techniques with first-hand observations and site visits.  On a quarterly basis, Urbanation tracks the new, resale, rental and proposed condominium apartment markets in the Greater Toronto Area. Urbanation also actively conducts site specific market feasibility studies across the country for both condominium and purpose-built rental apartment projects.

 

www.urbanation.ca 

Sharp Drop in New Condo Supply Pushing Up Prices in the Core

Feb 26, 2017

Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its Q4-2016 market results recently. Here are the highlights.

 A total of 27,217 new condominium apartments were sold across the Greater Toronto Area in 2016, rising 34% over 2015 to a new high. Remarkably, sales totals topped the previous record set in 2011 on much fewer new pre-construction launches (18,466 in 2016 vs. 28,204 in 2011). Activity ended the year strong with 7,422 sales in Q4-2016, an 18% annual increase. The strength in demand combined with a 6% decline in new launches last year pushed unsold inventory in development down by 47% from the end of 2015 to a more than 10-year low of 9,932 units, which equaled only 4.4 months of supply (a balanced market for new condos is approximately 10 months of supply).

 New condo sales grew the most in the suburban 905 Region last year, soaring 82% to a high of 8,703 units in 2016 and representing a record share (32%) of GTA activity. Sales also increased by a robust 57% in the outer-416 areas of Etobicoke, Scarborough and North York (7,397 units) on higher new launch activity last year, while a minimal 3% gain was recorded in the former City of Toronto (11,116 units) as launches dropped by 40%. The demand-supply imbalance was most acute in old Toronto, where unsold inventory plunged by 57% to 3,503 units, or 3.8 months of supply.

 The overall average index price for sold units in active development across the GTA continued to grow at a moderate annual pace of 3% in Q4-2016 (to $598 psf), which was impacted by the shift in activity to lower-priced suburban markets last year. Within the former City of Toronto, average selling prices within projects launched in 2016 reached $746 psf, up 14% compared to new launch prices in 2015. At the end of 2016, remaining inventory in new projects in old Toronto was offered at $795 psf.

 The draw down in inventory will limit the market’s ability to top 2016’s record activity. Urbanation is forecasting 23,000 new condo apartment sales in 2017, with the expectation that developers will respond to present market conditions by launching a greater number of new projects this year.

 “The new condo market is experiencing broad-based demand that will carry forward in 2017”, said Shaun Hildebrand, Urbanation’s Senior Vice President. “Buyers priced out of the low-rise segment, a surge in rental demand, and increased attention from investors are placing heavy downward pressure on condo inventories, which will support strong price growth this year”, added Hildebrand.

 A record volume of 25,187 condo apartments were resold in the GTA in 2016, rising 22% annually and representing a high of 26% of all GTA resales last year. Sales of resale units in Q4 were up 26% from a year ago, while total listings in the quarter were down 14% year-over-year. This divergence caused the sales-to-listings ratio to hit a record 80% in the fourth quarter (up from 55% in Q4-15), which led prices to grow at annual rate of 16%. At an average unit size of 861 sf, the average resale price reached $458,000, or $532 psf. For the first time, condo apartments represented the majority (59%) of all resale activity in the GTA below the $500,000 price point.

 

 

 

ABOUT URBANATION

 

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the condominium industry since 1981. Urbanation uses a multi-disciplinary approach that combines empirical research techniques with first-hand observations and site visits.  On a quarterly basis, Urbanation tracks the new, resale, rental and proposed condominium apartment markets in the Greater Toronto Area. Urbanation also actively conducts site specific market feasibility studies across the country for both condominium and purpose-built rental apartment projects.

 

www.urbanation.ca

www.twitter.com/urbanation

 

AVERAGE GTA CONDO RENTS UP 12% TO NEARLY $2,000 RENTAL DEVELOPMENT PROPOSALS CONTINUE TO SURGE

Jan 19, 2017

TORONTO – January 16, 2017:  Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its year-end 2016 rental results today.

 

Highlights

 

The number of condo apartments leased through the MLS system during 2016 in the Greater Toronto Area declined by 2% to 26,602 units, the first annual decline recorded by Urbanation since tracking began in 2011. Rental activity slowed last year on account of occupancy delays for condos under construction, less rental turnover of the existing stock, and an increase in resale activity. Meanwhile, applications for new purpose-built rental development reached 27,812 units, an increase of 7,586 units in the past three months.

 

Despite a 34% year-over-year surge in final closings for newly completed condos in Q4-2016, total rental listings fell by 8%, pulling down lease volumes by 4% annually during the quarter. With resale prices for condos up 15% over the same period, more owners have become enticed to sell their units as opposed to holding onto them as rentals. At the same time, existing tenants have become less willing to move due to the high cost of renting in the open market. The share of the total inventory of condos that was leased last year declined to 8.5% from 9.3% in 2015, while the share of total units resold jumped from 7.1% to 8.1%.

 

Average condo apartment rents shot up by 11.7% year-over-year in the fourth quarter, the highest level of growth ever recorded by Urbanation and a dramatic acceleration from the 4.2% rate recorded one year ago. Part of the increased rate of growth was caused by a shift in lease activity to the former City of Toronto and relatively high rents achieved within newly completed buildings. Nonetheless, same sample rents grew by a significant rate of 7.3%, as the average days on market dropped to 13 — down a full week from Q4-15.

 

“The undersupply of rentals in the GTA continued to worsen throughout the year, causing rents to surge alongside home prices and further deteriorating housing affordability across the region” said Shaun Hildebrand, Urbanation’s Senior Vice President. “While less pressure on rent growth may arrive in 2017 due to a temporary rise in new apartment completions, it’s become clear that more attention needs to be paid to building rentals over the longer-term” added Hildebrand. 

 

Condo Rental Market 

 

Average rents reached a record $2.77 psf in Q4-2016 based on an average unit size leased of 719 sf, equaling an average monthly cost of $1,990. Former City of Toronto rents averaged $2,134 ($3.13 psf), while the Toronto suburbs of Etobicoke, North York and Scarborough averaged $1,857 ($2.47 psf) and the 905 region averaged $1,739 ($2.22 psf). Rents were up the most in the former City of Toronto at 12%, compared to 7% in the Toronto suburbs and 6% in the 905 region.

 

Purpose-built Rental Survey

 

Urbanation’s survey of purpose-built rental apartment projects completed across the GTA since 2005 (49 buildings totaling 8,484 units) reported a vacancy rate of 0.6%, down from 1.0% last year. The availability rate (units that are vacant plus those where the tenant has given notice) was 1.6%, the lowest level surveyed by Urbanation over the past two years. Rents across the sample averaged $2.49 psf, up 5% annually. The inventory of purpose-built projects under construction totaled 22 buildings and 5,133 units in Q4-2016, down by 183 units from the previous quarter and down 1,037 units from a year ago. The total inventory of proposed purpose-built rentals increased to 27,812 units, nearly three times the number tallied a year ago (10,513).

 

 

 

                    

    

 

ABOUT URBANATION

 

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the condominium industry since 1981. Urbanation uses a multi-disciplinary approach that combines empirical research techniques with first-hand observations and site visits.  On a quarterly basis, Urbanation tracks the new, resale, rental and proposed condominium apartment markets in the Greater Toronto Area. Urbanation also actively conducts site specific market feasibility studies across the country for both condominium and purpose-built rental apartment projects.

 

FOREIGN BUYERS REPRESENT 5% OF NEW CONDO SALES IN GTA Domestic Investor Share at 52%

Nov 2, 2016

  • TORONTO October 27, 2016: Urbanation Inc., the leading source of information and analysis on
    theToronto condominium market since 1981, released the results off ts first ever survey of new
    condominium foreign purchasers and investors today.
     
    In response to the increasing need for more clarity regarding the role of foreign purchasers in the
    GreaterToronto Area housing market, Urbanation expanded its survey of sales activity in new
    condominium apartment projects to include the share of units sold to non-resident buyers as well as
    domestic investors.
     
    Urbanations survey, which is completed by developers or brokerages representing new
    condominium apartment projects, found that foreign purchasers represented 5% of all sales that
    have occurred within projects currently in active development across the Greater Toronto Area.
    Furthermore, domestic investors represented 52% of sales.
     
    Among projects indicating a presence of foreign buyers, shares of units sold to foreign purchasers
    ranged between 1% and 25%. Shares of sales to domestic investors ranged between 5% and 90%.
    The highest shares of sales to foreign purchasers and domestic investors were generally found
    within centrally-located projects in the Downtown Toronto area.
     
    The results of this very important survey show a rather limited role of foreign buyers in the GTA new
    condo market and a very significant overall share of investors. These estimates coincide with the
    percentages of new condos entering the rental market upon completion, indicating the important role
    investors play in the GTA housing market said Shaun Hildebrand, Urbanations Senior Vice
    President.
     
     
     
    Definition
     
    Urbanations estimates were based on a weighted response rate representing 25% of all new
    condominiumapartments sold within projects in development as of Q3-2016. The responses were
    consistent with the distribution of projects across the Greater Toronto Area.
     
    Foreign buyers are defined as purchasers whose primary residence is outside of Canada. Domestic
    investors are defined as purchasers whose primary residence is located in Canada and who do not
    intend on self-occupying their unit(s).
     
     
     
     

NEW CONDO SALES HIT NEW HIGHS Available Supply Drops to Decade Low

Nov 2, 2016

  • TORONTO October 27, 2016: Urbanation Inc., the leading source of information and analysis on
    the Toronto condominium market since 1981, released its Q3-2016 market results today.
     
    A totalof 6,677 new condominium apartments were sold across the Greater Toronto Area in Q3-
    2016, soaring 73% year-over-year to reach thehighest level of third quarter activity on record. Sales
    were 58% higher than the 10-year average for Q3 periods and 12% higher than the previous high
    set in Q3-2007. Total unsold inventory in development plunged by 33% from a year ago to 11,485
    the lowest level since the first quarter of 2007 and representing a record low 5.2 months of supply.
     
    The average index selling price for new condo apartments continued to edge higher, rising 2% from
    a year ago to $590 psf. GTA-level price growth has been weighed down by a shift in new
    development activity to areas outside of the core. Within the former City of Toronto, average index
    selling prices grew by 5% year-over-year to $674psf, while asking prices for unsold units, which
    dropped in number by 48% annually to an all-time low, increased by 12% from a year ago to $759
    psf. Price trends for new condos are beginning to follow the resale market,where average index
    prices grew 12% from last year to $511 psf ($667 psf within the former City of Toronto).
     
    The pace of new condo development has fallen well below the level of demand this year. Given the
    low prevailing amount of available supply and diverse range of buyers, the recent mortgage
    insurance rule changes are anticipated to have a somewhat limited effect on market conditions for
    condos in the near term said Shaun Hildebrand, Urbanations Senior Vice President.
     
    Lack of Supply and Shift in Demand
     
    In the year-to-date to September, a total of 19,917 new condominium apartments were sold across
    the GTA. Over the same period, only 12,189 newunits opened for pre-sales, marking the widest
    divergence betweensales and new supply on record.In total, 90% of the 111,207 units in
    development were pre-sold as of Q3-2016, with 80% of the 30,426 units inpre-construction already
    pre-sold, jumping from a 64% share last year. Among the new units that opened for pre-sales during
    the third quarter, 63% were sold by the end of September one of the highest opening quarter
    absorption rates on record.
     
    In a sign that demand among end-user buyers has been increasing in the new condo apartment, the
    quarterly absorption rate of remaining supply within existing projects launched in previous quarters
    (where owner-occupant purchasers tend to be more active) soared to a record high of29%
    double its 10-year average of 14%. Furthermore, sales of more expensive condo nits have also
    been growing quickly in the resale market, with year-to-date activityup 62% annually among units
    selling for more than $600,000.
     
  •  

Greater Toronto Area Experiences Double-digit Growth in the Third Quarter of 2016

Oct 13, 2016

TORONTO, October 13, 2016 – The Royal LePage House Price Survey1 released today showed double-digit growth in the prices of homes across the Greater Toronto Area (GTA). In the third quarter of 2016, the aggregate2 price of a home rose 13.6 per cent to $693,154 year- over-year.

When broken down by housing type, the median price of a two-storey home and bungalow in the GTA climbed 14.8 per cent and 16.0 per cent year-over-year in the third quarter to $812,990 and $688,813, respectively. Condominiums within the region also witnessed a healthy increase, rising 5.0 per cent to $381,963 during the same period.

The strongest growth during the quarter was found in regions outside of the downtown core, with all but Brampton, Milton, and Mississauga outpacing home price appreciation in Toronto.

“Many homebuyers have continued to look towards the suburban areas of the Greater Toronto Area for affordable housing, as ongoing house price appreciation, chronically constrained inventory and an unprecedented level of demand has priced many purchasers out of the region’s innermost markets,” said Gino Romanese, senior vice president, Royal LePage. “For those focusing their home search within the core, this low inventory, high demand environment has increased instances of multiple offer situations, and caused prices to skyrocket further.”

Recently, the continued outflow of migration from the city centre has spurred a noticeable shift in demographics within many of the GTA’s suburban areas. Regions that once were industrial hubs have begun to gentrify as they transform into commuter cities, housing many young professionals looking for more affordable housing. As a result, house prices in these areas are also climbing. Oshawa, as an example, experienced the largest aggregate price gain of any region across the GTA in the third quarter, climbing 26.0 per cent year-over-year, while ten out of the eleven other suburban areas surrounding the city experienced double-digit price growth as well.

Seller confidence is at an all-time high in the York Region, with Richmond Hill once again experiencing one of the strongest gains in appreciation east of British Columbia. During the third quarter, the aggregate price of a home in the area surged by 25.7 per cent year-over-year to $1,074,829 due to the region’s limited inventory and continued interest from foreign buyers. Homes in Vaughan have also appreciated significantly over the same period, increasing by 13.5 per cent year-over-year to $846,481.

Domestic and international interest continued to drive prices higher in Markham, with many vying for the limited supply of inventory available within the market. Aggressive bids stemming from multiple offers influenced the significant jump in aggregate house price, up 15.2 per cent year-over-year to $870,353 in the third quarter.

Brampton saw its aggregate house price climb in the third quarter by 12.0 per cent year-over- year to $569,510, as many homebuyers continued to flock to the market, confident that prices will continue to rise into 2017. The region’s affordability, stability and close proximity to the city’s core made it an attractive option, placing further strain on inventory and causing numerous bidding wars as buyers continued to attempt to break into the market before it was too late.

Home prices in Mississauga continued to rise in the third quarter, climbing 9.6 per cent year- over-year to an aggregate price of $609,266. The region’s close proximity to Toronto coupled with its relative affordability has led to a heated market where many properties sell within a week of being listed. As a result, prices and home sales continue to climb as inventory diminishes.

Milton to the west, saw home prices appreciate by a healthy margin in the third quarter, rising 10.5 per cent to $613,759 when compared to the same quarter last year. In the past three months, inventory within the region has not been able to keep up with the considerable demand stemming from young families looking to the region for reasonably priced properties. Milton’s inventory shortage has been further exacerbated by a notable shift in the buying process where homeowners are electing to search for properties prior to listing their own as they are confident that their homes will sell quickly.

Low inventory levels across Oakville continued to drive prices higher throughout the third quarter, resulting in a significant year-over-year aggregate price increase of 15.4 per cent to $894,696. While foreign buyers represent a small, albeit growing, segment of the market, they have had a significant impact on prices, aggressively bidding for properties during multiple offer presentations and setting higher benchmark levels for subsequent transactions in the region.

Buyers continued to flock to the Durham Region in the third quarter of 2016 in search of affordable housing and stellar returns on their investment. Whitby and Oshawa saw some of the GTA’s strongest house price appreciation, with the aggregate house price surging 21.5 per cent and 26.0 per cent year-over-year to $590,921 and $453,975, respectively. Pickering and Ajax also experienced a noteworthy uptick in aggregate house prices, increasing by 18.2 per cent and


 

Lytton Park neighbourhood real estate update 2016

Aug 10, 2016

There have been forty-five MLS sales in Lytton Park approaching the end of the third quarter of 2016. Demand continues to heavily outweigh supply leading to numerous bidding wars with houses averaging just eight days on the market. The days on market stat is a little skewed as many listings hold back offers for approximately one week so essentially these homes are selling on the day that offers are being presented. The average list to sale price ratio is 98% which is quite high given just two sales were below the one million dollar mark with the rest exceeding the one million dollar mark.

Lytton Park is centrally located just 20 minutes to downtown Toronto. This neighbourhood is known for its excellent public and private schools and an abundance of parkland and recreational facilities nearby. Shopping districts on Yonge Street, Avenue Road and Eglinton Avenue West are all accessible on foot as is the Yonge Street subway making this neighbourhood a strong draw with walk score enthusiasts. Lytton Park's traditional housing stock consists of a mix of Georgian, Tudor, Craftsman, and Colonial style homes. Recently some of the new builds are choosing a contemporary design. The lots are typically 40-50 feet wide and the streets are well treed creating a quiet and pretty streetscape.

The median sale price in Lytton Park is $1,795,000. That average is somewhat surpressed by a fair number of sales along Lytton Park's busier arterial streets such as Avenue Road and Lawrence Avenue. Fifteen sales surpassed the two million dollar mark. Many of these were original Lytton Park houses that have had renovations and additions. Last year the new builds in Lytton Park were having trouble breaking the three million dollar mark. This year four new home sales have already exceeded that milestone with one sale over five million. Look for prices to keep trending upwards in Lytton Park through the last quarter of 2016 and into  2017. 

* If you are thinking of buying a home in Lytton Park in 2016 contact David Dunkelman, Broker, Royal Lepage Signature. I have helped many families find the perfect home in this neighbourhood. Email: ddunkelman@trebnet.com or call Direct 416-726-6574

Lytton Park Toronto neighbourhood real estate insights provided by David Dunkelman, Broker, Royal Lepage Signature Realty Brokerage. You can contact David at Office: (416) 443-0300, Cell: (416) 726-6574, email: ddunkelman@trebnet.com or visit the website www.realestatewithdavid.com

(C) www.TorontoNeighbourhoodGuide.com

** The information provided herein is compiled from source data obtained from the Toronto Real Estate Board. It is presented here for information purpose only. All data are subject to updates and revisions. The author assumes no responsibility for the accuracy of any information shown.

 

NEW CONDO SUPPLY DROPS TO 6 YEAR LOW Sales Jump 26% while Unsold Inventory Falls by 26%

Aug 5, 2016

TORONTO – August 5, 2016:  Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, released its Q2-2016 market results today.

 

A total of 7,731 new condominium apartments were sold across the Greater Toronto Area during the second quarter of 2016, rising 26% year-over-year to reach the second highest level of quarterly activity on record behind Q2-2011 (8,548). Sales would have been even higher if supply kept pace with demand, as new project launches fell 9% from a year ago to 5,106 units. As a result, total unsold inventory in development plunged by 26% annually to 13,528 — the lowest level since 2010 and representing a decade-low 6.8 months of supply.

 

The average index selling price for new condo apartments continued to grow at a slow pace, rising 2% from a year ago to $582 psf. Price growth was stronger in the core where supply has become more strained, with sold index prices up 4% annually ($662 psf) and unsold prices rising 7% to $724 psf in the former City of Toronto. In the resale market, condo apartment prices grew 10% year-over-year to $498 psf.

 

“With demand for condos in the GTA pressing forward strongly, new projects are being challenged to enter the market in greater volume. Should current conditions persist, price pressures for high-rise units can be expected to build, particularly as low-rise housing remains afflicted by record-low supply” said Shaun Hildebrand, Urbanation’s Senior Vice President.

 

Demand Shifts to Larger Units

Urbanation examined the distribution of sales by unit type among the top 20 selling new condo apartment projects, which represented approximately half of all sales in the second quarter. The share of two- and three-bedroom sales increased to 44% in Q2-2016, up from a 35% share of sales held for these larger unit types among the top 20 selling projects a year ago in Q2-2015, and a 27% share five years ago during the market high in Q2-2011. While the share of three bedroom sales remained relatively minimal at 3%, the share of two bedroom without den sales increased to 29% (compared to 18% in Q2-2011), which occurred as the share of one bedroom plus den sales fell to 28% (from 39% in Q2-2011) and one bedroom without den sales declined to 25% (from 30% in five years ago).

 

Apartment Site Acquisitions Rise

In a sign that more supply is heading into the market in the future, Urbanation’s tracking of commercial property transactions revealed that apartment development site sales in the GTA reached 73 transactions during the first half of 2016, up from 47 acquisitions during the first half of 2015. The total value of apartment site sales increased by 13% annually in the first half to $971 million. More than 90% of the total value of sales was located in the City of Toronto ($904 million) and three quarters in the former City of Toronto ($730 million

 

 

 

 

ABOUT URBANATION

 

Urbanation is a real estate consulting firm that has been providing market research, in-depth market analysis and consulting services to the condominium industry since 1981. Urbanation uses a multi-disciplinary approach that combines empirical research techniques with first-hand observations and site visits.  On a quarterly basis, Urbanation tracks the new, resale, rental and proposed condominium apartment markets in the Greater Toronto Area. Urbanation also actively conducts site specific market feasibility studies across the country for both condominium and purpose-built rental apartment projects.

 

www.urbanation.ca

www.twitter.com/urbanation

Toronto Market Stays Hot This Summer

Jul 27, 2016

Market Statistics

Weekly Sales Report - July 22, 2016 

 

REGION
AREA SALES
AVERAGE PRICE
  Halton
 193
 $821,230
  Peel
 522
 $608,800
  Toronto
 894
 $700,319
  York
 472
 $983,684
  Durham
 322
 $545,965
  Dufferin
 18
 $449,578
  Simcoe
 69
 $538,091
  Total
 2,490
 $717,950

NOTE: Please note these are preliminary figures. Minor adjustments may be required at month's end. Courtesy: Toronto Real Estate Board