There were a record 196 condo projects under construction in the Toronto census metropolitan area at last count (the end of June). Sales of newly built high-rise units downtown this August were about half what they were a year ago, according to RealNet, a real-estate research firm. Prices are slipping – in August they were about 4 per cent lower than the year before – and many economists believe that a glut is forming that will cause prices to drop further.
According to Urbanation, a market research firm, the number of unsold condo units in the Toronto area in June hit a high of 18,123 (a figure that includes projects that are not yet completed). “With plenty of potential resale condo supply coming over the next year, Toronto is quickly heading for buyers’ market territory for the first time (depending on your definition) since the recession,” economists at Bank of Montreal wrote this week.
“It’s an extremely crowded market,” said Urbanation’s Ben Myers. “They have to somehow differentiate themselves from the competition if they want to make sales.”