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An urban planner warns: Beware of the too-cheap Toronto condo

Workers are seen at a condo development in the Liberty Village area in Toronto.


Ute Lehrer, an associate professor at York University, would like to see people paying more for Toronto condos.

Why? Because you get what you pay for, she says.

"Sometimes you have to invest more up front in order to save later," says Ms. Lehrer, who has a PhD in urban planning. "If I had the authority to advise, I would actually suggest that the entire building industry produce higher-quality condominiums over all, and that, of course, means higher prices."

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Her desire to see higher prices runs counter to calls for more affordable housing. Homes in Toronto are now more expensive than those in New York or Tokyo when you compare prices to income levels, the Paris-based Organization for Economic Co-operation and Development pointed out this month. Condos are providing a more affordable alternative to houses in Toronto. The costs of owning a two-storey house amount to 65.3 per cent of household pretax income for average families in Toronto, while for condos it's 34.2 per cent, according to the most recent numbers from Royal Bank of Canada.

Condo prices in Toronto have been stagnant for about two years, as policy makers and economists have worried that too many units are being built. Toronto-Dominion Bank has forecast a 4 per cent drop in prices this year, followed by a further 4 per cent drop next year, because a large number of new units will be completed. Developers are holding the line on prices and offering incentives to keep sales going. The benchmark price of a new unit in the city is now $437,663 according to RealNet Canada Inc.

The reason Ms. Lehrer is concerned about prices boils down to construction standards, which she thinks are often not up to par. In her opinion, it's the majority, not the minority, of Toronto condo developers who are not paying enough attention to quality. And that, she says, will result in headaches down the road – not only for condo owners, but for Toronto residents who will have to put up with more construction and repairs.

"These buildings, within 10 or a maximum of 20 years, will need major renovations," she says. "And that's pretty scary."

She notes that while house owners can determine whether or not to do preventative maintenance such as redoing a roof, condo owners do not have the ability to single-handedly make those decisions because they are in the hands of condo boards. And she wants people to know that money spent now can become money saved later.

While problems such as falling glass get attention, she says the bigger problem could be the issues that aren't so hazardous. "It's about the everyday life experience that comes from the quality of the building," she says.

"Toronto has not been known for paying attention to high-quality buildings," Ms. Lehrer says. "I'm not an inspector, but from talking to people in the business, a lot of them have said that over the last three years, there have been quite a number of companies that are cutting more and more corners."

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"We know that in 10, 15 years, these buildings will need major renovations, and we are going to have to deal with that in a city that is pretty dense and built-up," she says.

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