Toronto

Toronto Condo Prices Hit A New High As Inventory Rises Back To 2016 Levels

Toronto condo prices just keep ballooning, although less than they have been recently. Toronto Real Estate Board (TREB) numbers show the price of a typical condo reached an all-time high in June. Some of the pressure to move higher is finally being released though, as sales fall faster than inventory.

Typical Toronto Condo Price Reaches A New High

The price of a typical condo hit a new all-time high across Greater Toronto. TREB reported a benchmark price of $502,400 in June, up 7.52% from the year before. The City of Toronto’s benchmark price rose to $529,300, a 9.10% increase. The city continued to outperform the suburbs on both monthly and annual increases.

Toronto Benchmark Condo Price

The price of a “typical” condo apartment in Toronto.

Source: CREA, Better Dwelling.
The annual rate of increase continued to taper, but was still massive. Last June TREB saw an annual price increase of 30.6%, which tapered down to this month’s 7.52%. The City of Toronto was at 32.6% last June, tapering down to this month’s 9.1%. In contrast, the median rate of price growth over the past decade has been just a touch over 5%. Even with the taper down to single digits, the gains are likely to come down further.

Toronto Benchmark Condo Price Change

The annual percent change of price, for a “typical” condo apartment in Toronto.

Source: CREA, Better Dwelling.

Toronto Condos See Median Price Rise Over 9%

The median sale price of a condo actually outperformed the benchmark. TREB reported a median sale price of $489,000, an increase of 9.15% from last year. The median sale price in the City proper rose to $535,000, a 12.63% increase from last year. Median sale prices aren’t adjusted to size or quality, so they aren’t a great reflection of how much you would pay. They are one of the more popular measures used by international buyers.

Toronto Median Condo Sale Price

The median sale price of a condo apartment in Toronto.

Source: CREA, Better Dwelling.

Toronto Condos See Average Price Rise Nearly 8%

The average sale price of a condo is performing more in line with the benchmark. TREB reported an average sale price of $561,097, up 7.9% from last year. Most of the strength is from the City, where the average price reached $605,530, up 9.5% from last year. The 905 saw the average rise to $450,672, a much more conservative increase of 3.4%. Once again, the average sale price isn’t a great indicator for how much you’ll pay for a condo. Instead it’s a better indicator of dollar flow.

Toronto Average Condo Sale Price

The average sale price of condo apartments in Toronto, and the suburbs.

Source: CREA, Better Dwelling.

Toronto Condo Sales Drop Over 5%

Condo sales continued to fall across Greater Toronto. TREB reported 2,234 condo sales in June, a decline of 5.3% from last year. The City of Toronto represented 1,593 of those sales, down 6% from last year. Declining sales don’t mean a lot in the context of prices, unless contrasted with inventory, so try to reserve your judgement for a bit.

Toronto Condo Sales Vs. New Listings

The number of condo sales, vs newly listed condos per month in Toronto.

Source: TREB, Better Dwelling.

Toronto Condo Inventory Rises In ‘Burbs, Falls In The City

New condo listings made a huge decline right across Toronto. TREB reported 3,585 new listings in June, a decline of 15.54%. The City represented 2,498 of those new listings, a decline of 15.92%. The decline in new listings wasn’t as big of a drag on total inventory.

The total number of active condo listings didn’t fall anywhere near the new listings. TREB reported 4,005 active listings, an increase of 2.5% from last year. The City represented 2,584 of those listings, down 4.57%. This is the highest levels of condo inventory across TREB since August 2016, and it’s still not a huge amount. Sales are still falling faster than inventory, releasing some of the pressure to see prices rapidly rise.

The number of condo listings available for sale in Toronto.

Source: TREB, Better Dwelling.
Toronto condo prices hit an all-time high, but there may be some relief on rising prices soon. Sales fell faster than inventory, and the benchmark continues to see tapering growth. Rising interest rates are likely to be a drag on growth as prices push higher as well.

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11 Comments

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  • Reply
    TNT 3 months ago

    Condos are now pricing at the same price as row homes. That’s bad news.

  • Reply
    NJ 3 months ago

    For more than 4 years (2012 till end of 2015) condo prices were at low 300s, yet suddenly in just 2 years it went topping 500s, that’s insane ROI and unsustainable. Just stupid fishes gets baited.

  • Reply
    gear74 3 months ago

    Condo prices in downtown Toronto were undervalued before. Now it’s not only another mean of living, it’s the way of life : walking distance from walk, proximity to everything, great nightlife. This is the way of life in many many countries. We, Canadians are all spoiled with all this big houses. Since the house in Toronto proper is way more expensive people better get used to this condo prices. Don’t believe condos in great location like Downtown Toronto will go down in price, but the price acceleration will slow down.

    • Reply
      Trader Jim 3 months ago

      They’ll stay flat until incomes catch up for 10 years, or they’ll fall. It’s not a matter of prime location or a lifestyle choice, it’s a matter of free-flow cash in the economy. If they don’t fall, and incomes are rising at just above CPI, the rest of the economy collapses. Economies have a funny way of balancing out like that.

      Housing is late-business cycle. Unless the business cycle booms and results in a *surge* of wages, home prices will at least lose value in real terms.

      • Reply
        John 3 months ago

        A surge in incomes would be a surge in inflation. A surge in inflation means a surge in interest.

        I dont think any plausible increase in incomes could offset the resulting increase in interest.

  • Reply
    CJ Ray 3 months ago

    One of many reasons why the next generation is ‘Gen-F’d’.

  • Reply
    Beh G. 3 months ago

    Not necessarily related to this topic but I wanted to post this for you guys since the RE industry is hailing Montreal as the next big thing!

    https://www.lavanguardia.com/local/barcelona/20180716/45938578727/colau-onu-declaracion-ciudades-especulacion.html

    You have to use Google translate to read the article if you don’t speak Spanish, especially as spoken in Catalonia! 😉

    Of course, you won’t find any references to this in Canadian media but it’s a very important development and of course we’ll have speculators that are going into the Montreal market now claiming they were completely caught off-guard (i.e. they’re not doing their research).

  • Reply
    Crash 3 months ago

    It is all bull’s trap and dead cat bounce. Don’t trust this fake info. Crash is here!!! Skies are falling!!!

  • Reply
    The6Confusion 3 months ago

    This is a bit of a reality check for all the bears (myself included) that the market is going to correct. I did not buy a condo two years back, a year later, it had gone up a whopping 30%. I was convinced that it was even more over valued, after all, what mature market goes up by 30% in 1 year! I dedicated to stay out of the market, and now its gone up by another 7%. Now I’m permanently priced out, and to add insult to injury, the rent in my area has gone up by $350 per month. As analytically sound as the main posts are on BD, I find the comments section to be an echo chamber for bears. I’m no longer convinced that condo prices will correct to be more affordable for middle income earners. My only hope is that rents return to stability (as incomes can no longer absorb rent inflation).

    • Reply
      John 3 months ago

      Which is why I dont believe true FOMO has occurred in Toronto.

      People have yet to be priced out. We are just currently on the side lines.

  • Reply
    Joe 3 months ago

    I have been reading the articles and comments at BD and I feel that the real estate market will slow down but not crash like many suggest (barring any huge economic crisis caused by trade wars/etc). The net gain (appreciation – cost of carrying) in the near future will not be close to what we had in the last few years and possibly lag behind other assets. However, if you are not looking for short term speculation, I feel that real estate is still a pretty good investment.

    Buying a house/condo to live/rent out in Toronto seems like a wise choice as rents skyrockets faster than interest go up. The probability that investors will all suddenly throw their rental properties on the market is low and even if a number of them do, there is population growth to soften this effect. Even in negative cash flow condo rental cases, I feel that rents will eventually catch up and appreciation, though slower, will still be worthwhile.

    There are definitely tons of investments out there that give better returns and are much more liquid but they are also riskier for the common folks and for these folks, investing in real estate is a sound choice.

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