Toronto Sees New Condo Sales Fall Over 52%, Inventory Spikes Over 63%

The Toronto condo resale market might be doing well, but new condos are having a hiccup. Altus Group numbers, obtained from Building Industry and Land Development Association (BILD), show the new condo market in Greater Toronto is rapidly cooling. Generally speaking, new condo apartments saw higher prices, plummeting sales, and soaring inventory.

New Toronto Condo Prices Are Up Over 16%

The price of a new condo stalled for the month, but still made a huge climb from last year. The price of a new condo reached $774,759 in July, virtually flat from the month before. Annual gains were still very lofty though, with prices up a massive 16.5% compared to the same month last year. The monthly price change isn’t all that surprising, considering July is one of the slower months. The annual change is unusually high.

New Toronto Condo Sales Are Down Over 52%

Despite higher prices, sales continued to fall for condo apartments. Altus is reporting 855 condo sales in July, down a massive 52% compared to the same month last year. That’s on top of the 20% decline we saw last year, so for those keeping track – we’re down 62% from 2016. Higher prices, and higher interest rates are likely behind the sales decline.

Greater Toronto New Condo Sales

Total condo apartment sales in Greater Toronto for July, by region.

Source: Altus Group. Better Dwelling.

Toronto New Condo Inventory Jumps Over 63%

Lower sales levels helped to boost inventory in Toronto. There were 9,931 condo apartments available for sale at the end of July, up 63.12% compared to the same month last year. July is typically a slow month, but BILD noted only “minimal” projects were launched last month. This likely helped keep inventory lower than we would have seen, but that won’t last for long.

David Wilkes, President & CEO of BILD said “We are still seeing a shortfall in condo apartment inventory.”  Further adding, “given the current pace of sales, we should have nine to twelve months’ worth of inventory, but we only have five. We expect that more condo apartment product will become available in the fall.”

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  • Reply
    Tia 6 years ago

    I thought Toronto had an endless supply of immigrants and refugees that were going to line up to buy nearly $1 million condos? Where they at?

    • Reply
      Ahmed 6 years ago

      The provincial government is also forecasting that 2/3 of all immigrants expected to arrive in Canada, are moving to Toronto. Something smells fishy with our government stats. Why are there empty houses on my street if we’re in a housing crisis? Unless people move here, get a passport, then leave… but maintain “residency” to reap the benefits of healthcare, etc.

    • Reply
      Canadian 6 years ago

      I see the problem of current situation in our government who is trying to orchestrate the market , Toronto real estate is still have a room to add more value, and yes buyers are on the way. Toronto is a giant , beautiful city , fourth in size in North America, the largest city of Canada.

    • Reply
      Francis 6 years ago

      Because massive immigration will decouple wage growth from real estate price growth. Big business wants immigrants for the effects it has on wages and replacement costs, while Big Real Estate likes it for increased demand.

      But eventually, those two special interests diverge as the scam is being perpetuated.

  • Reply
    Qzm 6 years ago

    $774,759 for a shoebox condo? That’s about three houses in most major US cities. You Canadians have lost your minds.

    • Reply
      Grizzly Gus 6 years ago

      $774,759 in Canadian will only be worth about 2 pick-up trucks, 20 double cheese burgers with supersize fries + drinks, a 2-4 of Bud, a shotgun, and a package of fireworks. When you compare a GTA condo to a hillbilly wedding its really not that bad of deal.

    • Reply
      Chris 6 years ago

      You are damn right. Canadians have lost their minds.

    • Reply
      Jon Tario 6 years ago

      Several cities, yes. But NYC, DC, the SF Bay area, and LA prices are high. The difference however (with the exception of Silicon Valley and the hills and ocean front of LA) is that as you branch out from the city prices are significantly less. In GTA I see the same prices in downtown that I see in Etiboke and Oakville. THAT, my friend is unheard of in the US. Also, in the US we like our space. No way are you finding a two bedroom condo that’s 650 sq.ft. Thats just not right. Who can live like that?

      • Reply
        Trader Jim 6 years ago

        With the exception of DC, all of those places have GDPs the size of small country’s. NYC’s GDP by itself is bigger than Canada.

        We need to stop this comparison based on how similar the buildings look. Most of the cost is the land underneath it.

        • Reply
          Jon Tario 6 years ago

          What? I’m responding to OP. Not comparing mate and I don’t think anyone here is comparing based on about how similar the buildings look. Give us some credit 🙂

          • Jon Tario 6 years ago

            meant not comparing GDP – no edit function. oye.

          • Trader Jim 6 years ago

            My bad, but it really shouldn’t be listed along side those cities at all. It’s smaller than Atlanta in GDP, and a little above Detroit. Through the magic of disbelief, we place a higher value on our home prices because we’re delusionaly pretending it’s closer to NYC or LA.

            If we doubled our GDP, our population and output would be closer to Chicago… which is about 1/3 of the price.

    • Reply
      Vlad 6 years ago

      How many will you buy in NY, Boston, San Francisco, right 0.
      Toronto to Canada = NY to USA

  • Reply
    Zlatko 6 years ago

    Prices are always sticky on the way down. Even though inventory is up so much, and sales are down so much, prices still increased 16%? No one is forcing a cut. People need to just walk away from these offers.

    • Reply
      Vlad 6 years ago

      You not going to see condos prices going down any time soon if at all.
      Stats in this article even if valid just shows sales getting to normal rate.
      Last year it was abnormally crazy and people could not reserve unit in new building even if they wanted. Buildings were sold out in matter of weeks, now that craziness cooled down mostly by new prices that builders adopted as normal (over 1000 per SQFT).

  • Reply
    @xelan_gta 6 years ago

    Great article, no doubt there is a major slowdown in new constructions segment.
    I must add that now condo sector absorbed buyers from both condo and detached segments. And even with all that demand sales are very low.

    Detached sales are minimal. Here are detailed stats from the same Altus Group
    July 2018 Results:
    Low Rise: 216 sales; down -77% from 10 year average
    High Rise: 885 sales; down -40% from 10 year average
    Total New Homes: down -55% from 10 year average

  • Reply
    Danger warner 6 years ago

    super rich entities are capable of buying up Canada, assuming Canadians just walk way from these offers, so there will be no more place to live for Canadians in Canada if one wants to do so.

    • Reply
      Pragmatist 6 years ago

      Right. About time we banned foreign ownership.

      • Reply
        Xeno Warrior Princess 6 years ago

        The foreign buying tax doesn’t apply to buying pre-construction, only when the property registers. Most foreign speculators were buying and flipping before it registers anyway, so it would have no impact.

        If it’s the foreign buying tax, why is the rest of the country seeing declining sales? If it’s B-20, why are country’s that have lowered their downpayment structure and are actively seeking foreign investment seeing declining sales? GTFO here with your xenophobic garbage, you have no clue what you’re talking about.

        • Reply
          SMH 6 years ago

          To completely ignore the foreign money pouring in buying our properties is irresponsible. It clearly plays a factor when after BC put in place its foreign buyers tax that Toronto immediately started to blow up, then thereafter when Toronto put in its FBT Montreal is now in the throws of housing mania.

          People like you screaming that anyone speaking out about foreign money are xenophobic or racist is one of the reasons Vancouver did NOTHING to curb the issue and now are paying a hefty price for it. The foreign money and its laundering is adding fuel to the fire and to ignore it would be a big mistake. It is neither xenophobic nor racist to recognize that.

          P.S. I’m Asian, born to parents who immigrated here in the 80’s. And I still do believe foreign money plays a role as well as other factors ie. low interest rates, does that make me racist?

          • @xelan_gta 6 years ago

            Foreign buying is a privilege, not necessity. Should we grant that privilege when people in Vancouver live in trailers? That’s up to everyone to decide.

            The issues with any foreign buying (FB):
            – In 100% of cases it reduces affordability for local population.
            – Many FBs borrow from local banks and can easily walk away defaulting on their mortgage without any consequences whatsoever, leaving Canadians to pay the bill.
            – In GTA alone we have about 1000 of buyers who refused to close in 2017. In almost all cases sellers were able to sell only at lower price and if they were “lucky” to have a FB who walked away they don’t have the option to sue him/her for the difference. There are many examples when sellers lost 100-500k because of that.
            -If we have deep RE correction FBs won’t lose jobs and won’t be affected by it, they will be able to buy our properties at big discounts at the bottom of the correction and increase their presence in our RE market. Because of that affordability will be even worse for future generations.

            This is just the tip of an iceberg, we’ll learn much more issues while this RE correction becomes deeper.

            The larger the share of FBs, the bigger those issues. It’s being recognized around the world and restrictions are being put in place for a reason. Both local speculators and FBs are responsible for RE bubble creation. Those people who say it’s only FBs fault are wrong as well as those people who say it’s only locals’ fault.

          • Bluetheimpala 6 years ago

            RE as an investment class should’ve had some walls put up with the main one being interest rates, loan regulation, corporate disclosure and ultimately taxation. The door was left wide open and people came in trashed the place. Foreign governments liked that the West was/is getting pooched because we can’t control ourselves. Those foreign entities view us as weak and easily manipulated and SHOCKER that’s what happened. Once the snowball started it was really locals who kept it going while their outsiders have been cashing out since late 2016 and are almost done more or less but the quick and easy narrative was that foreigners started it and it is their fault. Tsk tsk…don’t eat the puke. BD4L.

          • BCGUy 6 years ago

            Foreign Buyers definitely helped Canada’s economy, if only for the short term, while helping create a horrific bubble.

            But there’s thousands of baby boomers who were able to sell in Greater Toronto Area, and Greater Vancouver Area and retire early or sell and move out of the city with a nicer house and a huge chunk of change in the bank.

            Its not all bad when it comes to foreign buyers.

            Its the people like most of my friends who bought the Kool-Aid and bought overpriced houses-condos etc(many bought more than one) and over extended themselves while calling me a fool because of the “fake money” they made, that I supposedly missed out on. Only a few actually sold and had tangible benefits. Everyone else is paper rich.

            Going to be interesting to see where they are in a year. …

  • Reply
    CJ Ray 6 years ago

    Well at least we now have to get some actual real sales data. Until the TREB Syndicate gets their greasy, slimey hands into it!

  • Reply
    Contrarian 6 years ago

    The Canadian dollar is low which makes Canada’s real estate cheaper for foreign money to buy. Foreigners buying now will get a windfall profit from a higher Canadian dollar.

    The foreign purchasers who bought when the dollar was higher, and before the foreigner’s tax, are sitting tight and holding onto their property because they would lose money selling now.

    Rents are rising in Toronto and mortgage rates are still low which makes buying attractive. There’s not a lot on the market, especially in places where people want to live, so prices are staying high.

  • Reply
    Taxman 6 years ago

    Buying multiple homes to flip and as an investment should be taxed at the highest levels,

  • Reply
    Vlad 6 years ago

    You not going to see condos prices going down any time soon if at all.
    Stats in this article even if valid just shows sales getting to normal rate.
    Last year it was abnormally crazy and people could not reserve unit in new building even if they wanted. Buildings were sold out in matter of weeks, now that craziness cooled down mostly by new prices that builders adopted as normal (over 1000 per SQFT).

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