Canada

One of Canada’s Biggest Real Estate Bulls Isn’t So Bullish On Condos

One of Canada’s largest real estate brokerages is bullish on real estate this year, just not condos. Royal LePage released its annual price forecast showing slower, but still big, price growth in 2021. There was one notable exception – condo apartments. They expect prices to rise, but they also expect them to lag the market. Toronto condos aren’t even expected to beat inflation. 

Canadian Condo Prices Forecast To Grow At Half The Rate

Canadian condo apartment prices are forecast to gain next year, but underperform. The brokerage forecasts that a typical condo in Canada will cost $522,700 in 2021, up 2.25% from the year before. This is about half the growth they’ve forecast for the total of all home types. This is much slower than usual for condo apartments, especially with the recent boom.

Royal LePage Canadian Condo 2021 Price Forecast

The forecasted percent change in prices for condo apartments in 2021.
Source: Royal LePage, Better Dwelling.

Toronto Condo Prices Forecast To Almost Be Flat

Greater Toronto condo apartments are expected to underperform national price growth. The brokerage is forecasting prices will reach $600,800 in 2021, up just 0.50% from last year. This is less than a tenth of the 5.75% forecasted increase for Toronto’s aggregate market. A big change for Canada’s largest condo markets, which was thought to be unbeatable just a year ago.

Vancouver Condo Prices Are Expected To Rise Over 3%

Greater Vancouver condo apartments are expected to outperform the general market. The brokerage is forecasting a price of $684,300 in 2021, up 3.50% from 2020’s estimated finish. This is almost a third of the 9.00% forecast for the region’s aggregate. It’s slow for Vancouver, but still outperforms the national forecast. The brokerage’s ambitious outlook for Vancouver was an unusual outlier amongst Vancouver forecasts.

Montreal Condo Prices Expected To Rise Over 3% 

Greater Montreal condo apartments are expected to beat national performance as well. The brokerage is forecasting a price of $382,600 in 2021, up 3.75% from 2020’s estimated finish. This is just over half of the 6.00% gain projected for the region’s total market. Better than Toronto or Vancouver, but still much slower than last year.

Ottawa and Halifax Condo Markets Expected To Lead The Country

Two of Canada’s smaller cities are expected to lead condo apartment price growth. Ottawa condos are forecast to make the biggest gains with prices reaching $417,900 in 2021, up 7.50% from last year. Halifax follows with a forecast of $322,300, up 7.00% over the same period. Very large gains, but once again, not exactly the size seen over the past few years. 

Canada’s real estate markets are forecast to see price growth slow  this year across all segments. The brokerage cited a popular observation – people are moving away from city centers. They observed this trend before the pandemic, but it was accelerated by low rates and work from home adoption. This trend also takes people away from prime condo markets, and mostly puts them in other home types. Not many condo apartment towers in cottage country. Yet at least. 

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7 Comments

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  • Mortgage Guy 3 weeks ago

    Canada’s entering the point of no return for polarization. White collared workers will be able to work wherever they want, choosing smaller and cooler cities like Hamilton over Toronto.

    People in low skilled jobs that require supervision will have to live in those built-for-airbnb torture boxes they designed.

    • Insanity 3 weeks ago

      Not all white collared workers are allowed to work from home. Some companies mandate their employees to return to the office.

      It’s also only current white collared workers who aren’t being completely screwed by affordability. Anyone entering into the workforce, who still have to rent, are going to have enormous challenges trying to save a down payment for a home given the absurd costs of living nowadays (especially on the west coast).

    • Crazy Times 3 weeks ago

      Not all white collared workers can do this as some employers are mandating they return to the office as they (employers) don’t like work from home.

      This also doesn’t take into account any new people entering the workforce, even if they are white collared workers. Will be even more difficult to save for a down payment with the crazy costs of rent, and throw into that mix cost of real estate (meaning larger down payment is needed).

    • Doomcouver 3 weeks ago

      A lot of “investors” are holding out hope that interest in Toronto/Vancouver condos will come roaring back once COVID is over. What they don’t realize is a chunk of the economic damage is semi-permanent and will be made very obvious once the wage and income subsidy programs dry up early this year. Plus the move to remote work for many companies is fully permanent, and no one wants to be working from home in their tiny downtown apartment. Just like the 1980s, Toronto condos will probably kick off the price implosion and it will radiate out to all cities in Canada. It’s taken over 2 decades to get here, but the end of the mania seems to be closer than ever.

  • Faith 3 weeks ago

    Never trust real estate guys, they will do anything for their ends to meet

  • SH 3 weeks ago

    I think they’re being conservative in their estimates. The Liberals plan to flood Canadian cities with non-Canadians. That will overwhelm any increase in listing activity and new build completions.

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