Solid condominium performance bolstered by affordability in the first half of 2008, says RE/MAX
Condo sales increase in 30 per cent of GTA districts, while 87 per cent post gains in average price over 2007
Mississauga, ON (September 3, 2008) -Showing remarkable resilience in a complex real estate environment, sales of condominium apartments, town homes, and lofts moved ahead of 2007 levels in 30 per cent of districts examined in the GTA this year, according to RE/MAX Ontario-Atlantic Canada.
Condominiums proved to be as solid an investment as single-detached homes in 2008, with property values of both rising virtually across the board in the first half of the year. The average price of a condominium appreciated in close to 87 per cent (52/60) of Toronto Real Estate Board districts examined by RE/MAX — with 20 per cent (12/60) reporting double-digit increases from January to June 2008, compared to one year ago. Willowdale, Lansing (C07) topped the list of best performers, with a 14.66 per cent increase in values, rising from $258,884 to $296,854. Thornhill (N02) placed second with a 13.3 per cent increase, bringing average price to $290,709. Both Willowdale and Thornhill saw nominal increases in sales activity as well, rising 2.8 and 3.5 per cent respectively.
The downtown core (C01), including King West, secured third spot with an 11.35 per cent increase in average price, bringing values in the area to $355,201 from $318,974 one year ago. Lawrence Park (C10) saw an 11.3 per cent increase in values, rising from $350,916 to $390,589, and a 5.7 per cent increase in unit sales, rising from 174 in first half of 2007 to 184 in 2008. Cabbagetown (C08) placed fifth with a 10.82 per cent increase in average price, rising from $301,224 to $333,818.
“Condominiums experienced upward momentum during the first six months of the year, despite an overall lag in the marketplace,” says Michael Polzler, Executive Vice President and Regional Director, RE/MAX Ontario-Atlantic Canada. “Their entry-level price point –between $200,000 and $300,000 for a small, one-bedroom unit downtown – clearly struck a cord with a broad range of purchasers. And while singles, empty nesters, and retirees, remain driving forces in the condominium market, a new demographic has emerged — young families. This active segment of the market is fuelling demand for town home developments throughout the central core. “While sales of single-detached homes softened, 95 per cent (60 out of 63) of communities examined experienced an increase in the average price in the first half of 2008. Of the 63 districts reporting, 22 per cent (14) reported a moderate double-digit increase in price. Three of the top five districts that saw significant upward momentum were located outside of the central core, while two were solid blue-chip neighbourhoods in the East and West Ends.
Leading the charge was Mississauga’s Lorne Park (W13) with a 13.63 percentage increase, bringing average price in the area to $679,914. Caledon (W28) came in a close second, with a 13.62 per cent increase in single-detached homes, with an average price of $500,812. Markham (N01) claimed third spot, with a 13.5 per cent increase in average price ($616,025 vs. $542,713). The popular High Park, Bloor West Village (W02) area secured fourth place, with average price hovering at $513,543, up 13.01 per cent from one year earlier. Danforth/Riverdale (E01) rounded out the top five with a 12.83 per cent increase in average price ($460,805 vs. $408,404).
Despite the higher price tag for single-detached properties, the bulk of sales occurred at more affordable price points. For example, in Lorne Park and the surrounding areas, the average price was $679,914, but the most popular price point was $275,000 to $375,000 where 28 per cent of sales occurred. In Caledon, 36 per cent of sales occurred between $350,000 and $450,000.
In Markham, where values average $616,025, close to 29 per cent of sales occurred between $475,000 and $575,000. In High Park and Bloor West Village, 28.9 per cent of sales were priced between $350,000 and $450,000. In the Danforth/Riverdale neighbourhood, close to 32 per cent of sales occurred between $375,000 and $475,000. The most popular housing type in most markets was the two-storey, followed by the bungalow, with the exception of older, more established areas like High Park, Bloor West Village and Danforth, Riverdale where the second most popular housing type was the two-and-a-half storey home.
“Affordability has played a key role in market performance over the past six months” says Polzler. “Price-sensitive purchasers clearly broadened their search perimeters, looking to Toronto’s bedroom communities for more affordable detached housing, while condominiums have provided monetary relief, especially in the central core. Demand for condo apartments, towns, and lofts is expected to be solid for the remainder of the year as a result.”
Note: All statistics sourced from RE/MAX and TREB Net
See full Re/MAX GTA condo report, first half 2008