REMAX 2023 Condominium Report – GTA Focus
REMAX 2023 Condominium Report Indicates Potential Slowdown in the Condo Market
Recent economic indicators point to potential challenges for Canadian homebuyers, primarily driven by anticipated interest rate hikes. This may signify the end of a short-lived surge in condominium activity across major Canadian markets.
A thorough analysis by RE/MAX of nearly 100 communities in seven significant Canadian condo markets reveals that the robust sales observed from May to August of this year couldn’t match the levels seen in the first quarter of 2022. In the first eight months of 2023, overall condominium sales declined in all but two markets, with Calgary showing an impressive 22% increase and Edmonton experiencing a modest 3% rise in sales compared to the previous year.
It’s worth noting that Alberta markets stand out due to their affordability, which is attracting a considerable influx of interprovincial migrants.
Meanwhile, the average prices of condos remained stable in Greater Vancouver, Calgary, and Halifax-Dartmouth but declined in the Fraser Valley, Edmonton, the Greater Toronto Area, and Ottawa.
These price drops can be attributed to higher borrowing costs and the additional 2% added by the stress test, which made it more challenging for buyers to enter the condominium market in certain regions.
REMAX 2023 Condominium Report for the GTA
For Toronto condos, which makes up for the largest condominium market in Canada, a significant increase in new listings in August has raised concerns. Toronto saw its apartment inventory rise by almost 24% year-over-year, while townhouse stock increased by a more modest 7.5%.
Ontario, while welcoming 125,000 international migrants in Q1 2023, experienced a decline of 14,732 in interprovincial migration, the largest out-migration since 2000. Affordability remains a major concern in most Canadian markets, despite some softening in overall values.
High carrying costs, exacerbated by current interest rates, pose a barrier to home ownership. Notably, the most active areas in every market are often those where affordable condominiums are available. First-time buyers and real estate investors continue to drive activity, with lower price points showing consistent demand.
After four consecutive months of sales surpassing the previous year’s levels, renewed concerns over higher interest rates may slow down homebuying activity in the Greater Toronto Area’s condo market in the coming months.
Overall sales of condo apartments and townhomes in the GTA for the year-to-date period are down by 12.8%, with the average price of these units decreasing by six percent.
Condominium Sales, Average Price, and Market Share
GTA Housing Market, January 1 – August 31, 2023
|Market||Sales Transactions||YOY Change||Avg. Sales Price||YOY Change||Condo Market Share|
|2023||2022||(+/- %)||2023||2022||(+/- %)||2023||2022|
REMAX 2023 Condominium Report highlights affordability as a key concern
Affordability remains a critical factor, as high interest rates and the government stress test hinder many first-time buyers from qualifying for mortgages. Buyers looking for value are willing to explore areas outside Toronto, such as the 905 region, where they can find more affordable options without the municipal land transfer tax applied in the 416-area code.
Sales data for Toronto Regional Real Estate Board districts during the first eight months of the year show an increase in transactions in a quarter of the districts year-over-year. This growth is particularly pronounced in some areas, including the 416 area code and the 905 region, where entry-level buyers can find homes within their budget.
Yet, luxury condominium market is strong
The luxury condominium market in Toronto and Calgary remains strong, while activity at higher price points in Greater Vancouver, the Fraser Valley, and Halifax has slowed down. Buyers are increasingly willing to expand their search to find better value or avoid additional costs, such as land transfer taxes.
Importance of Condo Status Report
Maintenance fees and the overall condition of condominium boards are now essential factors for buyers. Unlike freehold properties, condominiums do not allow for deferring repairs and maintenance, making it crucial for buyers to ensure that everything is in order.
Condo Assignments are on the rise
AssignmentsNew Assignment Rule 2022 represent opportunities in markets like Greater Vancouver, the Fraser Valley, and the Greater Toronto Area. Many presale buyers from three to four years ago are finding it challenging to qualify for mortgages at the current interest rate levels, leading them to sell or assign their condos to new buyers.
New condominium construction has slowed down in most markets, with many projects being delayed or canceled due to financial viability concerns in the current economic environment. Having said that, there have been quite a few builder new condo launches recently, which have received a huge response.
Current Builder New Condo Projects in Mississauga & Area
M6 CONDOS AT M CITY
CANOPY TOWER 2
Selecting a builder’s new condo with our help comes with several perks. You get a free legal review, a look at their past performance, advice on upgrades, and support in finding tenants if you decide to rent it out. Team Kalia is your reliable partner, making sure you have all the information and support you need to choose between new and resale condo options.
GTA Condo Market Report by TRREB
As per TRREB’s 2023 Q3 Report, the condominium apartment market balance improved in the past year. Q3 2023 sales increased YoY, but new listings outpaced sales growth, leading to a slightly lower average price, offering relief amidst higher borrowing costs. In Q3 2023, 4,415 condo apartment sales were reported, up 6.2% from Q3 2022.
The GTA-wide average selling price was $716,145, slightly lower than $720,628 in Q3 2022, with Toronto’s average price at $736,566, down from $750,087. Market conditions are expected to tighten in the second half of 2024 due to GTA’s rapid population growth, with potential borrowing cost relief in 2024 and 2025.
And as per the latest TRREB’s October GTA market stats, here are the average condo apartment and condo townhouse prices.
|Average Home Prices by City October 2023|
|Condo Townhouse||Condo Apartment|
|City of Toronto||$827,644||$729,160|
Mississauga Condo Market October 2023
All Mississauga Condos Average Condominium Apartment Prices
1 BR + 1 WR: $529,829. Units Sold: 24
1 BR + Den + 1 WR: $548,650. Units Sold: 10
2 BR + 2 WR: $568,692. Units Sold: 25
City Centre Condos, Mississauga Average Condominium Apartment Prices
1 BR + 1 WR: $535,100. Units Sold: 10
1 BR + Den + 1 WR: $563,000. Units Sold: 3
2 BR + 2 WR: $656,453. Units Sold: 15
Hurontario Condos, Mississauga Average Condominium Apartment Prices
1 BR + 1 WR: $530,540. Units Sold: 10
1 BR + Den + 1 WR: $544,583. Units Sold: 6
2 BR + 2 WR: $647,177. Units Sold: 13
It is interesting to note that 2 BR + 2 WR units are fast gaining popularity and demand.
In our opinion, Mississauga, especially City Centre, popularly known as Square One presents an excellent opportunity to buy or invest in condos in the present market.
Looking to Buy, Sell, Invest or Rent Condos in Mississauga & GTA? Contact Team Kalia today!