Whoever thought we’d see the day that Toronto’s condo market exceeded that of Vancouver’s? No one thought it was coming any time soon, but new stats from the Canada Housing and Mortgage Corporation say that lenders can expect to see a whole lot more Toronto mortgages, and that they’re likely to be on condominiums, as the starts for Ontario multi-dwelling units jumped by 50% over the first quarter of this year.
The report also showed that starts were up all over the country, with 14,517 starts occurring around the entire country – that’s the highest amount the country’s seen since the financial crisis in 2008. The reasons for the jump in starts, especially when it comes to condo starts, are many. One shift that may be partly responsible is the fact that so many Baby Boomers are retiring, and looking to downsize as they do, mostly to condo units rather than sprawling single detached homes. Another reason for it is because as gas prices continue to climb, Canadians start looking for a way to cut back on their commute; and one way is by moving to condo units in many of the downtown cores rather than purchase that home in the suburbs.
However, it’s not all busy executives and our older population that are scooping up all the condo units – foreign investors are too, and this is evident by the amount of “shadow condo inventory” currently sitting on the market. These are units that have been purchased, but still sit vacant; and it’s a sign that investors from other countries see Canada as one of the world’s most stable housing markets and therefore, a great place to purchase.
What might be even more interesting from CMHC’s report though, is that the housing market in B.C. has slowed by 27.7%, a sign that the most overstocked market in the country might be starting to show signs of also slowing down. Alberta though, continues to stay strong with more Calgary mortgages about to be shuffled into the marketplace as this area saw a 6.4% increase in starts. Quebec starts rose by a high 16.3%, while those in Atlantic Canada rose by 2.7%.
While the condo market is hot everywhere in the country, and especially in Toronto, the number of starts for single detached homes dropped. The slight plunge only slipped 2.4%, but with all the condo starts happening elsewhere, it’s clear to see what type of housing Canadians, and Canadian builders, are currently most interested in.
