The downtown condo market in Toronto so far in 2012
2011 was an all time high year for the condo market in Toronto, more condos were sold than any other year ever. The first 3 months of this year were similar with several large projects like INDX Condos
and Massey Tower
selling 70-80% of their projects within a matter of a couple weeks. There was speculation at that point that 2012 might actually break the records set in 2011.
After a red hot start to the year however, things have slowed down considerably over the last 3 months to be more in line with historical sales levels from the past few years which means we are behind the numbers we achieved in 2011. A couple smaller projects have been put on hold, and several large projects that were originally supposed to be launch in the spring have still not launched as developers have become more cautious. Prices remain consistent though and there is no signs of prices falling at this point in the new condo market.
Mixed use projects becoming more common
Some mixed use projects that have been recently launched that will contain office space as well as condos include 88 Scott (Wellington and Scott by Concert Properties) and Peter Street Condos (Peter and Adelaide by Centrecourt Developments). Mixed use projects are becoming more common in condo projects downtown. Harbour Plaza by Menkes is expected to launch later this year and will be a multi-phase project with a large commercial component.
The resale condo market so far in 2012
The resale market has closely followed the pre-construction market in that the year started out quite hot but in the last few months things have slowed down considerably. Generally speaking sales are down and inventory is up compared to a year ago, however, prices are still holding firm and are up slightly.
What is the outlook for the condo market for the rest of 2012?
In the second half of the year I expect far fewer new projects to launch than we saw in the first half. Developers will focus their efforts on selling the product they already have on the market, rather than adding from their pipeline. Demand should still be pretty steady albeit not at the levels we saw in 2011′s record setting year. The result will be flat prices for the second half of the year. There will be some opportunities for deal hunters who know where to look as some developers whose projects are not selling well will likely offer excellent incentives to buyers.
The resale market will likely see record high levels of inventory that will put downward pressure on prices. I expect prices will come down in the last few months of the year around 4-6%.