Just released from Urbanation:
Q3-2010’s 3,805 new units sold represented a drop of over 1,000 units from the previous quarter’s 4,991 new unit sales and an 18 per cent decline from Q3-2009. Despite the third quarter drop, the Toronto CMA condominium apartment market is on pace for the second highest annual sales total on record.
“The third quarter decline may be attributed in some part to those buying units as an investment resisting the continuing rise in the psf (price per square foot) of new units, particularly in downtown locations off the subway line,” said Urbanation Editor and Executive Vice President Ben Myers.
The average sold unit in the 275 active projects on the market was $462 psf in Q3-2010, with unsold new units being offered at $520 psf. Similarly, the average psf for resale units sold was $372 psf in the third quarter.
“To some degree, the recent ‘upward price aggressiveness’ of developers of new projects, counting on the apparently robust demand for their products, has now met with reluctance from both investors and end-users,” added Myers.
Even with a summer slowdown in the market, only 19 per cent of the CMA record high 69,892 units (in the 275 active projects) were unsold at the end of Q3-2010 – well below the historic level.
Myers added, “With prices rising and the market expanding, the ability of developers to differentiate their product through design, architecture and advertising will be paramount for their success going forward. Successfully incorporating those project elements by developers and their consultants, plus strategic pricing, was a significant factor in condominium market recovery in 2009.”
This agility by Toronto developers may have contributed to the very short duration of the recession in the CMA condominium market. Another contributing factor to the success in the new market was the resurgence in the resale market; the market witnessed record high resale activity between Q2-2009 and Q2-2010.
The 3,646 resale condominium transactions in Q3-2010 were down 25 per cent year-over-year, and 28 per cent from the 5,076 resales in Q2-2010, the highest quarterly total in CMA history.
“2010 remains on pace for the best year ever in terms of condominium resale transactions,” said Myers, “however, the market has finally shown signs of slowing after 15 months of frenzied activity.”
The average resale unit sold for $331,000 in Q3-2009, down from the $335,000 recorded in the previous quarter, while listings dropped for the second consecutive quarter to 8,539.
November 1, 2010Market |