All you need to know regarding the housing market in Toronto, Canada and abroad.
This week in Toronto: Why condos are outpacing house prices in the GTA, there are not enough family-friendly condos to match demand in the city and young professionals want to see denser housing.
Elsewhere: Montreal home sales trend upwards, a look at Detroit housing after the 2008 financial crisis and nearly half Europeans who don't own home reckon they never will.
The majority of new condominium construction is driven by investor demand – not demand from families – and investors are willing to pay much more (on a ppsf basis) than end users are. Investors also prefer smaller units because they are less expensive and typically have a better return on investment than larger units. Because of this, the price that developers are paying for land is based on what investors are willing to pay for condos which explains why its hard for them to build affordable family-sized condos.
Toronto condo prices reach new heights (City News)
One thousand dollars. That’s the new cost, on average, per square foot for a new build condo in the heart of Canada’s largest city. It’s a shocking 30 per cent increase, per square foot, year-over-year in Toronto. A price point which is here to stay, according to Urbanation, the company that compiled the third quarter report.
Not enough family-friendly condos to match demand: Report (Toronto Star)
Up-sizing young families and downsizing seniors are about to converge on a Toronto-region housing market that isn’t sufficiently prepared to accommodate their needs in terms of space and affordability.
Many would elbow their way into some of the region’s established, amenity-rich neighbourhoods if there were more affordable housing options, according to a survey of 18- to 39-year-olds for the Toronto Region Board of Trade.
One recent survey by Fortress Developments showed a roughly even split among respondents on the question of whether government should try to control house prices in Toronto, decide how many Toronto houses can be sold, and who can buy them. Is there something so special about Toronto real estate that it destroys the logic of the marketplace, and makes people yearn for the sector to be government-run?
Off the boil? Canadian housing (The Economist)
“The single-family home and plex markets are becoming increasingly favourable to sellers, as selling times for these property categories are falling,” said Mathieu Cousineau, president of the Greater Montreal Real Estate Board.
The New Democrat government has said it’s reviewing transaction data along with the foreign buyers tax and an interest-free loan program for first-time homebuyers in an effort to decide whether such measures should be kept, revised or scrapped altogether.
Reagan reckoned that home ownership brought “stability and rootedness”. That may be so, but it also brings rigid labour markets. Yet few politicians are willing to praise the merits of renting. Thatcher’s and Reagan’s housing reforms were thought to be driven by a fear of a slow creep of socialism. They would look enviously at Russia today. Home ownership rates in Britain and America have fallen in recent years; Russia’s has increased by 30 percentage points in two decades.
November 10, 2017This Week In Real Estate |