Market to stabilize Misconception about foreign owners
Resale apartment condominium sales are down by almost 25 per cent compared to a year ago, but the market “has seen the worst of it” and will stabilize in 2013, says CMHC senior market analyst Shaun Hildebrand. A combination of tighter qualification rules for insured mortgages and a retreat by investors has slowed the condo market. All the recent bad press probably hasn`t helped.
Hildebrand`s analysis shows condo prices will experience only a mild correction in the near term and that economic fundamentals and demographics point to a stable condo market going forward.
Hildebrand says there is about 4.5 months of supply for resale condos, creating a buyer`s market. While he does not expect a strong spring market in 2013, by the second half of the year Hildebrand believes prices my start going up. The strongest communities will be Mississauga and Scarborough, followed by downtown Toronto and North York. Etobicoke and York markets may be slowest to rebound.
Hildebrand also says there is a misconception that foreign investors own many of the region`s condos. In fact, non-Canadians own just 3.7 per cent of GTA condos, and recent immigrants own many of those units.
Fifty-one percent of GTA households have two people or less and one-person households grew by 15 per cent from 2006 to 2011. These are the people who continue to find condos an attractive option.
The average condo price in the GTA is about $325,000. REU