Toronto’s real estate prices are destined to continue increasing over the medium to long term.
According to the TREB (Toronto Real Estate Board) statistics, in the Greater Toronto Area, 2022 sales for the year ended with an average selling price of $1,189,850, up 8.6% over the 2021 average of $1,095,333. However, the CREA (Canadian Real Estate Association) reported last month that the national average home price across Canada was $632,802 in November 2022, a 12% decline from the same month in 2021.
Currently the rates for these condos have prices set around $2,000 per sq. ft plus. What do we see will happen next with super-condominiums as the landscape evolves?
Benjamin Tal, Deputy Chief Economist for CIBC, a top forecaster for the Canadian real estate market stated, “If you think it’s expensive now, just wait”. Given the world’s central banks’ recent battle with inflation, this should be no surprise. Pundits predict that by mid-2023 the rate will top out and probably begin declining by Q3/Q4.
Over the last 20 years, there has been and continues to be a perfect storm for ever escalating Toronto real estate values. Contributing to GTA price increases, in 2005 the provincial Greenbelt Act froze 2,000,000 acres of land surrounding Toronto, which severely restricted the supple of new single family homes and townhomes. Of the approximate 45,000 average annual new home sales in Toronto over the last 20 years, pre-Greenbelt, over two thirds were single family homes and townhomes. Today it is less than one third. Fortunately, new condominium sales have filled the gap.
The super-condominium has become a prime aspect of the Toronto real estate market. Supercondominiums are loosely defined as large, highend condos that offer a variety of suite sizes and rooms and offer common areas and amenities.
It is very impressive, that notwithstanding December 2022 sales volumes down 48% from last year, that December 2021 prices have continued to increase.
With only a handful of current developments and strong, patient developers, as well as an aging, affluent and expanding purchase base, in addition to significant supply chain issues and escalating material costs, the prices of the next super-condo projects will jump to $3,000 to $3,500 per sq. ft.
No. 7 Dale in Rosedale has 26 suites with only 10 remaining. With occupancy scheduled for Q2 of 2023, costs are all in and fixed. While pricing is not cheap, at about $2,600 per sq. ft average on what is available, it provides an assured belowmarket pricing from upcoming projects that will enter the real estate market in Toronto, as a result of the fixed costs making it immune to the price jumps of the next round of super-condos.
No. 7 Dale is the gold standard for super-condos in Toronto. It has earned this delegation with the Rosedale ravine location, suite sizes ranging from 2,200 to 5,200 sq ft., expansive terraces and highend, imported materials and appliances, such as, Dada Kitchen and Molteni & C millwork from Italy, pot lights from France, windows from Belgium and bricks from Denmark. Every aspect represents the best of the best. “If this building began construction today it would be about 25% more expensive to build,” states Boris and Josh Shteiman, developer/builder.
Buy new and buy now has been good advice for the last several decades and continues to hold value within the Toronto and GTA real estate market. With escalating price points for the Toronto supercondo, one of our favorite expressions still holds as the rule to follow: “Don’t wait to buy real estate; Buy real estate and wait.”