This is your weekly mortgage and housing news update. There were plenty of headlines covering the Toronto housing market and most of it carried a negative tone, which doesn’t reflect well for Canada’s biggest market.
Toronto Housing Market
The adjective that most people use to describe the Toronto housing market is heated. This is especially true for the condo market which continues to see the average price increase while the average unit size decreases. Plus, the glutton of new construction in the pipeline leads to fears of massive over-supply, which have many experts calling for a condo market crash.
The Financial Post believes Toronto’s overheated market is unsustainable because the rest of Canada has been experiencing home price moderation, whereas home buyers in Toronto continue to over-spend for their properties. Over the past year, only Toronto has shown price gains (%) in double-digit territory at 10.5%. TD Bank believes Canadian home prices are 10-15% above a sustainable level.
Rundown of the numbers:
- 20% The number that the Toronto market accounts for within the Canadian housing market
- 36.1% The jump in new mutli-family home construction (mostly condos) from Q1 2011 to Q1 2012
- $360,892 The average price of a condo in Downtown Toronto
- 17% Percentage of Torontonians willing to pay more than $600/month in condo fees
‘The Donald’ himself made an appearance in Hogtown (that’s Trump, not Duck) to officially cut the ribbon for his Trump International Hotel and Residences tower in downtown. The Toronto Star has reported over a dozen investors are refusing to pay the final closing costs and assume ownership of their units, claiming these investments no longer make financial sense.