After mortgage-rule changes helped cool off the sector, Toronto’s condo market is in a sort of Goldilocks phase — not too hot, but not too cold.

David George-Cosh – Wall Street Journal

A year ago, Toronto’s condo market was described as being too hot, with prices and sales far outpacing expectations.

Comment: And those who said that were wrong. Same as they have been wrong since they first started saying it in 2003. But none of them ever admit they were wrong.

Now, after mortgage-rule changes helped cool off the sector, Toronto’s condo market is in a sort of Goldilocks phase — not too hot, but not too cold.

Comment: Exactly where it should be!

In its latest report, the Toronto Real Estate Board says condo sales in the city were down 6% in the second quarter from the same period last year. Condo prices in Canada’s biggest city are up 1.7% over the same time period to $347,896, TREB said.

Comment: Early July sees condo sales rising again, more than 4%, with prices up as well.

While sales are still down, they’re not as bad as they were in the first quarter when condo activity fell a sharp 17% from the first quarter of last year, said Jason Mercer, TREB’s senior manager of market analysis.

“You’re starting to see more households move into the market who have put their decisions to buy on hold over the past few months,” Mr. Mercer told Canada Real Time.

Comment: Exactly what I predicted last year.

Other metrics reported by TREB also support a more balanced condo market in Toronto. Active listings are up 2.5% in the quarter, while new listings are down 4% compared to the same period last year.

That should allow the condo market in Toronto to tighten up, leading to better sales activity and steady price growth, Mr. Mercer said. He sees condo prices rising by about 3.5% by the end of the year.

Comment: And it is simple stats like that that bely any talk of a softening market.

“This is reflective of the tightening of the mortgage tightening guidelines put in place last year,” Mr. Mercer said. “You’re now seeing more conservative lending and households more conservative of their balance sheet.”

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Contact Laurin Jeffrey for more information – 416-388-1960

Laurin Jeffrey is a Toronto Realtor with Century 21 Regal Realty. He did not
write these articles, he just reproduces them here for people who are
interested in Toronto real estate. He does not work for any builders.
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