Toronto Condos Market Records Record May Sales

According to Toronto Condo marketing research firm RealNet Canada, the high-rise market continues to push for new highs.

May set another record with 2,433 new Condo sales in the GTA, up 50 per cent from May 2010.

The low-rise homes are suffering on account of much lower inventory. As of May there were only 6,819 new low-rise homes available compared to a historic 20,000 new homes available in any month.

The price gap between Toronto and area low-rise and high-rise is now $70,000 making new family homes more exepensive than Condos.

The rental market accoirding to a CMHC release in June shows the Toronto rental market at 1.6 per cent, down from 2.7 per cent last year.

Investors continue to buy new Toronto Condos and immediately put most of them on the rental market as vacancy rates continue to go down.

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Toronto Condo Prices Continue To Rise

In Toronto affordability is still a contributing factor in the unstoppable Toronto Condos Market. Mortgage rates are still down and employment numbers are strong.

Now buyers on the Toronto Condo buying sidelines are wondering if there may be a correcting or worse, what if the interest rates go up.

A sense of urgency has resulted in Toronto for years with bidding wars for homes in the cities more desirable locations like Rosedale, Forest Hill and Toronto Downtown Condos.

Now buyers are in a hurry and expectations are taking over the basics of supply and demand.

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Canadian Housing Markets Bubble?

Canada's central banker said some parts the Canadian Housing Market are hot and there is not much his bank can do to stop it.,

The message again was simple, be prepared for interest rates to rise and with all the mortgage debt most Canadians are carrying, be prepared for those rate hikes to take a much bigger part of any budget.

According to the central banker there were signs the average home selling price was 11 times higher than the average income (Asian wealth from abroad) and a possibility of too many Toronto and Vancouver Condos under construction.

Mr Carney said some parts of the housing market may be acting like the classic bubble with expectations of rising prices and ever higher returns driving demand rather than the classic supply and demand of years gone by.

So, even as the central banker warns of the impact of higher rates because of all  the debt Canadians carry, the Canadian housing market continues to heat up.

Pictured above: One Bedford Condos For Sale Or Rent

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Toronto And Vancouver Coming Housing Bubble?

A recent U.S housing report examined the property crash in several U.S metropolitan areas

The report found development restrictions played a big part in fuelling these Housing Bubbles.

Cities in the U.S with restrictive land use regulations whether it was compact city policy, growth management or smart growth all contributed to first a higher price on available homes, more credit to buy theses homes and then a larger drop as prices started to go down.

In comparison the study by the National Centre For Policy Alternatives found that some housing markets with the greatest rise in prices increased by an average $135,000 to $275,000.

In major markets with the least rise in prices, houses only increased by and average $135,000.

This could be a clear warning for Vancouver and Toronto home prices as both cities have similar development restraints.

Vancouver is hemmed in by the mountains and Ocean while Toronto has greenbelt areas surrounding the city, restricting new inventory and helping to drive up home prices to meet demand.

Recently we have seen in the Toronto Real Estate markets, the average price increases but resales are down and fewer listings are put on the market.

What is needed is a more balanced Toronto Real Estate Market with more choices for both buyers and sellers.

Vancouver has seen the average resale price there for a detached house increase to $805,000 in may, up 10 per cent from a year ago.

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Toronto Condos Continue Records

Toronto continues to have the largest Condominium Market in North America.

In April a new Condo suite was sold every 13 minutes, setting a high-rise Condo sales record for that month.

Who are these luxury Condo buyers?

Some are foreigners who want to invest here after looking around other cities in the World. Most choose Toronto because of the economic, political and social environment found here.

Prices attract too. New York Condos can go for $10,000 to $12,000 a square foot compared to $2,000 to $3,000 luxury Toronto Condos are selling for now.

Some Condo buyers are local business owners who are trading in their luxury mansions in Rosedale and Forest Hill for the latest Condos and luxury amenities the developers have to offer.

Luxury downtown Toronto Condos like the Shangri-La, The Ritz-Carlton, the Four Seasons and the Trump Tower are all catering to moves towards high-end, high-rise Condo living in our cosmopolitan World class city.

Pictured above U Condominiums.

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Canadian Real Estate Overheating?

There is a huge difference in the Canadian Real Estate markets compared to the U.S. Real Estate markets.

In the U.S. the latest Standard and Poor's housing report showed home prices there fell 4.2 per cent in the first quarter, adding to an eight month fall.

The average home price in Canada for April was $372,544, more than $100,000 over the U.S. amount.

Perhaps the bigger difference is a result of artificially low interest rates backed by the Canadian governments mortgage insurance, something the Americans do not have.

U.S home prices are in a housing bubble and it seems home prices are in no hurry to go up anytime soon.

Even our Toronto Commercial Real Estate Downtown is surging.

It appears that the governments tightening of Canadian mortgage rules and warnings that the government is watching any overheating of the home market is not stopping some Canadian cities like Vancouver and Toronto from record breaking home prices.

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