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Condos a bright spot in recovering Toronto, Vancouver markets
[VANCOUVER] The market for condos and attached properties surged in Canada's main real estate markets, Toronto and Vancouver, as buyer interest in expensive detached homes has withered, data showed on Tuesday.
Toronto home sales and prices were down in November from a year earlier, while in Vancouver sales and prices jumped sharply year-over-year, separate reports showed. Condo prices in both cities held strength compared to cooler segments.
Sales volumes in Toronto rose 3.6 per cent in November from October, suggesting the market may be stabilizing after a sharply weaker summer. Sales were down 13.3 per cent from a year earlier, the eighth straight month of declining sales after a years-long boom, a report from the Toronto Real Estate Board (TREB) showed.
In Vancouver, sales went the other way, down 7.5 per cent from October but up 26.2 per cent from a year earlier, the Real Estate Board of Greater Vancouver (REBGV) said.
Together, the two regions account for about half of house sales by volume in Canada.
Vancouver's market staggered in 2016 after the government introduced a foreign buyers tax, but the less-expensive condo market has bounced back as investors continue to fuel demand.
Toronto, hit by a similar tax in 2017, is showing a similar pattern, with detached sales swooning but the condo market showing better strength.
Worries about government moves to cool demand imposed by the province of Ontario in the spring have started to wane, said TREB President Tim Syrianos in the report.
"On top of this, it is also possible that the upcoming changes to mortgage lending guidelines, which come into effect in January, have prompted some households to speed up their home buying decision," he said.
Canada's tougher new lending rules that require stress tests on uninsured mortgages and an end to practices designed to circumvent lending limits will take effect on Jan 1.
The average selling price for all homes types in Toronto was down 2 per cent at C$761,757 (S$808,350), while condo prices rose 16.4 per cent. Overall, prices are 17 per cent below the April peak.
The Ontario government introduced a foreign buyers tax and other measures in late April, in a bid to cool real estate demand in Toronto and the surrounding areas.
In Vancouver, the average selling price for condos jumped 19.9 per cent, with townhome-style properties rising 18.9 per cent compared to the previous year. Detached home prices rose 7.5 per cent but are down 4.6 per cent from an April 2016 peak.