There was a time not long ago when condo apartments were out of favour. This time last year, Torontonians had fled downtown as the pandemic took hold, temporarily stemming the demand for this housing style.
As a result, real estate professionals have been advising buyer clients for months that, unlike freestanding homes, condo apartment pricing was to be trusted. That is to say, the listing price for condo apartments was likely to be quite close to the ultimate sale price.
This is no longer the case.
Over the past several months the real estate market has displayed a clear shift in favour of condo apartments. A return to the office for many downtown residents may have encouraged the pricing upswing, in part.
At the same time, the housing shortage continues to push pricing higher for freestanding homes like detached, semi-detached and townhomes, leaving fewer options available for buyers.
Whatever the reason, condos are back.
Encouraging signs of condo apartment demand kicked off 2021, and by the end of the third quarter the average selling price for condo apartment sales had increased by 8.9 per cent compared to Q3 2020 (Toronto Regional Real Estate Board, 2021).
According to TRREB President Kevin Crigger, “The condo market has seen a dramatic resurgence compared to a year ago. In 2020, first-time buyers sat on the sidelines due to economic uncertainty. This year, however, improving economic prospects have seen many of these buyers accelerate their search for a property.” (TRREB, 2021).
As a result, condo apartment buyers must now join the ranks of freestanding house hunters when it comes to market conditions: the list price may no longer be an accurate reflection of what a seller hopes to obtain for the home.
This trend may continue to escalate as it has with freestanding homes, driving price further uphill for condo apartments. Kevin Crigger warns that “if demand continues to increase relative to supply…the annual rate of price growth could increase as we move into 2022.” (TRREB, 2021).
Experienced REALTORS® are tracking these market changes and can help you stay on budget despite the shifting landscape. Be sure to ask your trusted real estate professional for guidance. Compare sale prices of condo apartments in the same building and neighbourhood before making an offer, ensuring that you are reviewing sales from the past one to three months.***
Reference: Toronto Regional Real Estate Board (TRREB), 2021. Condo market report. TRREB Releases Q3 2021 Condo Market Statistics.
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