Urbanation released its Q1-2021 quarterly condo market update for the Greater Toronto Area at the end of last month. And there's some good stuff in it. New condo sales totaled 5,385 units in the first quarter of this year, which is higher than the 10-year average of 4,924 units and only slightly below sales from a year ago (Q1-2020). By and large, the numbers are starting to feel a bit pre-pandemic-like.

If you remember what happened back in the second quarter of last year, there was a quick shift in demand toward the suburbs and outskirts of Toronto. Part of this was driven by affordability. But I guess part of this was also driven by the fact that some people seemed to think that our cities had never before experienced a health crisis and were going to somehow die. Or perhaps it was because Zoom is so much fun (and not at all exhausting) and that this time was destined to be different. Either way, I never understood this.

Fast forward a year and the core is not surprisingly coming back. The oldest part of the city (former City of Toronto) saw 2,886 new condo sales in the first quarter of this year. This is actually higher than sales in Q1-2020. New condo openings in downtown Toronto sold for an average price of $1,419 per square foot. And overall absorption was about 76% in the quarter, which is the highest it has been since 2017.

Some of you may be looking at these numbers and thinking WTF. But when developers look at the costs in their pro forma, as well as what's on the horizon -- ahem, inclusionary zoning -- it's usually that same feeling. So it's hard to imagine average prices and rents going anywhere but up.

This morning BILD released its November new home data for the Greater Toronto Area. 

The story is one we’ve been hearing for a while. Supply is trending downward. It’s becoming harder to build. And prices are up. The average new detached house in this region is now C$1,230,961 and the average new condo is now C$493,137 (~$601 psf). Overall, average pricing is up 20% for low-rise houses and up 10% for condos, compared to this time last year.

One of the things that I find interesting about the data is how unit sizes have recently started trending upward on the high-rise (condo) side. Below is a chart from Altus Group that shows what I’m talking about. Look at the increase from the middle of 2015 to today. The average is now 820 sf, compared to what looks to be around 770 sf at its lowest point.

Now, there are a number of possible explanations for this. One is that boomers are starting to sell their houses and move into condos in larger numbers, and 500 sf just don’t do. The market is starting to cater to them. Another possible explanation is that low-rise pricing has become so out of reach for many people and families, that they are now looking to condos to fill that need.

I see both scenarios playing out in new projects today. But this second scenario, in particular, is one that I’ve been thinking about for a few years now. It’s less obvious than the boomer play. But I think of it as the market maturing. I like seeing families living right in the city and I am sure we will see more of that in the future.

Urbanation released its Q1-2021 quarterly condo market update for the Greater Toronto Area at the end of last month. And there's some good stuff in it. New condo sales totaled 5,385 units in the first quarter of this year, which is higher than the 10-year average of 4,924 units and only slightly below sales from a year ago (Q1-2020). By and large, the numbers are starting to feel a bit pre-pandemic-like.

If you remember what happened back in the second quarter of last year, there was a quick shift in demand toward the suburbs and outskirts of Toronto. Part of this was driven by affordability. But I guess part of this was also driven by the fact that some people seemed to think that our cities had never before experienced a health crisis and were going to somehow die. Or perhaps it was because Zoom is so much fun (and not at all exhausting) and that this time was destined to be different. Either way, I never understood this.

Fast forward a year and the core is not surprisingly coming back. The oldest part of the city (former City of Toronto) saw 2,886 new condo sales in the first quarter of this year. This is actually higher than sales in Q1-2020. New condo openings in downtown Toronto sold for an average price of $1,419 per square foot. And overall absorption was about 76% in the quarter, which is the highest it has been since 2017.

Some of you may be looking at these numbers and thinking WTF. But when developers look at the costs in their pro forma, as well as what's on the horizon -- ahem, inclusionary zoning -- it's usually that same feeling. So it's hard to imagine average prices and rents going anywhere but up.

This morning BILD released its November new home data for the Greater Toronto Area. 

The story is one we’ve been hearing for a while. Supply is trending downward. It’s becoming harder to build. And prices are up. The average new detached house in this region is now C$1,230,961 and the average new condo is now C$493,137 (~$601 psf). Overall, average pricing is up 20% for low-rise houses and up 10% for condos, compared to this time last year.

One of the things that I find interesting about the data is how unit sizes have recently started trending upward on the high-rise (condo) side. Below is a chart from Altus Group that shows what I’m talking about. Look at the increase from the middle of 2015 to today. The average is now 820 sf, compared to what looks to be around 770 sf at its lowest point.

Now, there are a number of possible explanations for this. One is that boomers are starting to sell their houses and move into condos in larger numbers, and 500 sf just don’t do. The market is starting to cater to them. Another possible explanation is that low-rise pricing has become so out of reach for many people and families, that they are now looking to condos to fill that need.

I see both scenarios playing out in new projects today. But this second scenario, in particular, is one that I’ve been thinking about for a few years now. It’s less obvious than the boomer play. But I think of it as the market maturing. I like seeing families living right in the city and I am sure we will see more of that in the future.