Inventory Relief
The biggest story in the Toronto condo market over the past 6 months has been the disparity between supply and demand. Simply put, inventory (condos available for sale) is at an all time low, and demand is at an all time high. This has been a recipe for rapid price appreciation, frenzied buying, and sellers very much in control of negotiations.
2010 promises to bring change. Several high-profile condo projects downtown are coming to completion this year and whenever this happens, huge numbers of units are put on the market by investors looking to cash-out their investments.
Specifically over the next few months, buildings that will likely be registering include London on the Esplanade (just registered), Murano (North Tower to be registered this month), VU (Jarvis and Adelaide), 550 Wellington, West Harbour City, Boutique, Glass House, CASA, Bloor Street Neighbourhood, etc.
Most of these are buildings that were selling during the heady days of 2005-2007 and 2010-2011 will see all of these projects come ‘online’ and they will be added to the inventory for the downtown market.
Buyers should soon be able to breathe a sigh of relief as all this product will be coming to the market in time for the spring. However, prices will likely continue to rise as demand will remain strong for at least the next 2 quarters.
In about six months two key events will take place that will likely shape the real estate market for the following 6 to 12 months – the Bank of Canada will be raising interest rates and the HST will kick in. There is a great deal of uncertainty surrounding these two events; however, many are predicting that they will have a negative impact on prices heading into the final half of 2010.
