Condo Pro: 2012 Will Rock!

By Barbara Lawlor

The 28,000 new condominiums sold in the GTA last year set a new record in the high-rise sector, and BILD is calling 2011 “Year of the Condo”! It was also the second-best year ever for total sales, which is fabulous news as we enter 2012. I predict that this coming year will bring more good news for many reasons. For one thing, our continued low mortgage interest rates are simply unprecedented! Everyone is buzzing about what an opportunity this is for anyone looking to buy, from first-time purchasers to the executive elite. I mean 2.99 per cent for five years? What a remarkable development, having been told a few years ago that in Canada, we’d never see single-digit mortgage interest rates again!

Of course, things change over time. Mortgage rates will eventually rise, and new condo prices will too. So, If you have been thinking of buying a new condominium, this is the year to act. I recently heard a talk by Benjamin Tal, Deputy Chief Economist of CIBC World Markets Inc. and one of our country’s leading experts on the real estate market. He painted a bright picture and said that we have the luxury of time right now, as interest rates will stay very low, possibly over the next two years.

In addition, Toronto has made gains in employment and population growth, and currently leads the country in terms of economic momentum. We offer a stable home base for the 100,000 immigrants we welcome to the city every year, as well as those migrating from other areas of Canada. In fact, if anything, we are under-supplied with housing. Each year, 40,000 households look to buy new housing product, and in the high-rise industry we can supply only 15,000. Low-rise is even tighter because of the dearth of available land supply.

As I mentioned, prices will continue to rise, but with interest rates so low, first-time buyers will continue to find condominiums the ideal way to enter the market. During 2012, executive buyers will see the continued arrival of the pure luxury market in Toronto, with The Residences at The Ritz-Carlton leading the way. The concept of living atop a 5-Star hotel is catching on, and more of these incredible residences will become available as the year advances. For the first time, wealthy baby-boomers will have a spectacular choice of condominiums they can see, touch and experience before buying.

 

The choice in the GTA is simply spectacular. There are hundreds of high-rises on the market, both in the 416 and 905 areas. High-rise sales accounted for 62 per cent of purchases last year, and there is every reason to believe we will sustain that momentum. This is especially true, with the continued influx of immigrants. And why wouldn’t people coming to Canada want to live in the GTA? By world standards, Canada is a safe country with a stable economy, and Toronto and its surroundings offer the ideal mix of urban and suburban residential locations. We now live in one of the most cosmopolitan and desirable areas on earth, and as more people move here, they will need homes to live in.

The retirement of baby-boomers and the ability of first-time buyers to afford condominiums over low-rise homes also contribute to the continuing success of the condo. Add to that exciting and innovative amenities and the best selection of suite features and finishes in North America, and the appeal is irresistible.

I have been in this industry for a long time, and I find what’s happening right now a thrilling development. Just imagine, 10 years ago, only 25 per cent of new home purchases in the GTA were high-rise condos. And in 2011, that statistic skyrocketed to 62 per cent. Phenomenal selection, incredible value, remarkable interest rates – when it comes to new condominium sales in the GTA, 2012 WILL ROCK!

Barbara Lawlor is president of Baker Real Estate Incorporated and an in-demand columnist and speaker. A member of the Baker team since 1993, she oversees the marketing and sales of condominium developments in the GTA and overseas. Keep current with The Baker Blog at blog.bakerrealestate.com