Toronto’s condo market languished through most of 2020, with the 905 eclipsing the downtown core in sales, but momentum swung back to the latter last quarter.
According to an Urbanation report, preconstruction condo sales in the City of Toronto climbed to 2,886 in the first quarter of the year from 2,829 in Q1-2020, but the number of transactions was also 2.5 times higher than the quarterly average between the second and fourth quarters of last year. The City of Toronto comprised over 50% of new condominium sales in the GTA for the first time since 2018.
Downtown Toronto preconstruction sales also reached record-high prices in Q1, selling at an average of $1,419 psf for a 603 sq ft unit, up 5.7% from $1,343 for a 594 sq ft unit a year prior. As a result, remaining inventory sold for 3% more at $1,416 psf than it did in Q1-2020 when it was $1,371 psf. Last quarter, downtown Toronto new condo projects sold for between $1,260 and $1,470 psf while the 905 sold for $737-1,214 psf.
The resale market surged by 104% in the City of Toronto during the first quarter of the year compared to Q1-2020, with inventory falling to one month, which is far below the five months of supply there was in the second and third quarters of last year. However, average resale prices last quarter were 4.7% below Q1-2020, but 6% above Q4-2020 prices, reaching $1,018 psf for 736 sq ft units.
GTA-wide, new condo sales fell to 5,385 units last quarter from 5,593 a year earlier, but they were higher than the 10-year average of 4,924. Seventy-six percent of new condos launched for presale last quarter were sold by the end of the quarter, marking the highest level of opening quarter absorption since the market peaked in 2017. Moreover, they sold for a record sale price of $1,261 psf ($817,000 for a 648 sq ft unit), increasing by 8.8% from $1,159 psf for 664 sq units in Q1-2020.
Unsold inventory in the GTA decreased by 11% year-over-year in Q1 to 11,956 units, which was a 10-quarter low, while the average price rose by 7.7% to $1,178 psf. With declining inventory, developers raised prices by an average of $45 psf, up 4% from the last quarter of 2020, although several builders increased prices by more than $100 psf.
There were 83,497 units under construction in the GTA during the first quarter of the year, a year-over-year increase of 10% from 76,145 units in the first quarter of last year. However, at 44%, the City of Toronto represented the lowest share of GTA condo units under construction, while, at 32%, the 905 recorded a record high share.