Key Market Indicators for the City of Toronto in 2014:
In 2013 we saw that major industries inside the city of Toronto continued to grow; this includes financial services, technology and research industries, and educational institutions. 2014 will also see continued stabilization from interest rates, which is good news for the markets. Population growth also continues to be strong for the city of Toronto. As more and more people desire to move into the city this will be good news for anyone looking to sell property in Toronto especially in the downtown area. One potential issue will be whether banks and mortgage lenders are willing to finance rental condos, but only time will tell.
Predictions and Key Numbers for 2014:
We predict that 2014 will be a record breaking year for real estate sales in the city of Toronto. Toronto has 750,000 more people than the last record year in 2007. Many clients have been sitting on their hands waiting for the right moment and this year will be it, expect to see sales in the area of 95,000 units.
The 416 area code will be extremely popular with buyers looking for homes in the sub $1 million dollars range, expect to see a rise of prices in this area with appreciation rates in the area of 3-4% per year moving forward.
This year many condos in the $500,00 range will transition from rental properties to being on the open market.
Luxury condos are seeing a depression in their prices from $1,000 per square foot down to $700, per square foot. These natural market pressures will help to open these properties to a larger buyer pool.
New starts for condos in 2014 will come in around 11,500 units following roughly 12,000 units in 2013. This is well below the 35,000/year new units the market could actually support, which will continue to keep pressure on prices. Many of these new condos are being built in the $500-$600 per square foot range.
2014 will see a resurgence of assignment sales, (sales of a property prior to its completion date).
As more owners move properties onto the open market expect rent prices to stay even with 2013. Studio Apartments will have an average price of $1400 per month. One and two bedroom apartments will come in at $1600 and $2200 respectively. 2014 will also have roughly a 1% vacancy rate.
In sum, 2014 will be a very strong year for real estate sales in the city of Toronto and with buyers entering the market after the lull, there will be an advantage to sellers.
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