Priced out of the detached home market, many Canadians returned to condo search triggering a price surge in that market as well, according to a report from RE Max Canada office.
Affordability, coupled with availability, set the stage for exceptional rebound in condominium sales across the country in 2021, Mr. Christopher Alexander, senior vice president of Re Max Canada, said in a report published Tuesday morning.
The Re Max s Canada 2021 Condominium Report, which examines trends and developments in five major Canadian centres and more than 100 sub-markets, found that buyers turned to condominiums in 2021 as freehold values escalated beyond their reach.
Double acceleration in detached housing values revived slumping condominium sales early in the year, with demand shifting into high gear as supply dwindled and prices accelerated, Alexander said. To date, the younger buyer has been behind the push to buy condos, with most looking to secure low interest rates and buy before prices climb beyond their means. Condos were briefly lost their charm in the eyes of Canadians who worried about sharing elevators and common room with strangers amid COVID fears and looking for more room as many started working from home, but this led to a rapid increase in values across an already inflated detached home market.
A separate report by Re Max last week noted that single-detached homes led price gains this year with increases in both the 6.8 and 27.3 percent across 26 markets surveyed. The real estate broker expects the trend to continue into the fall, driven by strong demand by young families.
The families who missed out on snagging a detached home have turned their attention to the condominium market, especially as a downtown revival is slowly gaining momentum in some provinces.
The strongest gains in condo sales were made in Western Canada with Greater Calgary and Vancouver reporting condominium sales rising 87 and 83 per cent in the first eight months of the year, respectively, compared with the same period last year.
The Greater Toronto AreaToronto Area GTA led the east in terms of percentage increases in condo sales at 71 per cent, followed by Halifax-Dartmouth at 36 per cent and Ottawa at 29 Percent, the report noted. The biggest upswing in pricing occurred in the East, with both Halifax-Dartmouth and Ottawa posting double-digit price gains of 30.0 per cent and 18.0 per cent, respectively. In Vancouver - Canada's most expensive real estate market, condos represented 48.2 per cent of all residential property sales during the eight-month period, up from 46 per cent last year. The benchmark price for a detached home is $1,828, 200, compared with $744,221 for a condo for gains of 6.7 per cent since the start of the year Share of market is expected to climb for condominiums in the next six to 12 months as values for single-used houses - that are up 25 per cent to date - make condominium ownership the next best option, Re Max noted.
Halifax-Dartmouth area led the price gains in condominium markets, rising 29.8 per cent year-to-date to just under $400,000, followed by 17.5 per cent increase in Ottawa to $420,654. The average price for a condo in Calgary is $263,480, an increase of 3 per cent year-to-date.
The decrease in condominium supply is expected to place upward pressure on prices in the months ahead, prompting more multiple offers on well-priced units in Greater Vancouver, Re Max noted.
Share of market will climb for condominiums in the next six to 12 months, as values for single-planned homes — which are expected to increase 25 per cent to 40 million.
Re Max concluded on August 4, 2013 that condominium ownership is the next best option?