March was another strong sales month as reported by the Toronto Real Estate Board. Residential sales were 10% higher than March '05 and on a year-to-date basis are 9% higher than last year. The condo market shows even better numbers. Condo apartment sales were 13% higher this March than in March '05. Downtown, the market was even better - sales up 25% for March. And if you really want to get excited - there were 57 condo apartment sales over $500,000 in March versus only 34 for the same month last year! The condo market should be very strong for the balance of this year. The sale-to-listing ratio was 46% this March versus 35% a year ago. Market balance between buyers and sellers is found in a range of 25-35%. We still have a shortage of good condo listings in the Downtown market and this will not change as we enter the peak of the spring market.
Looking farther out, the gage of future prices can be found in the sales of new projects, which won't be ready for three to four years. When this latest round of condo developments started back in '98, resale condos sold for $275-300 per sq.ft. New projects were offered at $325. Today, resale units are averaging $350 - that's only a 4% annual increase over the period. However new projects are selling in the $425 -500 range. The price differential, which historically has been about $50 per sq.f.t., is now $100. Buyers of new projects should be cautious because the market will not catch up to some of these prices being offered! We do know going forward that resale units will continue to appreciate. There are still some good new projects coming to market but there are other projects that will not hold the pre-construction prices being offered today! Last year our Company did over 25% of its sales in new projects. As a brokerage, not tied to any one project, we were able to evaluate all projects for our clients. Going forward, buyers looking at new projects should retain someone who can objectively make comparisons between projects.
As we have always maintained, to accurately gage the market in terms of prices, you need to track individual condo units. This month we looked at a newer building - 410 Queens Quay - the Aqua at Spadina. The first unit we examined was two bedrooms with one bath, parking and a terrace of some 150 sq.ft. It sold in July of '03 for $257,000 and the same unit sold again in November of '05 for $306,000. This was an increase of 19% over 28 months or an annualized rate of 8%. On a per sq.f.t basis, this worked out to $350. If you adjust for the premium for the terrace and view, plus parking, the price is under $325. A similar-sized two bedroom unit just sold in April of this year at $320,000. Again condo prices are appreciating but at very reasonable and sustainable rates!
We are currently entering the busiest rental time of the year - the May/June occupancy period. In March, 146 one-bedroom units were leased Downtown. The average one-bedroom was on the market for just 22 days and leased at 100% of list - $1400. The two-bedroom market was better for potential renters in March. Sixty units were leased. The average two-bedroom leased for $2200 versus a list of $2250 and was on the market for 36 days. Going forward, there is a month's supply of rental product, which is sufficient for this time of year.