January started out much like last year, with residential sales at just over 4,000 units. Condo apartment sales also equaled last year's total for January. Similar results were reported in the Downtown and Etobicoke Waterfront condo markets. Sales were ahead by 2% over 2004. Indications for February show that overall sales may well be 10% higher than in 2005. (Our Company's sales are already running over 50% higher than last year!) So look for a strong real estate market this spring. While active listings are 8% higher than a year ago, quality listings are in short supply. We have already experienced multiple offer situations in both detached and condo properties this year. However an area of weakness remains the Etobicoke Waterfront where the sale to active listing ratio is under 10%, due to several new buildings coming to market. While this is a buyer's market, do not expect to see a significant drop in prices. Owners are being patient. What you will see is a lot of choice and the ability to negotiate more favourable closing dates.
This month we decided to look at condo townhouses, and in particular the development at 12 Sudbury (just off King St. W.). We tracked the sales progress of two sizes of units. The first was an end unit - the best in the complex with three bedrooms and over 1300 sq.ft. with two decks and parking! It sold first in April of 2001 for $255,00 and the same unit sold again in October of '03 for $305,000. An identical unit just sold in December of '04 for $343,000. The price appreciation was 34.5% over 44 months or just over 9% per year. A smaller townhouse of 820 sq.ft. with a single deck and no parking (street parking by permit) was sold in October of 2002 for $192,000. The same unit sold again in February of '04 for $215,000. Later an identical unit sold in October of '04 for $222,500. The price appreciation here was 16% over twenty-four months or 8% per year. Even with these increases, units are selling for $260-270 per sq.ft. which is less than condo apartments selling in the $300+ range. Our forecast for 2005 is that these units will continue to be popular and one can expect similar price increases going forward.
The Toronto Real Estate Board released its annual report on the rental of condo units for 2004. Of the 6600 units leased, over 91% were condo apartments as opposed to townhouses. Downtown (south of Bloor) where one third of all units were leased, the average bachelor rented for $1050, the one-bedroom rented for $1425 and the two-bed-room rented for $2100. Of more concern to investors was the fact that the lease-to-list ratio Downtown was just over 60% for the year. That meant many owners had to list their property twice before it rented.