May was the third record sales month in a row for the Toronto Real Estate Board. All residential sales were 18% higher than May of last year. Condo sales also kept pace. May of 2004 was 16% higher than May of '03. Downtown the results were even better. Condo sales for the month were 31% ahead of the same month last year and 14% higher than April's sales. On the Etobicoke Waterfront, sales were 27% higher than May of '03 and level with April sales. The bottom line is that condo sales are strong. What is really surprising is that while year-to-date condo sales Downtown are 17% higher than last year, the number of new listings that came on the market in the first 5 months is 9% lower!! Can you believe that there is a shortage of good condo listings! The reality is that we are in a market where 'averages' distort the underlying market. Within this market there are 'hot' and 'cold' buildings and units. The challenge is to identify the trends and get 'ahead of the crowd'. That's where a Realtor who specializes in condos earns their keep.
To prove my point, the Toronto Real Estate Board reported that the average price of a downtown condo sold west of Yonge Street was $271,839 in May of this year - 6% higher than a year ago. The average price of a condo sold east of Yonge was $224,927 in May - 6% lower than a year ago. This information is of no use to anyone except economists who write reports on how the condo market is doing badly.
So let's look at the real world and sales at the Prince Arthur, a prime Yorkville condominium at 38 Avenue Rd. This area produces the highest condo prices and this building is one of the most sought after addresses. We traced the sale of an 1855 sq.ft. unit - 2 bedrooms, which was first offered by the developer from plans at $769,000. After construction, it sold again in 2000 for $799,900. The same unit sold again in September of 2002 for $988,000. The price per sq.ft. was $550. While this type of unit has not sold since that date, sales of similar sized units in 2003 and 2004 are selling for $600-700 per sq.ft. So how would you characterize this building and this type of unit?
We are now in the peak rental period for condos. Supply and demand are pretty much in balance and owners are far less willing to negotiate any lower prices. Inventory of one and two-bedroom units are slightly lower than last month. The most popular units are renting for $1400-1500 - that will get you a one bedroom with parking. Jr. one-bedroom (studio) units start at $1050 without parking. Furnished units are coming back in demand, a sign that the corporate community is moving more contract employees.