CONDOS ARE THEIR OWN MARKET
But what about cities like New York and Boston? In Manhattan, the home of the financial services industry and where 'sub prime' mortgages were securitized and circulated around the world, like some infectious disease, we have seen thousands of job losses in the financial services industry. Still condo and co-op housing prices rose by 5% last year!
In Boston, a city not unlike Toronto in size and industry infastructure, we have seen condo sales remain steady and prices continue to edge up.
So what about the Toronto condo market? May sales on the Toronto Real Estate Board were again lower than last year and listings are rising. This is good news for buyers and for the overall market. Price increases are moderating which will sustain the market are current levels. History shows that three years of double digit price increases will create a price bubble and eventually a price correction. The Toronto house market has already experienced that, and price reductions are starting to be observed. In the condo market, we have seen only one such year of double digit increases. My guess is that price appreciation will continue this year for condos, but at a much lower rate than last year.
Again the condo and house markets are moving in different directions.