As many of you know, we have long extolled the strength of the Toronto Condo Market. On many occasions we have criticized the logic of those calling for a major price correction over the past five to ten years. However, while we see no prospect of a major price drop, we do have the feeling that we are reaching the top of the mountain and there will be a levelling off of prices for 12-24 months. Our rationale has nothing to do with low rental rates for condos or the rationale of per capita income to condo prices. Rather it has everything to do with our prices versus those of other major cities in the world and more particularly New York where we like to draw comparisons - even if only to dream! When we look back ten years ago, resale condo prices were just above $300 per sq. ft. and pre-construction or new development sale prices were at $350. Today we are at $500-600 in the resale market and $600-700 in the new market. New York has not enjoyed that level of appreciation. In Manhattan you can find condos starting at $1,000 per sq. ft. and that market has far more appeal than ours and has a lot more wealthy individuals. It is also not moving up as quickly. While experts keep focusing on the end-user in the resale market; prices in the new development market trickle down to the resale market. (Yes most investors are well financed and they will only sell their units at a profit – not a loss). Right now, there are less and less investors who have the appetite for condos at $700 per sf which will be the brake to the resale market where you find the end-users.