We can safely say now that 2020 was quite an unpredictable year for Toronto’s condo business. There has been an overall temporary shutdown of the construction industry. But with the first wave of pandemic easing up, the economy is shaping up again. Projects have started resuming. With that, condo developments can also be seen. Shaun Hildebrand, President, Market Research Firm Urbanisation, notes a total of 6,816 new condo apartments that have reached completion in Q3-2020.
Even then, the overall count in the number of condo apartments under construction in the GTA remains fairly high at approximately 78,156 units. There has been an additional 5411 units that are yet to be completed in Q4, as reported by Hildebrand. He also says that the condo completions might see an elevation as 22,434 new condos are scheduled to be completed in 2021. 70% of these are located in the heart of Toronto.
Along with the uncertainty that the pandemic has brought, it has also given way to the resilient construction industry, giving much hope for the next thing to come. Condo developers have been feeling much more positive about the year ahead. With 2020 at an end, we’ve gathered insights on what the developers expect from 2021 and how the condo market might unfold.
Overall Success of 2021
Brian Brown, Principal, Lifetime Developments, says that the “success of 2020 surprised us all”. According to him, even though it was below what they had expected at the year beginning, the sales still continued despite the shutdown caused by the pandemic. For 2021, he expects a “promising 2021 with signs of returning to a more normal state by the middle of the year.”
Lifetime’s initial plan inb XO2, 2020, was to launch the project at 500 Dupont and the 2nd Phase of the King and Dufferin project. However, there was a delay due to the pandemic bringing the projects to launch in 2021.
The President of Vandyk Properties, John Vandyk, has put forward a similar viewpoint. Vandyk says he feels optimistic about the possibilities of the new condo developments in the year ahead.
He further stresses that the condo development market in Toronto has faced a cyclical 2020 when compared to the market in general. The first 2 months saw remarkable growth, but by the middle of March, the “wind was completely taken out of the market’s sails, only to return strong again in the middle of the summer”.
For 2021, there seems to be a bold move forward in the condo market. Interests might remain low, and the downtown condo market will see a surge in 2021. Condo sales can possibly increase up to 15% throughout the board in the year ahead.
First Six Months of the Year
The first half of the year will be quite active in the condo market of Toronto, as per Brown. He also adds that most developers who delayed their projects in 2020 were waiting for the news of a vaccine being announced. Brown also speculates that 2021 should expect to see many “great sites” to be brought to market with strong price holding that would go along with the market demand.
Brown further puts forward that the reputation of Toronto is quite strong globally, especially in the condo market. With its stable banking system, low interest and borrowing rates, and high numbers of immigration, Toronto is set to play a prominent role at the beginning of 2021, something that “we will be very proud of”.
Vandyk has been holding a similar feeling of optimism about the first few months of 2021. He also says that the data they have been watching closely gives information that the first quarter will be steady that will lead to a positive flow in the second quarter. He further added that the same momentum would be adding positive consequences in the third and fourth quarter and possibly beyond. There are many exciting projects prepared to be launched in the market. This includes their Grand Central Mimico project.
“We are watching it closely to ensure that our releases are appropriately timed and that they coincide well with the resurgence in the buyers’ confidence we are forecasting,” adds Vandyk.
The Impact of COVID vaccine on Toronto Condo Developments
So far, the speculations have been that the COVID-19 vaccine will bring an optimistic wave in the Toronto Condo Market. Gavin Cheung, Vice President of CentreCourt, says, “the roll-out of a highly effective vaccine program in 2021 should materially improve the psychology of all Canadians, and market activities will feel a lot more normal than in 2020.”
Brown, too, has added that factors like low-interest rates are also contributing factors in estimating a positive 2021 beginning. The increased immigration targets of over 400,000 will help the condo business for the next 3 years.
Condo Development Trends Gaining Popularity in 2021
As for 2021, the biggest trend would be the ‘re-settlement of the downtown core.’ The economy will begin again up to its full potential. Colleges and universities will reopen, and work-from-home would resume the backseat. New downtown projects can be expected to gain the first-hand traction in the market.
Marco Mendicino, Canada’s Immigration Minister, reports that the country is set to welcome more than 1.2m new immigrants over the span of 3 years. This also means 401,000 new permanent areas for residents in 2021, which should escalate to 411,000 in 2022, and 421,000 in 2023.
Even though these predictions paint a pretty optimistic picture of Toronto’s condo market, it is yet to see how far these predictions come true. For now, there is just a hope that 2021 has better surprises than 2020.