Sam Mizrahi’s supertall skyscraper “The One” just started construction on the seventh level of a planned 85 storeys.
Despite ongoing construction and a completion date in 2023, commercial space at The One has already been fully leased, and 82 per cent of the residential units have been sold. The building’s high-end luxury condos come with a hefty price tag, yet Mizrahi said most of the tower’s condos have already sold, prompting the addition of nine additional floors of units.
“There are few condos left to sell at this point,” Mizrahi said.
The One reflects a larger trend within the Greater Toronto Area: Condos have replaced detached single-family homes as the primary form of home-buying.
In January 2022, home sales in the GTA fell with fewer properties listed for sale, resulting in lowered sales forecasts, while price predictions remain high. The Toronto Regional Real Estate Board reported that 5,636 homes were sold in January — an 18 per cent drop from the 6,888 homes sold in January 2021.
However, taking into account condo sales, January 2022 was actually a vast improvement in home sales from the previous January, Construct Connect reported.
Drawing on numbers from Altus Group, there were 2,853 total new-home sales in January — an 18 per cent improvement from January 2021 and 47 per cent above the 10-year average.
With condo sales included, it was the highest number of new homes sold in January in 19 years.
At a recent news conference, Jason Mercer, chief analyst for the Toronto Regional Real Estate Board, placed this trend in context.
“A first-time homebuyer can only buy homes that are available at the price they can afford and that means a condo because that’s more affordable than a single-detached home,” Mercer said. “Where are those condos? They’re in Toronto.”
While it’s possible that Toronto will eventually see a return to pre-pandemic levels of home sales, Mizrahi said condos will play an increasingly important role in meeting the city’s growing need for housing.
“Condos aren’t just more affordable. They’re also more energy efficient and take up less space,” Mizrahi said. “I think it’s likely that more and more families will choose condominiums — not just in Toronto, but everywhere.”
Real estate company Engel & Völkers recently put out their Canadian luxury real estate report, which estimates the city’s population will continue to increase in coming years, despite the lack of diverse and affordable housing options.
“Between 2016 and 2021, Toronto’s population grew faster than new residential housing, and by 2046, the city of Toronto will see its population grow from three million to four million,” the report said.
The combination of limited homes and ongoing increases to the population underscore the importance of condo developments in the GTA.
For example, Toronto and Vancouver are both expensive places to live, making current housing options quite limited.
But the situation is more severe in Toronto, according to TD economist Rishi Sondhi, who explained while there was a 16 per cent increase in listings in Vancouver between 2019 and 2021, there was only a six per cent increase in Toronto for the same time span.
According to a new report by RBC Economics, local real estate data shows Toronto’s composite MLS HPI benchmark of $1.26 million surpassed Vancouver by $5 million, sitting at $1.255 million in January.
“It’s a stunning development, though not entirely surprising considering how hot the Toronto-area market has become,” RBC senior economist Robert Hogue told CTV News.
Given that home prices are only expected to continue rising, there’s little doubt that Toronto will become increasingly reliant on condos, Mizrahi said.
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