On July 18, 2012, the Greater Toronto Area REALTORS released their Q2 Condo Report. Here’s a summary of the data, as well as commentary by our very own Broker of Record, Kaive Wong.
There were 6,345 condominium apartment transactions during the second quarter of 2012, down by 2.6 percent compared to the 6,609 transactions reported in the second quarter of 2011.
Meanwhile, new listings for condominium apartments were up by 19 percent in comparison with the second quarter of 2011.
The average price for the second quarter condominium apartment sales was $342,212, a 3.2 percent increase when compared with the 2011 average price.
There were 4,771 condominium apartment rental transactions during the second quarter of this year, which reflects an increase of 3 percent when compared to last year’s 4,629 transactions.
Meanwhile, new listings for condominium apartment rentals were up by 15 percent in comparison with the second quarter of 2011.
The average rent for a two bedroom condominium in the second quarter of this year was $2,088, representing a four percent increase over the second quarter of 2011, which had an average rental price of $2,016 for a two bedroom condo.
The media has finally been able to talk down the condo market with a slight decrease of 2.6 percent compared to a strong year in 2011.
There is definitely more supply of listings available in the market given that so many buyers, while they do want to purchase real estate, are now trying to time the market and perceive that there may be potential price reductions in the near future.
The problem with that scenario is that they must continue to rent and are now facing some of the highest rents ever recorded for downtownTorontocondos.
Even though it is only July, and we are not quite into the peak demand for September occupancy, we are already seeing properties rent not in days, but in hours. Furthermore, many rental properties are receiving multiple offers.
Therefore, the cost of the buyers’ market timing is significantly higher rents versus taking on five year mortgages at below 3% (I can currently offer a 5 year fixed mortgage at 2.94%).
This again, as I previously mentioned, is great news for landlords who can rake in top notch rents and be extremely selective on tenants.
I have been pounding the table for investors to act quickly to acquire rental properties that, in all likelihood, I can have leased prior to them even closing on the property and generating double-digit returns on equity.
Given the increased supply of sale listings, landlords can strike a bargain on a purchase deal, yet still achieve record level rents for their property.
The Q2 Rental Market Report from TREB agrees with my findings, with rental transactions up 15% year over year and rental rates increasing significantly faster than inflation.
If you are interested in dipping into the market, call me at (416) 929-1660 or contact me via email at firstname.lastname@example.org. I’d be happy to assist you with all your real estate and mortgage needs.