Report predicts steadily rising condo prices

Condos are seen under construction at the corner of Lakeshore Blvd. and Yonge St., March 21, 2006.

Jan 30, 2007 02:24 PM

Business Reporter TORONTO STAR
Despite an unprecedented influx of new supply on the market, the Toronto condominium sector will continue to do well over the next five years, says a report released today.The price of an average existing condominium should rise from $239,816 to $292,077 in 2011, representing an increase of about 4 per cent annually, says a report by the Conference Board of Canada and Genworth Financial Canada.

“Toronto has seen a record decade of growth and this report shows that the market remains healthy,” said Peter Vukanovich, president of Genworth Financial.

Toronto is forecast to be the third-strongest market in terms of price growth after Calgary and Edmonton.

The 4 per cent forecast is higher than the estimates of some other analysts who have called for a much more moderating trend or even a correction in the market.

The average price increase for a condo at the end of 2006 was 5 per cent.

Demand for condos are forecast to be strong in the medium term because of a number of factors, including immigration, an aging population, and affordability, said the conference board.

Condo starts in Toronto reached a record high of 16,200 units in 2005.

However, starts are expected to fall by 4.6 per cent in 2006 and another 6.3 per cent this year, representing a more balanced resale market.

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