With high costs, high interest rates and poor investment prospects, Toronto-area condo pre-sales are below 50 per cent, a more than 20-year low, say the report's authors. The glut of condos for sale in the Greater Toronto Area is a dire signal of worsening housing affordability and rental supply in a market where the math “doesn’t make economic sense,” according to a new report from CIBC and Urbanation.
The report notes that falling interest rates, a projected slowdown in population growth and a stabilization of construction costs provide a glimmer of relief, but the authors expect that relief to be limited. At Wednesday’s Bank of Canada, senior deputy governor Carolyn Rogers took pains to note that interest rate cuts aren’t “the magic solution” to Canada’s housing problem.
With high costs, high interest rates and poor investment prospects, condo presales are under 50 per cent, a more than 20-year low, the authors write. New projects won’t start construction with less than 70 per cent presales, they note, “a fact that is working to dramatically slow down the supply pipeline.”
“This is a troubling sign for the outlook for rental supply in the region and raises an alarm bell over the necessity to increase purpose-built rental supply.”Clemson’s Dabo Swinney sounds off on ‘frustrating’ new scholarship rulesSlated for Sept. 1 to 4, the showcase will kick-start with a symbolic demonstration of unity with designers at the Ukrainian House at European Square.