According to TheRedPin, the most expensive areas are all located in downtown Toronto: the Bay St. corridor, the waterfront and downtown, priced per square foot at $893, $804 and $801, respectively. The average prices of condos in those neighbourhoods are $744,129, $627,967 and $613,168.
However, those numbers are somewhat deceiving because they include luxury condos, which invariably raised the average prices in neighbourhoods that include a lot of starter condos.
According to Enzo Ceniti, director of training and development of TheRedPin, the best approach for condo hunters is to choose a building of interest instead of solely relying on neighbourhood averages.
“I think, for a buyer, you might want to look at the individual neighbourhood, or individual building, as its own ecosystem,” he said. “Each building has a real cost per square foot that should be considered. The Yonge St. corridor will be well over $1,000, but something nearby might be for $700 per square foot. So it’s really about investigating the buildings themselves.”
Further to that point, says Hyder Owainati, market analyst and communications manager at TheRedPin, a unit’s price per square foot reflects, among other things, certain conveniences afforded by particular buildings.
“Bay St. is close to the Eaton Centre, Dundas Subway Station, the financial district, and parking spots there are going for as much as $60,000,” he says. “There isn’t much land there anymore, so the existing stock of condos are seeing prices go up. Anything near transit, highway hubs, very good public schools, grocery shopping, entertainment, restaurants, nightlife — anything in walking distance will bring up prices. Walkability will increase price per square foot because the property becomes more desirable.”
Concerns for end users and investors are different. Ceniti says the former opt for the maximum square footage their budgets allow, while the latter try to maximize their investments by purchasing the lowest cost per square foot. As for transient housing, people look to the rental market but because the region’s detached and row houses are beyond most people’s means, condos have matured from stopgaps to lifetime homes. For that reason, amenities are increasingly becoming an important factor in the buying decision.
“One thing we’ve been seeing with clients is the cost of detached and semi-detached townhomes are becoming unaffordable for small families with a child on the way, so they’re looking to the condo market,” said Kyle Murdock, vice-president of sales at TheRedPin.
“Instead of price per square foot, they’re looking at amenities available at those properties. We’re finally seeing condominiums with family-friendly amenities. For a couple who is going to have a child in four or five years and doesn’t see detached homeownership as a reasonable possibility, they’re going to look towards a downtown condo that fits their budget and that fits the direction of where their family is going. I think we’re going to see a lot more builders creating product to serve those customers.” Of note, TheRedPin included Mississauga’s City Centre in its analysis because it is the largest condo hub outside of Toronto.
The average condo price there is $386,742, and the average price per square foot is $449. Outside of Toronto, the most expensive areas are south Oakville, Kleinburg and northeast Markham. According to Shaun Hildebrand, senior vice-president of Urbanation, Oakville’s lofty prices have been most consistent because of its sustained affluence. He also says some neighbourhoods have reputations that precede new builds.
“Let’s just say Bloor and Yonge won’t be entry-level units,” said Hildebrand. “Sometimes it is the relative value to ground-related low-rise homes. For example, new projects in The Beach are far higher than a few blocks north towards Gerrard and the Danforth. Same if the project is in Roncesvalles versus, say, Bloordale or St. Clair West.” TheRedPin’s analysis only includes neighbourhoods with at least 200 condo sales.
Original Link: HERE