We were very saddened to hear of the passing of Harvey Kaufman of Norman Hill Realty a couple weeks back, he was a big favourite in the Urbanation office. Harvey handled the sales of a number of high profile developers including The Pemberton Group, Menkes Developments, and The Conservatory Group to name a few.
After many years of trying to get Harvey to sign up for our report we just gave up, but were happy to exchange info with him whenever we could and express our opinions on this site or that. The most admirable trait possed by Harvey had was his ability to stick up for himself and what he beleived in. There were many a times that a developer told him not to give data to us and he told them it was the right thing to do, that Urbanation provides a valuable service to the industry and assists many of the lenders, suppliers, appraisers that work on their projects make more informed decisions. That takes a lot of stones when dealing with some of the clients he did and we thank him one last time for it.
Many of the jokes and insults that Harvey told us we won't be sharing on this blog, but trust us, they were priceless. We wanted to make sure we acknowledged how much me thought of him and hope his family is doing well. Our condolences.
Monday, February 6, 2012
MEDIA CONTACT: Vicki Griffiths
Vicbar Marketing Limited
Urbanation Reports 2011 SALES SHATTER PREVIOUS Record high
What does 2012 hold for Toronto’s condominium market?
TORONTO – February 6, 2012: Urbanation Inc., the leading source of information and analysis on the Toronto condominium market since 1981, today released its Q4-2011 market overview.
The 7,226 new sales in Q4-2011 were not only the highest of any fourth quarter on record, they helped the Toronto CMA reach a record high of 28,190 new condominium apartment sales in 2011. This caps a truly unprecedented year – one that smashes the previous record of 22,654 sales set in 2007 by an astounding 24 per cent.
Urbanation tracked a total of 357 condo project in Q4-2011, 330 active projects containing 81,274 units, with 5,464 units in the 27 sold out (and not registered) projects.
But with the record year 2011 behind us, industry participants and purchasers are asking: What comes next? Are the numbers a cause for celebration or for concern?
“The more successful the condominium market is in Toronto, the more reports surface warning of oversupply or a correction in prices,” says Ben Myers, Urbanation Executive Vice President and Editor. “Because the underlying realities of the market are constantly changing, we wanted to take off our ‘rose coloured glasses’ and review potential factors, both economic and psychological, that could derail the high-rise market in Toronto in our latest report.”
Urbanation identifies speculative purchasing, over-leveraging and herd behavior as risk factors for a market correction. Regarding speculation, the Toronto CMA has seen very few resale projects experience a ‘dump’ of units at registration; meaning purchasers are likely long term, hold-and-rent investors. A 2011 survey of Urbanation industry participants revealed that only 57 per cent thought that more than 10 per cent of condo suites were being assigned pre-registration. That’s a drop from the 70 per cent of respondents who felt that way in 2010.
The 2011 survey also showed that there was little concern with the level of international activity in the market. Leverage was also not identified as a major concern, leading Urbanation to believe that condominium investors are well capitalized.
Based on the responses to Urbanation’s latest survey, the biggest concern going into 2012 is that unit prices are rising too quickly (according to 53 per cent of respondents, up from 34 per cent who expressed the concern about pricing in 2010.)
Despite the concern, the unsold index price inflation was moderate in the new condominium market at 5.1 per cent annually to $557 psf, while the former City of Toronto saw prices rise just 2.5 per cent from $646 psf to $662 psf. Unsold units were offered at $835 psf in the Downtown Core at the end of the fourth quarter, an increase of 15.5 per cent over Q4-2010 ($723 psf), a significant jump.
While Urbanation’s 2011 survey showed respondents had less trepidation in 2011 regarding a potential oversupply than there was in 2010 (21 per cent versus 6 per cent), unsold supply increased 13 per cent in Q4-2011, the largest quarter-over-quarter jump for the Toronto CMA since Q2-2008. The 14,969 unsold units at the end of Q4 represent the highest level recorded since the mini-recession in Q1-2009 and an 8 per cent increase over Q4-2010.
Myers added “the key statistical indicators that Urbanation reviews quarterly in our publication are still positive, seller’s market conditions in the resale market and strong demand for condominiums in areas that have not previously supported high-rise densities. We anticipate that the market will remain strong in 2012, with over 20,000 new condominium sales” Urbanation’s survey respondents believe the results will be slightly lower, with 41 per cent predicting sales between 17,500 and 20,000. It is worth noting that, in Urbanation’s 2010 survey, 39 per cent of respondents forecasted 13,000 to 15,000 new sales for the Toronto condominium market for 2011 – half of the final record breaking result.
Urbanation is Canada’s leading condominium market research company. Since 1981, Urbanation has analyzed the Toronto condominium market, publishing the “industry bible” – Urbanation’s Condominium Market Survey. This quarterly report tracks new, resale and future condominium projects. The newest report from Urbanation is UrbanRental, which tracks activity in the condominium rental market. Urbanation also provides the development community with essential consulting services, which include site and topic specific market studies and surveys.