23-04-2025
Canada's condo crisis; survey reveals shifting investment options
Once a darling of the real estate investment scene, the condominium is facing a potential image problem among Canadians.
A newly released survey by indicates a significant shift in perception, with nearly a third of respondents expressing doubt about condos retaining their status as a sound investment.
The survey of 1,568 Canadians paints a concerning picture for the condo market's investment appeal.
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by Taboola
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A striking 57 per cent stated they would not consider purchasing a condominium for any reason, while a mere 11 per cent viewed them as a viable investment opportunity.
"Investor confidence has definitely softened," observes Kevin Wong, a mortgage agent at Swivel Mortgage Group Inc. in Ontario.
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He notes a trend of some investors divesting from condo properties and redirecting funds towards alternative investments like the stock market or burgeoning real estate markets in regions such as Alberta.
points to a confluence of factors potentially contributing to this shift. Rising inventory levels are exerting downward pressure on condo prices.
While this may offer a more accessible entry point for buyers, it presents a challenge for sellers grappling with an oversupply of units.
Data from Statistics
Canada
between 2016 and 2020 revealed that a substantial two in five condo apartments across five provinces, including Ontario and British Columbia, were utilized as investment properties.
This trend was partly attributed to the relative affordability of condos compared to detached homes, attracting individuals seeking to become landlords.
Notably, over half of occupied dwellings in downtown Toronto and Vancouver were condos, with a significant portion being rentals.
However, the tide appears to be turning. highlights concerns surrounding a slowing rental market.
Recent data from indicated a national average rent decrease of 2.8 per cent in March, averaging $2,119.
This softening rental landscape, coupled with increasing costs associated with property tax and maintenance fees for condo owners, is squeezing profit margins for investors.
Despite the overall dip in investment confidence, the allure of condos as an entry point into homeownership persists, particularly among younger Canadians.
The survey found that 45 per cent of non-homeowners are still considering a condo purchase, including higher-income individuals earning $100,000 or more.
Furthermore, 28 per cent of Canadians aged 18 to 34 remain more inclined to view condos as a good investment.
"Condos are the lowest point of entry for many people," explains Wong, a sentiment echoed by Statistics Canada's 2019 data showing that a significant percentage of first-time homebuyers in British Columbia (37.8 per cent) and Ontario (16.5 per cent) opted for condos.
