Latest news with #Realosophy
Yahoo
23-07-2025
- Business
- Yahoo
Bought a condo in 2020? If it's in Toronto, it likely underperformed your savings account
For the past five years, a high-interest savings account has been a better bet than a Toronto condominium. While condo values have soared in every other major Canadian city since 2020, Toronto's market has slumped, delivering returns that barely break even and leaving it as the undisputed laggard of the national housing market. Benchmark pricing data from the Canadian Real Estate Association (CREA) show a condo purchased in Toronto at the start of 2020 is now worth around 3.75 per cent more than it was five years ago. Over the same time period, condos in other major Canadian cities have gone up 16 per cent or more. Economic factors, migration, affordability and particularities of local inventory help account for variation in market trends for condos in different cities. In Halifax and Quebec City, smaller markets where housing supply has lately been limited, prices have gone up by almost 90 and 60 per cent, respectively. Regardless, by almost any measure, Toronto has drastically underperformed. In a June interview, John Pasalis, president of Toronto-based brokerage Realosophy, told Yahoo Finance Canada 'demand is at the lowest level it's been in 20 years.' Most markets experienced a price correction following pandemic-era peaks, but none have been as pronounced or as enduring as in Toronto. In Halifax, Quebec City, Montreal, Calgary and Saskatoon, the pandemic was at worst a bump in the road for condo values. Prices in Ottawa and Victoria remain slightly below their peaks but comfortably above their January 2020 benchmarks. In Toronto, the market has fallen more or less steadily from its peak in March 2022, when the benchmark condo price hit $716,100, up nearly 29 per cent from $555,600 in January 2020, CREA data show. In June this year, a benchmark Toronto condo costs $576,400. Considered as an investment, a typical Toronto unit bought in January 2020 and sold in June 2025 would have delivered a compound annual growth rate of 0.46 per cent — less than the returns offered by many banks' high-interest savings accounts. Even such a decline, however, has done little to solve Toronto's affordability crisis. Condo prices have dropped almost 20 per cent from their 2022 peak, but a benchmark unit in Toronto is still the second-most expensive in Canada, behind Vancouver. A benchmark condo in Halifax has nearly doubled since the start of 2020, but is still roughly $100,000 cheaper than one in Toronto. A comparison of condo markets in Toronto and Halifax only goes so far, given the difference in population, but there are some interesting insights around supply. A building boom in Toronto, driven in part by low interest rates, is a key factor in the current oversupply — with unsold inventory in record territory. In Halifax, condo supply is virtually non-existent, with a single pre-construction condo building on the market, according to Chris Perkins, a broker-owner at Coldwell Banker Maritime Realty. "The vast majority of cranes you see in the air (there are a lot) are building rental apartments," Perkins said in an email to Yahoo Finance Canada. "This is partly due to the fact that the current marketable value for a condominium unit in Halifax does not make financial sense for a developer to build. The government offers a 15 per cent HST rebate to developers to build an apartment building, but this does not extend to condominiums and greatly impacts the viability of a project." There have been 365 condo sales in the city this year, Perkins says — versus nearly 4,000 in Toronto in the first quarter of 2025. Many prospective condo buyers in Halifax are older and have paid off the mortgages on their homes, Perkins says, with those homes worth nearly 90 per cent more than they were in 2020 on average. 'Not all of them want to rent, and the options for a sizeable 1,200+ square foot condo are severely limited,' Perkins said. 'Lots of equity competing for condominiums in limited supply.' Edmonton's recent performance could offer some insights for Toronto, with the same caveats around city size. Edmonton was the only major city to show negative price growth through the pandemic, though it has since rebounded. The city's slide actually began around 2013, with oversupply a key factor — perhaps offering a cautionary tale for Toronto, where a similar glut of inventory now threatens to prolong its market downturn. John MacFarlane is a senior reporter at Yahoo Finance Canada. Follow him on X @jmacf. Download the Yahoo Finance app, available for Apple and Android. Erreur lors de la récupération des données Connectez-vous pour accéder à votre portefeuille Erreur lors de la récupération des données Erreur lors de la récupération des données Erreur lors de la récupération des données Erreur lors de la récupération des données
Yahoo
22-07-2025
- Business
- Yahoo
Bought a condo in 2020? If it's in Toronto, it likely underperformed your savings account
For the past five years, a high-interest savings account has been a better bet than a Toronto condominium. While condo values have soared in every other major Canadian city since 2020, Toronto's market has slumped, delivering returns that barely break even and leaving it as the undisputed laggard of the national housing market. Benchmark pricing data from the Canadian Real Estate Association (CREA) show a condo purchased in Toronto at the start of 2020 is now worth around 3.75 per cent more than it was five years ago. Over the same time period, condos in other major Canadian cities have gone up 16 per cent or more. Economic factors, migration, affordability and particularities of local inventory help account for variation in market trends for condos in different cities. In Halifax and Quebec City, smaller markets where housing supply has lately been limited, prices have gone up by almost 90 and 60 per cent, respectively. Regardless, by almost any measure, Toronto has drastically underperformed. In a June interview, John Pasalis, president of Toronto-based brokerage Realosophy, told Yahoo Finance Canada 'demand is at the lowest level it's been in 20 years.' Most markets experienced a price correction following pandemic-era peaks, but none have been as pronounced or as enduring as in Toronto. In Halifax, Quebec City, Montreal, Calgary and Saskatoon, the pandemic was at worst a bump in the road for condo values. Prices in Ottawa and Victoria remain slightly below their peaks but comfortably above their January 2020 benchmarks. In Toronto, the market has fallen more or less steadily from its peak in March 2022, when the benchmark condo price hit $716,100, up nearly 29 per cent from $555,600 in January 2020, CREA data show. In June this year, a benchmark Toronto condo costs $576,400. Considered as an investment, a typical Toronto unit bought in January 2020 and sold in June 2025 would have delivered a compound annual growth rate of 0.46 per cent — less than the returns offered by many banks' high-interest savings accounts. Even such a decline, however, has done little to solve Toronto's affordability crisis. Condo prices have dropped almost 20 per cent from their 2022 peak, but a benchmark unit in Toronto is still the second-most expensive in Canada, behind Vancouver. A benchmark condo in Halifax has nearly doubled since the start of 2020, but is still roughly $100,000 cheaper than one in Toronto. A comparison of condo markets in Toronto and Halifax only goes so far, given the difference in population, but there are some interesting insights around supply. A building boom in Toronto, driven in part by low interest rates, is a key factor in the current oversupply — with unsold inventory in record territory. In Halifax, condo supply is virtually non-existent, with a single pre-construction condo building on the market, according to Chris Perkins, a broker-owner at Coldwell Banker Maritime Realty. "The vast majority of cranes you see in the air (there are a lot) are building rental apartments," Perkins said in an email to Yahoo Finance Canada. "This is partly due to the fact that the current marketable value for a condominium unit in Halifax does not make financial sense for a developer to build. The government offers a 15 per cent HST rebate to developers to build an apartment building, but this does not extend to condominiums and greatly impacts the viability of a project." There have been 365 condo sales in the city this year, Perkins says — versus nearly 4,000 in Toronto in the first quarter of 2025. Many prospective condo buyers in Halifax are older and have paid off the mortgages on their homes, Perkins says, with those homes worth nearly 90 per cent more than they were in 2020 on average. 'Not all of them want to rent, and the options for a sizeable 1,200+ square foot condo are severely limited,' Perkins said. 'Lots of equity competing for condominiums in limited supply.' Edmonton's recent performance could offer some insights for Toronto, with the same caveats around city size. Edmonton was the only major city to show negative price growth through the pandemic, though it has since rebounded. The city's slide actually began around 2013, with oversupply a key factor — perhaps offering a cautionary tale for Toronto, where a similar glut of inventory now threatens to prolong its market downturn. John MacFarlane is a senior reporter at Yahoo Finance Canada. Follow him on X @jmacf. Download the Yahoo Finance app, available for Apple and Android. Sign in to access your portfolio
Yahoo
12-06-2025
- Business
- Yahoo
Weak condo markets in Toronto and Vancouver threaten future housing supply: CMHC
Falling condo prices and rents in Toronto and Vancouver are driving a construction slowdown and could frustrate longer-term efforts to ramp up overall housing supply in Canada, according to an analysis from the Canada Mortgage and Housing Corporation (CMHC). Spurred by a range of factors, the weak condo markets in the two cities have seen sales plummet, just as scores of new completions keep adding to inventory. Recent economic uncertainty means there is 'little evidence to suggest that price and rent declines are likely to quickly reverse,' the CMHC says. 'In the short term, these developments present relief for buyers and renters in the most expensive cities in the country,' the analysis notes. 'However, they do so at the cost of discouraging new construction and fuelling underlying housing shortages in the future.' Low interest rates before and during the COVID-19 pandemic helped fuel demand and a condo construction boom, but a rise in rates in 2022 depressed demand, 'reducing affordability for homebuyers and potential returns for investors,' the analysis says. Ongoing affordability concerns and the recent trade war with the U.S. have helped maintain the grim market conditions. 'We're just at this period where buyer sentiment is in the gutter, both from end users and of course from investors,' John Pasalis, president of Toronto-based brokerage Realosophy, told Yahoo Finance Canada. 'So demand is at the lowest level it's been in 20 years. And inventory just keeps piling up.' Between 2022 and the first quarter of 2025, total condo sales fell 75 per cent in Toronto and 37 per cent in Vancouver, the CMHC analysis says, while inventories in the two markets rocketed upwards. 'In Toronto, where the market weakness is the most pronounced, the months of inventory for pre-construction condominiums in Q1 of 2025 were more than 14 times higher than they were in 2022,' the analysis says. Average resale prices dropped 13.4 per cent in Toronto and 2.7 per cent in Vancouver over the same time period. Say they bought a brand new pre-construction condo for a million bucks. That's really only worth 700 or 750 grand president John Pasalis Pasalis said he met with a condo owner last November, and discussed similar units selling at the time for around $950,000. One month ago, two similar units sold for $850,000, he said. 'That's not of course happening everywhere, but this is what happens in really, really slow markets when demand is in the gutter and some people just desperately need to sell.' Some investors have been clobbered by the changing market conditions. Toronto investors 'face as much as a six per cent capital loss on pre-construction purchases concluded in 2024,' the analysis says. Those who bought condos in Toronto in 2019 or 2020 now find them 'not worth anything remotely close to what they paid for them,' Pasalis said. 'Say they bought a brand new pre-construction condo for a million bucks,' he said. 'That's really only worth 700 or 750 grand today. So, many of them are underwater.' Economists and other experts have said Canada's housing crisis is in part due to new supply not keeping up with population growth. The new federal government has promised to ramp up supply, though some economists say the government's policies won't be enough. In Toronto and Vancouver, many new units — largely bought before the market turned — will be completed this year, nearing the records set in both cities in 2024. After that, however, new supply looks like it will be limited. Around 55 per cent of pre-construction units in Toronto went unsold in 2024 and in the first quarter of 2025, the CMHC analysis says — putting the projects in jeopardy, given financing usually has a pre-sale threshold of 70 per cent. 'In 2024, condominium apartment unit cancellations were 5- and 10-fold higher than they were in 2022 in Toronto and Vancouver, respectively,' the analysis notes. Some developers have been converting condo projects into purpose-built rentals, but the number of cancellations has been growing, the CMHC says. 'The condominium projects cancelled today mean fewer housing completions in the future,' the analysis says. 'The relief for buyers and renters is temporary with future housing shortages compounded.' The market could still turn around, Pasalis said, if trade issues are resolved and consumer confidence is restored. At the same time, he said, if the economy struggles under an enduring trade war, 'the market can definitely get worse.' John MacFarlane is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jmacf. Download the Yahoo Finance app, available for Apple and Android. Sign in to access your portfolio
Ottawa Citizen
06-06-2025
- Business
- Ottawa Citizen
Canada's housing crisis calls for more than ‘cranes on the skyline'
This week three of four Canadians declared they have no confidence in Prime Minister Mark Carney's ideas for solving the country's housing affordability crisis. Article content Like most premiers and mayors, Carney is promising to 'build, baby, build' to stimulate a record amount of housing construction. But Angus Reid Institute polling suggests the public is more than skeptical, perhaps in despair. Article content Article content Article content While voters understandably get lost in the complexities of solving a house-price catastrophe that sees average prices at a ridiculous $1.2 million in Greater Vancouver and $1.1 million in Toronto, at least one veteran housing analyst is making a clear and devastating case that Canada's dilemma is being significantly fanned by a wave of investors. Article content Article content John Pasalis, author of a new report titled The Great Sell Off: How Our Homes Became Someone Else's Business, says politicians are abandoning people who want to live in their homes, and they're selling a generation of voters a 'fantasy' that their worn ideas will lead to affordability, he writes. Article content 'As long as politicians and housing economists insist that 'more supply' is the only solution — ignoring the financial dynamics driving demand from investors — we will continue to fall short. This is not just a supply problem. It's a financialization problem, and solving it requires more than cranes on the skyline,' writes Pasalis, president of Realosophy. Article content Article content 'We are at a crossroads. For too long, we've operated under the assumption that today's housing market is simply a more expensive version of the one our parents knew. It isn't. We are living through a paradigm shift — one in which homes are no longer primarily bought by local families, but by global investors. Housing has become a financial asset unbound from local incomes, and policy has yet to catch up.' Article content Article content Last year 30 per cent of all homes in Canada were owned by investors —domestic and foreign — who buy properties they don't intend to occupy. That's a 50-per cent jump in 10 years. Article content In B.C., an incredible half of all condos built in the past decade have been snapped up by investors. In Ontario, the proportion is 57 per cent. Pasalis says government policies are largely to blame.
