Waiting for The Toronto Condo Bubble to BurstListen, I'm a proud supporter of continued Toronto Real Estate Development, and I'm not so blind to think that there will not be an end to the current construction boom in Toronto. As all property booms of development come to an end at some time. The prices for property in Toronto are not soaring, there have been large increases however in Single Family Detached homes, which are becoming scarce as property downtown is converted into multi-level and multi-unit housing.
And now that the Bank of Canada has gone about making it difficult for people to finance mortgages by reducing the amortization period of on them to 25 years from as high as 40 years. However, due to the volume of people moving to Toronto each year, we will require a lot of construction to meet the needs of new residents. The excess inventory levels have actually come down and are now below the historical average for Toronto, as those units get bought up by end-users and investors.
I hear all the time that there are regions of western Canada that are growing faster than Toronto, so why does Toronto have all this construction activity. Well the answer is pretty simple when you think about it. All the western provinces are growing faster than Toronto in percentage terms, however in absolute terms Toronto still grows faster. Toronto in fact adds over 100,000 people per year, and of that population between 20,000 to 30,000 move downtown. And trust me when I say, that there are not currently room enough for 20,000 or 30,000 people to move downtown. They need somewhere to live. Thankfully, we have this construction boom!
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