Condo owners' pain could be condo buyers' gain, as market meltdown continues
Buy low, sell high, they say. Well, it looks like condo sellers in some towns (looking at you, Toronto) are about to give buyers a windfall chance at low prices.
The psychology in some of Canada’s biggest condo markets, particularly those with large immigrant populations, has been deteriorating for months, but the meltdown is worsening. It may not be a Chernobyl — because prices will someday recover — but it’s definitely feeling Three Mile Island-esque.
The reason is simple: the fundamentals are about as pretty as my Amazon.com Inc. stock during the dot-com bust, particularly in metro Toronto, which is dealing with:
You get the picture.
Pro tip: “RBC is often the lender of choice for new construction projects,” Taylor says. “RBC locks in the value at the purchase price no matter what the eventual truth is. This is a big boon to buyers whose homes are now valued less than the purchase price.”
In the GTA, TRREB says third-quarter condo resales dropped 4.4 per cent while listings jumped 10.6 per cent. But that’s the government’s bombshell announcement that it was slashing Canada’s population for the next two years. Talk about kicking the legs out from under a market. Condos in places like metro Toronto, Vancouver and Montreal are heavily tenanted by temporary residents and immigrants.
By the way, Canada’s annual population has never fallen in records going back to Confederation in 1867. Why the feds had to play economic Russian roulette and make population growth negative (-0.2 per cent a year for two years) is beyond logic. Rebalancing housing demand to supply is one thing; levelling an immigrant-dependent economy in the process is another.
And God forbid that the Bank of Canada chooses not to drop rates the 100 basis
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