More than 35 million people now call Canada home, according to data released by Statistics Canada last week. That’s five per cent growth since 2011, when the population was 33.5 million, the highest rate of growth among G7 countries.
About two thirds of the increase in the population was due to net immigration, according to StatsCan. Many newcomers settle in the GTA, which sees a net migration of 100,000 people each and every year.
None of the census data is surprising. A lot of the overall growth in the GTA was outside of Toronto in surrounding municipalities such as Brampton, Milton and Bradford West Gwillimbury.
Toronto itself also saw significant growth especially downtown near the lakeshore between the Don and Humber rivers and along the Yonge subway corridor. These are areas that have seen significant condominium construction in the last decade as our industry complies with provincial intensification policy.
The development and home building industry is highly regulated; we don’t just build what and where we want to. Rather the policies and plans of multiple levels of government determine how land gets used and where and how development occurs.
The Province’s Growth Plan for the Greater Golden Horseshoe is a very prescriptive plan. Released in 2006, it was designed to change the nature of development in the GTA and move away us from the largely suburban-oriented development pattern that we had been following to more intensive development. The Plan mandates that a significant portion of development occur within existing communities and that development be denser and use less land.
BILD members have become very good at implementing the Growth Plan and have moved from building mainly low-rise homes such as single family detached, semi-detached and townhouses to building at least as many high-rise homes as ground-related homes.
In 2002, the biggest year ever for new home sales in the GTA, there were 53,660 homes sold of which 72 per were low-rise and 28 per cent were high-rise.
Last year there were 47,161 new homes sold in the GTA, and 62 per cent of them were high-rise units and 38 per cent were low-rise homes, according to Altus Group. 2016 was in fact a record breaking year, and the 29,186 condo apartments sold across the GTA were the most ever on record and 30 per cent more than in 2015.
While a lot of the new condo apartments sales were in downtown Toronto, there were also many sold in developments outside of the core. For instance there were 2,324 new condo units sold in Vaughan last year, according to BILD member Urbanation.
The number of new condo apartments available for purchase across the GTA is at a 10 year low. Based on the current pace of sales, there is only about 4.4 months of condo unit supply, well below the 10 months needed for a balanced market, according to Urbanation Inc., which has been tracking the high-rise market since 1981.
Prices for new high-rise homes also reached record levels in 2016 averaging $507,128, while average condo suite sizes grew to 826 square feet, and the average price per square foot increased to $614. A year ago, the average price per square foot was $584 while the size of an average suite was 775 square feet.
The lack of supply will lead to a slowdown in sales and Urbanation is predicting only 23,000 new condo unit sales in 2017. That is not nearly enough to meet demand as the region continues to grow.