Foreign vs. domestic condo buyers: who’s more active in GTA?

Foreign purchasers of condos represented 5% of all sales that have occurred within projects currently in active development across the Greater Toronto Area, finds new research by Urbanation Inc., a company that analyzes the Toronto condo market.

Meanwhile, domestic investors represent 52% of sales, says Urbanantion.

In its most recent survey of sales activity in new condo apartment projects, the firm looked at the share of units sold to non-resident buyers as well as domestic investors. The survey was completed by developers or brokerages representing new projects.

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The highest shares of sales to foreign purchasers and domestic investors–as opposed to homebuyers–were generally found within centrally-located projects in the downtown Toronto area, the survey notes.

“The results of this very important survey show a rather limited role of foreign buyers in the GTA new condo market and a very significant overall share of investors,” says Shaun Hildebrand, Urbanation’s senior vice-president. “These estimates coincide with the percentages of new condos entering the rental market upon completion, indicating the important role investors play in the GTA housing market.”

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Overall condo sales

A total of 6,677 new condo apartments were sold across the Greater Toronto Area in Q3 2016, says Urbanation’s Q3 2016 market results. That’s an increase of 73% year-over-year and marks the highest level of third-quarter activity on record.

Further, sales were 58% higher than the 10-year average for Q3 periods and 12% higher than the previous high set in Q3 2007, says Urbanation.

But, this time around, total unsold inventory in development plunged by 33% from a year ago to 11,485 — the lowest level since the first quarter of 2007 and representing a record low 5.2 months of supply.

The average index selling price for new condo apartments in Q3 2016 continued to edge higher, rising 2% from a year ago to $590 per square foot. GTA-level price growth has been weighed down by a shift in new development activity to areas outside of the core, says Urbanation.

Find out more about GTA condo sale activity.

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