Amid the skyscrapers and waterfront, this dynamic, multicultural metropolis is home to over 80 different ethnicities. Its bustling and vibrant city centre neighbourhoods are extremely popular and current levels of house price growth reflect this.
In a century when most developed countries will see their population decline, Canada will see population growth that continues to lead the G7. Toronto is forecast to account for 28% of this growth. Toronto’s favourable growth trajectory is underpinned by a diverse economy, ambitious infrastructure projects and the city being a destination of choice for international immigration.
Residential property market conditions became unsteady in April 2017 after a 15% foreign buyers tax was implemented. In the same year, a movement towards rising interest rates began to trend, with the Bank of Canada gradually raising theirs from 0.5% in 2017 to 1.75% in 2018. New borrowing regulations introduced in 2018 to rein in prices are also proving to have an impact on the market, which is now cooling down.
House price growth was 1.5% last year, which is low in comparison to the annual average of 10% over the last decade. However, this is a welcome slowdown for aspiring home buyers faced with increasingly severe affordability constraints.
In contrast, rental growth was high in comparison to the last decade at 4.8%, driven by near historically low vacancy rates of 1.2% in 2018. Demand for rental properties is being generated by downsizing baby boomers, professionals moving to Toronto to work in the city’s booming tech industry and millennials priced out of buying their first property.
Although more purpose-built rental units are now under construction in Toronto, at a higher rate than in previous years, this may not be enough to meet the current need. This supply challenge in hand with growing demand means the upward pressure on rents is likely to continue.
What you can buy in Toronto: The Well
The Well is the largest mixed-use endeavour under construction in Canada. Located in the heart of Toronto’s west end the development totals 3.1m sq ft on 7.8 acres, including 420,000 sq ft of retail and food service space, 1,700 residential units, and +1.0m sq ft of office space spread throughout seven buildings that are connected to a 3-level retail base.
|Address: Borders Front, Spadina and Wellington|
|Status: Under construction, retail and office estimated to complete in 2021, and residential estimated to complete in 2023.|
|Number of units: 1,700|
|Average price: N/A|
|Developers: RioCan REIT and Allied Properties REIT|