Monday, May 19, 2008

The Age of the Condo

Although people's eyes glaze over at the mention of Statistics Canada, the latest 2006 census make interesting reading, particularly as they relate to a favourite topic of dinner-party conversation - Toronto's booming condo market.

Over the past year, Statistics Canada has been releasing the results of the 2006 census and the findings illustrate how demographic changes have been and will continue to shape housing needs across the Toronto Census Metropolitan Area (CMA) in favour of condominium living. This explains in large part why new high-rise condo sales have accounted for a growing share of total new-home sales in the area over the past several years and actually exceeded new low-rise (single-detached, semi-detached, townhomes) sales for the first time in 2007 by capturing 52% market share, according to RealNet Canada.

Simply put, Toronto's population is growing, ageing and diversifying in ways that it never has before, and in favour of condominium apartment living more so than ever before.
According to the census data, the population in the Toronto CMA grew by 9.2% from 2001 to 2006, from 4.68 million to 5.11 million residents. Interestingly, the suburbs (905 region) grew by 19.2% and accounted for more than 93% of Toronto CMA population growth during this period. The city of Toronto (416 region) grew by only 0.9% and contributed to only 5.3% of Toronto CMA population growth. Yet, the rate of new household formation was significantly higher in the city of Toronto, accounting for 22% of total household growth in the Toronto CMA during the inter-census period. This means that although the city of Toronto did not experience as much population growth as the suburbs, its population was both older and ageing at a faster rate; thus creating new households and new housing demand through the splitting up of existing households. For example, a family of four who lived together as a one household in 2001 may have split into two or three different households by 2006 as the now-grown children left home as first-time condominium buyers or renters.

As the majority of new high-rise condominium apartment sales from 2001 to 2006 occurred in the city of Toronto and over 50% of sales were likely attributed to this new group of young, first-time home buyers from 25 to 35 years of age, it is not surprising that the census data also confirms that nearly 90% of new households created from 2001 to 2006 were one-person (more than 28,880) and two-person (more than 10,805) households typically favouring a condominium-type lifestyle. (Note: Statistics Canada defines a household as a person or group of persons who co-reside in or occupy a dwelling.)

Similarly, a decrease in the number of married couples (down 0.3%) and a significant increase in the number of separated or divorced individuals (up 6.2% or 12,565) also translated into changing housing needs and preferences likely in favour, again, of condominium-style living.
An ageing population where children are leaving home also means that there is a growing number of ageing parents whose housing needs are also changing. Now finding themselves empty nesters, many no longer need (or want) to maintain a large (and largely) empty family home, perhaps in favour of spending more time at the cottage or travelling; so downsizing to a more carefree, maintenance-free condominium lifestyle is growing increasingly attractive. According to the 2006 census data, the leading edge of Baby Boomers aged 55 to 64 years were the fasting-growing segment of the population in the Toronto CMA during the inter-census period, increasing in numbers by 27.7% (more than 113,400). This suggests that demand for condominium apartments will likely continue growing among these Baby Boomers, particularly as they shift into the pre-retirement and retirement stage of their lives.

In summary, condominium apartments have become an integral part of the housing market in Toronto and as long as there are still children growing up and creating empty nesters out of their parents, young adults who want to move out of the family home and renters who dream of buying their own home, there may continue to be demand for condominiums. Check out the latest Statistics Canada 2006 census data if you need proof.

• Jeanhy Shim is president of ThinkBUILD Consulting Inc., a real estate consulting firm specializing in residential product developments. She can be reached at National Post

The Humber Bay Shore Community Association has some impressive figures of their own;

Community Summary Group Total Suites
HBSCA Member Communities 3,807
Properties Under Construction or in Presale Stage 1,054
Proposed future projects 2,807
Community Total 7,668

As the figures indicate above, within the next five years or less the number of condominium suites located in the Humber Bay Shores Community is expected to double! How will this affect our community? One of prime goals is to serve as your voice and represent your views as to how this dramatic growth will impact all aspects of living in our community.

This bodes well for the community and business' that serve the condo owners along the Mimico Lakeshore Business District.

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