The 2021 real estate market saw month after month of record high home prices as buyers fought over limited inventory. But with detached homes now well out of reach for many GTA buyers, an en masse shift towards condos is likely in store for the near future, according to a new report from Strata.ca.
“Throughout this pandemic, detached home values have sprinted like a hare, while condos have moved like a tortoise,” said Strata.ca Broker Cliff Liu. “But condos will likely become the dark horse in 2022, especially among those who missed out last year.”
Liu says that as detached homes continue to grow in price, GTA buyers will turn to condos — particularly townhouse condos and larger apartment condos — as more affordable alternatives.
“Without a doubt, people will continue striving for bigger units that feel like a bungalow in the sky,” Liu said. “With ongoing restaurant and nightclub restrictions, people understandably now want that social space inside their homes, and this means a 500-square-foot condo will no longer do.”
There’s historical evidence of condo market upswings following peaks in the detached housing market. In 2017, for example, the condo market rose steadily following a spike in detached home prices.
“Detached homes and condominiums are like yin and yang,” Liu said. “They tend to move cyclically, always chasing each other to find that new balance.”
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Whether buyers in 2022 will go for newer condo buildings, which tend to be on the smaller side but have modern amenities, or older buildings, which have larger layouts but fewer amenities, remains to be seen.
“Older condos tend to have better layouts and generally more square footage, although hallways and lobbies can be quite outdated,” said Strata.ca realtor Galina Sheveleva. “Newer buildings usually offer better finishes and taller ceiling heights, but I’ve seen some very awkward floor plans there that’ll make you scratch your head.”