Average condo price in Greater Toronto Area soars above $700,000

The Toronto skyline is seen in this undated photo. (CTV News Toronto/ Ted Brooks)

The average resale price of a condominium in the Greater Toronto Area has now surpassed $700,000 as the market bounces back from a slowdown in the early days of the pandemic.

The Toronto Region Real Estate Board (TRREB) says that there were a record 7,815 condominium apartment transactions in the GTA in the fourth quarter of 2021, despite a 29 per cent drop in listings from the previous year.

It says that the increased demand alongside a dip in supply created “very tight market conditions” in the condo sector, which resulted in the average resale price rising 16.4 per cent year-over-year to $710,087.

The rising costs also bled into the condo rental market, where the average monthly cost of a one-bedroom unit rose 13.7 per cent to $2,099 and the average cost of a two-bedroom unit rose 12.6 per cent to $2,763.

TRREB says that the increases essentially pushed rents closer to their “pre pandemic peak.”

“If you think back to the beginning of the pandemic this was a segment of the real estate market that got hit hardest. We saw, you know, a real spike in listings and there wasn't a lot of demand. So we actually saw a period of time where the selling prices dipped a little bit but as we moved into the second half of 2020, and even more so into 2021 we saw real resurgence in the condo market,” TRREB’s Senior Market Analyst Jason Mercer told CP24 on Friday morning. “A lot of that was on the back of first time buyers. When we did our consumer polling at the end of last year we found that first time buyers were going to be a major factor in 2021 and that certainly turned out to be true.”

TRREB has previously said that the average selling price across all residential property types in the GTA hit a peak of $1.095 million at the end of 2021, up nearly 18 per cent from the previous year.

While there has been some speculation that home prices will be impacted as the Bank of Canada embarks on an interest rate hiking cycle, Mercer said that demand will continue to be strong in 2022 as immigration increases and new listings continue to languish below historic levels.

“If you look at the market as a whole at the end of last year we only had 3,200 listings on the MLS system so, you know, for a lot of condominium apartments we're seeing more than one interested buyer and that serves to put upward pressure on home prices,” he said.

According to the TRREB data there were more than 16,000 condo apartment units listed for rent in the fourth quarter of 2021,  down 48.9 per cent from the previous year.

The vacancy rate in Toronto was 1.7 per cent. But in other GTA suburbs the vacancy rate was lower, ranging from 0.2 to 0.9 per cent.