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Canada  + Multi-residential Housing  | 
Greater Toronto Area condo-rental rates will remain historically high in 2024, says a new report from the region's real estate board.

Condo Sales Down Across Canada

Condominium sales are down considerably in Canada’s major markets from 2022, says Altus Group.

The decline is part of a housing crisis that is likely to be a long-term problem that plays out over the next 10 to 15 years, Altus analyst Marlon Bray wrote in a market insights article published on the company’s website.

Bray noted that, according to Canada Mortgage and Housing Corporation data, housing stars dropped 7% in centres with populations of 10,000 and over. The decline is primarily attributable to a 25% decline in single-detached home starts.

While condo sales fall, low-rise starts are lagging historical levels.

“In the short-term, that pullback is alleviating some of the pressures related to the shortage of labour and higher construction costs,” wrote Bray. “The longer-term view is more problematic with significant obstacles ahead in terms of an arduous approval process and declining productivity that will make it more difficult to address the country’s housing crisis.”‘

Challenges in government approval process are contributing to the housing crisis, according to Bray. Canada ranks 29th out of 30 Organisation for Economic Co-operation and Development countries in the time needed to obtaining construction permits, wrote Bray while citing World Bank data.

In Canada, approval times vary widely, and “Toronto is terrible.” But Charlottetown, Saskatoon, Regina, Winnipeg, and Calgary have average approval times of less than six months.

Due to lower productivity and quality, construction completions are taking 25% to 30% longer than five to six years ago due to a shortage of skilled labour.

Excessive taxation on new housing, in the form of a harmonized sales tax and development charges, considerably impact developers’ ability to deliver product, according to Bray.

“Generally, construction starts will remain subdued until interest rates drop, and condo sales pick up,” he wrote.

Photo: Shutterstock

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Marlon BrayAltus Group

About Monte Stewart

Monte Stewart serves as Content Director - Canada for Connect Commercial Real Estate. Based in Vancouver, British Columbia, Monte provides daily news coverage of major Canadian commercial real estate markets, including Vancouver, Toronto, Montreal and Calgary. He has written about the real estate sector for various media outlets and Avison Young since the early 2000s. In addition, he has covered sports, general news and business for several leading wire services and publications, including The Canadian Press, The Associated Press, The Calgary Herald, The Globe and Mail, Research Money, The Daily Oil Bulletin, Natural Gas World and The Toronto Star. Monte is active in his community as a youth basketball coach and raises funds for such charitable causes as Movember.

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