We asked nine of the city’s top real estate experts for their thoughts on what the market will bring in the months ahead. They gave their input on everything from investing to the likelihood of a seller’s market and where prices are headed for spring. Developers Jennifer Keesmaat, President and CEO of Collecdev-Markee, and Brad Lamb, president of Brad J. Lamb Realty and Lamb Development, predict what’s coming for the year ahead:
BRAD LAMB: Generally speaking, prices have dropped about 10 to 15 per cent from the early spring of 2022. So if Ben is right, and they start reducing rates in June, and we get a 2 per cent decrease in rates over the next year or so, this time next year, we will have recovered all of that, and we’ll probably be about 4 per cent or 5 per cent over what the prices were back then.
Going forward, I just don’t really see what can change the inevitable. I think Toronto and Canada are a very desirable city and country to live in. We are expensive. We are not the most expensive in the world. We may someday be the most expensive in the world because we are probably one of the best cities and countries in the world to live in. I think there’s going to have to be solutions about how to solve those problems. But price-wise and looking in the crystal ball, prices will rise as soon as interest rates start to fall.
JENNIFER KEESMAAAT: I think you’re going to see more developers trying to figure out how to get into the purpose-built rental space, precisely because it’s a way to mitigate the short-term risk of not being able to bring condo product to market. I’m very much hoping that we will see more incentives from the federal government to help get purpose-built rental built. We’ve also seen some big announcements in the past few months from the provincial government around changes to the planning approvals process in order to expedite getting land entitled so that the barrier to getting housing built isn’t going to be the approvals process.
Right now in my inbox, I probably have between five to 10 zoned sites a day that are coming across my desk: people who have a site that’s zoned that they’re trying to offload because they don’t want to build it and they don’t want to hold onto it and carry it. Hopefully, that will slow down, but that’s a lot of property right now that’s sitting on the market that is already zoned.
The federal government has also been making some massive announcements mostly with respect to figuring out a way to unlock federally owned land, provincially owned lands through incentives and municipally owned lands. And that could move the needle and shift some of the thinking in the industry around the type of product that people are willing to build. And I think that developers who have highrise condo products are going to continue to wait. It’s way too risky to launch anything right now in light of so many projects having launched over the course of the past 12 months that didn’t sell past 30 per cent, so they couldn’t move forward.
This is an excerpt from Post City’s 17th annual Real Estate Roundtable in partnership with the Rotman School of Management. Click here for more excerpts from the panel or listen to the discussion at the podcast below. Special thanks to our incredible sponsor The RE/MAX Collection.
