Toronto Condo Market Worries Bank
In a recent Financial System Review the Bank Of Canada again sounded an alarm about the many Toronto Condos now under construction worried that this might result in a downward correction.
The Bank is worried about record personal debt and a sharp decline in the job market could bring down the economy.
The supply of Condos under construction is above historical averages relative to the population.
Three warning signals of the Toronto Condo Market of concern to the Bank:
- The prices of Condos has flattened with prices declining
- The number of unsold Condominiums in the pre-construction stage has doubled
- The average Toronto Condo square footage has declined since 2010 to satisfy investors who could bail under stressed conditions
A sudden correction in Toronto Condo prices could push down all housing prices adversely affecting employment and household incomes and most important household net worth according to the Bank Of Canada.