In early October, BILD had Avid Ratings and Environics Analytics present at its highrise forum. Environics, a marketing analytics company, presented data on the typical resident of a condominium apartment in the Toronto Census Metropolitan Area (CMA). They presented some interesting figures, which showed that 34 per cent of condo residents are under the age of 35 in the Toronto CMA, 44 per cent are one-person households, and 49 per cent have a university degree. The more surprising figures showed that 56 per cent of condo households drive to work, and 61 per cent were born outside Canada.
These are important demographics to consider if you’re in the market for a condominium as an investment property. The data suggests a fairly young population, skewed toward one-person educated households. In a suburban highrise project, you should consider buying a parking spot, as the 56 per cent of residents who drive to work is likely heavily influenced by residents in the “905” markets.
One interesting point made by Environics is that they expect the “under 35” age demographic to decrease in the 2021-26 period, which is noteworthy given that is the time frame that almost all pre-construction condominium projects launching in 2017 or 2018 will likely see their first occupants. Will there be enough young folks available to rent all the investor-held units? This could potentially impact the rent you could charge.
It is worth reiterating these statistics: More than half of all Toronto CMA condo residents were born outside of Canada. With that in mind, it is difficult to predict the level of immigration in Canada and Toronto, and the Liberal government has stated its intent to increase immigration in the coming years. Economists underestimated the level of population growth in Canada and the Toronto CMA in 2017, so if they can underestimate population in the short-run, there is a very good chance they would also do so for 2021-26. As with the weather, it should be easier to forecast the temperature tomorrow, but harder to forecast next week.
Avid Ratings reported that 80 per cent of new-condominium buyers in Canada would recommend buying a unit to family and friends. They also reported that 78 per cent of new-homebuyers looking at condominiums for their next purchase would choose a highrise building (11 or more storeys). Avid Ratings data also shows that people will sacrifice space in their home, but not the level of interior finish. They are willing to sacrifice common building amenities, but less willing to increase their commute.
All of these factors are worth considering if you are buying a unit as an investment, or you’re buying for personal use and want to maximize your resale value.
Avid Ratings survey findings also reveal that energy-efficient appliances and open-concept kitchens are two of the biggest must-haves in a new highrise home. Hopefully, this data helps you narrow your choice in the new condo market, helps you attract the right tenant or maximizes the value you receive when you eventually sell your suite.