Toronto housing starts are forecasted to take a dip in 2019, alongside all other major Canadian markets, except Montreal.
In a quarterly housing report, Altus Group predicted Toronto homebuilders will begin work on 38,550 units this year. Although this is roughly 2,500 units less than 2018, it’s still above the 10-year average of 36,663.
Specifically, Toronto will see apartment starts drop from 29,639 units in 2018 to a predicted 27,000 this year. As for single-family starts, which includes single-detached, semi-detached and row units, they’re expected to stay relatively the same at 11,550.
The main reason for the downward trend is affordability, the forecast noted. Because of the steady demand and lack of available single-family units, home prices have been on the rise in the GTA. As a result, they’ve become attainable to only “very high-income buyers.”
“Expect relatively stable single-family starts in 2019, but fewer apartment starts as the backlog from record sales in 2017 dissipates,” the report noted. “Purpose-built rental apartment starts surged ahead in 2018 to about 3,300 units, up 42 per cent from last year — a 25-year high. Expect even stronger activity in 2019 based on applications and potential affordable housing initiatives on the way.”
The City of Toronto already has affordable housing units in the works. Just last week, the federal government announced they would invest $89 million into a new 16-storey building in Etobicoke as part of their 10-year National Housing Strategy.
Toronto’s housing starts for 2019 are on par with the rest of Canada’s major markets, according to Altus Group’s report. All will either remain steady or see a slight decline, except Montreal, which will see a slight uptick thanks to the increased job growth and housing demand it experienced in 2018.