The condo market has been booming for a generation in Toronto with a tiny blip recorded in the 07-09 slowdown.
Condo flipping made thousands of savvy investors healthy profits throughout this boom, while our skyline has been transformed and developers raked in huge amounts of money. Condos were unheard of until the late 1970s but their value to investors became apparent as they are significantly more profitable than building apartments and collecting rent long term.
For many, if not most Torontonians, condos are the only way to get a roof over their heads. They are far more affordable and plentiful than detached homes and townhouses. Condos aren’t simply a place to live in, they are also fully financialized assets, similar to stocks, bonds, and tax saving vehicles. Statistics Canada released data in early July of this year which shows that almost 40% of Toronto condos are not owner occupied. This means they are empty, rented out, or used a second property. For many international investors, a condo in Toronto is a money laundering tool. A good lawyer can help anyone with cash use loopholes to maneuver their way through and to buy a condo despite not being a citizen or resident of the country.
This number is one of the reasons we have a housing crisis in our city. So much housing construction is dedicated to building housing units that in many cases aren’t being used by locals. Our housing supply policies are being designed to cater to wealthy investors with tons of cash who are completely disconnected from local culture, life, and history. Greed is dominating our market and it’s leaving the region with a huge supply of extremely expensive housing that few people enjoy and that is out of the reach of many. While government measures have made some progress on reducing these trends, at the end of the day there’s always a way for an investor to take advantage of loopholes.