A Tale Of Three Cities

There are many corners of Canada’s residential real estate sector, but none is more fascinating than the marketing and sales of pre-construction condominiums.

To be fair, all of us at Baker Real Estate are pretty blatantly biased about this point of view. But when you think about it, the pre-construction market is so unique because it reflects the longer-term hopes and expectations of buyers. Thinking three to five years ahead, as future residents select a layout, a countertop, a showerhead or any other number of fixtures for their unit, they are envisioning a future life – and all that entails.

Here’s where it gets even more interesting: The choices made by condo buyers – whether as investors or end-users – are as diverse as their dreams. Given Baker’s dominant presence in Canada’s three largest urban markets – Toronto, Montreal and Vancouver – we thought it would be fun to take an informal look at regional preferences and how they compare.

TORONTO

High-rise vs Low-rise
Canada’s largest city is home to the tallest of tall high-rises (60 stories+ is not unusual and Baker recently sold out a 67-storey building in Mississauga. Investors are leaning towards purchasing those high-rise units while end-users are showing a preference for low-rise.

Location
Much like New York, London and other urban centres, the core of downtown Toronto is thriving once again. As people return to their offices and to their social lives, many are determined to make up for lost time – something that is clearly reflected in the sales data.

Demographic Preference
We are seeing an influx of first-time buyers of varying ages purchasing new construction condos because it’s the most affordable entry point in a city where real estate prices are on the rise. As well there is still tremendous investor strength in the 30-50 year-old age demographic, while “right sizing” among older Baby Boomers is continuing.

Downsize vs First Home
We are seeing fewer people downsizing because of the current global state. However, there is a surge of asset class purchasers, as well as first-time home buyers taking advantage of low interest rates and buying something they can afford before they are priced out of the market.

The Big Three(ish): Must-have Common Space Features
• Walkability (proximity to neighbourhood amenities)
• Party room
• Electric car chargers
• Parcel rooms

The Big Three: Must-have Unit Features
• Den/flex space
• Smart tech
• Media/desk nook

Hottest Bathroom Trends
• Separate Shower Stalls
• Stone Finishes
• Storage
• Heat Recovery Ventilation Systems

Hottest Kitchen Trends
• Integrated Appliances
• Islands with space for seating to potentially replace dining tables

Worth Noting: Toronto
• We have noticed that quite a few developments are opting for units that are without outdoor space, relying instead on communal outdoor areas to fulfill this need.
• If there is a balcony people prefer to have them directly off the living space.
• With the current social climate there is a larger interest in garden boxes and greenery either on balconies or in shared space.
• Pool-side cabanas are an increasingly popular amenity.
• Units with added features like dens are commanding a premium price per square foot.

MONTREAL

High-rise vs Low-rise
As in Toronto, Montreal-based investors are leaning towards purchasing high-rise while end-users are showing a preference for low-rise. This delineation is especially marked among international investors or new Canadians.

Location
Old Montreal is the HOT ticket location. The area had very limited pre-construction residential opportunity, but that has changed recently. With the recent addition of new development, purchasers can access all the charm of old Montreal (food scene, the proximity to the St. Lawrence River, walkability, and incredible views) with the convenience of buying pre-construction. It’s particularly appealing to “right sizers” who love the walkability and lifestyle on their doorstep.

Demographic Preference
In Montreal there has been a surge of buying among local professionals “right sizers” (in the 55 to 75-year old cohort). They are gravitating to larger penthouse units ranging in the $1-1.5 million range. The Montreal market skews to end user purchases with fewer investors in the mix.

Downsize vs First Home
Those who are in a position to purchase are demonstrating the foresight to recognize that the pandemic isn’t forever and are purchasing in the city core now. This includes “right sizers” and young professionals.

Overall, Montreal is a very affordable city. Among first-time buyers there is evidence that sales are being propelled by current low interest rates and the understanding that building costs are on the rise.

The Big Three(ish): Must-have Common Space Features
• Destination dispatch elevators
• Proximity to transit
• Indoor/outdoor pools
• Car wash bay
• Climate controlled wine lockers/wine room

The Big Three: Must-have Unit Features
• Unique decor options (for example some developers are hitting classic design trends like herringbone flooring)
• Self-regulated heat and cooling
• Outdoor space –either for common or exclusive use (The City of Montreal is not “pro” balconies)

Hottest Bathroom Trends
• Heated floors
• European wall mounted toilets
• Suspended vanities

Hottest Kitchen Trends
• Integrated appliances
• Induction stovetops
• Corian countertops (making a huge comeback)

Worth Noting: Montreal
• Montreal doesn’t have a foreign buyer tax.
• Taxes aren’t included in purchase price (unlike Ontario) so you have to calculate tax on top of the purchase price.
• Climate controlled wine lockers – similar to regular lockers can be purchased and are typically located off of a wine room which can be rented.

VANCOUVER

High-rise vs Low-rise
Townhomes are trending in Vancouver right now.

Location
Highrise developments in Burnaby, Surrey, Coquitlam are in big demand.
Townhomes (see above) are hot, especially in Vancouver West.

Demographic Preference
Demand is coming from a broad spectrum, including returning Canadians and new immigrants – a trend that will gather momentum as borders re-open later this year and into 2022.

Downsize vs First Home
We’re seeing a lot of “right sizer” and end user demand for larger units. Investors and first-time buyers are bullish on the smaller units.

The Big Three: Must-have Common Space Features
• Bike parking
• Walkability to services
• Fitness facilities

The Big Three: Must-have Unit Features
• Climate control
• Wellness features such as air purification and water purification
• Enclosed/heated balconies and outdoor space in general

Hottest Bathroom Trends
• Heated floors
• Suspended vanities
• Halo Lighting

Hottest Kitchen Trends
• Integrated appliances
• Design infusion (blends of different cultural design styles)
• Storage options / Smart storage

Worth Noting: Vancouver
• A lot of attention is focused on design aesthetics and the cutting-edge work of on world-renown architects and interior design teams.
• Functionality in design is a big driver in all spaces.
• Typical buyers are very well informed and do own research before purchasing.

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