Condos, Where Is This Market going?

It’s incredible what is happening with real estate after what seems like years of constant incline with seemingly no end in sight. No doubt population concentration is one of the factors. As immigration continues to rise, new home building is required but it seems that it cannot keep up with the influx of immigrants and the naturally occurring population growth through birth. So what is the next trend? Will there be a shortfall of housing or will there be a glut when certain events could happen such as a rise in interest rates or a reduction in immigration to our great country?

One of the front-running trends of recent years is the proliferation of condominiums. Cities finding themselves inundated with condos that are rising farther into the sky than ever before and taking on beautiful architectural design with beautiful facades and interesting roof designs. Today’s condos are usually well equipped with amenities including the shared conference rooms, work-out rooms and cooking/relaxing areas among well thought-out gardens and patios.  Heavily populated cities in the eastern part of the world and parts of Europe and India thought of the condo long before North America did, especially the sizing of the units themselves.  I remember when I rented my first apartment with my wife back in the day we struggled with size, (having moved from a comfortable home), and the square footage was probably nearly twice as big as today’s norm of say 800 sq. ft.

One of the other glaring differences is the amenities, of course.  We were required to use a communal washing machine and dryer room which you would usually find in the basement. I think you will find most condo’s today come equipped with the washing machine / dryer compliment as well as state of the art kitchen hardware. Another noticeable difference is the welcoming areas.  Most ‘apartments’ we visited when we were younger were minimalist when it came to reception areas if there was one at all. Now, when I find myself in a modern condo, it is such a pleasure to look at and at least the one’s I have been to have architecturally designed gardens and rockery visible from anywhere in the reception areas.

It’s true that the color scheme of these buildings tends to remain on the neutral side of whites, beiges and grays which, by the way is a painting contractor’s dream.   But that doesn’t seem to matter as many of the architects have found ways to introduce so much of the exterior grounds and views (always the good views) into the ambiance of the towers. Of course it depends on the rules and whether you are renting or buying as to what you can do with the interiors of the individual condos. Back when we were able to introduce any color into our unit without reprimand as long as it was returned to a neutral color.

I think today the issue is that more people own and re-rent than actually buy and move in. That factor may change in the near future as incoming buying slows down but it seems the need for rental units will continue to grow.  But there are reports that concern is growing for the continued rapid building of condos. In fact, Huffington Post reports Royal Bank of Canada (RBC) has sounded a distress call about the state of Canadian condo building; the amount of units that are currently in construction versus the amount that have been sold.  The inventory may be too high.