Toronto Neighbourhoods With the Highest Condo Appreciation Rates
As real estate activity in Toronto continues to soar, particularly in the condo market, it appears that certain neighbourhoods are seeing condos appreciate at greater rates than others.
On Wednesday, Strata released a new report on condo appreciation rates in Toronto, which revealed that properties in traditionally-overlooked areas are now seeing the biggest return on investment (ROI) in the past 12 months, with property values in three neighbourhoods now outpacing those in the downtown core by as much 20%.
Strata’s data shows that the buildings offering the best ROI are concentrated in Jane and Finch, Rexdale, and Malvern for a total of 24 properties, where appreciation rates are almost 12% higher than the city average.
According to Strata, while Toronto’s average condo appreciation rate is 2% year-over-year, Malvern and Jane and Finch, for example, have seen an increase of 14% and 11% respectively during the past 12 months. And that’s a stark contrast to the downtown core, whereby condos there showed a depreciation of -6%.
Robert Van Rhijn, Broker of Record for Strata, says he believes immigrant populations are the driving force of rising appreciation rates in North York, Etobicoke, and Scarborough.
“Many immigrants may not have the means to purchase in the heart of the city. And because prices downtown are typically higher, people usually look to outlying neighbourhoods for better value,” said Van Rhijn.
“This creates more demand than there is supply, resulting in value increases as buyers compete and outbid one another. Our data shows that sellers in Jane and Finch, Rexdale, and Malvern have been the beneficiaries of this trend over the past year.”
According to Strata, the majority of Toronto’s highest-performing condominiums are concentrated in Jane and Finch, Rexdale, and Malvern. To show how appreciation rates vary in each neighbourhood, Strata highlighted the top three condos that have appreciated most in value this past year.
Jane and Finch
Van Rhijn says he believes that the city will continue to see a lot of “upswing” in these traditionally-overlooked neighbourhoods. And as appreciation rates increase, he expects some level of gentrification to occur in the years ahead.
“As prices rise, we’ll undoubtedly see the typical signs of gentrification occur. That means more boutique shops, restaurants, and other amenities popping up in these areas. This will result in even more demand among a more diverse demographic of buyers,” said Van Rhijn.
That being said, now might be an ideal time for both families and investors to start exploring these neighbourhoods, given they may look rather different in the years to come.