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New Condo Sales Still Down; Prices Still Up

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Realnet has released the sales figures for new condos for the month of January. Prices are still increasing despite the fact that the number of sales continues to be significantly lower than a year ago.

Prices are up 8% for high rise condos while sales were down 64% compared to January 2008.ÂÂÂ

The average selling price of a high rise condo was about $388,000 in January 2009, compared to $358,000 a year earlier. The number of sales however went from 508 in the City of Toronto last year to just 184 this year for the month of January.

Even though prices are still ‘going up’ the writing is on the wall and this trend cannot continue indefinitely for new condos. We saw this in the resale market where first the number of sales dropped off, and then a few months later prices followed.  Last month prices were up 10%, this month they are only up 8%. Probably in about 2-3 months prices should statistically flatten out while in reality with the various incentives builders are now offering, prices will finally start to dip a little.

It will be very interesting to start seeing the numbers in both the resale and the new development markets for the month of February because February 1, 2008 was when the Toronto Land Transfer Tax kicked in and so we can do more of an apples to apples comparison to get a truer idea of where the market is at.ÂÂÂ

What are your thoughts? I always appreciate your feedback. Leave me a comment below or send me an email via my contact page.

All stats from Realnet. Full report download: Realnet New Homes Market Report January 2009. **REPORT REMOVED DUE TO COPYRIGHT CLAIM BY REALNET CANADA INC.**