40 | fall 2016 cmba-achc.ca CMB MAGAZINE
P
rices of homes in the Greater Toronto
Area (GTA) continue to increase
annually by double digits, and the
average price of a detached home
has risen above $1 million. ese developments
have caused quite a stir in the media and among
the general public. But the wider reality is that
the demand for downtown living in major cities
around the world continues to grow – and
Toronto is no exception.
Within the GTA, demand for low-rise homes
is so strong that in addition to average detached
properties surpassing the million-dollar mark,
the average price for singles, semi-detached and
townhomes is around $800,000 – an all-time
high. To put things into perspective, with the
price of an average high-rise condo holding
steady at around $440,000, the gap between low-
rise and high-rise is now roughly $343,500, or
$100,000 more than this time last year.
So, on the one hand, land shortage in
the GTA poses a significant challenge for
builders and brokers looking to help finance
their projects. On the other, it represents a
tremendous opportunity for builders that
specialize in low-rises, and the brokers who
come up with the financing for these projects, to
add to their bottom line.
With the right combination of creativity
and market savvy, there are still plenty of
opportunities out there, many of which are
flying below the radar of other builders. Some
of the options we're seeing in helping to finance
various builder projects include:
n
laneway townhomes (building on land behind
current properties, with access for these new
homes via an existing laneway)
n
repurposing of former commercial/industrial
sites to allow for new ground-related residential
dwellings
n
intensification of existing suburban areas
(i.e. redeveloping larger lots into smaller
residential lots)
n
infill townhome projects (redeveloping
underutilized urban land to allow for greater
density)
n
severance of existing larger residential
lots, originally intended for one home, to
accommodate two to three single-family low-
rise homes
n
repurposing of existing or former institutional
properties (i.e. churches, schools, warehousing
facilities) into multi-unit residential condos
n
specialty builds using green technologies
(such as LEED) that justify higher prices for
low-, mid- and high-rise projects
All of these approaches can provide broker/
builder partners with a way to not only contend
with current land shortages within the GTA,
but actually take advantage of this shortage.
Prospective buyers are prepared to pay a lot
more not just for detached homes, but low-rise
e ever-growing demand for new homes in the GTA offers an
unprecedented number of opportunities for brokers and builders
BY PAUL RAYMENT, VICE PRESIDENT, FOREMOST FINANCIAL
Land, Ho!
