Wednesday, September 12, 2012

We Need Developer Assistance - RE: Toronto's Assignment Activity

This week Urbanation has started collecting data for our last survey on assignment activity in the Toronto CMA new condominium market.

We wanted to make it publicly known that we are not getting paid for the collection of this data, and we are not selling the results of this survey - our goal is to simply provide the industry with hard data on the 'speculative' market that may or may not exist in Toronto.

Recently, Toronto's most recognizable developer, Brad Lamb, discussed his feelings on assignments in this Home Publishing article. Mr. Lamb does not feel that the market for assignments is out of control, yet several media articles have warned of excessive speculation in the Toronto condominium market and its dire consequences. Unfortunately, decision makers at major banks that lend to the high-rise construction industry are reading these articles and being influenced by these articles. There is no doubt that part of the recent decision to alter the mortgage insurance rules was in part due to apprehension regarding 'flippers' or short-terms investors in Toronto's markets.

As a note, the individual project data on assignments WILL NOT be published, just the aggregate data on a submarket, municipality and CMA basis, yet we have already had developers respond saying that they will not provide us data for this survey. What are you trying to hide? If activity was limited, why not get that word out?

We would really like those developers to understand how important the results of this survey, our quarterly Condominium Market Survey and UrbanRental reports are to industry. Lenders, brokers, appraisers, municipalities, suppliers, insurers, mutual fund managers, hedge funds, private equity firms are looking for data to make better informed decisions, and without that data, they may and likely will make detrimental decisions in relation to these developer's projects.

The Toronto condominium market has been hot for 10 years, but the recent data suggests it is slowing and anecdotally, investors are now looking elsewhere to park their money, as they don't anticipate the same level of price appreciate going forward. Hopefully, developers will realize that construction lending dollars, mortgage dollars, and equity dollars will flow more easily when those firms have all the data available to them when they are making the decision to lend or not.

Please take the time to respond to our request as a service to the industry. Thank you.

Ben Myers


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  2. Condominium is a housing structure that is part of building. They provide first rate amenities. Toronto is the number one city in new condo constructions. I would love to buy a condo in Toronto.