Most condominium investors in Canada’s prime real estate markets, Vancouver and Toronto, own just one secondary unit and plan to hold on to it for at least five years, according to the results of the Canada Housing and Mortgage Corporation’s (CMHC) 2015 Condominium Owners Survey released April 5.
The annual report, focused on the Vancouver and Toronto Census Metropolitan Areas, asked condominium owners whose primary dwelling is a freehold or condo unit but who also own at least one secondary condo unit about what motivates their condo purchases, how long they intend to hold onto their units and what mortgages and other financing they are using.
Combining responses in both cities, the survey found:
- Nearly one-half of responding investors purchased their last secondary unit for rental income.
- About 60 per cent plan to hold onto their most recently purchased unit for more than five years.
- Around eight per cent plan to sell their unit in less than two years.
- Nearly three-quarters have only one unit and roughly 90 per cent do not plan on buying new units in the next year.
- 56 per cent expect their units to increase in value over the next year, 35 per cent do not expect a significant change and five per cent anticipate a decrease in value.
- When asked how their most recently purchased secondary unit was being occupied, 48.4 per cent said it was rented out, 42 per cent said it was being occupied by either themselves or relatives, and 4.1 per cent said it was vacant.
Breaking down purchase prices between the two cities, a larger share of respondents in Toronto purchased in the $250,000 to $499,999 price range, while a larger share of investors in Vancouver purchased in the $500,000 to $749,999 range.
However, mid-range rental prices told a different story. Larger shares of responding investors in Vancouver were renting out their units for between $500 and $1,499 per month than in Toronto. On the other hand, more investors in Toronto were renting out their units in the $1,500 to $2,499 range. Responses were similar in the two cities at the lowest and highest rental-price ranges.
The report added that the results have been stable over each of the annual surveys conducted.
To download the full report for free, click here.