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Newmarket ready to grow up into condo market: town report

Yorkregion.com
Aug. 19, 2016
By Chris Simon

Newmarket is ready to test the heated waters of the condominium market, says the town’s community services commissioner.

According to a report released by the municipality, market conditions are quickly aligning to support the development of "vertical residential" such as condos and apartment buildings. The report, which is available on newmarket.ca, was developed after a series of six meetings between town officials and some landowners and developers regarding the marketing of the Davis Drive corridor.

“We’ve got an infrastructure in place that would support urbanization,” commissioner Ian McDougall said, of the Davis corridor. “We’ve got our planning documents to align with more vertical growth. Really, the market conditions within the GTA ... do afford an emergence of a different type of housing option. It’s a supply and demand environment.”

While the report supports the town’s longterm plans to focus growth in the Davis and Yonge Street corridors, there has been some thought - based partly on the stalling of high-density projects such as Slessor Square - that the market is not ready for the type of intensification brought on by condos and apartments.

Not so, says local realtor Jay Miller. His brokerage serves York Region and Toronto and he has noticed the local demand for alternatives to traditional detached housing is increasing significantly, due largely to a strong mix of young couples and families entering the market and older so-called empty nest homeowners looking to downsize.

“(The town is) trying to address the need,” he said. “Newmarket is fairly landlocked and there’s not a lot of room for growth. There’s a lot of people who have been in Newmarket for a long time and now they’re getting to the age where they don’t need the big house. They want to downsize and they like the condo lifestyle, but there’s nowhere for them to go, just because of what’s (currently) offered. The need is definitely there and growing.”

Unfortunately, fast-rising prices in the area have forced many people out of the detached home market, Miller admits.

“Newmarket is now not affordable for a lot of young couples,” he said. “Quite often, we get young couples that sit down with us, they’ve both got good jobs and they’ve saved a little bit of money and want to buy a home. When you do the numbers, they’re not going to be able to do it here. We move them elsewhere. So how do you get started in the (local) market? There’s another option for young people to go into a condo ... the signs are there.”

There’s some evidence to support the claims made by the town. There were 987 condos sold in York Region in the second quarter of 2016, compared to 835 during the same period last year. The average sale price also increased, from $375,209 last year to $390,038 in 2016, according to the Toronto Real Estate Board.

Across the board’s entire coverage area, 8,965 condo sales were reported between the beginning of April and the end of June, up 17.4-per-cent compared to the same period last year. The average sale price climbed to $415,326, up 7.1-per-cent over last year.

“Sellers' market conditions exist for condominium apartments in many parts of the GTA,” TREB market analysis director Jason Mercer said. “This is why we are seeing average price growth well-above the rate of inflation.”

The trend continued into July, where 2,665 condos were sold across Toronto and the GTA, including 783 in the geographic area known as the 905, up 10.3 and 12.8 per cent compared to the same month last year, respectively.

Newmarket’s report also notes there are favourable conditions to support office and mixed use growth, especially given the importance residents are placing on working closer to home. There’s also a low office vacancy rate in the municipality right now, McDougall said.

To encourage growth, the town should consider incentives for landowners and developers where necessary, he said.

“The condo market needs to be tested and the sense is someone needs to step up and lead, which should create a ‘trigger effect’ with others wanting to move quickly,” McDougall said. “There’s a lot of interest in Newmarket as a regional hub, given what’s going to happen population wise in northern York Region. Within northern York Region, there’s going to be significant growth.”

The town should also provide a timely, efficient approval process for development and work to better align its communications efforts within the corridor with private sales and marketing plans for the area, he said.

Three more meetings are scheduled regarding the marketing program this summer. Two are planned for early fall.