Whatever is happening recently, we have a habit of extrapolating indefinitely into the future. But circumstances change, and what was true before is not necessarily true in the future. Consider the trope: “tiny condo”. If I had a dollar every time i hear that said … or “boxy condo”; as if houses aren’t also “boxy”.
Yes, there was a “oversupply” of condos a few years ago. New building plans were scaled back or postponed. Some planned condos were converted to rentals or student housing (for eg, Nuovo condo on Rochester became rentals; two condo towers on Champagne became student housing).
But did society stop having kids in 1995? No? Well, they are adults now, and may want to move out the basement or attic to their own place, so there is ongoing demand for apartments, either condo or rental.
And the recent “condo boom” wasn’t much of a peak either. In this chart from Urbsite, compare the 2014 apartment boom with the 70’s:
And many potential downsizers ( I speak from personal experience, and from observing other
decrepit elderly folks like me) couldn’t find much on the market a few years ago unless you wanted to downsize to a small unit designed for millenials buying their first apartment..
I think a lot of complaints about condos being small or oversupplied is a search for a socially acceptable reason to be NIMBY. In my neighbourhood, the co-ops disposed of their 5 bedroom units, as is Ottawa Community Housing now, while simultaneously complaining that market housing isn’t “family friendly”. Walking the talk isn’t required.
Today, the market is being provided with large three bedroom units. Again. And in all types of neighbourhoods.
Here is a three bedroom layout in Kanata:
Separating the bedrooms to opposite ends of the apartment is good marketing, since it allows large units to be shared, or keeps older parents away from visiting and more active adult children.
Here’s an attractive new-build layout, in Vanier:
And here are two layouts on the Vanier Parkway near the Adawe ped/bike bridge crossing the Rideau River, making it very accessible to the downtown and Ottawa U:
In centretown west, Domicile is building a new 20 storey rental apartment building on Rochester, near Dows Lake, with 60 three bedroom units.
On Main Street there is a buzz of new condo mid-rise buildings. I notice one building offered a number of nice three bedroom units (marketed as two bedroom plus den, but the “den”, with its own window, is easily screened off to house visiting kids or other guests).
Out in Barrhaven, a low rise apartment building has these three bedroom units:
And also in Vanier, I notice one builder is even offering a five bedroom apartment. Claridge’s ICON building at Dow’s Lake has a few very large units too.
Most condo builders will combine smaller units into larger unit. So you can have as many bedrooms or space as you want and are willing to pay for. Some rental agencies will do the same. There are numerous very large units in Island Park Towers and some rental buildings along Carling. To justify the cost of renos, rentals will require a longer lease commitment. In a co-op near me, tenants are sinking their own big dollars into renos because the units themselves are so cheap to rent (2 bedroom townhouses, with garage, $900/month incl utilities).
Like all housing, new build units with the latest layouts and amenities cost more than older accommodation. It doesn’t take much searching to find lots of 60’s and 70’s buildings with large units. Here are some rentals from that era:
(note how similar the above 70’s rental, with a row of bedrooms, is to the new condo in Barrhaven, two pictures above …).
A number of yesterday’s luxury apartments, once derided for displacing “affordable housing” in centretown, are now themselves the affordable housing of today. Luxury plus time equals ordinary and affordable.
Condos from the 70’s are way cheaper than new. I noticed a recent listing for 1025 Richmond Road, near the coming New Orchard LRT Station, for a 2100 sq ft condo, riverfront, 3 bathrooms, 2 balconies, 2 garage spaces, in a building loaded with amenities, asking $575,000, or considerably less than $300 per sq foot ($274 for the calculator deprived).
And in centretown west, a 1150 sq ft two bedroom two bathroom apartment, lovely river views, remodelled to the hilt, asking $300,000, or $260/sq ft. Sold as of Saturday after months on the market.
Some buildings even have too many three bedroom units, one popular condo building on Bay Street has many three bedroom units that are converted to dens, offices, or combined into larger living rooms.
I’d love to compare the sq foot cost of new infill homes to new condos, but it is like pulling hen’s teeth to find the square footage of many new infills. The buildings are selling wow! layouts, and big windows, and design, rather than square footage, which is more the suburban trope.
But if a newish infill, one of those vertical shoe-box-on-end type designs that are popular on the west side, goes for $700,000 then the cost per square foot is about $460 assuming there is about 1500 sq ft distributed amongst all those floors. But if the price is nearer $900,000 then the infill cost is similar per sq foot to that of a high rise. **
And that, of course, was always the premise behind smart growth – make development land scarcer > more expensive > forcing higher density units. Thus far it has been working.
And the existing carve outs, whereby City Council discouraged infills/densification in many single family neighbourhoods, the recent Ontario policy directive mandates intensification of housing near transit stations. So those single family blocks adjacent Tunney’s, Westboro, or Cleary Station will soon be in play. And soon, so will the rest of the single family neighbourhoods, as the call for “complete communities” takes hold. There’s only so much longer boomers can stay overhoused. Downsizing is now Rightsizing.
But back to our theme: builders are building large condo and new rental units, “family sized”, three bedroom units. And there is a large stock available from the 70’s, at a cheaper price. Just like “regular, ground level housing”.
Supply, meet demand.
** (When the cost differential for concrete construction in buildings was too much higher than stick built towns, buyers tended to choose more space in the suburban towns over the amenity of living in walkable neighbourhoods, ergo the spate of ground floor townhouse units promised in condo towers that failed to sell, and were rejigged to become smaller apartments with walkoff balconies, but that market niche seems to be undergoing a revival now as new versions of “townhouse units” are selling again as they are now comparable or cheaper than infills or suburban row houses).