Oversupply warning in Toronto, Vancouver condo market

Although deemed to be "low-risk" in the CMHC’s latest assessment of Canada's property market, there is a warning over one sector of Toronto and Vancouver’s real estate.

Capital Economic’s David Madani says that the oversupply of condos in the two cities could reach dangerously high levels.

He told CanadianBusiness.com that builders are giving incentives to buyers but they may not be enough of a draw for investors who may “move off to the sidelines” if prices stall.

In the first quarter of this year, there was a 42 per cent increase in new condo supply, according to Urbanation, and some experts are predicting a sharp drop in prices if demand does not match supply. 
 

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