Units inside an 80-storey, $450-million downtown skyscraper helped drive Toronto's new-condominium market to record heights in 2007 - marked by lineups over a week long and heated arguments outside sales centres.

New-condominium sales in the City of Toronto were up 45.7 per cent last year, going from 13,535 units in 2006 to 19,724 in 2007, Building Industry and Land Development Association (BILD) officials announced in a news release.

For the first time in the city's history, condominium sales overshadowed low-rise home sales.

"The share of the market accounted for by high-rise product has risen steadily from 25-28 per cent in the 2000-2003 period to 32 per cent in 2004, 42 per cent in 2005, 45 per cent in 2005 and 52 per cent last year," BILD CEO Stephen Dupuis said in the release.

Illustration courtesy of Bazis International
Renderings of Bazis International's One Bloor

Dupuis said there were three main reasons for the increases: Affordability, with the average Toronto condo being $77,000 less than the average low-rise home; government "policy bias" on land availability; and interest from more than just first-time buyers.

Elsewhere in the Toronto area, sales were not as strong as in the central core.

For example, Peel Region - which includes the west Toronto municipalities of Mississauga, Brampton and Caledon - showed a 16.1-per-cent drop in condominium buyers. Sales went from 8,379 in 2006 to 7,031 in 2007.

Durham Region municipalities including Oshawa and Whitby, however, recorded a 6.4-per-cent increase, with developers selling 245 more units, or a total of 3,844 in 2006 compared to 4,089 last year.

Statistics show the Toronto market, with more ongoing condo projects than any other North American city, will continue to go up this year with a frenetic pace of construction starts. Foundations were poured across the city for 38,300 units in January, up 95 per cent from 19,600, according to the Canada Mortgage and Housing Corp.

Industry analyst Will Dunning said it's important to put numbers into perspective, however, rather than just looking at increases and decreases. "It might look like an area is really in trouble when they had a thousand less sales last year. But if two new condo buildings were released on the market two years ago and none last year, that can account for your decrease right there," he explained.

Amid all that frenetic sales activity, there is also a downside risk and investors need to be cautious, Dunning adds. "When it comes to buying, you shouldn't try to time the market ... If you're looking to buy, you have to do it for all the right reasons. Look at what's the best decision for you - what stage of your life you're at, what area you want to buy in and what's your budget. Don't buy or sell because you're trying to make a fast buck."

Jane Renwick, editor of Urbanation, a publication serving the condo industry, sees a strong outlook for the year ahead.

There were 101 condominium projects launched in the Toronto area last year and another 259 projects in different stages of construction, she says.

"Last year was the best year ever from both a new and resale perspective. We have factors like low interest rates and affordability that point to an even stronger market in the year ahead. Each quarter outperformed the past last year," she says. "There aren't really any variables I'm aware of that could negatively affect sales in the year ahead."

Courtesy of Trump International
Trump International Hotel and Tower

Renwick explains condominium buyers generally fall into three demographic groups: First-time homebuyers; empty-nesters downsizing and looking for an easier retirement lifestyle; and move-up buyers.

She says move-up buyers aren't the largest segment, but made the Toronto market interesting last year.

One Bloor, an 80-storey building planned for near Yonge and Bloor, started sales in mid-November.

About 90 people lined up outside the sales pavillion up to two weeks in advance for a chance to buy one of the 592 units.

Several real estate agents disagreed with the need for a lineup, however, and tried to walk to the front of the line the day the sales centre opened, prompting shoving matches where police had to be called in.

But the long wait would pay off for buyers. When the lineups first started, units were listed on a nearby billboard with prices ranging from $300,000 to $2 million.

The day the sales centre opened, onlookers cheered as a worker got on a ladder and changed the price to between $500,000 and $8 million.

Private individuals and realtors who had hired people to wait in the lineup for them made a quick profit almost overnight.

Meanwhile, at least one buyer got to quietly skip the lineup. Kazakhstan-based developer Bazis International announced just before sales opened to the public that the 7,500-sq.-ft. penthouse suite had been snapped up by an unnamed Hong Kong buyer for $25 million.

Architect Roy Varacalli told one Toronto newspaper the penthouse took up the entire 80th floor of the skyscraper, giving its owner a spectacular 360° view of the city.

But he said the buyer was most impressed by the 20-ft. indoor infinity pool that appears to have a vanishing edge - it was designed to run right up to a floor-to-ceiling plate-glass wall at one side of the building. If you open your eyes underwater, Varacalli said, you get a unique view of the city skyline.

It also features three bedrooms, a library, music room, family room, nanny's quarters, champagne pantry, walk-in wine cellar, a cold room for fur storage and five outdoor terraces, with in-ground radiant heat to melt winter snow.

The home could be tiny, however, compared to Toronto billionaire Alex Shnaider, who said several months beforehand he was purchasing the 14,000-sq.-ft. penthouse suite in Trump International Hotel & Tower for a bargain $20 million.

Condominium units were also responsible for boosting resale home numbers to a strong finish in 2007, Toronto Real Estate Board president Maureen O'Neill said in a media release.

She said condos typically account for about 20 per cent of total sales during a year, but during last December they added up to more than a quarter of resale activity throughout the city. They increased by 12 per cent over the previous year to a total of 93,193 units.

O'Neill added the 4,646 units sold last December alone came within two per cent of the best monthly record set in 2001.

The eastern part of Toronto's downtown core was the most active, with agents selling 59 per cent more than in 2006.

(David Hatton can be reached at hatton@businessedge.ca)