According to Urbanation: There were 917 condominum apartment sales in the Toronto CMA in Q1-2009, a 73% decline from Q1-2008 and Q1-2007.

This is not a picture of the fly condo line.


I went to the fly condo pre-launch....whoa momma was it a frenzy. People were fighting
over the finger sandwiches....and condo units too. I was such a buzz kill, lecturing people about investing with fundamentals.


According to Scotia Economics, here are 7 reasons why they believe we won't have an 80's style condo-correction

1. The number of apartment units under construction has fallen now for four consecutive months, having peaked last October.
2. Residential construction intentions are down sharply. Municipalities issued permits for just over 10,000 multi-unit dwellings in the first two months of 2009, roughly half the rate of a year ago. For the first time in over a decade, apartment completions are exceeding
   apartment starts.
   
3. We expect to see an increasing number of pre-construction project cancellations.
4. While the level of recently completed but unsold multi-unit dwellings is high, it remains well below prior cycle peaks (developers require more pre-sales before they get financing).
   
5. apartment rental vacancy rates are low, suggesting a greater ability to absorb vacant condo units. Tight rental markets make condo ownership more attractive to renters, and rental condominiums more attractive to investors. Roughly 20% of condo units
   are rented.
6. Several major developers, including in both Toronto and Vancouver, reported sharply higher sales volumes in March. Houses are more affordable (lower interest rate and federal incentives for first time buyers)
7. Condo's are preferred choice of housing demographically (empty nester's downsizing and younger folks out of school buying their first property that they could afford)

Good news for people who own an existing condo - your property values won't fall that much....bad news for people lining up hoping to flip their condo's at a higher price (it's not going to double before construction is complete folks)