As preconstruction condo sales in Toronto hit lows reminiscent of the financial crisis, developers are getting creative with incentives to attract potential buyers.
Recent reports indicate a significant decline in sales compared to previous years, with high interest rates and market uncertainty cited as primary factors. In response, developers are offering unprecedented incentives such as reduced parking fees, lower deposits, rental guarantees, and mortgage assistance programs.
For instance, developer Camrost Felcorp recently concluded a successful incentive program offering two years of mortgage cost coverage, up to $90,000 for units under $1 million. These incentives are tailored to current market conditions and aim to address buyer concerns amid economic uncertainty.
However, while developers seek to entice buyers, they are cautious not to reduce the base price per square foot, which could trigger long-term market corrections. Instead, they’re offering one-off incentives like free parking or temporary mortgage holidays to maintain unit values.
With project cancellations and delays potentially impacting future housing supply, developers are navigating a delicate balance to stimulate sales without devaluing their properties.
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