New townhouse projects launched this year in Calgary and Edmonton are much smaller on average than those in the Greater Toronto Area and, to a lesser degree, Vancouver, according to a new report released on Monday by the Altus Group.
“Combined with a lower average asking price per square foot, the townhouses being built in Calgary and Edmonton are better positioned for the first-time buyer segment of the market than the average product being launched in Vancouver and the GTA,” said the report.
The average unit sizes for new townhomes were: 2,100 square feet in Toronto; 1,600 in Vancouver; 1,400 in Edmonton; and 1,300 in Calgary.
“New townhouse sales in both Calgary and Edmonton were relatively flat in 2017 compared to 2016. This year, trends have been mixed – with Calgary up in the first half of the year, while Edmonton new townhouse sales moderated,” said Altus Group.
Calgary saw townhouse sales of 894 in 2016 followed by 886 in 2017 and 639 for the first half of this year.
Edmonton sales were 797 in 2016 followed by 819 in 2017 and 303 for the first half of this year.
The report said the role of townhouses in the new home market has been growing since the 1950s. However, recent new townhouse sales are down in Vancouver and the Greater Toronto Area, due to broader affordability challenges.
The report said buyers of new townhouses are a diverse group, with a good mix across older as well as younger households, and between households with and without children. There were buoyant sales of residential land for townhouse development last year and stacked townhouses are still a niche segment of the overall housing market.
But Altus Group said townhouses are poised for stronger sales.
“Townhouses are an attractive product for younger families. While many millennials have delayed forming families and buying homes, there is pent-up ownership demand forming. … The more affordable nature of townhouses vis-à-vis single-/semi-detached homes, combined with the generally more ‘family-oriented’ environment vis-à-vis condominium apartments, make townhouses attractive to this group,” said the report.
“This, along with policies aimed at increasing densities for greenfield areas, and the growing number of baby boomer retirees looking for move-down product, suggest new townhouse sales are poised for growth in the years ahead.”
Mario Toneguzzi is a veteran Calgary-based journalist who worked for 35 years for the Calgary Herald, including 12 years as a senior business writer.
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