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Toronto is in the midst of a major condo-building boom, which experts say makes the sector more vulnerable to future price drops. (John Rieti/CBC)

The number of new condominiums sold in Toronto dropped by eight per cent in the third quarter, the smallest decline of the year but still on track to see the city sell less than half the number of new condos as were sold in 2011.

Market tracking company Urbanation said Wednesday that a total of 3,049 new condominium apartments were sold between June and September, down eight per cent from the same three months a year ago.

Given the current sales trend and the expected number of launches for the fourth quarter, new condominium apartment sales will likely total approximately 13,000 units this year. That's down from 17,997 in 2012 and 28,190 sales in 2011.

Sales slowdown

Averaging out over the past three years, however, brings sales levels back in line with the historical trend, Urbanation said.

"The softer numbers this year should be viewed in the context of the exceptional strength that preceded them," Urbanation's vice-president Shaun Hildebrand said. "While the recovery towards more normal volumes has been gradual, the industry continues to make the necessary adjustments required to maintain stability in the market, such as 
reducing inventory build-up, taking a careful approach to new openings and offering more competitive prices.” 

On the price side, there's evidence of stability. A separate set of numbers from the Toronto Real Estate Board also released Wednesday shows that the average price of a resold condo (not a new one) was $384,441 in the city's downtown core in October. That's up 7.2 per cent from last year.

Resale condo sales were also sharply higher, up more than 20 per cent last month to 1,347, TREB said.

That's in keeping with Urbanation's quarterly numbers, which show that there were 4,207 condo resales during the quarter, up 23 per cent. 

The average price of a resold condo increased by 1.5 per cent during the last year to $413 per square foot. That works out to a price of $366,000 for an average 887-square-foot condo.