Because there seems to be an unlimited market for new condo units. As long as they have no trouble selling them, they’ll keep on building them.
The pros say it’s a bubble that’s going to burst soon, but they’ve been saying this for 10 years or more and it’s still going strong.
Why do they have no trouble selling them? I think it’s mainly because most people in Toronto can no longer afford to buy a house as their first owned residence. It’s a bid to get a foothold in the residential real estate market, so they don’t get hopelessly left behind in rental units that get them nothing but a rich landlord. So mom, dad, baby, dog, and cat crowd into a 600-sq. ft equity condo and sit tight, waiting until they can raise a mortgage big enough to make the leap to a house.
There are also a lot of speculators buying pre-construction condos for the purpose of flipping them once the building is up and the prices start their inevitable climb to the stars. They can easily double their investment in a year or two at minimal risk. It’s lucrative as hell. And a lot of owners keep their condo when they move out to their townhouse in the satellites and rent it to single professionals or university students with parents wealthy enough to afford the rent.