Toronto vs. New York City


4 minute read

April 15, 2013

People love to make this comparison, no matter if they know anything about New York City, or not.

Let’s take a look at a few condos for sale in Manhattan and compare them to what it would cost in Toronto…

“Toronto is still soooo undervalued compared to Paris, London, Hong Kong, and New York City!”

I’m so tired of hearing that.

It’s like the saying, “It could be worse.”

I hate that saying too.

Because it could always be worse.  Anything could be worse!  You broke your leg in a fall?  Well, it could have been worse!  You could have broke both legs!  Think of the worst possible thing, anywhere, ever – and it too could be worse.  There’s nothing worse than death?  Sure there is – torture, then death!

The same mentality goes into comparing real estate values versus the top cities in the world.

The perennial market bulls love to compare Toronto’s prices to that of other world-class cities, and they say, “Condos are $550/sqft in downtown Toronto?  That’s nothing!  It’s less than HALF the going rate in New York!”


What does one thing have to do with the other?  What does Vancouver have to do with Toronto either?  I hear people talk about how condo prices are $850 – $1000/sqft in Vancouver, as if that somehow makes Toronto’s prices easier to swallow?

There is only ONE thing I like to compare Toronto’s real estate prices against, and you all know where I’m going with this – Toronto.

Compare Toronto’s prices today, against yesterday’s, two years ago, and two years from now.  Compare downtown Toronto to uptown Toronto, and compare new Toronto condominiums to old Toronto condominiums.

Prices in Dubai are $3,000/sqft, and somehow this makes me feel better/worse/the same about Toronto prices?

I hate that argument.

But it got me thinking about New York City (or maybe I’m just nostalgic, since my fiancée and I went to New York City for the first time ever, exactly one year ago today), and so I thought I’d share a couple of active listings in Manhattan, which is what most people like to compare to downtown Toronto.

2nd Avenue & East 24th Street

1-bedroom, 1-bathroom
571 square feet

This is a 1-bedroom condo, measuring 571 square feet, meaning the cost per square foot is just shy of $1,000.

It’s also an older building (keep in mind that while 70-80% of downtown Toronto condos are less than 10 years old, the same can’t be said for NYC), but this unit has been completely renovated.

The building is just north of Gramercy Park, although it’s one block from the hospital, two blocks from FDR Drive, and thus it’s pretty busy, and likely very noisy.

The condo fees for this unit are a whopping $816/month, which is more than double what you’d expect to pay for a 571 square foot unit in a downtown Toronto condo.

On the flip side, what does $560,000 get you in downtown Toronto?

Depending on the location, you could get upwards of 1,200 square feet, likely a 2-bed, 2-bath, and in a variety of different styles.

51 Walker Street

2-bedroom, 2-bathroom
1,642 square feet

Welcome to Tribeca!

Having only been to NYC once before, I’m going to ask my readers: what area of Toronto would you compare Tribeca to?  Queen West?  Kensington?

With this unit, the price begins to creep up a little bit!

$1,522/sqft, although this is a new building (new in NYC means 2005), and it’s top of the line.  Private elevator, 10 1/2 foot ceilings, and maybe everywhere!

$2,500,000 in Toronto would buy you one of the nicest condos you could find, or buy you the most expensive house in Leaside or Moore Park, a starter home in Rosedale, ortwohouses in Riverdale.

520 East 81st Street

Junior-1-bedroom, 1-bathroom
465 square feet

Here we have a tiny unit – 465 square feet, in a building that was constructed in 1964, for a whopping $450,000.

East 81st Street.

I seem to recall that Jerry Seinfeld, in the show Seinfeld, lived on west 81st Street.  I can’t remember his address, although the fact that I remember a TV character’s street is probably weird enough…

Just looking at the photo of the kitchen, you can tell that this unit needs a lot of work to bring it up to anything close to 2013’s standards.

It’s less than $1,000 per square foot, but not by much.  And considering it needs a $30K renovation, you still wouldn’t net out at less than $1K per square.

A 465 square foot condo in downtown Toronto, in an average building, between 5-10 years old, would probably cost you $240 – $250K.  I sold a unit earlier this year at the new M5V Condo for $299,900 that was only 410 square feet, but that was an insane price per square foot, and the demographic in that building is today’s uninformed youth that want to live “some place cool” no matter the price.

I found a few condos in NYC over $2,000/sqft, and a few closer to $800/sqft, but overall, the prices seem to be at least DOUBLE that of Toronto, on average.

So what lessons can we learn?

What conclusions can we draw?

“Toronto is so under-valued compared to New York City!”

I don’t think that’s the right turn of phrase.

Toronto costs less than New York City, but value is in the eye of the beholder.  Millions and millions of people around the world would love to live in New York City, and thus the “value” of living there is much, much higher than Toronto.

Let’s just be thankful that the cost of living in Toronto is so much less than New York City, and leave the comparisons be.

Because you know that somewhere in Canada – St. John’s, Winnipeg, Thunder Bay, Medicine Hat – somewhere, there are people who are fed up with the real estate market in their city, and the market bulls are saying, “Yeah, prices have gone up, but still, Regina is sooooooo under-valued compared to Toronto!”

Written By David Fleming

David Fleming is the author of Toronto Realty Blog, founded in 2007. He combined his passion for writing and real estate to create a space for honest information and two-way communication in a complex and dynamic market. David is a licensed Broker and the Broker of Record for Bosley – Toronto Realty Group

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  1. AndrewB

    at 8:14 am

    I always thought in terms of geographic layout, economy, suburban bedroom communities, Toronto is more like Chicago. We like to compare ourselves to NYC, but we are no where close to being a NYC. Not even in the real estate sense. What Toronto lacks IMO, is that “world class” image.

  2. AsianSensation

    at 10:18 am

    David, great comparo.
    What would the property taxes be between T.O & NY?

    1. ScottyP

      at 12:14 pm

      The standard property tax rate (“Class 1”) in NYC is 18.569% of 6% of the unit’s market value, after exemptions:

      The example given here is on a unit worth $450,000, with a STAR exemption to its credit, being assessed an annual property tax of $4,371.14.

      Compared to Toronto’s rate of 0.7711981%, NYC is about a quarter a percentage point pricier, excluding exemptions.

      1. David Fleming

        at 12:52 pm

        @ ScottyP

        Thanks for finding this.

        I owe you a beer. Or a coffee. Or a coffee with Bailey’s and a 1/2 ounce of rum…

        1. AsianSensation

          at 3:49 pm

          Thanks for indulging my curiosity.
          Nice to know we’re not the only ones being screwed by the taxman!!!

  3. Geoff

    at 10:39 am

    When people start saying about Toronto ‘if you can make it there, you can make it anywhere’ I’ll believe comparisons between NYC and Toronto are valid. Until then, count me out.

    1. Dan

      at 10:31 am

      Toronto is more a “You’re going to make it after all!” sort of place.

  4. Joe Q.

    at 10:42 am

    It’s impossible to make an intelligent determination of “undervalued” vs. “overvalued” without looking at prices vs. rents and incomes. IMO.

  5. Phil

    at 3:26 pm

    I fail to see why people compare Toronto to NYC, a city 4 times the size and many times the wealth, culture, world influence etc, but to say way more high paying jobs.
    Chicago is a closer peers. Much closer. And if we compare with Chi-town, Toronto is probably 40% more expensive. While downtown Toronto nowadays charges $550-600 psf, downtown Chicago/Near North price most condos at well below $400psf. While $300k brings you at 529sf suite in Toronto nowadays, you can buy a spacious 900sf in a nice hood in River North.

    1. jeff316

      at 3:52 pm

      Direct comparisons of price, price psf, and rent-to-income are all just as pointless whether it’s TO-NY or TO-CH. There are too many differences that make the comparisons inaccurate and useless.

      Personally, I’m all for a moratorium on TO-NY comparisons but only if that includes transit comparisons.

      For some reason it seems to be the same people that poo-pooh TO-NY real estate comparisons but then compare Toronto’s paucity of transit to other “world class cities”.

  6. Mithras

    at 1:21 pm

    I’m sorry but a lot of this is based on unsound reasoning. Toronto has more in common with New York than it has in common with Winnipeg. The two cities do more trade and have more linkages than Toronto has with most other Canadian cities. Toronto is the 3rd largest city in North America. It pays in that pack even if it isn’t the leader.

    The 15 year CAGR for Toronto home prices is 5.2%, the 10 year is 5.2%, and the 5 year is 5.3%. If you put that in real terms the 10 year CAGR is 3.3% and the 5 year is 3.7%. (Everything is Feb-Feb to be apples to apples).

    In comparison the 10 year CAGR for house prices for the following cities are:

    Victoria – 6.4%
    Vancouver – 7.7%
    Calgary – 6.5%
    Edmonton – 7.0%
    Winnipeg – 9.3%
    Montreal – 6.5%
    Greater London UK – 4.0%
    Central London UK – 8.2%
    Paris – 4.1%
    Greater New York – 1.0%
    Manhattan – 3.6%
    Gasoline Prices at the pump – 7.1%
    Gold Price – 16.7%

    I look at those numbers and say Toronto’s 5.2% increase is pretty darned steady. In real terms it’s 3.3% y/y growth. It’s not much higher than Manhattan, Greater London or Paris and they have all had massive price corrections. Even with the massive price correction, Central London is still appreciating at a much greater pace. Gas is getting expensive much faster as has gold. Toronto has appreciated in value slower than most of Canada. Almost everything gets more expensive over time and some things will almost always outpace the CPI. House prices are usually one of those things.

    1. David Fleming

      at 1:58 pm

      @ Mithras

      Awesome insight!

      Thanks for putting all this together!

  7. chantalmcculligh

    at 11:29 am

    You have an incredible style of writing. You immediately captivated me by the first few sentences – And I’m not even that interested in real estate hahaha

  8. alanna

    at 11:32 pm

    Uh yeah Toronto will always be a piece of shit. It will never even come close to being half the city New York, London, Paris and Hong Kong are

  9. Pingback: The Craziest Floor Plan You've Ever Seen? - Toronto Realty Blog

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