Toronto, a great place to live, but
June 1st 2009
If you’re looking in Toronto for a
condominium to live in, then there is no better time to buy than
now, but if you are looking for a condo as an investment, there
are a lot of other cities which undoubtedly will show a much
higher return over time.
Our first pick is
Las Vegas. Both condos and
houses have fallen by nearly 60% in Nevada, and in some cases
the price decline has been greater. Vegas is an exciting world
class city with some of the best shows, the finest hotels and a
slew of Michelin star restaurants. It’s also a great place to
get away from Toronto’s cold winter months.
Speaking about cold, Ft Lauderdale real
estate prices are also a bargain along with other parts of
Florida like Miami and even Key West. You can find a 1400
square foot two bedroom two bathroom condo in the Lauderdale
area that sold for $140,000 during the boom for less than
$40,000. Maintenance and taxes are fairly high and insurance
continues to be more expensive, but spending part of the winter
in a tropical climate just can’t be beat.
Spain also has some remarkable values, and
condos in Dubai are also selling for half price.
Relative to most of these places,
Toronto condo prices are on the high side with downtown and
midtown city prices averaging $400 per square foot with
parking. A high Canadian dollar also makes out-of-country
purchases a lot more attractive.
The biggest obstacle is managing out of
country properties to maximize their income. It’s a lot easier
renting a condo 15 minutes from where you live than 6 hours by
plane each way. And while the Internet makes management easier,
you still need personnel on the ground. If you do buy out of
country and you want income from the property, be prepared to
play a local management service rental commissions and a monthly
management fee of about 7% of your property’s gross income.
Also, make sure the condo that you buy will allow you to rent
the property - many don’t.
Toronto Condo Report
Most of the markets that experienced strong
appreciation are now in a freefall. Las Vegas, Nevada is
down nearly 60% from 2006. Miami and Fort Lauderdale
Florida are down 55%. Both Northern and Southern
California are experiencing price declines close to 50%.
Redwood City, Menlo Park and even San Jose are seeing price
declines from a 2006 peak of $700,000 to a power of sale asking
price of $240,000. We recently saw a two bedroom two
bathroom Fort Lauderdale condo that sold for $160,000 in the
boom sell for under $40,000.00 just two weeks ago. And don't
even ask about
And yet, the Toronto real estate market is
the healthiest in the world, with one of the smallest property
value declines and abundant sales for well priced
properties. While it’s officially a buyer’s market, sellers can
still receive near “at the top prices” with a good web based
marketing campaign. Even the experts are at a loss as to
why the Toronto market is doing so well.
If you are a seller in this market, have
your agent price your property aggressively, at, or slightly
below, market value. Also insist that your agent advertise
the property heavily, especially on the web with a specified
If you’re a buyer, research the market and
the area. Check both links and click the adds. Smart sellers are
using web dollars to advertise specials. some are making
changes on a weekly basis. Interest rates today are great and
carrying costs are low, but with huge mounting government debts,
interest rates are bound to climb so choose a property for the
long run. The days of a quick flip, spectacular
appreciation or even any appreciation are gone. Find a
home that you love and get a long-term mortgage you can easily
afford and be prepared to stay put for the next five years.
2008 Condo Market Roundup
Dec. 20th, 2008
In the past 12 months the market
has changed from sellers to a buyers market. Average Toronto
prices have fallen about 8% from $420,000 to about $360,000.
Some markets still remain strong (relatively) and other GTA
markets are flooded with product, and declining prices.
What should you do in this market?
Exactly what you would do in any
market, just proceed with a little extra caution. If you want
the care-free condo lifestyle and have a property to sell, make
your condo offer conditional to the sale of your house. You can
also negotiate more then ever, even with builders on new
This is actually a good time to buy
in Toronto and the GTA. Mortgage rate are coming down, there are
lots of great condos and houses to choose from, and vendors,
both new and resale, are prepared to negotiate.
Best of luck in 2009.
Condo Update: Has The U.S. Housing Crash hit Toronto?
Published: Oct. 4th, 2008
Has the U.S.
Housing crash reached the greater Toronto Area? Definitely
not! But the market is weakening. Average prices in
the city of Toronto have slipped from about $420,000 to
$390,000, a 6% decline, over the past year. Where are
prices going? It depends on the economy. If the U.S.
bailout plan works and a recession can be avoided, our economy
will be in great shape. On the other hand, if the U.S.
market really tanks, we can expect a real estate price
adjustment, perhaps by as much as 20%. A 20% adjustment
means the average selling price of a home in Toronto will fall
from about $400,000 to approximately $320,000. The real
question is whether the money supply and mortgage abundance will
remain. If mortgage rates reach historical norms like 10%,
then the market could really tank, perhaps by as much as 35% to
Looking at it
another way, if you purchase a Toronto, or GTA condominium, with
a seven year mortgage at 6%, you may still have smaller mortgage
payments even if prices decline, should the interest rate
increase to 10%. In other words, if you find a home you
love, and plan to stay there for the next 7 to 10 years, and you
can easily afford the home, you’re probably going to be OK, but
don’t spec the market because you might find yourself in the
same shape as speculators south of the border.
Toronto’s new condo market opening
up to negotiation!
By Lex Dunkelman
Published: Aug. 29th, 2008
A drive along any Toronto street
reveals a crop of new listings, and the condominium market is
experiencing an even larger listing surge. Most developers
have been through ups and downs before, and smart Condo Builders
are anxious to sell their existing inventory.
Most Toronto builders don’t lower
their prices, but they are often open to free upgrades, mortgage
pay downs and even free parking spaces and lockers.
How do you get these great deals?
Just ask for them. Submit an offer with all of the options
that you want, at a price you’re willing to pay. Have your
lawyer help you to prepare an offer covering what you want.
The best way to get the best deal is not to fall in love with
any one condominium development. Select two or three, and
start making offers. You may be surprised what you’re able
Toronto condominium market continues to remain
By Lex Dunkelman
Published: July 13, 2008