Best Condos

[Anbarandy]

100K people per year immigration to GTA + sprawl restrictive Green Belt Act + people wanting to live downtown + lack of purpose built rental stock = continuation of demand for condos

1) 40-60% of all new condo units purchased by individual and group investors/speculators.
2) Current rental(vicinity of downtown core) = $2 to 2.10 per sq ft.
3) Avg. shoebox 700sq ft unit renting for $1400month or $16,800
4) Yearly carrying costs avg(400K purchase: Maint: $5000, Property Tax: $2800, utilities: $2500, Financing/or lost rate of return on 400K: $16,000
5) Yearly loss of about $10,000.
6) As you can see what is driving the investor/speculator market is not rate of return on rental but, unbridled greed on future value.
7) Not all 100k immigration is to the City of Toronto. How many of the migrants to Toronto can actually afford to puchase a condo?
8) When interest rates rise, which they eventually will, watch spooked investors/speculators dump as what happens in all bubbles.
9) Financial instruments in the sky....financial weapons of mass destruction.

 

[lamgos]

I've been hearing stories of an imminent condo market crash since at least 2002. Many are bought by rich Chinese with tons of cash that buy several units at a time, with current interest rates their lost return on 400K is only 3K (after tax) so that leaves a yearly profit of 3.5K to 6K if utilities are passed to the renter.

There are 250K immigrants coming to Canada each year at least 100K come to Toronto, after couple of years many can get financing.

1) 40-60% of all new condo units purchased by individual and group investors/speculators.
2) Current rental(vicinity of downtown core) = $2 to 2.10 per sq ft.
3) Avg. shoebox 700sq ft unit renting for $1400month or $16,800
4) Yearly carrying costs avg(400K purchase: Maint: $5000, Property Tax: $2800, utilities: $2500, Financing/or lost rate of return on 400K: $16,000
5) Yearly loss of about $10,000.
6) As you can see what is driving the investor/speculator market is not rate of return on rental but, unbridled greed on future value.
7) Not all 100k immigration is to the City of Toronto. How many of the migrants to Toronto can actually afford to puchase a condo?
8) When interest rates rise, which they eventually will, watch spooked investors/speculators dump as what happens in all bubbles.
9) Financial instruments in the sky....financial weapons of mass destruction.

 

[HOF]

I have a question. I'm thinking about selling my run down Toronto house since apparently it's worth over a million and moving into a condo. I'll probably just rent first. What condo building has the most hot young girls? I've visited a few buildings and I've been very impressed with the talent. Any tips would be appreciated.

We are not permitted to give out incall locations! :thumb:

 

[fun-guy]

I can only speak from my experience with over a dozen condos and oddly enough I aggressively started to invest in the TO condo market back in 2002. I buy and sell condos like stock investors, I don't get emotionally attached, they are commodities to me. jI look for good value when I buy and sell when my profit targets are reached, couldn't care less if I left money on the table, I move on and look for the next opportunity.

I've been hearing stories of an imminent condo market crash since at least 2002. Many are bought by rich Chinese with tons of cash that buy several units at a time,

I flipped all my condos over the years once my profit targets were reached and all were bought by Chinese investors and none paid with cash in a shopping bag, lol. I've been hearing those stories of a condo market crash for years as well but never believed it as I was in the know and knew what was really happening, never believe what the press prints, they have no clue and their goal is to sell newspapers.

with current interest rates their lost return on 400K is only 3K (after tax) so that leaves a yearly profit of 3.5K to 6K if utilities are passed to the renter.

Way off. My average cost per condo was slightly less than $400k and my gross profit levels after sale was 40 to 50% of purchase price on average. You didn't allow for financing of these condos, smart investors don't buy them outright, they are financed so the return on your actual cash outlay is much, much higher. With that said, you have to know what you're doing, many investors have no clue. I got lucky each time I guess, lol.

There are 250K immigrants coming to Canada each year at least 100K come to Toronto, after couple of years many can get financing.

I've read that before but those immigrants aren't my target market to sell, as mentioned all my sales were to foreign investors, either middle or far East through a network I'm privy to.

 

[shai]

I read an article in the globe and mail recently that stated the new condos being built with floor to ceiling glass are nothing but trouble.Apparently in about 15 yrs the seals around the glass will start to fail and cause leaking.It will cost the owner huge money to fix.Anyone else heard of this?

Yes, you can count on it. Avoid condos with floor to ceiling windows, especially those with green blue glass. The crap thrown up in the 90's with the cladding systems are already having problems, and this is one of the main resaons so many new condos are having window popping problems.

 

[toguy5252]

So what would you suggest?

All condominium corporations are required to have periodic technical audits carried out by qualified engineers etc who examine among other things structural integrity of the common elements including the windows. The CC the adjusts its reserves accordingly so that all common elements can be replaced at the end of their useful life etc. Although there may be some issue with windows etc they are manageable.

 

[babyfinsta]

1) 40-60% of all new condo units purchased by individual and group investors/speculators. (certain buildings are higher than this and others are lower depending on location.)
2) Current rental(vicinity of downtown core) = $2 to 2.10 per sq ft. (same rent as i paid at Cityplace back in 2003 - $1200 on 645sf from $1300 asking)
3) Avg. shoebox 700sq ft unit renting for $1400month or $16,800
4) Yearly carrying costs avg(400K purchase: Maint: $5000, Property Tax: $2800, utilities: $2500, Financing/or lost rate of return on 400K: $16,000 (u are assuming $570/Sf for 700sf and $400K price tag - average downtown is around $525/sf and u can still find lots of new condos in the $475/sf range or $332K)
5) Yearly loss of about $10,000.
6) As you can see what is driving the investor/speculator market is not rate of return on rental but, unbridled greed on future value.
7) Not all 100k immigration is to the City of Toronto. How many of the migrants to Toronto can actually afford to puchase a condo? (i dont need all 100k immigrants to buy condos. this year sales of 27,000 condo units - not all downtown either. large sales in markham/richmond hill/thornhill now.)
8) When interest rates rise, which they eventually will, watch spooked investors/speculators dump as what happens in all bubbles.
9) Financial instruments in the sky....financial weapons of mass destruction.

you haven't addressed the structural problems in the marketplace which is lack of land. look into how bad low rise sales were for this year. from restrictions due to green belt act, oak ridges moraine, restrictions on employment land conversions. try finding serviced land in markham and richmond hill. there isnt the infrastructure to even service a lot of the raw land out there.

are we crazy high? yeah, we are high..but we havent reached crazy yet. maybe in the next couple of years.

 

[fun-guy]

All condominium corporations are required to have periodic technical audits carried out by qualified engineers etc who examine among other things structural integrity of the common elements including the windows. The CC the adjusts its reserves accordingly so that all common elements can be replaced at the end of their useful life etc. Although there may be some issue with windows etc they are manageable.

This required some clarification.
According to the Condominium Act, all new condos are to have a first year technical audit within 11 months of registration. Then a second technical audit for the second year after registration. The technical audit, typically referred to Performance Audits, requires the engineering firms to inspect and examine several items within the building, including the window walls, and a comprehensive report is provided to the condominium board.

The board is then required to ensure all deficiencies are addressed by the developer, ie. fix them or negotiate a settlement. The board does not adjust its reserves based on the Performance Audits, that's a completely different process. New condomiiniums are requried to get a Reserve Fund Study done by qualified companies, also typically done by engineering firms, every three years. The Report will identify how much money the condominium is to have in its reserve fund each year for up to about 35 years. This is a complex study using forecasting models, net present values, estimates for inflation and interest rates, etc.... and the board is then required to implement a funding plan which is to be presented to the owners. Needless to say, these costs are incorporated into the monthly condo fees.

There's more but I'll bore you. As I mentioned previously I purchased several condominium units over the past decade and participated on many boards.

 

[fun-guy]

^^^ All the more they're wrong, lol. Whenever I read in the media we're in an over supply of condos, you know it's time to make an investment, I'm primarly a contrarion when it comes to investments. The media and so called experts have been predicting a condo collapse for several years now. You know if they keep predicting that year after year, they're bound to be true at some point, lol, and then people will call them experts, but they forget all those times they were wrong........... and we pay these guys?????

 

[Serpent]

^^^ All the more they're wrong, lol. Whenever I read in the media we're in an over supply of condos, you know it's time to make an investment, I'm primarly a contrarion when it comes to investments. The media and so called experts have been predicting a condo collapse for several years now. You know if they keep predicting that year after year, they're bound to be true at some point, lol, and then people will call them experts, but they forget all those times they were wrong........... and we pay these guys?????

They've been saying it for years because the fundamentals are out of whack. It hasn't happened yet because there needs to be a trigger event.

When you tell a fat relative that he's going to die one day of a heart attack, you're not wrong. One day he actually does die of a heart attack and there's usually a critical tipping point that makes that happen.

 

[fun-guy]

I think you mean the technicals are out of wack and we're waiting for a trigger (a fundamental event) to move the market in the direction of the technicals. We all know that the technicals say we have a bubble and need to bust, however after the bust happens then everyone says I told you so, lol. My 80 yr mother will then also be a genius as she's been saying that the market is over priced for years now, lol.

 

[toguy5252]

This required some clarification.
According to the Condominium Act, all new condos are to have a first year technical audit within 11 months of registration. Then a second technical audit for the second year after registration. The technical audit, typically referred to Performance Audits, requires the engineering firms to inspect and examine several items within the building, including the window walls, and a comprehensive report is provided to the condominium board.

The board is then required to ensure all deficiencies are addressed by the developer, ie. fix them or negotiate a settlement. The board does not adjust its reserves based on the Performance Audits, that's a completely different process. New condomiiniums are requried to get a Reserve Fund Study done by qualified companies, also typically done by engineering firms, every three years. The Report will identify how much money the condominium is to have in its reserve fund each year for up to about 35 years. This is a complex study using forecasting models, net present values, estimates for inflation and interest rates, etc.... and the board is then required to implement a funding plan which is to be presented to the owners. Needless to say, these costs are incorporated into the monthly condo fees.

There's more but I'll bore you. As I mentioned previously I purchased several condominium units over the past decade and participated on many boards.

You are quite right and I was simply trying to say in a non-technical or legal way that the CC board is required from time to time to adjust its reserves and that the structural integrity and life goes into that consideration and calculation. i sit on the board of a CC and as well act on behalf of a number of large condominium developers and the problems reported in the papers about glass etc. are greatly overstated.

 

[IVOR BIGGIE]

If you are so inclined, as it is a hotel/condo I believe there are deals to be made at Trump. Excerpt from an article on Trump Toronto.

Considering only 3 lenders will even consider lending on these projects and their high values, how does this in reality affect their worth? If you are selling a $1 million dollar plus unit and your buyers need perfect credit, $400k in cash and great income how limited is you perspective market. Even in a hot hot Toronto condo market not may people have that kind of money for one investment property. Otherwise you need the money in cash. So with Trump, Shangri La, Four Season having about 1800 units, how many potential buyers will these units actually attract. I foresee a large price reduction in these projects due to lack of able and qualified buyers and many people not being able to close at registration due to lack of funds and credit. Will be interesting to see what happens as some of these units are coming up for occupancy and registration for Trump Tower.

 

[88bb141]

I have a question. I'm thinking about selling my run down Toronto house since apparently it's worth over a million and moving into a condo. I'll probably just rent first. What condo building has the most hot young girls? I've visited a few buildings and I've been very impressed with the talent. Any tips would be appreciated.

You'd need to have a flat in the distillery, clubbing district or king west. Get some dates and take it to the next level, which should be easy if the date is going well. Action on the first date can be obtained in 40-60% of the time if there is good chemistry. A nice flat would also aid in that mission.

Finding a friend with benefits in the condo probably won't happy as women there won't be impressed with your place if they live int he building and don't want a f-buddy to close to home base.

 

[babyfinsta]

If you are so inclined, as it is a hotel/condo I believe there are deals to be made at Trump. Excerpt from an article on Trump Toronto.

Considering only 3 lenders will even consider lending on these projects and their high values, how does this in reality affect their worth? If you are selling a $1 million dollar plus unit and your buyers need perfect credit, $400k in cash and great income how limited is you perspective market. Even in a hot hot Toronto condo market not may people have that kind of money for one investment property. Otherwise you need the money in cash. So with Trump, Shangri La, Four Season having about 1800 units, how many potential buyers will these units actually attract. I foresee a large price reduction in these projects due to lack of able and qualified buyers and many people not being able to close at registration due to lack of funds and credit. Will be interesting to see what happens as some of these units are coming up for occupancy and registration for Trump Tower.

be careful of the condo/hotel hybrids as they may be property taxed at the commercial rate and than u are screwed. people never seem to think about that. that's what happened at 1 king west.

 

[marisha]

I dont see anything special at Yonge and Eglin... The condo's near the Rogers Center are great. If you're renting the wall-to-wall windows shouldnt be a problem, but if you did buy the condo fees will raise either way which should cover the damage. My family bought a 6 year condo with all glass windows (yonge and finch) for the SQ and the price I wouldn't agree on but the maintaince fees cover it.

The mississauga Marylin condos are an interesting design, but think of the SQ for the price. I live in the area of these condos, its barely 700SQ for 1500+ for 1BD+1, worth an investment? I highly doubt it, but renting it myself isnt a problem. Its only enough for 2 people, and the maintaince fees are a killer.

 

[LateComer]

be careful of the condo/hotel hybrids as they may be property taxed at the commercial rate and than u are screwed. people never seem to think about that. that's what happened at 1 king west.

Actually, the property tax situation has been resolved at 1 King West. The units that are rented out as hotel rooms are taxed at commercial rates (roughly $4000/yr for an average unit) but the rest are taxed at residential rates.

 

[fun-guy]

Actually, the property tax situation has been resolved at 1 King West. The units that are rented out as hotel rooms are taxed at commercial rates (roughly $4000/yr for an average unit) but the rest are taxed at residential rates.

You are correct but it was an issue for owners as they didn't know any of this when they first bought their units, it was incorrectly marketed. Regardless of the tax issues, I wouldn't touch a condo/hotel project with a ten foot pole. The cost allocations can be grey and wouldn't trust the boards in managing such projects. Yorkville Plaza is another example. After readiing the Declaration I wouldn't touch that project at all, there are so many exposures to further costs to owners it's not funny. This project is also complex due to the conversion from hotel to condo/hotel complex with many reciprocal agreements, current and future unknown arrangements with additional buildings.

 

[fmahovalich]

I have two houses and you are much better off buying bricks and mortar. This is the wrong time to buy a condo in Toronto. Yes demand may be solid, but with all the reading I am doing, they are due for a major correction. MAJOR!

Wait for that and then jump in if you insist!

Of course, then you still have those damn maintenance fees. SO HIGH. And with this glass issue, the small sizes, I just don't see the return. Always remember to calculate that maintenance fee into any house mortgage to see what you can get.

Good Luck.

 

[babyfinsta]

I have two houses and you are much better off buying bricks and mortar. This is the wrong time to buy a condo in Toronto. Yes demand may be solid, but with all the reading I am doing, they are due for a major correction. MAJOR!

Wait for that and then jump in if you insist!

Of course, then you still have those damn maintenance fees. SO HIGH. And with this glass issue, the small sizes, I just don't see the return. Always remember to calculate that maintenance fee into any house mortgage to see what you can get.

Good Luck.

condo prices dont fall in isolation. the real estate market would be falling as well ergo so will your houses. condos prices are high partly because your house is too expensive for someone to buy.