City
Want a Condo? Take a Number
Despite recent doom and gloom predictions for the Canadian real estate market, people are still lining up for condos here in Toronto. Case in point: College Park Phase 3: Aura. After watching the conversation on my last post on the development degrade into a weird debate on the validity of Chinese numerological beliefs, I thought maybe it was a good time to update the subject.
The line up for the broker's event grew slowly but steadily in the days before the event, and by the time they opened up the doors there were well over 200 agents waiting for a number. Yes, that's right, buying a condo in this town is not all that different from buying a nice cut of meat in Kensington.
Many of the 200+ agents were turned away as the developer only released a few hundred units for the broker's event and agents were permitted to sell a maximum of 2 units each. Predictably, they sold out all the units they released within a few hours. Still, it wasn't the bedlam that was witnessed at 1 Bloor, and more importantly, most thought they were treated relatively fairly by the developer and prices were more or less as advertised.
Anecdotal evidence suggests that Aura had a decidedly strong appeal overseas with many buyers hailing from Asia, Europe and the U.S..
Photo from Singtao
Andrew la Fleur is a registered real estate agent and regular contributor of blogTO.
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You think they are foolish? I'd say you are foolish, the Toronto market on a global scale is completely undervalued. For what Toronto offers these prices are a steal right now. Any foreign investor would be wise to grab a condo downtown Toronto. 5, 10, 20 years from now, Toronto will definitely be among the world class cities, and anyone who owns property in the downtown core will be singing.
Big run-ups in real estate values are inevitably followed by corrections of varying degrees, just as stink always follows a fart.
Any time you hear "it's different this time around" in reference to a massive runup in housing/stock/tulip prices, you should probably be skeptical.
Trust me, I've seen it before and been burned. Smart money never buys during a mania.
Still, I hope you are right.
No "doom and gloom predictions" here my friend. Just cold hard facts. The proof is in the pudding.
Real Estate sales in Toronto down 18% again for the month of March from the same time a year ago. Its the 3rd month in a row that has shown a double digit sales drop.
See a trend?
Toronto Real Estate Board Says GTA Resale Housing Market Still Down in March
http://www.marketwire.com/mw/release.do?id=834284&;k=toronto%20real%20estate%20board
Another reason why these aren't a good long term investment - take a look at how hard it is to sell condos that are 5 - 10 years old. There's too many new ones going up!
Toronto's Downtown core (C01) has also experienced healthy sales activity so far this month, due to strong condominium apartment sales as well. Overall sales in this area were up 11 per cent compared to a year ago.
First off, they were not all Asian, it just looks that way from this particular photo. There were over 200 people there and trust me, they were not all Asian.
Next, many of them are Asian because many of the agents were from a particular Real Estate brokerage that has a very strong connection to the Chinese community and this particular brokerage worked very closely with the developer on CP1 and CP2.
Finally, anecdotal evidence suggests many Asian buyers are attracted to TALL buildings. Aura is supposed to be 75ish storeys tall making it one of the tallest if not the tallest residential building in Canada.
Toronto is certainly recover and I agree that over the longer term (10+ years) you can probably count on 4%+ annual returns given the projected positive immigration however,
in the next few years things could very easily get ugly in this market.
As far Toronto being cheap by world standards, all I can do is laugh. What do apartment prices in Toronto have to do with apartment prices in New York? If you live in NY I don't think that it is practical to commute from your CityPlace apartment!
It's like saying that golf club memberships in Toronto are cheaper than golf club memberships in San Francisco so buying a golf club membership in Toronto is a smart move! LOL!
Why do people fall for this illogical marketing trick so easily?
The CP2 unit a family friend has easily made $100K from the time of pre-construction till now. It gives hope to my box in CP2!