There are still deals to be had, in the Toronto condo market!
So I am sure, all you hear about the Toronto condo market is the craziness. Media is again reporting that Toronto condos are on the verge of a bubble about to burst. The condo market is certainly moving fast, and yes, there are a lot of multiple offer purchases being reported. However, between all this craziness, my investors continue to purchase diamonds in the rough.
Our Last Purchase
One of my young investors, just purchased 11 Charlotte street, unit 1507 for $995,000. At the time of our purchase, we certainly were concerned buying an investment condo close to the $1M mark. Our research and knowledge of the surrounding area, justified the price and the potential for more growth in both appreciation and rent. We were also focused on the differential between one bedroom condos to two bedroom condos, and how the value was more justified in the larger units. This particular condo is a three bedroom, hence, it was a special property to acquire for my investor.
11 CHARLOTTE 1507 IMAGES
After our purchase of 11 Charlotte, unit 1507, two more similar units came on the market. They both were exact same layouts, and were asking over $100,000 more than our purchase price. Unit 2407 was listed for $1,150,000 and sold for $1,090,000. A whopping $95,000 more than our purchase. Unit 1107 was listed for $1,135,000 and sold for $1,090,000. Both these sales gave us immense satisfaction for our purchase and re-confirmed our sense of where the market is headed.
Buy Cold, knowing it will be Hot
There are some key points, every investor, must look at when purchasing in the Toronto condo market. The difference in this market has always been the uniqueness of the micro-markets, within the larger condo market. I have always informed my investors with the belief, that each condo building in Toronto is its own market. A savvy investor has to study all the buildings, and then speculate the potential for growth and demand for a building. However, once a building becomes “popular” with the general market, that building is bound to sky rocket in price. There are a few buildings, that I was selling over 15 units per year, when those buildings were not that popular. For some buildings, I used to have animated conversations with investors, as they were not able to see the future, as I saw it. Prime example of such a building is Fly Condos at 352 Front street west. Quite a few investors walked away from stellar investment properties, simply because of the feel of the building. Today, Fly condos is one of the most appreciating buildings in the Toronto core market.
Where is the market headed
The first two months of 2020, have certainly started with a BANG! During these months, my investors have bought 3 condos that we bought below market value. And I sold one condo, well above the market value. There was a lull in the market in November and December of 2019. Hence, the activity has just been cramped up, in these first two month. I believe that a lot of pseudo investors, will sell in the coming months. Some believe that there might be correction in the market, and now is the time to sell. This opportunist approach of some investors and owners in the condo market, should increase inventory and in-turn reduce competition for buyers. This is going to be a strong year in the condo market, as interest rates are bound to decrease. There are some pre-construction projects that are selling out at $1500/square feet. Such activity, always helps the re-sale market.
But where to buy?
Here comes the MILLION DOLLAR question, and yes there are some areas where you should park your real estate investment dollars. I would like to meet with you in person, to discuss. Please choose a day and time, using the link below:
Discuss Toronto Investments
Know where to buy