Tag Archives: desirable areas
In Toronto, more condos on the horizon despite dipping prices
Carolyn Ireland – The Globe and Mail
Bargain-hunting is under way in Toronto’s condo market.
Real estate agent Christopher Bibby, who was lamenting the stagnation in the market earlier this fall, says he has seen a recent upswing.
Mr. Bibby sold nine downtown condo properties in November.
“I feel the buyers are seeing a lot of value on the condo side,” says Mr. Bibby, of Sutton Group Associates Realty Inc. He says prices in some buildings have dipped between 5 and 10% since the spring and that is encouraging buyers to negotiate.
That will be good news to Great Gulf president David Gerofsky. Great Gulf has no intention of slowing the rate of condo project launches even as sales remain shaky.
“The major developers are continuing to sell and are still able to get financing,” he says.
Great Gulf typically launches two projects per year, he adds, and intends to do so next year as well. The buildings will have roughly 300 units each.
Mr. Gerofsky sat down to talk about the market while he was celebrating the redevelopment of the old Unilever soap factory near the foot of the Don Valley Parkway. The 30-acre site will be turned into a complex of office towers, retail stores and restaurants over the next five to 10 years by First Gulf Corp.
Mr. Gerofsky likens the future development to London’s Canary Wharf. “Thirty acres represents a huge chunk of downtown Toronto,” he says. “You can’t just plunk down a bunch of office buildings and a coffee shop.”
But not everyone is so sanguine. Last week I asked readers to weigh in on whether Toronto’s real estate market will rebound in the spring or whether a longer correction is under way.
One reader who has spent years watching the housing market believes that the historical value ladder has been distorted by the overbuilding of condos. Traditionally, people have climbed the ladder from condos to townhouses to semis to detached, he points out. They move from less desirable areas to better ones.
But he believes developers in Toronto have focused too much on “lifestyle” instead of “life” and there aren’t enough projects that appeal to people in all phases of life. Therefore, condo owners will have trouble selling their units and they won’t move up to single-family homes. Eventually, prices in the entire market will drop until a new balance is found.
“A correction is already under way,” in his opinion.
Comment: Except there is no real correction as of yet. Sales have dropped, but that is because of new mortgage rules. Once people save a bit more, they will be back at it. Prices have not dropped, even if some condos have seen small decreases. The market has changed, there is no more condo-townhouse-semi-detached path anymore. Many people do not want the big house in the ‘burbs. Many people want to live downtown, near work and play, in a condo. They do not want a yard or snow to shovel. The reasoning is flawed as it is based on past demographic patterns. But we do need more condos geared to people not in their 20s. Where is my dad going to go when he is 70? Not to the King Charlotte, I can tell you that!
But then there’s real estate agent Janice Weisfeld of Sutton Group-Associates Realty Inc.
She thinks the market will rebound in the spring if the weather forecasters’ predictions for an unusually snowy winter come to pass.
“Too much snow and cold may be the deciding factor for the ‘empty nesters’ to finally sell their home and move into a condo,” she says.
Comment: Actually no, it is not the snow that will dictate the spring market. It is whether or not first timers have saved up enough to counter the new mortgage rules. If so, the spring market will be chaotic and full of bidding wars again. If not, then we shall see…
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Contact the Jeffrey Team for more information – 416-388-1960
Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
They did not write these articles, they just reproduce them here for people
who are interested in Toronto real estate. They do not work for any builders.
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Toronto’s Wealthy Buyers Dragging Up Home Prices For Everyone
Rachel Mendleson – Huffington Post
High-income buyers are a driving force behind Toronto’s booming housing market, fueling demand for an extremely limited supply of properties in desirable areas, says one real estate broker.
According to Paul Maranger, a senior vice-president at Sotheby’s International Realty, this year has seen a surge in activity in the luxury real estate market in Toronto, as buyers increasingly chase a “Manhattan type of lifestyle.”
“Toronto at the luxury level is not looking for value. They’re looking for convenience,” he said on Thursday. “Many of our clients who work in the financial district, they’re working incredible hours at the office, and they are willing to pay a substantial premium to not have to do any extra work.”
Maranger was one of several real-estate experts made available to reporters on a conference call to discuss the BMO Spring Housing Report.
When it comes to the changing tastes of the wealthy, Maranger says the desire to walk to restaurants and the theatre is putting added pressure on properties in the city centre, and particularly single-family homes, which have become increasingly rare in Toronto due to a lack of available space.
Compared to the same period last year, Maranger says sales of “luxury” single-family homes ($2 million or more) in Toronto have so far increased by more than one-third, from 95 to 128.
Demand has been particularly strong along the subway lines, says Maranger, who cited the recent sale of a home in the Summerhill neighbourhood for more than $300,000 over the asking price as evidence of this trend.
“For a city the size of Toronto, we are grossly under-serviced from a subway perspective,” he said. “What we’ll see as a result of that, and what we’re seeing now, is a disproportionate demand, particularly along the Yonge subway corridor. Buyers are willing to pay a substantial premium to be on that line, and certainly on the [Bloor-Danforth] line.”
This increase in activity at the upper-end is rippling through the real-estate market, he says, pushing up prices of single-family dwellings across the city.
“There certainly is a Domino effect in the marketplace,” he said, noting that demand for detached homes just under the luxury level has grown feverish, with bidding wars and multiple offers becoming increasingly common.
“To get into the marketplace now […] the entry level price point is about half a million dollars, which is a substantial amount of money,” he added.
This observation adds weight to warnings of some observers, who have argued that growing income inequality may be ratcheting up house prices on the whole, and pricing low and middle-income earners out of the city centre.
Demand for single-family homes at the high-end combined with what Maranger describes as the tightest market he has seen in 15 years, has contributed to a boom in condo developments.
The recent increase in condo construction — and dampening demand in the formerly white hot Vancouver market — have prompted some to question the fundamentals of the Toronto market. But Maranger predicts activity at the high end of the market will remain strong.
“We have an incredibly strong base of high-income households who work predominantly in the financial district, and in financial law, education and health care,” he said. “From a mid-to long-term perspective, Toronto is going to hold itself in very good stead in the luxury market.”
—————————————————————————————————–
Contact the Jeffrey Team for more information – 416−388−1960
Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
They did not write these articles, they just reproduce them here for people
who are interested in Toronto real estate. They do not work for any builders.
—————————————————————————————————–
Incoming search terms
Related posts:
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