Tag Archives: condos

Is it cheaper to buy a house than a condo in the GTA? This expert thinks so

While many first-time buyers look to condos as a relatively affordable option, one Toronto housing market expert says that it is actually less expensive to buy a low-rise home in the GTA.

According to Realosophy Brokerage co-founder John Pasalis, when you control for the size difference between low-rise and condos in the GTA, condos are more expensive per-square-foot.

In the Maple neighbourhood of Vaughan a 1,385 square-foot rowhouse costs $685,000, while a condo of a similar size in the area would likely cost $684 per-square-foot, or $947,000. It’s just one example of a price difference that can be seen across markets in the GTA.

Pasalis believes that this discrepancy in prices can be chalked up, in part, to investor demand.

“The majority of new condominium construction is driven by investor demand — not demand from families,” he writes in a recent blog post. “Investors are willing to pay much more (on a per-square-foot basis) than end users are.”

Pasalis says that investors prefer smaller units, which typically have a better return on investment, which means that developers are creating units that are too small for families, at prices they cannot afford.

“When developers are pricing a unit, they’re thinking to themselves, why would I charge this much when I can get this much?” Pasalis tells BuzzBuzzNews. “And those prices don’t make sense for a two- to three-bedroom unit, which is likely why we’re not seeing as many of those units being built [in the GTA.]”

In order for a condo to be good-value-for-money for a young GTA family, Pasalis says that low-rise prices would have to increase at a much faster rate than they currently are.

“The rate of appreciation for low-rise homes in the 905 region isn’t going to be very high in 2018,” says Pasalis. “So I don’t see this trend changing in the next year or so.”

While Pasalis admits that for families with a budget of $400,000 or less, a condo may be the only option for homeownership, he says that those with one of $700,000 or more should consider their options.

“They can choose to buy a two-bedroom 1,000 square-foot condo in Maple for that price, or a three bedroom 1,385 square-foot row house with a finished basement and backyard. For most, it’s a pretty simple choice,” he says.

Source: BuzzBuzzHome.com –  

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Is Steeltown a steal for investors?

Source: Canadian Real Estate Wealth – Neil Sharma13 Nov 2017
With the cost of condos in Toronto surging, it’s only a matter of time before investors find the next hot market. And as it turns out, they might not have to go far.

Hamilton is enjoying a renaissance that’s, in part, being catalyzed by the astronomical cost of living in Canada’s largest city. While Hamilton’s amenities are no match for Toronto’s, they’re showing enough promise to lure millennial-aged Torontonians westward.

Brad Lamb, owner of Brad J. Lamb Realty Inc. and Lamb Development Corp., says investing in Toronto’s vertical homes is producing diminishing returns.

“It’s getting harder and harder in places like Toronto and Vancouver to buy a home, like a condo, and rent it and have it make any sense as an investment because you’re paying $1,000 per square foot,” he said. “You’re paying $500,000 for a one-bedroom condo apartment that’s 500 square feet and you’re going to rent it for $2,000 a month, but when you add up your mortgage, your condo fees and taxes, it doesn’t cover it. It certainly doesn’t cover in Vancouver, where that property is $650,000.”

Lamb says Hamilton has benefited from the black hole Toronto’s become. Steeltown has quietly cultivated a strong cultural scene in the city’s downtown, mostly in the James St. radius.

“Toronto’s real estate unaffordability shines a nice light on Hamilton, so investors are looking at alternate places to invest and prospective homeowners are looking for other places to live, where they can have a decent life in a nice home,” said Lamb. “Hamilton is a real city with a real urban vibe. It has a great parks system and an amazing amount of amenities. It’s a real city with a great food scene, and a great art scene, and a great music scene, so to me it makes sense that Hamilton is the next city. It’s a much more vibrant city now than ever. Every year it’s going to get larger, better, richer, and more expensive.”

The Hammer is a medium-sized city with over half a million residents, so it has retained its quaint, small-town charm, but Lamb believes it’s on the cusp of a population boom. Its downtown is lively on Friday and Saturday nights, and Lamb says business always follows in the tracks of younger people.

“Every month I see new things popping up that are very cool,” he said. “What gets me excited about a city is great retail. When you see young people out, it makes you want to visit and it makes businesses want to open there, because businesses want to be where young people are.”

Many millennials are flocking to Hamilton’s tech sector, where they’re paid good wages and promised bright futures, however, the linchpin is the city’s quality of life.

“Hamilton is going to experience a population growth much higher than what they’re projecting,” said Lamb. “More and more young people are frustrated with the cost of living in Toronto, and the inability of Toronto to create housing at a pace that is needed. I believe Hamilton will grow by 10,000 people a year.”

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Court orders developer to reveal condo-flipper info

THE CANADIAN PRESS

A Federal Court judge has approved at least one court order that will require a British Columbia developer to turn over information to tax officials about people who bought and flipped condo units before or during construction.

And several similar applications are under way, reflecting the federal government’s efforts to crack down on potential tax cheating in the presale market.

A July 25 Federal Court order requires the developers of the Residences at West, a Vancouver condo project at 1738 Manitoba St., to provide the Canada Revenue Agency (CRA) with documents related to presale flips, also known as assignments, in the building, including proof of payments and correspondence between the developers and people who buy the assignments.

That order followed a June 29 application from the federal government.

In September, the Minister of National Revenue applied for court orders related to One Pacific, a Concord Pacific project, and Telus Gardens, a downtown project developed by Westbank Corp.

Both developers said they would comply with the request for documents.

“Customer information is protected by privacy laws and is not at the developer’s liberty to disclose unless ordered by the Court,” Matt Meehan, senior vice-president of planning at Concord Pacific Developments Inc., said in an e-mail.

“To protect our customers’ information and ensure any release will be compliant with the law, we have asked CRA to obtain a court order, which we will adhere to.”

In an e-mailed statement, Westbank said it would comply with the minister’s application.

The CRA is investigating potential tax cheating in the presale market.

Developers presell units in projects to obtain bank financing. Those sales agreements can be “assigned,” or flipped, to somebody else before the building is finished.

A unit may be flipped several times before a project is completed. But only the transfer of legal title from the developer to the final purchaser is registered with the B.C. land title office.

That means the CRA does not know the identities of any buyer but the final one, and has no way to check whether the others have paid applicable taxes on those transactions.

The provincial government last May announced new regulations designed to limit assigning: Sellers have to consent to the transfer of the contracts, and any resulting profit must go to the original seller. But those new rules apply to single-family homes, not condo presales.

As the CRA heads to court to obtain data on presale buyers and sellers, some observers say the provincial government could cool speculation in the presale market – and support federal tax-enforcement efforts – by changing reporting requirements.

Presale purchasers may include people who are not Canadian residents and whose profit from flipping a presale contract would be subject to a federal withholding tax, said Richard Kurland, a Vancouver immigration lawyer.

He used the example of a person from Iran who buys a presale contract for $100,000 and sells it for $125,000 a month later. Under the Income Tax Act, that profit – because it went to someone who is not a tax resident of Canada – would likely be subject to a 25 per cent withholding tax, he said.

“If nobody knows that you’re from Iran and not a tax resident, and nobody withholds the money, you just walked off with $6,000 tax-free,” he said.

If information on buyers’ identities were routinely provided, the agency could more readily check to determine if, for example, anyone was claiming the principal-residence exemption on more than one property, Mr. Kurland said.

Asked if the CRA would like the province to make changes such as requiring routine disclosure of the identities of presale buyers, agency spokesman Bradley Alvarez said in an e-mail that, “any additional information, including that obtained from other governments and third parties, enhances the CRA’s ability to detect non-compliance.”

The CRA has found some flips are reported incorrectly or not at all and “the CRA welcomes any endeavours to obtain any information that can assist the Agency in detecting non-compliance.”

Developers support the CRA’s goals, but have to take privacy regulations into account, said Anne McMullin, president of the Urban Development Institute.

“It’s not the developers not wanting to hand over information, it’s, ‘Let’s do this safely,’ because of privacy laws,” Ms. McMullin said.

The NDP, which came to power after the May election, had said while in opposition that the Liberals were not doing enough to curb speculation in B.C. real estate.

In its election campaign platform, the NDP promised to set up a multi-agency task force to fight tax fraud and money laundering in the B.C. real estate marketplace.

Finance Minister Carole James was not available for an interview.

In a statement, her office said the province is monitoring the federal government’s court action, and tax fraud is “something that is taken very seriously.”

The B.C. government is working on a comprehensive housing strategy, and any policy or legislative changes will be made public once that strategy is developed, the statement added.

 

Source: The Globe and Mail –  AND 

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Map Charts Toronto Condo Prices By Subway Stop

condo prices ttc stop toronto

When it comes to Toronto condo prices, location really is everything. Sure, buying any unit in the city is going to be expensive, but when you see how prices vary based on the TTC subway map, it’s obvious that Line 1 reigns supreme.

Toronto realtor Davelle Morrison recently put together this map of condo prices by TTC stop, which reveals the area around Summerhill Station as the most expensive place in the city. It’s followed closely by Museum, Bay, Bloor-Yonge, and Rosedale as other high cost areas.

condo prices ttc stop toronto

On the flip side, the most reasonable condo prices in Toronto can be found in less dense areas of the city like Scarborough and the eastern portion of North York, which includes stations like Wilson, Sheppard West, and Lawrence West.

Also interesting are the TTC stops that yield no data. The map charts condo prices within 0.3 kilometres of each station, which means that there are plenty of blank entries because there just aren’t condos within the radius under examination.

When you think about it, that’s kind of troubling in terms of Line 2. There are too many stations that lack the kind of density that urban planners laud as key to successful city building.

Source: BlogTo.com  Derek Flack

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What share of GTA condos are flipped? New report offers insight

gta-condos

Soaring price appreciation in the Greater Toronto Area’s high-rise segment is encouraging condo investors to flip their units more rapidly.

So suggests the latest quarterly report from Urbanation, a Toronto-based real estate consulting firm.

This burgeoning trend is reflected in the 9,932 condo units that changed hands in the first quarter, a 73 per cent increase over activity in the first three months last year as well as a quarterly high.

Looking only at units in condo developments that were completed by builders and registered in the last two years, a total of 1,059 transactions were recorded in the first quarter.

In the first quarter of 2016, condo owners sold a total of 625 units in buildings completed throughout the preceding two-year window.

“The shortening of holding periods for some condo buyers is an outcome of the rapidly accelerating market,” says Shaun Hildebrand, senior VP of Urbanation, in a statement.

The average sale price of a resale condo unit in Q1 this year was $510,000, representing a 24 per cent increase over that period last year, according to Urbanation.

“Following the recent strength in condo price appreciation, Urbanation noted an increase in resale activity within newly completed buildings as well as more units transacting twice within shorter timeframes,” the consultancy’s report reads.

In fact, according to past Toronto Real Estate Board numbers, resale condo prices were increasing annually by a far more restrained 9.3 per cent as recently as September 2016.

With year-over-year appreciation well above 20 per cent now, a relatively recent development, it’s easy to see why some recent homebuyers would be compelled to sell sooner.

However, Urbanation’s Hildebrand notes flipping is not widespread — for now.

“Although the share of short-term condo market participants still appears relatively low, it will be important to monitor the situation closely going forward as market conditions evolve,” he adds.

Source: BuzzBuzzHome.com – 

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Is your condo board above board? Tips for evaluating condo governance

Condominums have proliferated in the downtown cores of Canada's biggest cities.

Condo corporations are effectively a 4th level of government, says one expert

Condominium governance is in the spotlight after an investigation by CBC Toronto reporters unveiled questionable practices at a series of downtown Toronto buildings.

Owners and property managers in those buildings say a group of people have aggressively sought control of the boards and budgets of multiple condos. The allegations include voting irregularities and contentious contracts.

If you’re wondering whether your condo board is operating in a trustworthy manner — or if you simply want to get a better grip on how your condo works — here are a few tips from experts in the field of condo governance.

Learn who runs the place

Not just anyone should sit on the board of directors of a condo corporation, experts say.

“You want people who are financially literate, who have some business experience, preferably,” said Audrey Loeb, a lawyer with Miller Thomson who specializes in condo law.

“You don’t want the board of directors managing the building, you want the board of directors overseeing the manager.”

That property manager should be independent of the board, with a good reputation, Loeb added.

Condo board directors should own a unit in the building, and ideally live in that unit, said Loeb. If not, that’s a potential red flag for owners.

Conflicts of interest on condo boards are another red flag, according to Brian Antman, who audits condo boards as a partner with accounting firm Adams and Miles and serves as a director of the Canadian Condominium Institute’s Toronto chapter.

Board directors shouldn’t have any financial interest in transactions with the property manager or their vendors, Antman said. Directors, he added, should also sign and follow a code of ethics.

Put on your reading glasses

Condo owners ought to take the time to read their building’s declaration, said Antman. (A declaration is essentially a condo’s charter or constitution.) They should also read any bylaws and rules instituted by the board, according to Antman.

Potential owners of new condo buildings need to read the disclosure statement provided by the developer, and should have it reviewed by a lawyer with experience in condo law, Antman said. (For resale condos, a “status certificate” replaces a disclosure statement.)

“It’s probably the most significant purchase they’ll ever make, and they shouldn’t be surprised by anything going into it,” he said. “I see a lot of people who don’t do their due diligence up front, and are surprised.”

Toronto condos

Potential condo owners should be sure to read disclosure documents or status certificates provided by the seller, one expert says. (Cole Burston/Canadian Press)

Communicate with the board, and participate

“The best way to tell how well-run your condo is… is to ask for documents, and see if you get them,” said Loeb, the condo lawyer.

Minutes of board meetings are a common record that a board should share.

“If you get them in a timely fashion, ask for the monthly financial statements,” said Loeb. “Any owner is entitled to see that stuff.”

Most condo board meetings are closed, but Loeb said owners should absolutely take the time to attend annual meetings.

If owners can’t attend an annual meeting but still want to vote on condo issues by proxy, Loeb recommends electronic proxy voting, by which proxy documents are emailed directly to owners.

Vancouver condos

Condominium buildings are administered by a condo corporation, which is controlled by a board of directors. (Darryl Dyck/Canadian Press)

If a condo owner is concerned about their condo corporation’s board, they can try to shake things up.

​”If they’re unhappy with the board, or a board member even, they can requisition a meeting to replace the board or the board member,” said Antman.

The owner can even try and join the board themselves, if they feel up to the task.

“This is their biggest investment, and if they want it to be run properly maybe they need to get involved,” Antman said.

Be warned, though: sitting on a condo board can be “a hugely time-consuming job, if it’s done well,” said Loeb.

“People have no clue what hard work it is, especially in the first two years of a condo’s life when you’re just trying to figure out what’s going on,” she said.

Make sure professionals are involved

Good condo administration often requires professional expertise, said Antman, an auditor.

“The [condo] corporation should hire a solicitor, an auditor, an engineer who’s doing the reserve fund study,” he said. “And all of these people that you’re hiring should be people that are experienced in the industry.”

A solicitor is especially important when things go wrong, said condo lawyer Audrey Loeb, who described how condominiums have become “very complex entities” over the years.

“My philosophy has always been that the condo is the fourth level of government,” said Loeb. “After the feds, the province and the city, you’ve got your condo [corporation].”

Source: By Solomon Israel, CBC News Posted: May 23, 2017 5:00 AM ET

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Buying an unbuilt condo? Think twice, agent says

Being exceedingly careful in one’s condo purchase is never a bad thing, especially in light of the $3-million class action by over a hundred condo owners in Ottawa.

Toronto-based real estate agent David Fleming, who says that he has never been involved in a pre-construction condo transaction in his 13 years as a professional, advocates one simple bit of advice: “Never buy new.”

“I liken it to buying a pair of jeans. If you walked in [to a store] and you couldn’t try them on and didn’t know how long they would be, and what the waist was … that’s a hundred-dollar pair of jeans. So why would someone buy a million-dollar condo the same way?”

The most important aspect that buyers should remember is the fact that they can back out with no penalty, as Ontario provides a 10-day “cooling off” period that can serve as an out for hesitant consumers. The countdown for the 10-day duration starts once the would-be buyer receives a copy of either the disclosure statement or the fully signed purchase and sale agreement, whichever comes later.

Another wise step would be to always hire a lawyer, who should be tasked to review all of the documentation involved in the transaction. If the lawyer suggests amendments to areas of concern, these proposals should be forwarded to the developer.

“If the developer says no, then don’t go ahead with the transaction.”

Fleming also noted that it would be helpful to remember that the people in the showroom are still salespeople who work for the developer, no matter how warm and accommodating they might seem. Working with one’s own real estate agent should help a consumer avoid an ill-advised purchase.

Source; Canadian Real Estate Wealth – by Ephraim Vecina 03 Apr 2017

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