All over Toronto, there are condominium units that are unnatractive, come with major red flags, and yet still sell to buyers looking for a discount.
If and when we see a market correction, it is this type of property that I wouldn’t want to be stuck holding and trying to sell to a buyer seeking “value” when there is value everywhere…
Let us remember – not every buyer has unlimited capital to work with!
More often than not, buyers will have to weigh the pros and cons of better/worse location versus less/more space, and take the money into consideration the whole time.
This unit likely sold to somebody who wanted nothing more than to be in this area, in this building, and unfortunately was maxed out at this price point.
The buyer of this unit wasn’t somebody who could afford $900,000 but paid $270,000 for a second-floor unit with all these drawbacks.
The point of my video is to explain that if and when a market downturn occurs, this is the type of unit that will be hard to move.
If the owner can ride out the storm, then he or she will never be hurt.
Unfortunatley, you never can predict when you’re going to lose your job, need to relocate, and need to sell your home…
Geoff
at 8:28 am
Nice post. Although I do wonder if there’s such a thing as ‘guaranteed’ to withstand a downtown areas but I do agree, if things do go off the rails this is the type of place that’ll go first.
Off topic, but David can you please consider doing some postings on the parts of Toronto that aren’t (a) right off the subway line (b) north of eglinton and c) east of bayview or west of bathurst? I get you’re a downtown condo guy but the name of your blog is torontorealtyblog, not just torontocoolcondosfor30yearolds.com 😉
In particular I’m trying to figure out what the future holds for my neck of the woods – detached houses in Don Mills (Lawrence/Underhill).
AnotherDavid
at 2:10 pm
Seems like he’s done a pretty good job with B and C. 😉
Geoff
at 9:17 am
AD – Did I miss a post? I saw an article on pickering which I guess is a,b and c but other than that I don’t remember seeing much. I saw a couple posting on leaside which is just east of bayview, perhaps I should have said east of leslie.
BillyO
at 9:32 am
The ICON?
George
at 1:27 pm
Your point is well taken, but I think good views from a condo balcony/window are pretty rare in the city. You’re either overlooking a railway, neighbouring building, parking lot, alley, or busy street. There are few city condos with a view of the lake and green space.
Ralph Cramdown
at 5:31 pm
The right kind of property to own in a downturn is “none.” Barring that, perhaps something with positive cash flow and enough equity that there won’t be any unpleasantness come mortgage renewal time.
If the market turns, many investors are going to list their units. Buyers of condos, more than any other residential property type, will know that as long as prices are falling, next month is a better time to buy than this month. The phone of the guy selling his top floor unit won’t be ringing. Can the phone of the 2nd floor unit’s vendor ring less?
clifford
at 9:46 pm
So I guess floor and exposure are all that matter to buyers, huh? I mean, what the actual condo looks like on the inside is irrelevant, right?
And what makes you think the buyer could not afford to pay more? You’re making a lot of assumptions on a very limited amount of information.
David Fleming
at 10:14 pm
@ Clifford
No, not at all! In fact, I live on the second floor of a condo! But my condo has a large terrace and it’s very quiet behind the building.
This particular second floor unit comes with many drawbacks and IF we make the assumptions that we did in the video, then we can analyze the situation further…
RPG
at 4:04 pm
I think this guy missed the point entirely. You didn’t go inside the unit because it didn’t matter at that point. It only matters that crappy unit is on the 2nd floor overlooking an alleyway. Enough said.
meow
at 1:03 pm
I totally agree with this video.
David Fleming
at 3:46 pm
@ Meow
Where have you been? As the hate-mail continues to pile up, I miss seeing your name amongst my comments!
lui
at 8:53 am
King and John St right David?….I know some one that lives there..I was shock as what she paid for a 3 floor unit facing King.Lobby is pretty nice but the units are soooo freaking cheap,,
lui
at 8:53 am
sorry cheap as fit and finish.
clifford
at 2:25 pm
Weird, my comment didn’t go through. I’ll try again
David… My apologies. I didn’t actually watch the video (audio issues). I just read the blog. My bad. I agree with what you said in the video.