Market Report – March/April 2017

Sales Commentary

Paranoia seems to have set in with the rapid rise in real estate prices over the past year – almost 30% year over year. And most of this increase has happened in just the past four months. Now Governments at all levels are ready to act! But wait! The market in terms of prices has already begun to plateau. It started in the last 10 days of March and has extended into the first two weeks of April.

So what has changed? We started from a market with a shortage of listings to one where listings are now at more normal numbers. In the first 14 days of March we averaged 450 new listings per day. Over the last 17 days of March we averaged 630 new listings. At that rate we would have 19,000 new listings in April. So why the increase? For years, many people in Toronto refused to sell. The cost to move with double land transfer taxes, commissions, and legal fees could be as much as $50,000! But at today’s prices, many have decided to cash out and ‘baby boomers’ are taking the lead. Plus, this is the start of the spring market which historically brings a jump in listings. You are also seeing buyers who have grown tired of the ‘multiple offer’ circus. Where there used to be 10 and 20 people bidding for a property, we now see the number at 2 or 3. And in some instances no buyers appear on the offer date!

In terms of sales, TREB reported just over 12,000 sales in March. That was 17% higher than March of 2016. The number matches normal sales for April and May. What we can tell you is that the spring market will end earlier than normal – probably by mid-May. Nonetheless the Ontario Government has been the first to the market with a ‘Fair Housing Plan’ or should we say, ‘Vote Getting Housing Plan’. The key changes, effective April 20, are: a non-resident buyers tax of 15% on all sales written from this date. The good news is that it will not apply to foreign nationals working in Ontario or to international students. There will also be expanded rent controls covering all units, with rent increases for current tenants limited to the cost of living each year! Additional changes are forthcoming but they are less important to individuals in the housing market.
The result of these changes will be to produce a market ‘pause’. Everyone will try to figure out the impact and buyers will hope for a price drop. Looking at the non-resident tax in B.C., we saw lower sales, and prices did decline. But that was primarily because of the poor introduction of the tax by the B.C. Government which made the change retroactive and forced a number of sale defaults. While Vancouver sales are lower than last year, prices for condos are now higher and detached houses are about the same.

So how does this translate to our market? The non-resident buyer impact is much smaller here than in Vancouver. However, the introduction of rent controls will encourage some investors to sell over time. We expect prices to soften from current levels. Our best guess is that prices will drop by 5% over the fall. There are always some people who want or must sell and if buyers hold off for a period of time they will see a small reduction. However the only time you will get a big price correction is if interest rates spike – owners can’t afford their mortgage (Currently mortgages in arrears are .12 of 1%! That is 30 times lower than the current U.S. rate). Forecasts for the next ten years suggest that the worst-case scenario is for rates to get to the 5-6% range – the rate where buyers already have to qualify today! The other situation is if we were to experience a major recession with big job losses. Do you see that for Toronto? No! Even the Ontario Government can’t mess that up. For buyers waiting, we are sorry to tell you that prices will be higher next year. The window of opportunity is small.

Rental Commentary

Why the Government’s sudden preoccupation with rent controls? The media has reported two cases where the landlord doubled the rent from $1600 to get rid of a tenant. The current rules of the Rental Tribunal make it very difficult to evict a tenant for non-payment of rent or for carrying out illegal activities. This is the only resort for landlords to get a speedy resolution. In both instances, the landlord needed to sell the unit as vacant. We can tell you that landlords value good tenants and want to keep them. By keeping a good tenant, you avoid vacancy costs and you save on leasing commissions. Good tenants can usually get rents below market for these reasons.

But there are more tenant voters than landlords. Hence, we have rent controls which will not be good for tenants in the long term. We currently have a vacancy rate under 1%. Plans by several developers to build apartment buildings will be shelved. Over time, more investors of condo units will also sell, particularly if the returns are negative or if they cannot evict tenants for valid reasons. The result will be fewer rental units for a growing population.  If you want to see the future, check out Stockholm which has rent controls and a Government rental registry with a six year wait list!In summarizing, we do have an idea to get more condo units into the rental pool. There are thousands of units available on Airbnb. Most of these owners do not declare the income and pay no HST. As a condition of operating in Canada, Airbnb should have to provide a download of all rentals each month to Revenue Canada to reassess. That would change the economics and make one year rentals more attractive to owners!

Toronto Market Report November-December 2015

Sales Summary

Sales were unusually strong in October according to the Toronto Real Estate Board. The pre-occupation with the Blue Jays was more than offset by the good weather in October. Sales were ahead by 3% over October of last year. Our commentary from last month remains unchanged in that 2015 sales are now close to those of 2014 on a monthly basis since the summer. Remember, weather only impacts the timing of sales, not the total number of sales over a lengthy period of time such as a year. Buying real estate is not time sensitive for most – unlike buying groceries each week. Let’s look at last year. Normally the Spring Market starts at the end of February and into March. Record cold temperatures in February delayed the start until April, yet we experienced a strong, record breaking sales market throughout the balance of the year.

Another market factor which gets way too much attention is changes in interest rates. The naysayers believe that our market will end with the U.S. Fed Bank Rate forecast to increase rates in December. The rate is expected to rise by ¼% to ½% in total. This is the same rate as the Bank of Canada rate right now – ½%. The previous record for sales on the Toronto Real Estate Board was in 2007. During that period our Bank of Canada Rate was 3.25% to 4.75%. The point to be made is that moderately increasing rates will have no impact on sales. They will however slow down the increase in real estate prices and that is not a bad thing.

In Toronto (the new 6) condo sales were ahead by 9% over October of 2014. Conversely detached house sales were lower by the same 9%. In terms of condo sales downtown, the monthly increase was 19% (in September sales were actually 1% lower than last year (and we were concerned). The Humber Bay condo market was even stronger – up 23% this October over October of last year. With all those construction cranes causing anxiety among economists, increased sales are to be expected, but the real focus should be on supply – units available for sale. In the downtown condo market, ‘active’ listings were up by just 1% over last year which means the absorption rate is actually rising. In Humber Bay, ‘active listings’ were up by 4% which shows an increasing absorption rate in this market. While low rise/freehold properties in the 6 remain in tight supply, the condo market is in better balance. While we see prices in the condo market increasing marginally, the price gap will to continue to widen with low rise and soon more buyers who desire to live in Toronto will have to adopt the condo lifestyle.

Toronto Condo Sale Price Comparison
The Murano: 38 Grenville St.
We examined price trends in the condo market with a focus on 38 Grenville this month. The Murano is a newer Bay St. corridor building completed in 2010. The first unit we tracked is a one bedroom with den and parking. It has 9 ft ceilings and open balcony on a high floor. It sold in 2015 for $499,000. At 657 sq ft, that translates into a price of $880/sf. The same unit originally sold in 2010 for $399,000. That was $700/sf. Even with a high initial sale price, the unit increased at a rate of 4.6% per year. The second unit we looked at was a two bedroom/two bath with den, balcony, parking and on a high floor with a view. It sold in 2015 for $648,000. At 857 sf, that represents a sale price of $760/sf. The very same unit also sold in 2010 for a price of $506,000. The annual increase for this unit was 5.1% over the same five year period. These prices are very close to those in College Park and represent the highest prices in the downtown condo market. Bay Street has always been the primary rental market in Toronto and its proximity to both U of T and Ryerson has made it very attractive to Asian buyers who value location. Currently there are only two units for sale in a building of 397 units. This is a very tight market and while prices are high, there is little likelihood that prices will decline from current levels; even if we compare these prices to last month’s Market Report, where we saw prices in the City Place market under $600/sf and not appreciating as quickly as Bay Street.

Rental Commentary
October is usually the start of the slowest season which runs through January, for rentals in Toronto. Prices tend to be lower as investors are anxious to get their units rented rather than let them sit empty. Nonetheless, over 600 one bedroom units and 250 two bedroom units were leased in the downtown condo market in October. That is almost twice the number of transactions that took place in the resale market. And yes, we are still having multiple offers for rentals, particularly in the two bedroom segment.

Over 40 studios were leased in October at an average rent of over $1400. The entry point for the one bedroom market – no den or parking – is $1625 per month. The one bedroom with parking now averages just under $1800. The top end of this market – a den and parking – now averages over $1900. One bedroom units without parking made up 55% of the units leased this past month.

The entry level for the two bedroom market remained at $2300 per month. The high end – parking plus a den – is now over $3100 per month. Bigger units are increasingly popular and the days-on-market to lease have decreased to the 20 day range for investors.

The three bedroom market, although small, is much in demand and rents remain in the $3500 per month range.

Toronto Market Report October-November 2015

Sales Summary

While many people focused on September sale results as being a record for the month, the reality is that the market is instead plateauing. Sales on TREB for September were 8200 units which were up by 2.5% over last year. In August we were 5.7% higher than the same month a year ago and if you go back to the Spring Market, we were running 10% higher each month.

Still if we match 2014 sale numbers over the last three months we will hit the record and magical number of a 100,000 units sold on TREB for a single year. The key will be October sale numbers which are always higher than September. For the first 14 days of October sales were ahead by 4% over the same period in 2014. A positive sign.

Looking at the Downtown Condo Market, sales were down by 1% from September of last year but active listings were up by 8%. In contrast, over the last few months this market segment has outperformed the overall market in terms of sales growth. The Humber Bay Condo Market followed suit. This change needs to be closely monitored. The question is will this just be a single month or the start of a bigger trend.

While the resale condo market was leveling off, the new or pre-construction market for investors, which was slow over the spring and summer, is taking off with the launch of several prime projects: 158 Front, Pier 27 (phase 3), Lighthouse Condos, Riverside Square (phase 2), and 150 Red Path. All of these projects were well priced for their market areas with the exception of Pier 27 which seems high, even given account to its prime waterfront location. Initial sales were good and we expect with a lower Canadian dollar that there will be strong interest from non-resident buyers.

Condo Sale Price Comparison:
City Place: 15 Fort York Blvd.
In this issue we looked at sales at 15 Fort York Blvd, part of the City Place development. It is located just west of Spadina. The building and the whole development is centrally located in the downtown core meaning that you can walk to just about everything. While most of these condos lack high end finishes, they are reasonably priced for downtown. The first unit we tracked was a one bedroom with balcony but no locker or parking. It sold in 2009 for $262,000 and again in 2015 for $312,000. Over six years the unit appreciated by $50,000 which translates into an annual increase of 3%. At 535 sf, the property sold for $583/sf which is slightly below the $600/sf benchmark for downtown. The second unit, a two bedroom with balcony and parking, also sold in the same time frame as the first one: first in 2009 for $305,000 and then again in 2015 for $404,000. The appreciation of $100,000 works out to just under 5% on an annual basis. This unit, at just less than 800 sf, produced a sale price of $510/sf. Again, there are not many newer buildings where you can buy at this price point downtown. Both units are at midlevel in the building and views are limited. Currently there are only three units for sale in a building of over 400 units.

Rental Commentary
September, although not as busy as the summer, marks the end of the prime rental season. Rentals downtown were 1100 units for the month, down from last month’s peak of 1400. As a point of comparison, condo sales covering the same area were less than half this number. The Third Quarter Rental Report from TREB showed that there were 2.5 times more condo rentals than sales in the downtown market over that period. Can anyone say Manhattan North!

CMHC reports that the condo vacancy rate downtown is stuck at 1.3%. And for units renting, the most common time frame to rent (mode) is just four days! Did anyone say, bring your cheque book to view a hot rental property?

A studio condo now rents in the $1425-1450 range. The entry level for a one bedroom without parking is now over $1600. A one bedroom plus den, again without parking, is now over $1800. And the top of the one bedroom market with a den and parking is almost $2000. The two bedroom market continues to outperform the one bedroom market. The starting point has moved up to $2300 and it tops out at almost $3,000/mo with a den and parking. The three bedroom market is $3500 per month. At these rent levels, investors are not getting rich. Rising property taxes and utilities offset much of these gains.

It is becoming apparent that more and more people are prepared to adopt the condo lifestyle and even to rent in order to live downtown as opposed to the suburbs. We expect the demand for two bedroom+ units to outpace supply shortly. Developers, in order to satisfy this demand, and also to attract investors who were previously buying one bedroom plus den units have begun to shrink the size of these condos. Two bedroom units used to be a 1,000 sf. Now two bedroom units are being offered from under 700 sf to up to 800 sf. in order to keep prices down.

Toronto Market Report Feb-Mar 2015

Sales Summary
The year started off without any surprises. Sales for January on the Toronto Real Estate Board were 6% higher than for January of last year. The fact that the weather this January was better than last year for the month certainly had something to do with the numbers. The test will be February where it looks like the weather will be worse than in 2014. Why the preoccupation with weather? Real estate is seasonal and there is little time urgency to make a deal on a particular day. Hence a decision can easily be put off for several weeks. So the question remains: will the market continue to outperform last year’s?

New listings were up 9.5% over January of last year but the number of ‘active’ listings in the market actually declined by 2.5%. The market, and particularly the low rise market, is constrained by the lack of listings. Many economists keep arguing that low sale numbers are a forerunner of falling prices. In fact this lack of listings is forcing prices to rise even faster and that is not sustainable in the long term!

People also ask us about the Bank of Canada interest rate cut of ¼%. For the real estate market, this is a nonevent. Rates are already low and young people do not take on mortgages with variable rates but choose fixed rates – usually five years instead. These rates are based on the bond market, not bank prime. However this is an indication that interest rates will remain low for quite some time to come.

Turning to the condo market, overall sales were up by 11% this January over last. Most of the increase was in the 905 Region. Downtown, resale condo sales were up by 9.8% over last January which is reflected in greater supply. More new condo projects were registered in 2014 but active listings are only 4.8% higher than last year at this time; an indication that the market continues to need and absorb new supply. The Etobicoke market experienced similar trends to the Downtown market.

Toronto Condo Sale Price Comparison
This month we looked at sales in one of the DNA buildings – One Shaw which is the oldest of the three. Completed in 2006, it boasts 317 units. Since completion, DNA has been the most popular development in the King West District. Three units we analyzed. The first unit we tracked was a two bedroom, two bath unit with parking, locker and outdoor space. It originally sold at registration for $296,000 in 2006 and then sold again in 2014 for $420,000. That is an annual price increase of 4.5% over eight years. At 745 sf, the 2014 price was $560/sf. The second unit we tracked was a one bedroom with den, locker and parking. It sold in 2011 for $343,000. It sold again in 2014 for $349,000. That is just a yearly increase of 1% over the last three years. Hence most of the price appreciation in this building occurred from 2006 to 2010. At just under 600 sf, the current price is $580/sf. The final unit we looked at just sold in February of this year for $340,000. It previously sold in 2008 for $262,000 which again works out to an annual increase of 4.5%. This one bedroom at 638 sf has a locker but no parking. The price per sf was only $533. But if you assume that with parking, this unit would sell at $580/sf, then the value of a parking spot in this building is $30,000 which is in line with most new condo buildings. Currently there are only three units for sale out of 317, and two of these are sold conditional. What does that tell you about supply?

Rental Commentary
January should be the slowest month of the year for rentals. But 450 one bedroom units and 175 two bedroom units were leased Downtown. The numbers were more than double the condo sales in the same market for January. The good news for tenants is that prices are softer at this time of year than in the summer. Studios are leasing for just under $1400 per month on average. The one bedroom market, without parking, starts at $1600. A parking spot is worth about $150 per month. The two bedroom market starts at $2000 per month without parking. The top end, two bedrooms plus den and parking will average $2800 per month. In the one bedroom market, 53% of units were rented without parking. For the two bedroom market, only 24% of the units were rented without parking. A better measure of the market at this time of year is that ‘days-on-market’ were in the 20+ range for all property types. In the summer, the number drops to the 8-15 day range!

Predicting the Toronto Condo Market

Every few weeks we get a comment from some rating company, our banks and even the Bank of Canada calling for a condo correction in Toronto due to oversupply and appreciation. People who live and work in the downtown area of Toronto are seeing things different. Condos are getting leased and sold.

Let’s look at the condo rental market.
a) I was looking to buy a two bedrooms, two bathrooms over 1,000 sq ft with many amenities and in a medium-rise condo six months ago and could not find any. So as a result, I decided to rent a condo with all my criteria except I decided to look at high-rise condos too. Before I rented, I had THREE landlords turn me down because I have a 8 lb pet. All the units I looked at, rented in seven days after my query.
b) As long as buying is too expensive for the young generation, who are seeking a “better” lifestyle then “home ownership”, the influx of immigration and foreign students studying in Toronto continue, this trend to rent is not going to change.
c) If there is a recession, there is a higher probability that the rental market will get stronger.
d) Many of my clients that initially contact me are looking for rentals between $1000 to $1300/month. Many will never find a rental in this price range in Toronto unless they look for apartments. These clients will at some point be able to afford to live in the condos where all their friends are.
e) The most surprising comment I heard from my friends have been the decision of two developers to change their project from condos to apartments. They were concerned the condo market is falling… I say this is fantastic! This means that that companies with millions of dollars behind them are seeing how strong the rental market in Toronto is. This is great news for investors.
f) Many of my clients come in with a low-balled price for rentals but I see them living in the exact condos they said were too expensive. We are too scared to let our kids live in a bad neighbourhood so eventually, mom and dad, increase their budget or buy a unit…which brings us to our next topic.

Let’s look at the condo sales market
a) There has been so much negative press about foreign investment ownership of condos and how they are inflating the price of condos in Toronto. The problem isn’t foreigners. Every friend, acquaintance, friend of a friend, family member etc. I know owns a property. So yes, there are lots of investors but they aren’t from out of the country. Many of them are living beside you. The foreigners are “rich” and when they buy, they typically pay cash so even if there is a correction, they can hold on. The bigger issue is the Canadian investors but is it really a problem? We are required to put 30% down, qualify with banks and are financially responsible for the loans unlike our American neighbours.
b) As well, our mortgage rates and bank rates are heading down or staying stable. As a real estate investor, I’ve made a lot of money in the last 5 years where my stock market returns have remained relatively flat since before the 2008 crash. I and many others expect the bank rates to remain low for at least another five years so we are still in a favourable environment for investing in real estate.
b) Over the last few years, detached homes and semi-detached homes have been seeing a 7-8% increase where condos have seen more modest 2-3% increases. As well, the price differential between semi-detached homes and condos have doubled for the 3 years between 2011 and 2014 from approximately $88,000 to $170,000. There are still multiple bids on homes and most downtown homes are averaging over $800,000. The Condo market will benefit from low bank rates, low market rates and lack of supply for the housing market for the foreseeable future.
c) There are over 6 new developments in the Yonge Corridor where all the one bedrooms are sold out. These developments are selling between $625-700 per sq ft. This means by the time costs are factored in, the buyer is going to be expecting well over $700 sq/ft for their units. As well, twelve new developments in the same area are planning on selling their developments in the next year.

Conclusion – If you are still sitting on the fence about your real estate investment, work with a real estate agent who can tell you which are the building to invest in. Buildings on the same block are not equal.


Happy house hunting!

Market Report – January 2015


  • Our forecast for 2014 keyed on the fact that 2014 would be a record year for sales on the Toronto Real Estate Board. We were the only ones who made that call. Most of the banks were calling for lower sales and a price correction. Today most banks and CMHC are calling for a strong real estate market in 2015 and we can only agree.
  • We also reported last year that the biggest challenge in the condo market was NOT the number of units being built but rather the mix of units. We need bigger units going forward and developers are already committing to more two bedroom units for 2015.
  • There are still some ‘bears’ that are negative on the Toronto real estate market. They will tell you that young people will move to the ‘burbs when they have children, that mortgage rates will be 7-10% sometime in the future, and that real estate prices are overvalued. The ‘bears’ making these comments don’t live in Toronto and they don’t know the vibe of the City. Some young people may move to the ‘burbs but most are going to stay downtown. Mortgage rates are not going anywhere for the next five years, and overvalued is an opinion not a fact. The market will always determine price.

4 Key Trends Impacting the Market

  1. Current immigration levels to Toronto (foreign and Canadian) require 35,000+ new housing units each year. Low rise construction is falling each year and currently sits at 11,000 units annually. The balance has to come from the high rise or condo sector. So current condo completions of 20,000 units annually will actually lead to a shortage in housing!
  2. People hate ‘commute times’ and even with a commitment to improve public transit, nothing major will occur for at least seven years.
  3. People living downtown are going ‘carless’. They want to walk or bike to work. The savings can be directed to more expensive housing.
  4. Millennials value ‘free time’ above all else. That means Starbucks as opposed to grass cutting and a different lifestyle from baby boomers.

The Toronto Real Estate Market Consists of Four Market Segments:

Most forecasters make the fatal flaw of talking about a Canadian real estate market. The fact is it does not exist. Houses don’t move so it is possible to have an oversupply in one market and an undersupply in another. That being said, there is no such thing as a single Toronto market either. Hence we intend to narrow our focus to just the downtown (416) Toronto market. And within this market there are four segments we need to examine: the low rise market, the condo resale market, the new condo market (where less informed people equate cranes with oversupply), and the condo rental market.

  1. Sales in the low rise market in Toronto may actually decrease in 2015.

    No one is moving! With the double land transfer tax, it is cheaper to renovate than to move. The only opportunity will be in the townhouse segment with infill housing. For developers the opportunity will be for stacked towns. That being said, prices in this segment can only go in one direction – up and 8-10% will be the norm.

  2. Sales in the resale condo market will increase by 10% over 2014.

    Revenue Canada has effectively killed the Assignment Market by applying income as opposed to capital gains tax on profits plus charging HST on the profit and original deposits (treating the sale as a commercial property). The increase in condo sales will come from more listings, as most investors will sell their units as resale condos instead. We expect over 20,000 condo units to be registered in 2014 and the same number in 2015. With this increase in supply, we expect condo price increases to moderate with prices increasing by 2-3%. The silver lining for condo owners is that with the price of low rise properties increasing even faster, more buyers will be drawn to the condo market which will support current prices.

  3. The new or pre-construction condo sale market is a challenge to track.

    Sales and ‘under construction’ stats are difficult to verify. Developers can report whatever numbers they choose and they often can overstate them. The only true measurement number is completions or registered units – those units entering the resale pool. In 2015 we expect about 22,000 units to get registered and we expect developers to report about 25,000 new sales. However, the two most important changes to this market are the increase in the percentage of bigger two+ bedroom condos being sold, and the launching of not just condo but multi-use projects (incorporating office and retail space with new condos).

  4. The condo rental market will continue to grow faster than the resale market as more investors rent out their units.

    Currently the rental market is one and half times bigger in terms of transactions. The good news for tenants is that rents will be unchanged for most and that any increases will barely keep up to increases in operating costs for investors. But the good news for investors is that the vacancy rate will stay under 2%.

There is no doubt that the Government would like to see a market correction occur with this real estate market. While we see little chance of this or a change to interest rates in 2015, do not rule out the Federal Government intervening with tighter mortgage rules (e.g. lower the TDS ratio, increase the minimum down payment, or ???). That could catch the real estate market off guard.

Market Report – November/December 2014

Sales Commentary

There appears to be nothing on the horizon that will change the direction of the housing and condo market in Toronto. The Toronto Real Estate Board reported sales in October were up by 7.7% over October of last year. For the first two weeks of November sales were running 8.3% ahead of last year. Tracking the listing market (supply), ‘active’ listings were down 5.7% from a year ago. It suggests that prices can only increase, going into 2015. Also it appears that sales in Toronto proper have been stronger than the 905 region in the latter half of the year. Expect freehold properties in this market to produce significant price gains in the next twelve months.

The condo market is showing much better price balance. While overall condo sales were ahead by 6.6% in October over the previous year, the downtown condo market experienced a better performance with sales up by 9.7%. At the same time, ‘active’ condo listings downtown were up by 8.9%. While the condo listing supply continues to grow, it is not outpacing demand. This has allowed condo prices to remain fairly flat. And the price gap between condos and freeholds is now being discussed in the media with the suggestion that more people will now have to live in condos if they want to live downtown (surprise). This change in attitude from a year ago at this time also extends to Millennials who seem more willing to buy than to rent. The ratio of renters to buyers of condos has come down from over 2.5 times to just 1.38 times. The other reason for the drop is seasonality. Last year the number at this time was 1.8 times.

This month we looked at sales at the Vu Condos at 112 George St. (Adelaide and Jarvis) which was completed and registered in 2010. This is a prime downtown location close to St. Lawrence Market. The first unit we looked at was a one bedroom plus den with parking, locker, and balcony at 685 sf. It sold this year for $396,000 at 99% of list. That works out to $578/sf. The same unit sold four years previous, at registration for $335,000. That works out to a price increase of 4% per year. The second unit we compared also sold in 2014. This was a two bedroom, two bath units with parking and locker. It had 10 ft. ceilings and also had a 240 sf terrace. It sold for $520,000 at 101% of list! At 812 sf, the price was $640/sf. Most units this size will sell for $550/sf. That means the buyers paid just over $20,000 in premium for the terrace. This same unit also sold at registration, four years earlier, for $442,000 but without parking. At the time parking could be purchased for $25,000. When you adjust the original price by this amount, the condo appreciated at just 3% per year. Condo fees at just 55 cents/sf/month are very reasonable for a building of this age where the fees include heat, water, CAC, but not hydro. The popularity of the building is reflected in the fact that there are only three units available for sale out of a total of 352 units. The average list price is $600/sf.

Rental Commentary

We are now entering the slowest period of the rental market. Downtown there were 655 condos leased in October. That number is 37% lower than the peak in August of this year. Seasonality also applies to rents. For tenants, the best time to rent is in November and December. The worst is April (for May) and July and August (for September). At this time of year, landlords are ready to make a deal, rather than have their unit sit empty. The price drop is about $50/month, depending on the unit. The average price for studio units dropped is $1400/month which dropped by $50/month. The one bedroom market remained unchanged with the entry level unit still averaging over $1600. The top end of the one bedroom market – a den plus parking is still over $1900. The entry point for the two bedroom market is on average $2100/month which dropped by $100/month. The high end of the two bedroom market which includes a den and parking is up slightly to $3000 per month. The three bedroom market remains in the $3500 to $4,000 range because of the lack of product versus the demand. Because parking spots in new condos are now being sold for $30,000 to $40,000, the rental price for a parking spot is now averaging $200 per month. That is still cheap to rent when you factor in condo fees and property taxes on these parking units.

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