Welcome to urbaneer.com’s Home Of The Month Feature, which showcases what our Buyers have recently purchased in the City of Toronto.
When it came time for our Buyers to purchase a suitable ‘future family home’, this thirty-something professional couple decided to go the rational prudent eye-to-the future route and keep their existing ten year old stacked townhouse unit as a long term investment. Rather than selling the property and using the capital for their down payment, they decided to refinance the dwelling and extract as much of their equity as possible and, combined with their additional savings, channel it towards the next purchase. After all, if you have a lot of equity in your dwelling and a solid income stream, why not refinance your property and have tenants pay that debt, rather than spending around 6% of the sale price to extract your capital? That prudent move could provide you a financial windfall twenty-five years down the road when the mortgage is paid and your tenants are providing you with a retirement income stream. I celebrate this strategy, which will help build wealth much sooner than if one sells their first home!
Like most Buyers, this couple started in a price range substantially lower than they ended up. This isn’t unusual, in part for our universal inclination to believe we can get what we want for a price less than reality, and in part because we all tend to lean to conservative when it comes to incurring debt. However, as our Buyers became educated in the market, they decided to increase their purchase price with the objective of finding a house that would serve them well for the long term, and eliminate the need to climb the property ladder anytime sooner than the next fifteen to twenty-five years.
Although the fewer transactions my clients make over their life time translates into a lower income for me, I’m all for Buyers incurring less expense while reducing the hassles of moving. One way to do this is to try eliminate multiple moves up the property ladder by embarking on fewer buys and sells. By staying in your residences longer and, if possible, keeping them as an investment, you reduce the fees payable to lawyers, lenders and realtors, and avoid the rather exorbitant City and Provincial land transfer taxes. This can translate into hundreds of thousands of dollars over the years. However, to do this you have to make sure you’re purchasing properties that can serve you for an extended period of time. This isn’t always possible when you’re operating within the limitations of your budget.
Click HERE to read last month’s feature of a couple who by-passed the condominium market to buy their first house.
In the case of these Buyers, their wish list pretty much matched most everyone’s dream of Home. Their criteria was for a detached three bedroom house in good condition, preferably renovated with a finished basement, on-site parking, and a generous sun-drenched garden in a central location convenient to a village shopping street, public transportation, green space and quality schools. Once they were well-informed of market values for the type of property they desired in the location they preferred, they established a budget within the range of $750,000 and $850,000.
Realistically, regardless of which of the four quadrants that radiate from the epicentre of downtown Toronto – Yonge and Bloor – the price of entry for a house fitting this description is going to have a price tag starting at around $750,000 and up. This price will vary according to location, and of course how many compromises you’re prepared to make including housing type (perhaps a row or semi-detached house instead of detached?), condition (perhaps in original condition or upgraded rather than renovated?), and property benefits (are you willing to forgo onsite parking, or walking to the subway?). As any Buyer quickly learns, the price of admission is often far more expensive than ideal.
It took almost eighteen months house-hunting before my Buyers secured this dwelling. During that time, as they evaluated each property and their budget, they fine-tuned and calibrated their search criteria in a systematic way which I greatly appreciated and admired. Every time we saw a property these Buyers would analyze its opportunities and constraints, determine how it would, or would not, ultimately meet their needs over the long term, and then pass on it until they found a contender which most closely matched their ever-refining wish list.
These Buyers had an affinity for St. Clair West of Bathurst. This arterial road and shopping strip, one of the ‘Little Italy’s’ which still retains a residue of this dynamic immigrant culture, has undergone a major transformation these past few years when the old streetcar tracks were dug up and replaced with a speedy efficient light rapid transit system which is streamlining the commute along St Clair. It’s also home to the recently completed Wychwood Barns, which were formerly transit maintenance garages. It took a decade of community involvement and fund raising to convert it into a sensational park containing 60,000 square feet of vintage – and now retrofitted – buildings that contain artist housing and studios, green space, a greenhouse, an organic farmer’s market, beach volleyball court and office space for community groups. It is a testament to how successful Toronto is transforming to the needs and desires of its residents.
Needless to say, to locate near St. Clair and Bathurst, in proximity to the shopping amenities of St. Clair West, the Wychwood Barns, and the streetcar line and subway station, all make this a Triple AAA location, especially as the schools are extremely reputable.
In this immediate location there is an enclave of homes which are situated on streets that have ‘wood’ in them, as in Wychwood, Humewood, Maplewood, Cherrywood, Valewood and Kenwood. This property, located on Pinewood, just north of St. Clair, had the benefit of being on a corner lot with a spectacular south-east-west exposure. Situated on the crest of a small hill, its position on this grassy knoll wrapped in mature trees provided a high perch (and dry basement) and beautiful vantage point. Extremely private, this house ticked all the boxes on my Buyers’ wish list, including two car parking, three bedrooms and two baths, updated building components and a finished basement, on an over-sized lot in a superb locale.
Here are some pics from the listing:
Listed at $729,000, my Buyers competed against five other buyers to secure this property for 13% over the list price with a quick three week closing. Although the sale price may strike you as high, it was well within the range of sales of less suitable homes in the area, which my Buyers had viewed. Herein was the value of their taking their time to look.
When house-hunting, it’s critical to have time on your side. Although these Buyers had the luxury of 18 months to find their Dream Home, it ultimately served them well. During this time they could become educated while exercising prudence in finding the right property which provided the perfect ‘fit’. As the realtor who ‘talks you out of buying until the right place presents itself’, these Buyers and I were a good real estate match, for they appreciated my ‘no pressure no hassle’ straight-talk approach as we navigated the market together. The end result is a testament to itself.
If you, or someone you know, has specific real estate needs, wishes and desires, and would prefer the services of realtors who subscribe to a pressure-free approach when searching for the right dwelling, please know we’re here to help at urbaneer.com.
~ Steven
Home Of The Month
