As Summer’s roasting temperatures continue to soar,Torontonians have had to strip down to the outdoor basics to stay cool. According to stylemaker Debonair.com, that means all the cool kids, hipsters and trendys are strutting in light-weight attire made of color blocking fabrics, especially those featuring a gradient or ombre tie-dye effect. Does this look ring a bell? It will for those of us of a certain age, as it was all the rage in the 1980s.
Yes, the 1980s is beginning to make an appearance in fashion again. Get ready for bigger shoulder pads and cinched waists. Which prompts the real question: “If we’re cycling back to the 1980s in fashion, will it also be repeated in real estate when Toronto property values peaked in a bubble and began a precipitous decline, crashing by as much 30 percent?”
Welcome to the latest installment of urbaneer’s prognostication: Part One of our Summer 2012 Real Estate Forecast.
It is a well-known fact that there are seasons to Real Estate, which in many ways mirror the seasons found in nature. In summer, Torontonians get seduced by the warm weather and thoughts of vacations, barbecues and beach time. With attention focused elsewhere, the real estate market typically slows. What also happens is the press leap onto this seasonal slowdown as a harbinger of bad times. Certainly over the last several weeks we’ve seen the frequency and the drama of real estate stories escalate into a frenzy. With all the conjecture, urbaneer’s clients have asked some hard hitting questions. In particular, are there elements that are newly present or that have found new momentum that could seriously, detrimentally, impact the Toronto housing market? And how might these elements impact Buyers and Sellers in the bigger picture? With history having a way of repeating itself (just look at Fashion), there is reason enough to be cautious.
Is The Condominium Market Cracking?
We have long said that if cracks were going to appear in the hot Toronto housing market, they would first show themselves in the condominium market, in particular in high-rise point towers targeted to international and local investors. With a recent surge of newly completed condominiums coming to market for resale, and summer’s seasonal slowdown stalling the sales momentum, we’re beginning to see a shift in the condominium market’s equilibrium that may quickly weigh in favour for the Buyer. Compounding this is the massive numbers of new units nearing completion in the coming months which could tip the scales of supply and demand. If investors decide to liquidate, the downward pressure could be substantial. Although the forces at work aren’t set to pop like the proverbial Bubble, at the moment what is a trickle could turn into a flow, followed by a flood of product coming for sale. When it comes to the condominium market one has to be prudent, if not a bit wary, of the risks.
Do I Not Buy A Condo?
We believe that when it comes to real estate, slow and steady wins the race. If you’re a candidate for a condominium purchase, whether by the limits of affordability, or because you prefer the lifestyle benefits associated with turn-key living, urbaneer wouldn’t discourage you from acting on the right property, but we’d certainly dissuade you from investing in a poor purchase. In fact, with our commitment to help you select the best of the best within your budget, it’s not uncommon for our Buyers to spend six months to a year navigating the complexities of the housing market before making their rational prudent educated real estate purchase. Why? Because we pride ourselves on steering you away from making the wrong property purchase, until such time as the ideal property for you presents itself.
What to look for.
Nothing beats the tried and true mantra of ‘location, location, location’. Proximity to green space, public transportation and a village-shopping environment will always be major drivers in the value of property. In the condominium market as a whole, there are swaths of ubiquitous, car-friendly architecturally-banal socially-isolated could-be-anywhere mid and high-rise towers chock-a-block with one-size, one-style, and one-occupant suites that lack any special qualities. These common cracker jack boxes in the sky, which dominate the condominium market, are the properties most likely to suffer in a market adjustment. Our advice? Avoid these developments and seek a condminium that incorporates as many of the following criteria: a well-designed well-proportioned well-built space plan; features that are rare and desirable including high ceilings, attractive views, abundant light, outdoor space, gas cooking, or a fireplace; situated in a stable, reputable, primarily owner-occupied complex that is ideally at least two or three years old (so that all those first-to-list suites are now re-sold and the building is well-managed and operating smoothly); and located in a stellar demand identifiable neighbourhood coveted by the local market (like the St. Lawrence Market, Queen West Village, or College Street).
Want to read the full Summer 2012 Forecast? Click HERE to read it. Whether you’re purchasing a personal residence, or you’re investing in your financial future, we’re here to help! Serving liberated, progressive pro-urban Torontonians for over two decades, our friendly, fashionable boutique real estate service always has your interests at heart. Building clients for life, consider letting us help build your real estate portfolio, one property at a time. Contact Steve Fudge, Sales Representative of Bosley Real Estate Ltd., Brokerage at (416) 322-8000.