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Reasons To Buy Condo In Toronto

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By Author: Stevie
Total Articles: 14
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As the autumn progresses the housing market that Canadians grew accustomed to in previous years still looks very different this year. For sale signs are lingering much longer than usual throughout the whole country. Bidding wars that used to be common are not occurring as often, with the exception of the condo markets in and around Toronto and Vancouver.

Those who can still buy have a clear advantage when you glance at the small condos market in Toronto. The Average cost of condos in Toronto and Vancouver are as follows:

● An average condo in Toronto is ~$520,000 (2017)

● A median condo cost in Vancouver is $650,000 (2017)

Below we will discuss the Toronto condo market and explain the top reasons why there are great opportunities for real estate condo investors in Toronto.

Affordability of Condos in the Current Market

Over time the average cost of a Toronto condo has steadily increased, despite this though, condos are the better option for first-time homebuyers as they are more affordable than the alternatives.

A lot of buyers have been pushed out of the downtown Toronto housing market, especially first-time buyers looking for a Toronto home. So they have discovered a more affordable option is available, which results in buyers choosing condos or sky homes (large condos) as they are more feasible and fundable.

Homes are very often a person’s largest financial purchase in their life, but it is important to be aware of all the fees applicable to get a better idea of the final price of the purchase. Mortgage advisors are a great resources to be explored, as are financial advisors who can help you understand all the costs and whether you have the financial ability to afford the mortgage and monthly costs. There are many options available for mortgages and you can find one that matches your financial portfolio and type of condo purchase.

Extra costs that you must be aware of when purchasing are: lawyer fees, closing costs, property taxes, levies, monthly utility fees, monthly condo maintenance fees and insurance.

Purchasing an older condo is an option, but be aware that you may end up with monthly or annual repair costs, and its advised you keep any financial documents given to you by the condo corporation. If you end up choosing a pre-construction there will be additional costs at the decor center for upgrades that are often left out of the purchase price, but you will see them in the sample unit and illustrated in marketing packages. Occupancy fees may also be applicable, it is a phantom rent that covers the time you take possession to the time you actually move in, since they are often not the same day.

Commercial Real Estate in Very High Demand

Within North America, Toronto has the second fastest growing market for downtown offices. Vacancy rate is at an all-time low and there is high demand. When any space becomes available companies will pay top dollar to snap it up creating a very competitive market.

There are even higher prices within the industrial space market with a year-over-year increase of 9.3% that is record breaking. Even though commercial real estate is pricey upfront, especially compared to other potential investments, the equity gains and rent roll you can expect make it worthwhile.

High Rent Prices

The Rent Control Act had good intentions within Toronto, but there is a trend of rent increases due to the increased rental competition due to low vacancy rates. Potential renters are doing whatever they can to secure a rental, from bidding wars to offering extra months of rent up front to secure their bid. Below are the numbers from two nearly identical units on 11 Charlotte Street that were rented late August within TWO DAYS of one another, and the latter rented for $400/month more.

First Unit: 11 Charlotte St. - 34th floor, parking and locker included

Second Unit: 11 Charlotte St. - 28th floor, parking but no locker.

In normal circumstances the higher floor units with a locker included should have resulted in a higher rate than the lower floor sans lockers. With the extremely low vacancy rate at the time, renters are stepping on each other to get an apartment which results in landlords getting what they want in prices within reason.

If you want to learn how to purchase condo like an expert, check out this article

More About the Author

Hi, I'm Stevie! The management of personal finances is something I've been very interested in since my high school years. I'd like to share some knowledge on the subject and I really hope it'll help someone.

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