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New Mortgage Rules Aimed at Cooling the Condo Market

Federal Finance Minister Jim Flaherty announced changes to the way mortgages are given out in this country today that are said to help prevent a housing bubble from forming. The keyword being prevent, meaning the government is very clear that they do not believe a housing bubble exists. I would have to agree with the sentiment in this city, however, I would add as I have been saying on this blog for months, the current pace we are at is not sustainable.

Personally I am not a fan of government intervention in the markets in this way, however, I don’t think these new rules will dramatically affect the market in any significant way. It seems more than anything, the moves today are meant to send a message to Toronto condo buyers in particular that condo flipping is not cool and real estate investing is not the same thing as speculation. Flaherty even mentioned “multiple-condo markets” in his statements to the press. Hmmm…I wonder what cities he is referring to?

My thoughts on the 3 key points in the release:

• Require that all borrowers meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter term. This initiative will help Canadians prepare for higher interest rates in the future.

Many lenders already do this by my understanding, so no big change here – if you want a 35 year amortization variable rate mortgage, you can get it, you just have to qualify for the mortgage funds at a 25 year fixed rate mortgage.

• Lower the maximum amount Canadians can withdraw in refinancing their mortgages to 90 per cent from 95 per cent of the value of their homes. This will help ensure home ownership is a more effective way to save.

This change is so marginal that I don’t know why they did it other than to send a message that borrowing money against your home is just about always a really bad idea financially.

• Require a minimum down payment of 20 per cent for government-backed mortgage insurance on non-owner-occupied properties purchased for speculation.

This one is aimed at all those looking to buy with 5% down and flip in a year for a profit. Flaherty is looking right at you crazy capitalists and saying don’t even think about it.

For the full statement by the government of Canada after the jump. Questions or thoughts on this? I’d love to hear them – leave a comment or email me.

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Toronto’s First Car-Free Condo

To my amazement, Tribute Communities has been given the go ahead to build a 42-storey condo tower on University Avenue, just south of Dundas with no parking spots. The City of Toronto’s decision to allow this represents a major shift in philosophy for City Hall with respect to how this city is being planned and what types of developments are encouraged and discouraged.

On the surface, it would seem to make sense that the city would want to encourage the development of condos without parking spots. After all, we are trying to be a ‘green city’, and a dense city, so encouraging a car-free lifestyle in the heart of downtown sounds logical. But the fact is many of the decision makers are City Hall are still stuck in the 1970s version of Toronto where the car is king, and anyone who rides a bicycle is not to be trusted.

This decision will certainly open up the floodgates for further projects without parking spots all over the city. Afterall, from a developer’s perspective, building a 3 or 4 level parking garage is hugely expensive and time consuming. Building a condo without parking should allow developers to offer more competitive prices and faster completion times – two things that every condo buyer wants.

One concern in building a condo tower like this is that all the units will be 1 bedroom, or 1+dens and the residents will be a homogeneous mix of students, singles, and couples. City Hall wants to encourage more 2 and 3 bedroom condo units in the downtown core, so it will be interesting to see how many larger units out of the whole project Tribute Communities allocates for 2+dens and 3 bedrooms.

If you are interested in this project, please contact me.

Does This Mean I Can’t Text & Drive Anymore?

On October 26, the ban on using hand-held devices while driving takes effect in Ontario. Real estate agents including myself who have grown used to ‘creative multi-tasking’ while driving will soon have to start adjusting their habits.

The downtown condo market is very fast paced, and many times I have had experiences with clients where the difference between getting a property sold, or putting in the winning bid comes down to something as simple as a single phone call, email or text message received at the right moment. I just might have to hire an assistant to drive around town with me and answer all my calls, texts, emails as well as operate my GPS while on the road. Interested? Apply within.

For the complete press release from the Toronto Real Estate Board on this announcement, click ‘continue reading’ below.

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Glas Condominiums – Now Registered!

Glas Condominiums (25 Oxley Street) is now registered. Congrats to all unit owners and investors who bought in the building several years ago and now you officially own your units.

I’ve spent a lot of time in the building lately as I have a couple of clients who are keen on the building. The suites are impressive and already Glas is commanding one of the highest price-per-square foot values in the area (King and Spadina). I expect resales to be in the mid $500s for most suites in the weeks ahead.

Today there are already about a half-dozen suites that have hit the MLS system as standard resale properties (building is registered, owners can sell and advertise at will).

This building is the first completed project under Brad Lamb’s development company.  Features like 9′ exposed concrete ceilings, extra large balconies (on some units) with gas lines, stainless steel appliances including gas cooking, granite counters, sliding barn-style doors, laminate floors throughout, floor to ceiling glass-wall construction, and ultra-modern design details – these are all features buyers of Brad Lamb’s projects have become accustomed to.

If you are a unit owner at Glas and are thinking about selling, or if you are a buyer interested in the building, contact me here.

Coming Soon: Victory Condos Penthouse Suites

I had lunch this week with a few developers at an exclusive VIP broker’s reception in Liberty Village. These ’schmooze-fests’ are generally just for mutual ego stroking, but they are also a great way to find out what is happening in the downtown condo scene. These are people who are ‘running things’ in Toronto.

In chatting with some of the folks behind Victory Condos I was informed that the penthouse suites at Victory will soon be released for the first time. The suites sound like they will be amazing. They will take the already great standard finishes and features of Victory up a notch. For example, 10′ ceilings instead of 9′ and full size appliances instead of ‘condo size’.

Each unit will have it’s own private rooftop terrace above each suite including a glassed in ’skybox’ which will let natural light down into the unit. This feature will really set these penthouses apart from others downtown and will make the units feel like modern townhomes in the sky. If you are looking for an upscale residence in the King and Spadina neighbourhood, consider the penthouses at Victory.

Victory Condos at King and Spadina by BLVD Developments is over 80% sold. Construction is underway. There are only about 25 units still available. Contact me for more information.

Giraffe Condos: Building Redesigned and Prices Lowered

Giraffe condos launched with significant fanfare and acclaim almost exactly 1 year ago. It was about one month later that the real estate market in Toronto all but collapsed. Sales at Giraffe were less than spectacular and like many Toronto developments, they had to react to what the market was telling them.

I’m pleased to announce that Giraffe has significantly lowered their prices across the board, introduced new suites, and kept nearly all the distinctives of the project in place that made it so appealing in the first place.

Prices are now starting as low as $360 per square foot. Prices have essentially been reduced as much as $50-60K for some units. 565 sq ft 1 bedrooms from $212,000, 612 sq ft 1+dens from $224,000, and 833 sq ft 2 bedrooms from just $302,000.

The major changes to the building are these:

• Eliminated the roof-top garden/patio area resulting in significant construction and maintenance savings
• Ceiling heights on lower half of building reduced to 8′ instead of 9′
• Depth of balconies reduced from 6′ to 5′ (but will still have gas lines on them)

Deposit structure is 15% in 180 days + 5% at occupancy (standard). Parking spots are $28K (very reasonable). Maintenance fees are $0.45/sq ft.

Giraffe is a LEED designed building by Teeple Architects.

All these changes have come about with little to no advertising on the part of the developer. Despite this, suites are selling fast with over 30 units sold in the past few weeks. Don’t wait for the mainstream media marketing hype (radio ads, newspaper ads etc) to tell you this is a great opportunity! This project is a great investment NOW. If you are thinking about buying at Giraffe, contact me today.

Queen and Portland: More 1 Bedroom Units Coming Soon

Anyone who has been shopping for a 1 bedroom or 1+den condo in downtown Toronto recently knows one thing for sure: Inventory is VERY tight. This is both on the resale side and the new construction side. Some developers are splittling up larger units into multiple smaller units to accommodate the seemingly endless demand.

Queen and Portland by Tribute Communities is a boutique building with only 90 units in total and will be a mixed-use building in the heart of Queen St West. The building will feature a massive rooftop garden/patio area over looking the action on Queen street, as well as a Loblaws, Joe Fresh, and a Winners in the retail levels of the building.

I have received word that some additional floor plans are being added to accommodate the demand for more smaller units. They have not released the information yet on the new suite designs and what their prices will be, but I am anticipating a half-dozen units or so in the $300K range. Keep checking back here for updates, or contact me if you would like to be notified as soon as they are released.

Coming Soon the West Don Lands: River City

January 22 Update: New Release of Floor Plans from $189,900. Don’t wait for the public launch. Buy today.  Contact me for more information.

It’s no secret that 2009 has been a very quiet year for new condo launches in downtown Toronto. Besides One Cole, there really hasn’t been any NEW launches worth mentioning this year. I expect things will change this fall and River City is a project that I am very excited about.

River City is going to be the first phase of new condos sold in the brand new West Don Lands neighbourhood. The West Don Lands is the currently undeveloped, 80-acre site bounded by Parliament Street (west), King Street (north), Don River (east), and the rail lands (south). Most of the land is owned by the provincial government and this entire area is slated to transformed from basically nothing into a master-planned community. Think condos, lofts, townhomes, retail, restaurants, employment, parks, and transit. This is going to be BIG.

The developers behind the project are Urban Capital (Camden Lofts and Charlotte Lofts) and Red Quartz Development. Sales will begin this fall. Register with TrueCondos.com now for your chance to buy at any upcoming VIP sales events, and stay tuned to TrueCondos.com for updates as more information is released in the coming weeks.

New Condo Search Websites Popping Up Everywhere

New condo buyers in Toronto are finally getting some serious attention from ‘the industry’ and it looks like the future isn’t entirely bleak for those wanting a true web 2.0 experience when searching online for information on new developments. This month two new Toronto condo search websites have popped up recently that I wanted to share with my readers: CondoCatch and Novo Condo.

CondoCatch is a fairly simple yet effective Google maps-based site which shows most of the new condo developments in Toronto on a map along with their key stats and occupancy dates. One neat feature is the ‘timeline’ which shows in chronological order the expected occupancy dates of their database of new condos. I’m not sure who runs CondoCatch or what their goals are, but it looks like they are not agents and they are focused on creating a useful tool for consumers.

Novo Condo is based out of Montreal and is a more sophisticated and professional looking site, but the basic premise is the same. They offer consumers a Google map of the GTA with most of the major condo projects included and the ability to contact the developer directly for more information. Clearly the focus on Novo Condo is on the developer/marketer/agent side of the equation to generate sales leads and interact with potential buyers and investors.

Check them out and let me know what you think!

1 Bloor Rumour Train Gathering Speed

July 22 Update: The 1 Bloor site at Yonge and Bloor is apparently up for sale according to the Toronto Star. If this is true, this would put the future of the tower in serious jeopardy.

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1 Bloor was the most celebrated and most reviled symbol of Toronto’s recent real estate boom.

Realtors lined up for weeks (or paid students and homeless people to do so) for the chance to buy units there only to learn that the developer increased prices by 25-50%  from what they were told they would be paying. It didn’t matter as they bought anyway and hundreds of units were sold in a matter of days at prices in the $1000 per square foot range.

Now, more than 2 years after the initial hype began, no shovel has hit the ground and no one is moving into their piece of Toronto real estate history any time soon. Still the million-dollar question remains:

Will 1 Bloor actually get built?

The latest rumours news on the project is this: it will be built, only it is going to be scaled back to 68 stories instead of the original 80. This is according to the Globe and Mail. So that would mean it is no longer Canada’s tallest residential building, and purchasers who bought units on floors above 68 are…screwed.

But hold on, because The Toronto Star has a remarkably different article in their paper today which says that 1 Bloor is going into receivership and that the current Kazakh financial backers of the project are in mired in a massive scandal. That doesn’t sound like the recipe for building a 68 storey tower to me.

So who is right? I have no idea, but this corner of Toronto deserves a landmark, be it 1 Bloor or something else. My fear is that if plans for 1 Bloor are scrapped, something mediocre will be built in its place. When it comes to condos, Toronto already has plenty of mediocrity but greatness is in short supply.

For a trip down memory lane, check out some of my old blog posts on the 1 Bloor development from when I was a contributor to BlogTO.

• Kazakhstani Developer to Transform Yonge and Bloor: Very Niiice!
• 1 Bloor: What will you miss the most?
• 1 Bloor: Crosshairs of Insanity