TrueCondos.com – The Best Source for Toronto Condos

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Around this time last year I predicted 2009 was going to be the year of the assignment. I was wrong. While assignments did begin to take a greater role in the overall Toronto condo market, they still have not gone ‘mainstream’. Quite frankly, this method of buying and selling real estate will probably never go mainstream, however, in 2010 it looks like assignments will be seen as a “Third Way” of buying condos in Toronto (the traditional two ways being pre-sale or resale).

People contact me just about every day and ask me about assignments - I want to buy an assignment! I want to sell my condo by assignment! The truth is, most people have no idea what is involved when buying and selling an assignment. When the Average Joe learns just a fraction of what there is to know about assignments, 95% of the time Average Joe ends up returning to the comparatively simple world of pre-sales and resales.

So for all the sellers of assignments, as well as those who may be thinking about buying a condo by assignment, I’d like to introduce to the the top-5 reasons why many assignment listings never sell:

1. No Market Exposure. You are not allowed to advertise assignments on the MLS. Many assignment listings don’t sell because no one knows about them!
2. Lawyers. Most lawyers hate assignment deals. They often look for reasons to kill the deal – and with assignments, you don’t have to look to hard.
3. Price. This is probably the #1 reason why many assignment listings don’t sell. You can’t price an assignment like a resale property. Investors buy assignments and investors don’t pay current market value for property!
4. Closing Day Too Far Away. Buying a pre-sale condo then trying to flip it a month later is a fool’s game. The unit must be at or very close to occupancy so that market value can be accurately predicted and the investor can safely determine if they are getting a deal.
5. Closing Costs. Did you get your closing costs capped by the developer when you first bought your condo? If not, there is no way to tell exactly what they might be. Buyers of assignments need some degree of certainty as to what closing costs they will incur, otherwise they will move on.

Bottom line, assignments are not for everyone, but for the right buyer and seller, working with a good Realtor and co-operative lawyers, they can be a fantastic way to transact in real estate. Questions about assignments? Contact me.

Coming soon from Urban Capital and ALIT Developments: Nicholas Residences.  Register with TrueCondos.com now for your opportunity to buy before the public launch. Floor plans and pricing available now. Worksheets for units being accepted NOW. Don’t delay, contact me today to buy a unit at Nicholas Residences.

Nicholas Residences will be located approximately at the corner of St Nicholas and St Mary Streets in the Bloor Yorkville neighbourhood. Steps to Yonge Street, Bay Street, The Manulife Centre and the heart of Yorkville, The building will incorporate two historic buildings on St Nicholas Street.

Urban Capital is the developer behind Boutique Condos in the entertainment district as well as River City in the West Don Lands.

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Like most Canadians, I have been watching the news and updates surrounding the earthquake in Haiti with a sense of shock and sadness. The images and scenes are horrific and overwhelming. And like most Canadians, I feel like it is my responsibility to do something to help.

The immediate needs are obvious: people need food, shelter and water desperately. I have faith in the International Community to provide for these basic needs in the weeks to come. But when the dust settles and all the bodies are buried, Haiti will need to literally rebuild itself. This will take years and probably hundreds of  millions of dollars.

This is why I have decided that for the next 30 days, for every client of mine who buys or sells a property, I will donate $1 for every $1000 spent to a charity of their choice to help the relief efforts in Haiti. For example, a purchase/sale of a $300,000 condo will mean a $300 donation. The charity must be directly involved on the ground with the relief work that is happening in Haiti. And to be clear, the donation will be made in the name of the buyer/seller – so there is no financial benefit for me personally.

I realize this will be more of a gesture of good will than any major significant contribution to the cause, but I feel like I have to do something more than just give personally, and I see an opportunity here for my business (helping people buy and sell real estate) to do some good.

And just a thought to all the Toronto Realtors out there who are reading this blog: if you want to join with me and do the same with your clients, I think that would be great. With a little momentum, we could start to make a significant difference. If you have any questions please feel free to contact me.

Update 1: 24 Hours after posting this I am happy to announce that 3 other Realtors have joined in the cause. Katy Galica of Re/Max Condos Plus, Kenny Shim of Re/Max Condos Plus, and Mark Savel of Re/Max Realtron.

Update 2: I’ve joined the Toronto Works For Haiti team. Toronto Works for Haiti is a collective of Toronto area small business owners who are offering services in exchange for donations to the relief efforts in Haiti. It’s all about raising money and awareness for Haiti so I am all for pooling resources and joining this group.

I would like to highlight one organization’s efforts in Haiti: Habitat for Humanity.

Habitat’s early response to the earthquake is threefold:

• Cleanup
  To clear the way for home repair and construction, Habitat will assist in the cleanup by mobilizing people to remove debris and salvage materials that can be recycled in new shelter.
• Shelter kits
  Shelter kits include building materials and tools and are designed to help families and neighborhoods make immediate repairs to damaged homes. The kits typically include items such as wall panels, roofing sheets, hurricane straps and a hammer and nails. Habitat also has a cadre of certified masons and carpenters to assist families with immediate repairs.
• Transitional shelter
  Small transitional shelters can be built quickly and provide permanent base structures that can be expanded over time. The shelters will meet humanitarian standards of adequate living space and provision of water and sanitation. The structures will also be designed with hurricane- and earthquake-resistant features

Other organizations who were very active in Haiti before the earthquake and will be there for years to come include:

• World Vision
• Red Cross
• Oxfam
• Doctors without Borders (MSF)

Consider giving to one or more of these organizations if you have not already.

Buyers looking to avoid multiple offer situations should consider the assignment market. With several condo buildings coming on-line in the downtown core this winter and spring, many sellers will be looking to sell before registration. Buying by assignment gives you the opportunity to avoid the bidding wars that are rampant in the resale market.

Nearly all listings on the resale market downtown priced under $350K are generating multiple offers. The lower the price, the more activity on the listing, the more showings, the more offers. Every day I have buyers calling me and emailing me who are looking to buy a condo downtown for under $250K. The market is hot, everyone wants a piece of it, and suddenly anyone with a few extra dollars in the bank considers themselves a real estate investor.

My advice is to consider buying an assignment at a building that is about to take occupancy or is in the occupancy period but not yet registered. For example, my colleague has a Junior 1 bedroom suite (525 sq ft) at West Harbour City with an asking price of $249,000. Occupancy is slated for March. A great starter condo or investment unit in what will likely be an excellent building. If this unit were on the resale market, it would likely be priced at something more like $269,000. Assignments like this give buyers the chance to save a little money and a little sanity.

Make sure you are working with a Realtor and a lawyer who understands assignments! Most do not and will only cause severe frustration for you. Questions? Contact me today.

Contact me now for the upcoming VIP Broker Preview event for Thompson Residences.

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