What Do All the Fastest Selling Condo Projects of the Last Year Have In Common?

Welcome to the True Condos Podcast with Andrew la Fleur, the planks to give the truth on the Toronto condo market and condo investing in Toronto.

Hi, and welcome back to the show. I hope you’re having a great summer. Right now it’s the middle of August. I missed a week here on the podcast. I don’t know if you missed me or not. Hopefully, you’re out there enjoying the great summer, the great weather, and looking forward to getting back into the fall season. If you got kids, kids back to school, and everything like that, it’s that time of year. The J’s are on fire. It’ll be very exciting to see what happens with the J’s this year. Things are looking very good. I was at the game last week. Crazy time at the dome to see the dome completely sold out. It felt like 93, it was crazy.

Anyways, back to real estate, back to the condo market. I’m very excited about the fall market and a lot of great, exciting new launches coming up, and a lot of exciting things that I’m working on here at truecondos.com. I’m going to be bringing you the listener, you the subscriber, and all you of course clients of mine. We’re looking very much forward to working with you again this season.

Now, I wanted to ask a question that is, “What do all the four fastest selling condo projects over the last 12 months have in common?” To answer that question, you might have to know what are these four projects I’m talking about. The four fastest selling projects for the last 12 months, one is academy condos, two is university suites, three is design house, and number four is grid condos. All four of those condo projects were launched and were completely 100% sold out within a matter of a few weeks.

There’s no other condo projects as far as I can tell of this size certainly, that have sold out in such a short period of time anywhere in Ontario within the past year like these four projects all have. It’s very interesting that what they all have in common is that they are all student-oriented condos, so student-oriented rental product that is entering the market and that is being just absorbed like crazy, just bought up crazy by investors who are very excited and interested in this particular type of condominium right now.

Why is this happening? Why are people so fascinated and so interested in this type of product? Why is this so hot? There’s a number, I think of reasons for that. I think the main driving force behind it and something I talk a lot about on this podcast and in my e-mails, to my subscribers and on the website truecondos.com and elsewhere, and that is just that the whole sector of student housing is booming.

There’s a big shift happening, and the old notion of students living in substandard rooming houses, five, six students sharing a house or more, everybody sharing one bathroom, one kitchen, living on top of each other, animal house thing, that perception and that reality is really starting the shift very quickly. It’s interesting to see that the student housing industry in Canada is really starting to mature, and catching up with some of the other countries around the world.

You go to the UK, especially and you see a much more mature student housing industry with much more higher end options for students. The whole sector is booming. The university populations are booming at pretty much every university in Canada. More and more people are going to school, and also they’re going to school for longer and longer, and more people are doing post-graduate degrees, master’s, and PhDs and MBAs, and everything else. There’s more students than ever before, and that number just keeps growing.

Just naturally, there is greater demand for student housing, but also as I mentioned, there’s this idea that there’s a shift towards quality, and there’s a big demand and a big premium being paid by students for quality housing solutions as oppose to the traditional, older style student housing that is stereotypical and really not preferred by a growing number of students and their parents who want to make sure that their students are in a situation and a setting for success.

They’re spending more money than ever on their children’s educations and students are taking on more debt than ever to fund their education. They want to be in a position for success and they want to live in a nice place, is the bottom line. They don’t want to live in this student dumps anymore, and that is a huge growing trend. These student condos are popping up at cities across Ontario and they are very popular with investors.

Another big reason why investors are really loving this product type and scooping it up as oppose to traditional condos and traditional condo buildings, and that is that there’s a flight towards quality. Investors are seeking higher, safer returns. They want to do less work for a higher reward.

The casual opportunities with student rentals certainly affords that where you can maximize smaller spaces and have multiple students renting from you at one time in one unit, two and three students at a time, depending on the setup of your particular building [inaudible 00:06:20] or your unit. That is a very attractive proposition for investors as they’re getting higher returns. Those are all great projects and a lot of my clients purchase those buildings, academy, university suites, grid condos and so on. They’re all sold out now.

The next project that I am very excited to be working on is Capital Hall. You may have heard about this one already. If you’re a subscriber, you’ve probably received information about it from me in your inbox. This project is in Ottawa, right next to Carlton University. It’s built by Ashcroft Homes. Ashcroft Homes is a massive builder in the Ottawa area. They built thousands of homes, many condo buildings as well. They’ve been around for several decades now.

Actually, just got back from a trip to Ottawa and I had a chance to tour some of the Ashcroft Homes properties, as well as the Capital Hall site where the building is going to be, and learned all about the project there. I just came away from that being really impressed with Ashcroft and their track record and what they’ve done, and what they built, and the quality of their product that they’re building, as well as just their commitment to really make a statement in the student condo space and the student housing space, not just in Ottawa, but their vision goes beyond that to really change the way that student housing is done across Canada.

I’m hoping to have on a future episode of this podcast an interview with somebody from Ashcroft so we can talk more about Capital Hall and about their plans for student housing and their bigger vision for student housing in Canada. Hopefully you’ll hear that from me soon, watch for that episode. Again, this is another product where you’re getting a fully managed unit, professionally managed property, you’re getting rental guarantees, you’re getting great ROI potential. My calculations, you’re looking at 16 to 19% returns on these units here which is just fantastic, 16 to 19% ROI.

You’re getting into a great neighborhood. We toured the area, you’re in Little Italy, steps away from great restaurants and shopping, and great street life. Ottawa is a very livable city. It’s the fourth largest city in Canada. Keep in mind, this is not just a little university town. Ottawa is a big city. It’s got a lot going on. It has a subway and you’re right on that subway and the subway is currently being expanded.

By the time that this building is built, the expanded subway line should be up and running as well. There’s a lot going on there, a lot of reasons to be excited about Capital Hall. Obviously, it’s a big thing for Toronto investors. It’s affordable. The prices are significantly lower than what we’re used to paying here in Toronto especially downtown. It’s a very low risk, low maintenance, low management type of investment that offers a very strong return.

Just like I often tell my investors like, “Even if for some reason this investment only works out half as good as advertised so to speak. If you’re looking at instead of 16 to 19% returns, let’s say you only get 8 to 10% returns in the worst-case scenario after several years, where else can you get 8 to 10% returns on something where you’re putting in minimal to no effort at all? You certainly can’t get that at the bank. You certainly can’t get that in GICs or anything like that.”

As far as I know, I don’t know anybody who’s getting that in stock market today. It’s a very attractive situation to be looking at properties like this. If you’re interested in more information about Capital Hall, I’ve got a 18-page investment guide book that I’ve put together. It’s free. Just head on over to truecondos.com and search for, “Capital Hall,” and you can pickup that investors package with the 18-page guide book. It’s yours for free. You can learn all about this investment and all of the details are alike.

Yeah, just go ahead and send me an e-mail anytime if you’d like to talk more or give me a call. You can reach me andrew@truecondos.com or text, call, 416-371-2333. I hope you enjoyed this episode of the podcast, hope it was informative, educational, and possibly even entertaining, who knows? I hope you have a great week and I hope you enjoy the rest of the summer or whenever you’re listening to this episode. Until next time, talk to you soon. Bye for now.

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