Toronto Condo Developers Taking A Page Out of The Leafs’ Playbook?
I’m not happy. I’m not happy because lately I’m seeing a disappointing trend with Toronto condo developers. I call it the “Maple Leafs Strategy”.
So what’s the “Maple Leafs Strategy”?
Think of our beloved Toronto Maple Leafs. They haven’t won the cup since 1967, they haven’t even made the playoffs since 2004. They are the definition of mediocre when it comes to professional hockey.
Every couple years there’s a new coach, new manager, new players, and new promises of greatness to come, yet still the product on the ice remains the same and produces the same result.
So why is this? How do the owners and managers get away with putting out such a high priced, mediocre product for decades?
It’s because the Leafs are still the hottest ticket in town and they sell out every game. “Leafs Nation” is fiercely loyal and ownership has very little incentive to put out something better or lower prices.
What does this have to do with Toronto condos??
I believe that many of Toronto’s condo developers are taking the same approach as the Leafs ownership: they believe that they can simply re-package what they already have, keep prices the same, and buyers will just keep on coming. Why? because they think that it’s Toronto, we are the condo capital of North America, “Condo Nation” is very loyal!
I’m seeing a lot of 2012 sites that are already being re-packaged and re-launched in so far in 2013. The same product, the same prices. This fails to excite me and I can’t recommend these types of relaunches to my investor clients. If it didn’t make sense in 2012, why would it make sense now?
[Unfortunately many of my Realtor colleagues are flogging this stuff to their clients telling them it’s a great deal and they should buy! I apologize on behalf of the dunces in my industry…]
Now don’t get me wrong.
There are some projects that launched in 2012 that still offer excellent value and have a good assortment of units available, but I’m talking about the projects that were busts in 2012 or even 2011 and the developer is still playing the same tune hoping for a different result.
What I’m looking for in 2013 for my clients
I’m looking for new buildings in new locations or for exisitng projects I’m looking for new incentives and/or new pricing for my buyers. I believe that soon reality will start to set in with developers that we are in a slower market than we have been in, and when that happens the value will return to Toronto condos. Stay tuned investors, because the tide is about to turn!
With this in mind, check out my blog post about the 5 things to expect in 2013 from the Toronto Pre-Construction Condo Market.
Or better yet, why not subscribe (it’s free) and never miss anything from truecondos.com? Just enter in your name and email below.
