Who is Buying All These Condos?
Right up there with ‘How’s the market?’ is the question, ‘Who is buying all these condos?’. I decided to tackle this question today with this blog post about the top-5 things to know about today’s pre-construction condo buyer.
- They are most likely Asian. This may sound strange but white people are not buying new condos. It’s simply a fact that the overwhelming majority of buyers of new condo developments, especially the big towers (30+ storeys), are new Canadians from Asian descent. Ãƒâ€šÃ‚Â They are not overseas buyers. The overseas buyer portion of the market has been grossly over-estimated in my opinion in the mainstream media.
- They live in the 905. Most of the buyers of condos in the downtown are not from Toronto, rather they are from Markham, Richmond Hill,Ãƒâ€šÃ‚Â BramptonÃƒâ€šÃ‚Â and Mississauga. Why aren’t Torontonians buying Toronto condos? My theory on this is that homes are cheaper in the ‘burbs, thus people are buying houses there and wondering what to do with their left-over cash so they buy more real estate as investment. Torontonians are mortgaged to the gills so they must have no money left at the end of the month to buy condos. It’s a theory…
- They are investors. This one is pretty obvious by now. Most of the buyers at the big towers are 90-95% investors (as opposed to end-users who plan to live in the suite themselves).
- They are fast. When a new condo launches they don’t need to think about it or consider which floor plan has the best walk-in closet. They just buy. They know that buying early in the Platinum level launch stage is basically a can’t-miss proposition. Prices will definitely go up.
- They have done it before and they will do it again. More and more buyers are repeat buyers. The sophistication of the average new condo buyer has gone up significantly over the last few years. They know how the game is played and the gloves are off.Ãƒâ€šÃ‚Â The first thing that many of my clients do after they buy a new condo is start looking for the next one. They are always on the hunt for the next great opportunity.
Questions or comments? Please contact me.