I think the condo market has slowed because rents can’t cover the mortgage AND if you own it - the maintenance fees are much too high at the moment. Most people living in a condo are paying more than the mortgage for a house. It’s ridiculous. If maintenance fees were $350.00 max - there would be more interest in them. I started out in my first condo in 2004 for $118,000 with $220 in maintenance fees. I’m a millennial and today when I speak to my coworkers 27 to 45 years old - they wouldn’t dare touch a condo. It’s not profitable to them. Great video as always Tom!!
Thanks for the analysis. You are correct as I try to sell a Downtowm condo at prime financial district at Bay and Adelaide. The lower floor same floor plan unit sold for $690k in 2020 Feb. Now 10:33 I ask for $650k but very few showings and no one is interested.
It's quite remarkable that the Canadian government, not the central bank, is investing $3.5 billion in purchasing Canada Mortgage Bonds to mitigate interest rates, yet condo prices remain stagnant. It's astonishing to see the government engaging in what appears to be quantitative easing, and even more so that despite this significant intervention, condo prices haven't budged.
its coming. it will take a few months to see the averages come up, but if you look at micro-markets you will see change. others, no change. ultimately, it wont really heat up until investors are back driving up prices. right now investors are out. they will have their ducks in a row once the demand comes back, which needs rates to start coming down. all in due time. as you can see, unemployment is still heading up. that needs to level off or start coming down before this pops off.
@@davidhughes6048 Do you honestly think on a 10 year horizon that downtown property wont emerge once again as the highest PSF property one can own? Of course it will. Once a conservative government is back in power, city centers in canada will return to the economic cesspools they were before the plandemic.
@dwestinghouse, your point is quite eye-opening. It's quite challenging to maintain a middle-class lifestyle in Canada. It requires not just earning slightly (3 x) above the average income but also having a grasp of macroeconomics, understanding currency fluctuations, bond yields, stocks, and options, or purchase a house before 2010, or alternatively, benefiting from parental homeownership.🤣
Same near Vancouver. I'd say my condo on BC Assessments in 2019 was about $795k. It went down then up. Our current BC Assessment for 2024 was $855K so not much in 5 years. I'd say condo prices will likely lag but go up again later.
It has nothing to do with rent control. The prices in Toronto and Vancouver are inflated due to the fact that 500K immigrants are being brought into this country every year to prop up the housing prices i.e. inflate demand. If this were ever to change, you will see a drop in prices on apocalyptic proportion. To use the euphemisms in the real estate industry, there would be "price discovery". Really, what I am saying is these condo prices in the GTA are similar to what is in NYC, NY. The difference is in NYC people actually make real incomes to pay those prices, this is not the case in Toronto, ON.
The price doubled for many reason still over priced the Canadian housing bubble needs to pop our banks can't manage this lvl of inflation and recession that's taking place.
Back in 2021, diving into the housing market was a rollercoaster. Freeholds were out of the question with their weekly price spikes. After weighing my options, I chose a condo with a killer view over an outdated bungalow in Scarborough or fighting over a dilapidated semi in East York. By 2022, I was patting myself on the back as condo prices soared while freeholds stagnated. I was looking at a $150K gain after all the selling expenses, making it seem like the perfect time to cash in, though hindsight is 20/20. Come 2023, the value of my condo began to dip, first slowly, then more noticeably. It’s recovering now, but hitting those 2022 highs feels like a stretch. Selling now would still net me a decent profit, especially when factoring in what I'd save on rent elsewhere. I'm not upset, just had my expectations set a bit high after the boom. I thought we'd bounce back to the pre-COVID economy and downtown would flourish once more. What's often overlooked is how the 2019 pandemic flipped the script on condo prices. Before COVID, living downtown was the epitome of convenience and luxury, with prices to match. The pandemic's mental toll and the shift away from centralized workspaces really took the wind out of condos' sails. Without COVID, I reckon downtown condos would've hit the $1M mark on average, a prediction many experts seemed to agree on.
Excellent video. I have 2 Nobu units. Absolutely beautiful with south lake views, and yes, still about $1800 negative cash flow on each. I like your prediction about condos coming back in price next year. I will probably have to keep mine for 3 years, as they were purchased as assignments.
@rdefacendis So true. In my experience, a lot of people don't even know their costs, it does not mean that the above commenter necessarily falls in this category. Often people don't calculate their annual inflation and risk adjusted return on realestate investment. It's often a highly leveraged investment.
@@rdefacendis baller? Yes, definitely. You think these are my first two properties?!? Laughable. They are #17 & #18. Brag to the dinner guests? No need to they are aware that I retired at age 43. Good Luck to you
Tom, you look like a young guy and I am glad you are a Browns fan. You were not around the 90s. Since the early 90s we haven't had a recession here in Toronto. We are due, way over due. 70% of people are living paycheck to paycheck. This will pop very very soon. I wish you well
A lot of people that have good incomes looking for long term look for rentals that were built before 2018. As soon as someone finds out the differences any financial literate person will go with a pre 2018 unit. So there’s a bigger for risk investors if their condos built after nov 2018.
Hey, I really enjoyed your content and insights! Just a thought, have you considered swapping out the whiskey bottles in the background for something more neutral? It might help more viewers focus on your valuable message without distractions. Keep up the great work!
What do you think about a stacked condo townhouse (top end unit) in Guelph. Its a Preconstuction for 628k (parking included). Do you think its too high for that price? Its called Northside condos in Guelph
Toronto’s rent prices can only support $1050/SF for an investor to achieve 3% cap rate on operations. This is what the average condo prices will move towards. If you paid more than this, expect for your investment value decline by the difference. If you bought lower than the price point, congratulations.
Hey Tom , really nice video ! I was wondering if I could help you with more Quality Editing in your videos and also make a highly engaging Thumbnail which will help your videos to reach to a wider audience ? Pls let me know what do you think ?
By 2025 the condo market is more likely to crash 20% of renters in Toronto were delinquent last year the only reason it's this high is because governments and central banks have been propping it up renters ability to pay will get much worse which will force speculators to sell
Now that the government announced they’re going to reduce the number of temporary residents and overall population on top of the new student visa restrictions can impact more condo prices than freehold?
@4:45 If investors don't invest, then where do ppl live. No investments, no building. No building, no house/condo. no house/condo, no 2here to live. The little house houses that are available for sale, what do you think the price will be then? & even worse when you can't buy you will have to rent. Guess what happens to rent prices when the majority of ppl have to be either tenants or homeless? Just another angle to look at the problems. We don't need less house/condo. If the population is growing, we need more houses/condos. Get rid of all the investors from top to bottom & see what happens to house/condo prices within 5yrs.
What does it mean get rid of investors. What are you talking about. The whole real estate market works with real estate companies and construction businesses taking risk to deliver buildings. The only way they can take those risks is with loans from banks. Banks won't loan unless 75% sellout. Investors are needed to achieve these thresholds or projects would take forever.
50% decline in prices... if not more... coming very soon!!! Every part of the world, there is a recession. What makes you guys think Canada will be different? This year we will hit 8% interest rate....
I think the condo market has slowed because rents can’t cover the mortgage AND if you own it - the maintenance fees are much too high at the moment. Most people living in a condo are paying more than the mortgage for a house. It’s ridiculous. If maintenance fees were $350.00 max - there would be more interest in them. I started out in my first condo in 2004 for $118,000 with $220 in maintenance fees. I’m a millennial and today when I speak to my coworkers 27 to 45 years old - they wouldn’t dare touch a condo. It’s not profitable to them. Great video as always Tom!!
Agree. The maintenance fees are insane, in Mississauga you rarely find a new condo under $600 in condo fees.
Thanks for the analysis. You are correct as I try to sell a Downtowm condo at prime financial district at Bay and Adelaide. The lower floor same floor plan unit sold for $690k in 2020 Feb. Now 10:33 I ask for $650k but very few showings and no one is interested.
It's quite remarkable that the Canadian government, not the central bank, is investing $3.5 billion in purchasing Canada Mortgage Bonds to mitigate interest rates, yet condo prices remain stagnant. It's astonishing to see the government engaging in what appears to be quantitative easing, and even more so that despite this significant intervention, condo prices haven't budged.
its coming. it will take a few months to see the averages come up, but if you look at micro-markets you will see change. others, no change. ultimately, it wont really heat up until investors are back driving up prices. right now investors are out. they will have their ducks in a row once the demand comes back, which needs rates to start coming down. all in due time. as you can see, unemployment is still heading up. that needs to level off or start coming down before this pops off.
lol. The Great Toronto Condo Investor is dead. RIP. I sold in 2017. Better an hour early than a minute late.
@@davidhughes6048 Do you honestly think on a 10 year horizon that downtown property wont emerge once again as the highest PSF property one can own? Of course it will. Once a conservative government is back in power, city centers in canada will return to the economic cesspools they were before the plandemic.
QT in the front and stealth QE with CMBs in the back. Funny how the repo operations no longer needed by BoC once the CMB were purchased.
@dwestinghouse, your point is quite eye-opening. It's quite challenging to maintain a middle-class lifestyle in Canada. It requires not just earning slightly (3 x) above the average income but also having a grasp of macroeconomics, understanding currency fluctuations, bond yields, stocks, and options, or purchase a house before 2010, or alternatively, benefiting from parental homeownership.🤣
I feel like the real problem is how bad the layouts / fees have gotten.
Units with good layouts /
Agreed. Good layouts with lower fees are still moving well. A lot of questionable layouts in newer buildings.
Same near Vancouver. I'd say my condo on BC Assessments in 2019 was about $795k. It went down then up. Our current BC Assessment for 2024 was $855K so not much in 5 years. I'd say condo prices will likely lag but go up again later.
It has nothing to do with rent control.
The prices in Toronto and Vancouver are inflated due to the fact that 500K immigrants are being brought into this country every year to prop up the housing prices i.e. inflate demand. If this were ever to change, you will see a drop in prices on apocalyptic proportion. To use the euphemisms in the real estate industry, there would be "price discovery". Really, what I am saying is these condo prices in the GTA are similar to what is in NYC, NY. The difference is in NYC people actually make real incomes to pay those prices, this is not the case in Toronto, ON.
Then why did condo prices almost double between 2014-2019 without this level of immigration?
Most new Canadian are renting first.
The price doubled for many reason still over priced the Canadian housing bubble needs to pop our banks can't manage this lvl of inflation and recession that's taking place.
or in Vancouver...
Back in 2021, diving into the housing market was a rollercoaster. Freeholds were out of the question with their weekly price spikes. After weighing my options, I chose a condo with a killer view over an outdated bungalow in Scarborough or fighting over a dilapidated semi in East York. By 2022, I was patting myself on the back as condo prices soared while freeholds stagnated. I was looking at a $150K gain after all the selling expenses, making it seem like the perfect time to cash in, though hindsight is 20/20.
Come 2023, the value of my condo began to dip, first slowly, then more noticeably. It’s recovering now, but hitting those 2022 highs feels like a stretch. Selling now would still net me a decent profit, especially when factoring in what I'd save on rent elsewhere. I'm not upset, just had my expectations set a bit high after the boom. I thought we'd bounce back to the pre-COVID economy and downtown would flourish once more.
What's often overlooked is how the 2019 pandemic flipped the script on condo prices. Before COVID, living downtown was the epitome of convenience and luxury, with prices to match. The pandemic's mental toll and the shift away from centralized workspaces really took the wind out of condos' sails. Without COVID, I reckon downtown condos would've hit the $1M mark on average, a prediction many experts seemed to agree on.
Condo market aside, fantastic selection of Whiskey behind you. 😉
Agreed 👍🏻
Excellent video. I have 2 Nobu units. Absolutely beautiful with south lake views, and yes, still about $1800 negative cash flow on each. I like your prediction about condos coming back in price next year. I will probably have to keep mine for 3 years, as they were purchased as assignments.
@rdefacendis So true. In my experience, a lot of people don't even know their costs, it does not mean that the above commenter necessarily falls in this category. Often people don't calculate their annual inflation and risk adjusted return on realestate investment. It's often a highly leveraged investment.
@@rdefacendis baller? Yes, definitely. You think these are my first two properties?!? Laughable. They are #17 & #18. Brag to the dinner guests? No need to they are aware that I retired at age 43. Good Luck to you
Tom, you look like a young guy and I am glad you are a Browns fan. You were not around the 90s. Since the early 90s we haven't had a recession here in Toronto. We are due, way over due. 70% of people are living paycheck to paycheck. This will pop very very soon. I wish you well
A lot of people that have good incomes looking for long term look for rentals that were built before 2018. As soon as someone finds out the differences any financial literate person will go with a pre 2018 unit. So there’s a bigger for risk investors if their condos built after nov 2018.
Hey, I really enjoyed your content and insights! Just a thought, have you considered swapping out the whiskey bottles in the background for something more neutral? It might help more viewers focus on your valuable message without distractions. Keep up the great work!
Filming in a temporary space while doing renos! Will be back to regular studio soon. Thanks for watching.
What do you think about a stacked condo townhouse (top end unit) in Guelph. Its a Preconstuction for 628k (parking included). Do you think its too high for that price? Its called Northside condos in Guelph
Good job in keeping the videos more concise :)
Simple investors dont want monthly losses. Thats almost every condo for sale...
Toronto’s rent prices can only support $1050/SF for an investor to achieve 3% cap rate on operations. This is what the average condo prices will move towards. If you paid more than this, expect for your investment value decline by the difference. If you bought lower than the price point, congratulations.
Thank you for sharing.
God bless You!
Hey Tom , really nice video ! I was wondering if I could help you with more Quality Editing in your videos and also make a highly engaging Thumbnail which will help your videos to reach to a wider audience ? Pls let me know what do you think ?
Thanks Tom great information as always ! ❤
Condos are horrible, in some countries maintenance fee is for the year ($2000) not every month .
Some condos are all glass and even worse .
Great video, Tom. I think you can make two or three shorts out of it.
By 2025 the condo market is more likely to crash 20% of renters in Toronto were delinquent last year the only reason it's this high is because governments and central banks have been propping it up renters ability to pay will get much worse which will force speculators to sell
And imagine how much worse that will make the LTB backlog. 2 year waits might be the norm
Now that the government announced they’re going to reduce the number of temporary residents and overall population on top of the new student visa restrictions can impact more condo prices than freehold?
That will impact rental prices first.
@4:45 If investors don't invest, then where do ppl live. No investments, no building. No building, no house/condo. no house/condo, no 2here to live. The little house houses that are available for sale, what do you think the price will be then? & even worse when you can't buy you will have to rent. Guess what happens to rent prices when the majority of ppl have to be either tenants or homeless?
Just another angle to look at the problems. We don't need less house/condo. If the population is growing, we need more houses/condos.
Get rid of all the investors from top to bottom & see what happens to house/condo prices within 5yrs.
What does it mean get rid of investors. What are you talking about. The whole real estate market works with real estate companies and construction businesses taking risk to deliver buildings. The only way they can take those risks is with loans from banks. Banks won't loan unless 75% sellout. Investors are needed to achieve these thresholds or projects would take forever.
Toronto condo prices, new alltime average price peak in spring 2025
And they call me a pumper...
Peak price was March 2022, at $822,000 for 416 condos. Today we are around $730,000. So it would take a lot to get back there in 12 months from now.
This market needs to crash Canada is far to dependent on the housing market when it pops.
Yes but they want to protect the banks and a crash in the short term isn't good politically
You forgot stagnant income -
If hard assets go up in value it’s only because of the debasement of our currency.
So FTHB's who had to enter the condo market today instead of 2015 (graduated high school that year) are completed and utterly screwed. Hooray.
No one HAD to enter the market.
correct
Who bloody has the money to afford this condos with ridiculous maintenance fees.
Good luck selling your property. How many of the people coming here are actually rich?
50% decline in prices... if not more... coming very soon!!! Every part of the world, there is a recession. What makes you guys think Canada will be different? This year we will hit 8% interest rate....
The market can remain irrational longer than you or I can remain solvent. Caveat emptor.
Not true as long as the tenants are covering all the bills, and my tax write-offs are more than my income. I Love RE
👍