When I am asked about the latest new condo development downtown, it is hard to choose from. On almost every corner you can find a new building site in many various phases of construction from the application to amend the zoning, to Sale Centers or even a big hole in the ground with a crane in the works. It is hard to know which one of these new developments will give you the best return on investment or the best place to live. You shouldn't just play pin the tail on the donkey, you need an expert realtor who specializes in downtown condos and is up to date with all the latest news to help you with this decision.
If you have been in the business as long as I have, you get to know the important factors that should influence your decision; LOCATION, BUILDER, PRICE & POTENTIAL GROWTH. The most obvious is location but it is amazing how many people forget to consider the number of buildings in the area, possible future developments, ease of public transportation, access in and out of the building especially in high traffic times, proximity to grocery stores, restaurants, places of work... and the list goes on.
Right now one of the hottest areas for construction is KingWest, a pocket just North and South of King Street West stretching from Yonge Street to Bathurst. This area has seen the biggest change in all of downtown with the most new construction projects underway. However this influx of condos has pushed prices to an all time high ranging from $600 a square foot to an astonishing $900 a square foot. These prices have far surpassed the east side of Yonge Street, but has become very congested with traffic both on the roads and streetcars. Unfortunately the West side has not seen an increase in amenities such as grocery stores and parks that are important to living in a big city.
One of my favourite investment opportunities lie on the East side of Yonge around the St. Lawrence Market area. This area has some new developments but definitely less than the West side and the prices are far more affordable around $500 a square foot. It is far less congested and has plenty of parks and grocery stores to choose from. This area is also a shorter walk to the financial district and if need be, you can catch a ride on the street car without being sandwiched in. It won't be long before KingEast catches up to KingWest as people will find it a more desirable place to live and the opportunity lies with the more cheaper prices you can find today.
Another important factor to consider would be the BUILDER. Choosing a builder with a good reputation for quality, delivery, finishes and resale values can make a huge difference in money in your pocket. Being an investor in new construction condo projects myself along with my clients, I have seen first hand the differences in experiences from builder to builder. Having the finished product delivered on time, with the finishes as promised in the sales centre along with the quality of workmanship are important to consider when looking at the builder's reputation. How many projects has the builder done in the past? How long was the occupation time before the building registered? Does the builder have a customer care department to follow- up with deficiencies? What are the resale values of past projects? An experienced realtor should know this information or be able to get it for you. There are some really great builder's out there that deliver as promised and there are definitely a few builder's I would never work with again.
PRICE is definitely important when considering a new purchase. The price should be attractive enough to a new buyer that is taking the risk of locking into an investment for 3-4 years not knowing where the real estate market will take us. It is amazing how many new construction projects are charging more per square foot than projects that are brand new and already built. The buyer should look at this closely as it can be more beneficial to purchase something already built and rent it out now and take advantage of these very low mortgage rates. There should be enough POTENTIAL GROWTH in the project to make the investment desirable. Also try to choose something that has value. Compare layouts and look at price per square foot in the building as they differ on the price list but not as much when it comes to resale after completion. Also, don't be fooled into paying price premiums for higher floors unless the views change dramatically. You probably will pay around $2000 extra per floor but that premium is never recouped in resale and I find it is best to buy something in the middle of the building.
If you are considering purchasing a new construction condo, please do not hesitate to contact me with your questions or concerns. If you already own a condo downtown and want to know how these new projects will affect you investment, I am always here to help.
