Toronto Condominium real estate project cancellations have created concerns among realtors and pre-construction condo investors across the Greater Toronto Area. One of many projects cancelled in recent months, the Cosmos Condominiums project in Vaughan (just North East of Toronto) sent a letter this week to investors announcing its cancellation and that it would be refunding deposits.
So why are projects like this being cancelled? The Cosmos had 1,153 units planned, which the developer had previously stated were sold out. In its letter to investors, the developer cited “unsatisfactory financing terms” by lenders. On the other hand, other projects, such as The AvonDale project at 620 Avenue Road might be cancelled due to poor sales. Both reasons are related to the underling developments which are an indication of what to expect next.
It has become less profitable and riskier to own rental property in the Greater Toronto Area.
When I read “unsatisfactory financing terms”, I assume that th e developers are unable to make the type of profit that they would like to make. A number of developments over the last year have increased the cost of construction and ultimately are reducing the supply of new housing in Ontario.
These developments include:
So why is all this happening? All of these were implemented by, or as a result of, government intervention (municipal, provincial and federal). Governments have stepped up their involvement in the market because foreign speculators of Toronto area estate have pushed up pricing beyond what local residents can afford. The federal government has been concern that Canadians are over leveraged and have been borrowing against the equity in their homes, which spiked along with the speculation that has been taking place.
As a result, whereby the federal government has made it harder to borrow money for home purchases, the Ontario government has made it less appealing to own rental property.
The bottom line is that increased costs, decreasing interest from foreign speculators and increasing difficulty for local residents in obtaining mortgages is making it increasingly difficult to make a profit in the real estate development. Developers have been designing smaller and smaller condo units to keep the selling price affordable.
Since condo units can’t get much smaller and still provide a decent lifestyle, what choice do developers have?
“The Condo Bidding War, Part 2” – Real Estate Vlog by Baldo for May 20, 2017
In this vlog I discuss the condo unit that I just showed and provide insight into some details that are often overlooked when condo shopping.
Please leave your comments and questions, as well as topics for future vlogs.
“The Condo Bidding War, Part 1” – Real Estate Vlog by Baldo for May 20, 2017
In this vlog I discuss a bidding war that took place on Tuesday for a condo unit in the Yonge/Finch area. Though we were told there were 4 offers registered just before cut-off, there were 12 bids presented later at the office. Please leave your comments and questions, as well as topics for future vlogs.
I Can Help You Get There! Video tour available at http://goo.gl/L2L1Rf
Available for sale – great luxury condo in a fantastic location within Bayview Village! An elegant one-bedroom plus den condo at ‘The Chrysler’, in the heart of Bayview Village with unobstructed east view! Open concept sun-filled, wonderful panoramic city view. The condo’s amenities include a luxury lobby, 24 hour concierge, great gym, virtual gulf, spa, billiards room, indoor pool, party room, guest suites and great BBQ patio. Building has lots of free visitor parking. Only about a 5 minute walk to the Upscale Bayview Village Shopping Centre (440,000 S.F. holding 110 stores). Steps to Bayview Subway station, close to Highways 401, 404 and Don Valley Parkway. Close to everything you need – parks, schools, restaurants, YMCA, Library, Loblaws, Pusateri’s, Banks!!!
‘The Chrysler’, also known as ‘Chrysler – East Tower’ is a High Rise (28 floors above ground and with a total of 337 suites and 16 Townhouses) condominium building located at 3 Rean Drive within the Chrysler Complex of the New York Towers Cluster in the Bayview Village Neighbourhood. Bayview Village is an affluent neighbourhood of Toronto and in 2011 had a population of 17,645. Nearby buildings include: Chrysler-West Tower, Waldorf –East Tower, Waldorf-West Tower, The Claridges, Merci le Condominium, Empire of NY, Amica at Bayview, The Chelsea, and Daniels Kenaston Gardons. Nearby parks include: Bessarion Parkette, Harrison Park, Rean Park, Sheppard Square Parkette, and Talara Park.
The building was designed by Kirkor Architects and Developed by Daniels Corporation.
To View Property Call Baldo Minaudo, Broker, Real Estate Homeward Brokerage Tel: 416-698-0245, Direct: 416-564-0245.
**Not intended to solicit persons under contract