TranceAddict Forums (www.tranceaddict.com/forums)
- Canada - Toronto & Southern Ont.
-- Condo Advice
Pages (4): « 1 [2] 3 4 »

quote:

Originally posted by VDub Lol at the anti-condites... Maybe he doesn't want to live at home anymore and he said he didn't want a house to himself... What's the alternative??? Rent??? The dumbest way to live if you can afford not too... Which building is the new one? South beach or iLoft??? Well can't be South Beach as they've not even broken ground yet...

Renting is not bad if you invest the difference in the monthly cash flow. That way you are still building equity/net worth at a much lower cost and potentially with a much higher return (depending on what you choose to invest in of course)

A friend of mine has quite the nest egg saved and could probably come close to buying something outright in cash, but still rents - he just can't justify essentially tripling his monthly living expenses to acquire an asset that is arguably hugely inflated in value.

quote:

Originally posted by Skipper Renting is not bad if you invest the difference in the monthly cash flow. That way you are still building equity/net worth at a much lower cost and potentially with a much higher return (depending on what you choose to invest in of course) A friend of mine has quite the nest egg saved and could probably come close to buying something outright in cash, but still rents - he just can't justify essentially tripling his monthly living expenses to acquire an asset that is arguably hugely inflated in value.

on a further note.. i know someone who rents for himself and owns rental properties. He says the principal property is a false dream (a liability) because you will never realize the value of the property unless you sell it and move into a tent. Yet you will pay taxes based on that value. Renting is a loss but you lower your costs and dont have to worry about anything. Also rent is a write off.

quote:

Originally posted by Jayx1 on a further note.. i know someone who rents for himself and owns rental properties.

Being a landlord sound like a piece of cake but it's not. Everytime your tenant has a problem, like an appliance breaking down, or a leak, you are responsible. Also when the tenant leaves, it's sometimes hard to replace them and every month that goes by, is money lost. Renting one place is a handful, renting multiple properties is practically a full time job. I think I'd rather buy a house in a few years so that when I retire, I can sell it, buy a smaller place, and live off the profit/difference. Seems like a more headache-free option.

quote:

Originally posted by 1dawoman Being a landlord sound like a piece of cake but it's not. Everytime your tenant has a problem, like an appliance breaking down, or a leak, you are responsible. Also when the tenant leaves, it's sometimes hard to replace them and every month that goes by, is money lost. Renting one place is a handful, renting multiple properties is practically a full time job. I think I'd rather buy a house in a few years so that when I retire, I can sell it, buy a smaller place, and live off the profit/difference. Seems like a more headache-free option.

def not the route to go for some people... but just using that as an example of property investments as opposed to liability.

the condo/house dilemma has been killing me. I currently live in a house which i own (Niagara is much cheaper than the GTA....by a landslide!).

Starting in the new year, my job moves to burlington and I will also make the move as 1hr+ drives wont cut it for me. I've been following the Burlington market for the last 3 months or so for pricing and features....

From what i can see in Burlington, condos start at 170k, towns in 230k and anything freehold is 270k+
Oakville is definitely more expensive than Burlington. I've not looked @ Mississauga.

In terms of condo fees, most towns and 3-4 storey condo buildings, they usually range from $150-$275/mo and generally include: Building Insurance, Exterior Maintenance, Parking, Water
So when you look at it, anything over $200 is a tax really...but you have to account the time your are not spending doing maintenance as it does add up when u have a home.

In that area, I don't see condos including heat/hydro. Some may include cable.

I think as you get into buildings that are high rise...the condo fees likely increase, but so are the amenities. It is more likely that hydro/heat are included (whats the point of having a furnace in 200 units!)


The toronto market is likely to be completely different than Burlington...but i thought id share what ive seen there...

quote:

Originally posted by 1dawoman I think I'd rather buy a house in a few years so that when I retire, I can sell it, buy a smaller place, and live off the profit/difference. Seems like a more headache-free option.

Except if you make little to no profit. My parents are currently looking at selling their house b/c my dad retired just over a year ago and the upkeep of the house is ridiculous (he had to put a new roof on, replace a sink, painting etc. and also recently had to buy a car - not related to the house, but another added expense). Unfortunately, the people who want to live in our neighborhood all want new houses (there's new subdivisions and houses being built all around us). And all the smaller houses he's looking at cost a lot more money than what he'd get for our house.

quote:

Originally posted by devnull From what i can see in Burlington, condos start at 170k, towns in 230k and anything freehold is 270k+

Jealous of you. Those numbers look like real estate prices of Toronto in the 1980s...

wish my work was close to Burlington...

quote:

Originally posted by The Highroller Not necessarily. Rent has to be compared with condo fees, interest on mortgage, property taxes, and expected value of gain/loss on your property (which may not be very easy to put a value on right now considering general housing market uncertainty).

Umm what about comparing the quality of living?!

Sure you can rent out a cheap hole, and put all the savings into a savings account. That works for building equity. But what if you dont want to live in a shit hole? Rent out a condo? Most decent condos cost very similar to rent compared to just paying the mortgage maintenance and taxes yourself. And with real estate you do build equity.

A house is a better investment, but a single guy doenst need a house. Condos can be good.

quote:

Originally posted by 1dawoman I thought my gender was obvious since it's stated in my user name.....guess not :P

Yah sorry about that...

Didn't pay attn...

My bad...

iLofts are nice but I only like the actual loft units...

quote:

Originally posted by The Highroller While in many cases it is better to own than to buy, there are certainly some cases where renting may be a better investment.

Yes I can concede to this point...

quote:

Originally posted by 1dawoman Those numbers look like real estate prices of Toronto in the 1980s...

Interest was at 20% in the 80's...

This is a decision Lauren and myself are looking at. We are not quite ready yet but almost there. I think we will be going with a condo...for a few years atleast.

The California condos on Queensway have sparked our interest but like Mark said the deposit is almost $25,000

quote:

Originally posted by Skipper he just can't justify essentially tripling his monthly living expenses to acquire an asset that is arguably hugely inflated in value.

quote:

Originally posted by VDub Well can't be South Beach as they've not even broken ground yet...

South Beach is a great project! (And yes they already have broken ground )

quote:

Originally posted by VERTiG0 What about condos NOT in Toronto? Still a bad idea?

It really depends what you want Cale. You can get houses here for a decent cost but you have to deal with all of the maintenance yourself, but if you score like I did, my condo fees are only 145$ a month. That includes maintenance and water, I pay hydro myself.

Property taxes are generally pretty cheap here and I can close my door after working all day long and not have to deal with anything outdoors.
The downfalls are though for me are not having a yard so I have to go up and down the elevator with my dog all the time. I don't have any storage space or a balcony so in the next year I will consider a house so I can have all this.

I have had this place for almost 9 years now and I don't think it was a bad decision at all, I just want more in a home now then I did when I was 22.

quote:

Originally posted by 1dawoman Jealous of you. Those numbers look like real estate prices of Toronto in the 1980s... wish my work was close to Burlington...

Ill sell you my house for 170. Nice bungalow, freshly done basement .... but u have to move to Welland lol

its frightening how many ppl willingly ignore the cost of owning vehicles in their evaluation of their property or investment

$600/month over 25 years = $180k!

and $600 is a very conservative estimate including car payments, gas, repairs, insurance, etc.. in actuality its more like $750/month.. and it seems like the norm for living in the suburbs is to own a minimum of two vehicles!

quote:

Originally posted by ChemEnhanced don't buy a condo

Buy 2 condos!

quote:

Originally posted by mute79 its frightening how many ppl willingly ignore the cost of owning vehicles in their evaluation of their property or investment $600/month over 25 years = $180k! and $600 is a very conservative estimate including car payments, gas, repairs, insurance, etc.. in actuality its more like $750/month.. and it seems like the norm for living in the suburbs is to own a minimum of two vehicles!

id own a car either way... i wont be a slave to the ttc and its inferior service.

quote:

Originally posted by Beings Umm what about comparing the quality of living?! Sure you can rent out a cheap hole, and put all the savings into a savings account. That works for building equity. But what if you dont want to live in a shit hole? Rent out a condo? Most decent condos cost very similar to rent compared to just paying the mortgage maintenance and taxes yourself. And with real estate you do build equity. A house is a better investment, but a single guy doenst need a house. Condos can be good.

True, condos are generally way nicer than an apartment where you'd get a decent amt of savings on the monthly costs - however my apartment, while modest, costs $1200/mth. 2 small bedrooms, massive deck, great area, amazing landlord. I just cant justify it..

i spend just over 1k on my car per month

Some advice from somebody who's actually gone through this and knows what he's talking about (lol @ all the renters chiming in):

New construction will save you a HUGE amount of money, and in spite of what some of the financial gurus here are telling you, you'll most likely have made a decent profit by the day you take possession. My information comes from my own condo, which is brand-spankin' new (moved in at the end of '07 and most units weren't finished until around April '08), and from people who are actually in the real-estate market, including family members who have no reason to colour the truth and business contacts who can't make shit up.

Simply stated, it's a good financial move. For me, given the quadruple leverage of the mortgage, I've made a return of about 80% on my initial capital, with nowhere near the kind of risk associated with more volatile equities.

There are still risks, obviously, and I don't mean to downplay those, but all investments are risky and you can do a lot worse than a new-construction condo in the GTA.

Now, having said that, money isn't everything. If you go for the new construction option you will have to deal with a shitload of headaches. Just off the top of my head:

• They drive you crazy with the upgrade process. If they're offering exactly what you want, then you're golden, but if you try to step even a tiny bit outside their standard, be prepared for endless arguments and stonewalling. The builder is not interested in your satisfaction after you've already signed a deal; he is interested only in keeping things as simple and straightforward as possible for the contractors. I replaced a toilet once while construction was still going on elsewhere in the building and ended up in a pissing match with their project manager.
  
• Speaking of toilets, and other plumbing fixtures, you'll probably have very little choice over what they put in, and what they put in is almost always crap (may or may not be the case in a pre-owned condo).
  
• You will have to take occupancy long before the construction is actually finished, and you will have to deal with all the hassles of literally being in a construction zone (noise, unfinished areas, waiting forever for the elevator, you get the idea)
  
• During the occupancy period you will have to pay occupancy fees, which is effectively the same as rent. It may be several months before you actually take possession. None of this goes toward your equity - you're basically pissing away money, and it's at the builder's mortgage rate, which will be higher than yours.
  
• Condo fees will go up almost right away. You can take whatever estimate they gave you, rip it up and burn it, because that's how relevant it'll be after your first year of occupancy.
  
• When you sign a builder's contract, you sign away all your rights, including the majority of tax incentives you might be eligible for. My closing document is literally 10 pages of explanations of all the miscellaneous expenses I had to pay for. It doesn't negate the ROI of new construction, but nevertheless it will surprise and annoy you. Enlist a good real-estate lawyer so you'll understand it all.
  
• Be prepared for a total clusterfuck with respect to common areas during the first 6 months to 1 year. IIRC, it took 2 weeks before I got a working garage door opener and 3 months before I could access my locker. Electrical, HVAC, security, elevators, fire alarms - you can bet that at least one and probably several of those things will cock up.
  
• Part of this is luck, but condo boards can be unstable for the first couple of years due to people not knowing what the hell they're doing. And if you've got a lousy condo board, you're in for all sorts of problems down the road. This can happen in an older condo too, but it's more likely with a new one.
  
• Edit: And, oh yeah, I forgot to mention all of the in-suite repairs you'll have to deal with once you move in, because they will screw it up. You don't have to pay for any of it, but it's a pain.

quote:

Originally posted by DigiNut If I had to make the same decision today, though, I would definitely go for pre-owned (preferably 3-5 years). Hope that helps.

It did.

While reading this, I tried to picture myself dealing with those problems and living under those circumstances and it really doesn't seem worth it for me, despite the savings. I am by no means a picky person that will get worked up over fixtures and what not, but the moving in before construction is over thing would annoy me. I'm also not a fan of occupency fees.

I really just want to move out...and have a big party

Thanks so much for your input.

quote:

Originally posted by DigiNut Hope that helps.

nice post dude!

"renting vs buying" and "condo vs. house" are topics on their own...suffice to say that some of the info here is misleading. rent is a tax credit and only reduces tax payable for relatively low income earners. IIRC, my provincial tax credits were consistently nil every year that I rented. my rent paid made zero difference.

IMHO, I wouldn't consider a primary residence (condo or house) as an 'investment' in the traditional sense. it's not that you won't see it gain/lose market value, or that it's not preferable to see your property appreciate vs. depreciate, but that it's not the same as buying stock at x price and selling at y.

obviously, a gain/loss is only realized when you sell. until then, it's a paper gain/loss. with a primary residence, it's not only unrealized until you sell, but unrealized until you sell and if you either exit the market entirely or buy again in another market that didn't experience the same level of appreciation.


Aaron gave a lot of good examples of what can be involved with a new construction. it can indeed be stressful and you need to determine if you can live with the potential drama in exchange for the pros that come with a brand new home that you were able to customize somewhat and be the first to occupy. there are clear benefits to be enjoyed.

one thing I would add is the builders can even make changes to room dimensions, if necessary. in theory, your 12x 10 bedroom could actually turn out to be 11 x 10 due to some unforeseen engineering/build requirement and you're shit outta luck with pretty much zero recourse. unusual? sure. but remember that you're buying a floorplan (that can change) with materials/finishes (that can change) with a tentative closing date (that WILL change, lol). new home warranty programs have less teeth than they ought to...so don't take too much solace in them either.


regarding appreciation, keep in mind though that most existing properties in the same market had similarly appreciated over the same time period of time too. whether you took possession then on an existing property or took position later on a new build is irrelevant in that regard. the more relevant stat might be whether new constructions prices appreciated to a greater extent than an equivalent resale property over that same time period.

what a new build does allow you to do is have your price set long before you have to incur the full expense required to acquire and maintain the asset. i.e. it eliminates the risk of price increases in the interim. but that is *not* to be confused with eliminating price risk, period...as an increase in value is not guaranteed. in theory, prices could have plateaued or even dropped in the interim (and in fact, that IS what happened in several areas of the country recently). you simply can't say with certainty where the market will be 2-3 years from now...though at the present time, it's quite reasonable to assume that Toronto home prices will continue to appreciate for the foreseeable future. still...there is risk.

a new construction also subjects you to mortgage interest rate risk. you know what mortgage rates are today if you close on a purchase now, but you do not know what they will be in 2-3 years when a new condo is built. virtually no mortgage lender will guarantee a rate beyond 12 months and the longest rate guarantee typically provided for current 'top' rates is anywhere from 30-120 days. with rates still at a relative low point and the likelihood is that they will be higher in the coming years, you're definitely taking on interest rate risk with a new construction vs closing on something now.

something that recently impacted people who took possession last year vs. a buying a condo that will closing years from now...the introduction of Toronto's municipal land transfer tax. previously, there was just the provincial LTT, but now there are both. thank you David f'n Miller.

what will impact people going forward if they choose a new construction vs buying now? HST (yes, there are thresholds, but it will still impact a significant portion of buyers in Toronto.

point ultimately being...you're taking on more than just the risk of 'drama' on inconvenience with a new build.

Powered by: vBulletin
Copyright © 2000-2021, Jelsoft Enterprises Ltd.