Mark Albert

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Looking in the Deja View Mirror

28 December 2018
Mark Albert

Let's take a look back 4 to 5 years at something I had written in 2015 about what happened in 2013/14 :

Here are the facts. *The market in the GTA has continued to rise. It rose, despite bank and other such analysts declaring a drop, in both 2013 and 2014. The average GTA property sale price in 2012 was a couple of thousand under $500,000. As of December 2014, the average price of in the GTA was pegged at $566,700. That’s a whopping 14% increase in property values.

*In this fourth/last quarter of 2018 the GTA still has seen a rise in values

  Average Price in October 2018: $808,034

Average Price in November 2017: $761,410.00 - Average Price in NOVEMBER 2018: $788,345.00  UP 3.5%

In fact, the “overbuilt” condo market has been a haven for consumers. And how about the relative rental market for those condo investors? Fourth quarter 2014 rental market reports had the vacancy rate for condos at 1.3% .   In some areas and at given times – that rate has dipped under 1%.

*In 2014 the average GTA one-bedroom condo was leasing for an average of $1558./month. NOW that leasing price average is over $2000./month This is a direct result of short supply and low vacancy.

What’s more is that those low, low mortgage interest rates that were to have a termination date of last spring (of 2014), and even the spring before that, are currently seeing rates of under 3% for conventional mortgages.

NOW, the average conventional mortgage rates for a fixed mortgage is about 3.6% . Of course now the "stress test" qualification requires the mortgage applicant to qualify for 2% more. Yes it affects qualification but the payment is at the current rate.

Rates and prices will fluctuate and change but in this province of Ontario and city of Toronto, a residential real estate investment ALWAYS appreciates given a reasonable time.

I watched a movie called “The Spectacular Now”; and no, “now” is not the place we want to or even can live, but it is always the place we want to act on. Our future is always determined by our present and is a direct result of our past.

And now for the story –

Ms. Seller acquired her townhouse in North York in 2005 valued at, in around, $275,000. In the summer of 2013, she was ready for a move. The problem – somehow, though coming from a smaller space, she had managed to fill every nook and cranny with “stuff”. Floor space was taken up with “stuff”. Countertops, coffee tables displayed all kinds of knick-knacks and various small appliances, jars and more stuff. And don’t try opening a closet…”that’s where we keep our stuff”. My wife armed with pictures and the feature sheet she had envisioned, went to work with the seller. She is an organizer of the “A” type. Homes were selling quickly, but conditions of this fast moving market (and this rule of thumb applies in most markets) dictated that we had ten days to peak the interest of buyers and elicit an offer.

The house, now shining and picturesque, was ready for its admiring public. Signs up, ads out, internet open to the cloud – we were in the market.

The result of this effort – sold at $380,000. , with all conditions removed (Note: Most condos require a status/condo corporation condition that has a 12 day allowance).   In today’s market, it appears that the value of this property may well break the $700,000 barrier. (Note: when I wrote this in 2015, I had set the breaking bar at $400,000.) Frankly, still good value in this market.

This was a simple story and not as clandestine as might be implied by my original mandate of secrets from a not-so-secret agent. Well, the incredible story about “stuff” is coming next.

*facts taken from TREB and Market Watch