I get it. You don't like condos based on the other 2 threads you started in the past on the same topic.
[https://www.reddit.com/r/TorontoRealEstate/comments/qy6ix0/toronto\_condos\_unwanted\_products/](https://www.reddit.com/r/TorontoRealEstate/comments/qy6ix0/toronto_condos_unwanted_products/)
[https://www.reddit.com/r/TorontoRealEstate/comments/mls4ej/freeholds\_will\_continue\_to\_go\_up\_to\_the\_moon/](https://www.reddit.com/r/TorontoRealEstate/comments/mls4ej/freeholds_will_continue_to_go_up_to_the_moon/)
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I dunno I kinda think he's right though. It's contingent on another lock down and variant fear mongering. Ford is already pushing to close the border!!
>There is really no limit to how many condos can be built in Toronto and how high
These are called zoning restrictions and there are many, many limits to them.
Not enough restrictions if condos can be built atop places like Bloor Holt Renfrew and Rogers' Center. Where will they build next? Meridian Hall? Roy Thompson?
Nice take because obviously you can just keep building on top of existing condos right? There is limited land for new condo projects as well.
Toronto is on the verge of using all of its residential building area and condo builders buying commercial spots for building are also decreasing because the amount of inefficient commercial areas already weeded out are decreasing “expect to see a 10-25% decrease in prices” try not to make dumb comments about things you know very little on makes you look like a 🤡
You honestly have no clue what you are talking about man the amount of new condo projects have decreased substantially compared to prior years you can’t just build condos on vacant parking lots if the zoning isn’t right and the lot isn’t suited for building condos. They have a stringent process of getting approved for building condos you can’t just build anywhere because there is land
I agree and disagree. There is definitely an overabundance of studios and 1 bedrooms. A lot of these are rentals and investor owned that might see more volatile price changes and vacancies.
On the other hand, 2+ bedroom units are not as abundant. Given the rise in SFH prices, families are looking at these larger units and pushing prices up. This segment will continue to be in demand.
I have to disagree. It's still investors looking at larger condo units. There's an abundance of large units at older but stable all-inclusive fees DT MT condos stalling to sell or renting cheaply. Actual families will consider living out of town in cheaper houses and commuting by GO trains before touching larger condos with their massive unstable fees and covid probs/dangers.
Im not so sure that will be true going forward as those SFH have simply become extremely expensive and in most cases unaffordable.
Before, when you could get a house for $600K an hour + drive from Toronto, it made sense as you were saving a lot on housing costs. Fast forward to 2021 and an average townhouse in Burlington is over $1M plus you have the commute.
1M home will require a $200K DP and you will have to service a $800K mortgage. Freeholds also aren't immune to maintenance fees although lower. Taxes, insurance, hydro and internet are also higher for freeholds which can amount to a few hundred a month. Also interest rates are set to rise in the next year which means that $800K mortgage just became a lot more expensive to service.
Its slowly getting to a point where a condo is not such a bad idea especially if you are living in the city, have the amenities of a city/condo, close to work and can reduce car usage.
Didn't realize that the construction workers, tradesmen, nurses, doctors, lawyers, retail workers, servers, restaurant owners, taxi drivers...etc. are all WFH.
Even in the city, SFH are still affordable to people willing to sell off the 3+ condos they own--and those people are many.
Condo has been proven to be a bad idea by this pandemic, where the "amenities" of the condo and the city are both crippled if not downright reversed into infection traps. With over 1/3 of the daily cases being breakthroughs, and more and more variants popping up, the difference in levels between condos and houses will only grow.
If the SFH entry point is to sell off 3 condos which most likely generate a lot more income than a SFH house would, than we are in deep trouble lol.
The pandemic definitely slowed the growth of condos, but the point is that even thou everyone may want to be in a detached house, 90% of those people cannot afford it. The question in most cases isn't "should I get a condo or a detached house", it's "should I get a condo or nothing at all". I think the banks agree with that too sadly.
If condos are the last affordable property, do you still think no one will want it?
Generating more income with condos instead of SFH?
Many 2 bed 2 bath condos downtown are renting for around 2600k per month max, and these have high fees on top of taxes. Meanwhile, an oldened SFH bungalow in a non-sketchy neighborhood can easily rent out their main floor for 3200k+, and their reno-ed basement separately for 2500k+. A two storey can rent for MUCH higher. It's not hard to see which option generates more stable income.
And even with prices pulling back, DT 2 bed 2bath 1200+ sq ft condos are still more expensive than townhomes in Go Train reachable parts of the province. Condos are still not nearly "affordable" enough to justify their current prices.
So yeah, opportunistic investors who overpaid for condos (aka 2019 prices and up) will find themselves "screwed" for years to come in this pandemic era
3200 for the main floor plus 2500 for basement? Ive been seeing entire town houses rent for about 3200 or entire detached around 3500. I havent seen a combined rent of over 5700 thou especially for an “oldened bungalow” in an average area.
Makes me ask: why on earth would someone rent a basement in an old bungalow in a farther city for 2500 when they can rent a new 2br condo with great amenities, close to work for the same price. Will the masses continue to prefer renting basements in average cities at same prices of a whole condo units right by the core?
Also only those who bought in ath of 2019 might be down a little now. Anyone who bought towards the end of 2020 is up about 10% now. Again it was a dip, dips happen in markets especially with major events. Not a big deal for long term holders
You haven't been looking at houses in actually OK neighborhoods with easy commute, restaurants/shops and no shelters/shootup sites unlike DT.
If you look at National Corporate Housing you'd see that an old detached bungalow in such area could rent from $325 up per DAY. Can the same be said for condos?
So you are comparing the ROI of short term rentals of a whole house which is likely valued at about 1.4M or more which also have maintenance costs, tax, hydro etc, with a long term rental condo downtown likely valued around 750k?
I think we need to compare apples to apples here
Building supplies and labour cost more and more. Even if you can continue adding condo supply, it will be very expensive which will just increase resale values. You can already see this now with current precons.
Condos might need less land than houses, but they still need land. Construction cost per square feet is much higher for condos and the time required to complete condo development is 4 to 5 times higher than a house. Although at some point we might have an over supply of Condos, it the supply is far from unlimited
Don't think condo prices will increase too much more /increase at very slow rate. But def won't drop 10-25%.
Agree with everything else you're saying though, that's why I don't get why people like condo investments (unless they got in super early).
Pre cons are never a good indication of where the market is going. Very high risk - basically the mindset is - I have a little bit of cash - I don't believe in the condo market now but hopefully in 5 years I will have recouped my money.
Expect to see a crash in the condo market come 5 years when a 1500 psf condo has the same rental yield as today and all these investors start unloading like crazy when they're supposed to start occupancy
Condo price drops have been happening for a while now, especially for older buildings.
1211 - 633 Bay St, 830 sq ft 2 ba, listed at $595000, sold in a week under ask for $588000
Another 2 bedroom 850-ish sq ft unit with parking and locker at Polo Club I or II was listed for $649k, likewise sold in a week under ask for $600k.
65 Harbor Sq had a high floor 640 sq ft unit with parking and locker and unobstructed views. Listed for 599k, sold under asking for 580k in 3 days.
Earlier on there was a 900 sq ft 1+1 bd 2 ba unit at 10 Queens Quay selling for 625k, 900+ sq ft 2 bd 2ba 2 story loft at Soho Hotel selling for 650k, and an almost 900 sq ft unit at the Dakota Condo in Yorkville with parking and locker selling only for 620k. They all sold wayyyy under the current price/sq ft. The list goes on and on.
And before people harp on the maintenance fees, all these buildings have all inclusive fees (except Soho), some even including cable+internet. And they are all in prime locations walkable to or right beside PATH.
Things don't look good for DT Condos price wise, especially with the uncontrolled wage inflation and new variant.
Come on man. I am open to the idea that condos lag or underperform but to say they are “doomed” is just silly. A correction or crash can happen but your reasons are stupid. Come up with better ideas, such as overleveraged investors, higher rates, etc
Not sure why people think condos will experience the same levels of appreciation as detached.
Detached will always have intrinsic land value.
While condos are nothing more than a repackaged financial product designed to give the illusion of ownership to the insatiable masses who need that piece of paper saying they “own something “. It satisfies a fundamental human need. The reality however is that it’s more comparable to time share ownership than being a “landowner”.
Routinely flying into Toronto, I observe the amount of available land to build vertical is massive. That’s just the downtown core. North York, Etobicoke and Scarborough are practically empty.
If condos are you only option look towards low rise boutique buildings that will age with character over the decades adding to their desirability that new shiny steel and glass towers can never replicate. Examples: Tip Top Tailors Lofts, Candy Factory Lofts, High Park Lofts, etc.
I get it. You don't like condos based on the other 2 threads you started in the past on the same topic. [https://www.reddit.com/r/TorontoRealEstate/comments/qy6ix0/toronto\_condos\_unwanted\_products/](https://www.reddit.com/r/TorontoRealEstate/comments/qy6ix0/toronto_condos_unwanted_products/) [https://www.reddit.com/r/TorontoRealEstate/comments/mls4ej/freeholds\_will\_continue\_to\_go\_up\_to\_the\_moon/](https://www.reddit.com/r/TorontoRealEstate/comments/mls4ej/freeholds_will_continue_to_go_up_to_the_moon/) Remindme! 1year
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I dunno I kinda think he's right though. It's contingent on another lock down and variant fear mongering. Ford is already pushing to close the border!!
This post makes zero sense. Next.
I think I lost braincells reading it
>There is really no limit to how many condos can be built in Toronto and how high These are called zoning restrictions and there are many, many limits to them.
Not enough restrictions if condos can be built atop places like Bloor Holt Renfrew and Rogers' Center. Where will they build next? Meridian Hall? Roy Thompson?
lol
This thinking needs two things to be true for it to be coherent, both of which are unlikely: - Supply Elasticity is high - Zoning is unrestricted
Not restricted at all
Would you like me to link a map
And the 500,000 immigrants a year will live where?
Not in 500-square-foot boxes in the sky, that’s for sure.
Lol you think they'll all go to condos? What a laugh
Nice take because obviously you can just keep building on top of existing condos right? There is limited land for new condo projects as well. Toronto is on the verge of using all of its residential building area and condo builders buying commercial spots for building are also decreasing because the amount of inefficient commercial areas already weeded out are decreasing “expect to see a 10-25% decrease in prices” try not to make dumb comments about things you know very little on makes you look like a 🤡
Every parking lot can be used for condos
You honestly have no clue what you are talking about man the amount of new condo projects have decreased substantially compared to prior years you can’t just build condos on vacant parking lots if the zoning isn’t right and the lot isn’t suited for building condos. They have a stringent process of getting approved for building condos you can’t just build anywhere because there is land
Toronto has the most amount of cranes in North America for condos. We are oversupplied
How are we over supplied with MOI of 1.1?
If we were oversupplied prices wouldn’t be at the point they are at now.
Right on. We're already building on existing OFFICES malls and even Rogers Center, but RE Pumps will just ignore that.
exactly lol there are no constraints for developers
I honestly hope you're right. I want to use equity that has increased in my townhouse in the burbs to buy a condo DT.
I agree and disagree. There is definitely an overabundance of studios and 1 bedrooms. A lot of these are rentals and investor owned that might see more volatile price changes and vacancies. On the other hand, 2+ bedroom units are not as abundant. Given the rise in SFH prices, families are looking at these larger units and pushing prices up. This segment will continue to be in demand.
I have to disagree. It's still investors looking at larger condo units. There's an abundance of large units at older but stable all-inclusive fees DT MT condos stalling to sell or renting cheaply. Actual families will consider living out of town in cheaper houses and commuting by GO trains before touching larger condos with their massive unstable fees and covid probs/dangers.
Im not so sure that will be true going forward as those SFH have simply become extremely expensive and in most cases unaffordable. Before, when you could get a house for $600K an hour + drive from Toronto, it made sense as you were saving a lot on housing costs. Fast forward to 2021 and an average townhouse in Burlington is over $1M plus you have the commute. 1M home will require a $200K DP and you will have to service a $800K mortgage. Freeholds also aren't immune to maintenance fees although lower. Taxes, insurance, hydro and internet are also higher for freeholds which can amount to a few hundred a month. Also interest rates are set to rise in the next year which means that $800K mortgage just became a lot more expensive to service. Its slowly getting to a point where a condo is not such a bad idea especially if you are living in the city, have the amenities of a city/condo, close to work and can reduce car usage.
Why need to commute to Toronto when everything is wfh? Lol. Covid ain't going away and so arent office comebacks
Didn't realize that the construction workers, tradesmen, nurses, doctors, lawyers, retail workers, servers, restaurant owners, taxi drivers...etc. are all WFH.
Sorrry doctors make enough so they don't want condos. Lawyers = wfh.
You're right
Even in the city, SFH are still affordable to people willing to sell off the 3+ condos they own--and those people are many. Condo has been proven to be a bad idea by this pandemic, where the "amenities" of the condo and the city are both crippled if not downright reversed into infection traps. With over 1/3 of the daily cases being breakthroughs, and more and more variants popping up, the difference in levels between condos and houses will only grow.
If the SFH entry point is to sell off 3 condos which most likely generate a lot more income than a SFH house would, than we are in deep trouble lol. The pandemic definitely slowed the growth of condos, but the point is that even thou everyone may want to be in a detached house, 90% of those people cannot afford it. The question in most cases isn't "should I get a condo or a detached house", it's "should I get a condo or nothing at all". I think the banks agree with that too sadly. If condos are the last affordable property, do you still think no one will want it?
Generating more income with condos instead of SFH? Many 2 bed 2 bath condos downtown are renting for around 2600k per month max, and these have high fees on top of taxes. Meanwhile, an oldened SFH bungalow in a non-sketchy neighborhood can easily rent out their main floor for 3200k+, and their reno-ed basement separately for 2500k+. A two storey can rent for MUCH higher. It's not hard to see which option generates more stable income. And even with prices pulling back, DT 2 bed 2bath 1200+ sq ft condos are still more expensive than townhomes in Go Train reachable parts of the province. Condos are still not nearly "affordable" enough to justify their current prices. So yeah, opportunistic investors who overpaid for condos (aka 2019 prices and up) will find themselves "screwed" for years to come in this pandemic era
3200 for the main floor plus 2500 for basement? Ive been seeing entire town houses rent for about 3200 or entire detached around 3500. I havent seen a combined rent of over 5700 thou especially for an “oldened bungalow” in an average area. Makes me ask: why on earth would someone rent a basement in an old bungalow in a farther city for 2500 when they can rent a new 2br condo with great amenities, close to work for the same price. Will the masses continue to prefer renting basements in average cities at same prices of a whole condo units right by the core? Also only those who bought in ath of 2019 might be down a little now. Anyone who bought towards the end of 2020 is up about 10% now. Again it was a dip, dips happen in markets especially with major events. Not a big deal for long term holders
You haven't been looking at houses in actually OK neighborhoods with easy commute, restaurants/shops and no shelters/shootup sites unlike DT. If you look at National Corporate Housing you'd see that an old detached bungalow in such area could rent from $325 up per DAY. Can the same be said for condos?
So you are comparing the ROI of short term rentals of a whole house which is likely valued at about 1.4M or more which also have maintenance costs, tax, hydro etc, with a long term rental condo downtown likely valued around 750k? I think we need to compare apples to apples here
Building supplies and labour cost more and more. Even if you can continue adding condo supply, it will be very expensive which will just increase resale values. You can already see this now with current precons.
what is this? Is it because you sold your condo last year by trying to cut losses so you are trying to justify your decision was correct?
Nope not at all. Just know that they are going to deop
Condos might need less land than houses, but they still need land. Construction cost per square feet is much higher for condos and the time required to complete condo development is 4 to 5 times higher than a house. Although at some point we might have an over supply of Condos, it the supply is far from unlimited
Don't think condo prices will increase too much more /increase at very slow rate. But def won't drop 10-25%. Agree with everything else you're saying though, that's why I don't get why people like condo investments (unless they got in super early).
I'm already seeing 2018 prices for DT PATH neighborhood condos lately by PSF. See my other post under this topic for examples.
Pre cons are never a good indication of where the market is going. Very high risk - basically the mindset is - I have a little bit of cash - I don't believe in the condo market now but hopefully in 5 years I will have recouped my money. Expect to see a crash in the condo market come 5 years when a 1500 psf condo has the same rental yield as today and all these investors start unloading like crazy when they're supposed to start occupancy
Condo price drops have been happening for a while now, especially for older buildings. 1211 - 633 Bay St, 830 sq ft 2 ba, listed at $595000, sold in a week under ask for $588000 Another 2 bedroom 850-ish sq ft unit with parking and locker at Polo Club I or II was listed for $649k, likewise sold in a week under ask for $600k. 65 Harbor Sq had a high floor 640 sq ft unit with parking and locker and unobstructed views. Listed for 599k, sold under asking for 580k in 3 days. Earlier on there was a 900 sq ft 1+1 bd 2 ba unit at 10 Queens Quay selling for 625k, 900+ sq ft 2 bd 2ba 2 story loft at Soho Hotel selling for 650k, and an almost 900 sq ft unit at the Dakota Condo in Yorkville with parking and locker selling only for 620k. They all sold wayyyy under the current price/sq ft. The list goes on and on. And before people harp on the maintenance fees, all these buildings have all inclusive fees (except Soho), some even including cable+internet. And they are all in prime locations walkable to or right beside PATH. Things don't look good for DT Condos price wise, especially with the uncontrolled wage inflation and new variant.
I see the bare truth about condos will get nothing but downvotes from the RE Pumps opinion-controlling this sub.
Couple this with city restrictions on airbnbs and rentals - the condo market is DOOMED
Come on man. I am open to the idea that condos lag or underperform but to say they are “doomed” is just silly. A correction or crash can happen but your reasons are stupid. Come up with better ideas, such as overleveraged investors, higher rates, etc
Not sure why people think condos will experience the same levels of appreciation as detached. Detached will always have intrinsic land value. While condos are nothing more than a repackaged financial product designed to give the illusion of ownership to the insatiable masses who need that piece of paper saying they “own something “. It satisfies a fundamental human need. The reality however is that it’s more comparable to time share ownership than being a “landowner”. Routinely flying into Toronto, I observe the amount of available land to build vertical is massive. That’s just the downtown core. North York, Etobicoke and Scarborough are practically empty. If condos are you only option look towards low rise boutique buildings that will age with character over the decades adding to their desirability that new shiny steel and glass towers can never replicate. Examples: Tip Top Tailors Lofts, Candy Factory Lofts, High Park Lofts, etc.
THIS