[urbandreamer]

Has anyone else walked by Cresford's Quad Lofts complex recently? I did and was surprised (or was I?) to see the entrance way looking like a dump: metal siding hanging from the ceiling, ripped and bashed in trim details, and more all on public display! That place looks more like a trailer park ....

 

[avatarreb]

Name-calling and bashing will not be tolerated.

While your opinions and insight can be interesting, it's not helping at all when you resort to such language.

You've been warned.

My Thanks.

 

[investor]

My Thanks.

Name calling? I responded to this guy's rude remarks with rude remarks. Quid Pro Quo Mod Man.

 

[I-Z1]

I responded to this guy's rude remarks with rude remarks.

How very mature of you, developer.

 

[JasonParis]

Investor, you've been warned and continue with the names. I've erased your posts and the mods will be dealing with you soon.

 

[simuls]

A little unfair...

After watching this show I have to say that I thought they treated the CanAlfa developments in Liberty Village a little poorly, especially the woman representing the development.

I'll fully cop to my bias because I did buy a suite in the Towers from her, but having dealt with almost every condo developer in downtown Toronto I must say that she was the most upfront, willing to negotiate and straight shooting developer's agent I've ever dealt with. Most won't tell you to go to a lawyer and will leave you to your own devices, most won't point out that unless it's in the contract it means nothing, most won't point out what is an upgrade and what isn't, and most won't care if you have issues after. CBC also neglected to point out that every model suite at the CanAlfa sales site has a prominently displayed disclaimer dealing with what is and isn't included - although I must admit that the extra 5 feet in the bedroom is a cheap cheap ploy on CanAlfa's part. I thoroughly researched the company before buying and talked to numerous people in their townhomes and some had horror stories and some were just fine - pretty much the same type of pattern I've heard from people at the ICON and ELEMENT (Tridel), DNA (Canderel-Stoneridge), and various Freed developments. It seems to be a crap shoot - even within the same building as several trades companies can all be working at once.

All the above being said, however, building on the Liberty Village Tower was supposed to start in October of 2006 and there is only a hole in the ground right now because they're combining the construction of the Towers, Bliss, Lofts and townhomes into one event. I'm fully planning on a May-December 2010 possession. 2 years late - but quite frankly, who cares? All they have is my 10% and my suite has already increased in price by 150000. Even if a condo bubble bursts and prices drop 25% (an unheard of amount that has never happened before in Toronto and isn't even happening in the hardest hit places in the US) most people who bought will still make some money.

As in any financial transaction, and this is the only way to look at real estate, it's buyer beware. Do the due diligence, get a lawyer, go with a developer with some sort of a decent track record and, with a little luck, you'll be just fine and will probably make some money along the way.

Oh, yeah. That lawyer was ridiculous in the assurances he wanted. Also, as long as you have the square footage on your contract floorplan you're protected by Tarion for anything over a 2% variance.

 

[SpadinaBus]

Has anyone else walked by Cresford's Quad Lofts complex recently? I did and was surprised (or was I?) to see the entrance way looking like a dump: metal siding hanging from the ceiling, ripped and bashed in trim details, and more all on public display! That place looks more like a trailer park ....

I walk by it everyday and I know what you mean. A neighbour who lives in there told me that these issues are as a result of disputes with Cresford about common elements deficiencies.

 

[dosbox]

Oh, yeah. That lawyer was ridiculous in the assurances he wanted. Also, as long as you have the square footage on your contract floorplan you're protected by Tarion for anything over a 2% variance.

His point was that while your total square footage might be in the ballpark, the floorplan itself is meaningless unless the dimensions of each room are laid out - as demonstrated by the young couple who were missing their "walk in" closet.

 

[investor]

. Even if a condo bubble bursts and prices drop 25% (an unheard of amount that has never happened before in Toronto and isn't even happening in the hardest hit places in the US) most people who bought will still make some money.

This statement is incorrect. In many parts of Florida, Arizona, and California, prices have fallen more than that already and are expected to continue sliding. In addition, condo prices in Toronto collapsed in 1989-1990 by effective about 40%-50% virtually overnight due to speculation and the manufacturing led recession.

Never count your money until it's in the bank. You are a speculator and sooner or later you will get burned.

 

[JasonParis]

I don't think this has been posted yet, but "Condo Crunch" can be watched here:

http://www.cbc.ca/marketplace/2008/01/09/condo_crunch/

 

[screenplaying]

I don't think this has been posted yet, but "Condo Crunch" can be watched here:

http://www.cbc.ca/marketplace/2008/01/09/condo_crunch/

I hope people also read the comments on that page. This was my fave:

Great show...I purchased a brand new condo in 2006 from Tridel. It's been nothing short of a nightmare. The show is completely accurate. Caveat emptor is definitely the rule. The huge problem I have run into is with the developers' complete disregard of the many serious deficiencies in the building and in the units themselves. Several fellow unit owners have either the same complaint or worse. They truly do not care and their level of disrespect towards us, their "customers" is appalling. Its just as you say in the show, it's either go ahead and sell your unit at a huge loss and buy another condo at a higher up-market price or hire a lawyer which costs more money without any guarantee of success and an indefinite court ruling timeline. Contact the City of Toronto and ask for building inspectors to come over and have a look, merely wasting your time. I'm now totally convinced large developers have city officials in their back pocket. Write letters and emails of complaint, happy trails...an exercise in futility. Report the issue to Tarion...another waste of time. How Tridel ever won the "Developer of the Year" I honestly do not know, it's mind boggling in fact. And to add fuel to the fire the developer owns the property management company plus the utility company providing the electric service to the building and all the suites...all 900+ units owners pay a monthly "administration" charge to the utility company, called Provident, to the tune of $9.50...if you do the math on an annual basis, a really nice chunk of pure profit at the expense of the unit owners. And lastly, if you think you can seek the assistance of your condo corporation's board of directors, think again. The property management company and thus the developer by extension have very tight reigns on the BODs.

A finger in every kickback pie. And I love those total crap bullsit industry awards. The kiss-your-own-ass cost of doing business. Always expensed under 'advertising'.

 

[I-Z1]

The huge problem I have run into is with the developers' complete disregard of the many serious deficiencies in the building and in the units themselves.

This is extremely common for property developers in Toronto. Life safety issues are also disregarded by developers and the city.

 

[simuls]

First off, I'm not a speculator or what one may even call an investor. I own a condo, that I live in, and bought another one, that I also plan to live in when it's complete.

Secondly, there are marked differences between the overall market in 1989-90 and 2008. Interest rates were at 11%, ours are at 4.25% and lowering, inflation was at 8%, ours is at 2%, unemployment was 10%, our is 5.5% - these numbers in 1989 had been around a while and weren't just a result of the recession.

Another reason the condo market went bust - on top of the above financial reasons was that the developers were building condos without presales. They would sell 10% of the units, get the money from the bank, build, and then they had to dump the 90% on the market - when the market could least handle it. Supply was far more than demand, hence the prices dropped. While I'm not saying there won't be a correction (my guess is sometime in 2010), the condo market has evolved from an undesirable alternative to owning a home, to a way of life that is actually desired by many. Until this past year (which is why I think 2010 will be a year of potential reckoning), most new condos were sold to people who actually live in them. Watching the listing:sales ratios and the condo rental vacancy rate will give us the most accurate forcasting of what might happen and right now the vacancy rate is less than 1% in new condos, and the ratio is 1.9:1 (a healthy balanced ratio is 4:1, so it's still very much a sellers market).

It's also important to look at the numbers in the US before the recent runup and collapse. Even with prices dropping some 40% (and I have no idea where you get this number from unless you're including the depreciation of the US dollar into your equation), these homes are still worth more than they were 5 years ago. If you had just gotten into the market, then yes, you're kinda screwed, but just as with the last US home correction - once it had run it's course (which took about 2 years), it only took another 3 years for the homes to get back to their highest valuations. So, like any good investment, it pays to sit and wait out the market. I agree that speculators aren't good for anyone.

 

[investor]

First off, I'm not a speculator or what one may even call an investor. I own a condo, that I live in, and bought another one, that I also plan to live in when it's complete.

Secondly, there are marked differences between the overall market in 1989-90 and 2008. Interest rates were at 11%, ours are at 4.25% and lowering, inflation was at 8%, ours is at 2%, unemployment was 10%, our is 5.5% - these numbers in 1989 had been around a while and weren't just a result of the recession.

Another reason the condo market went bust - on top of the above financial reasons was that the developers were building condos without presales. They would sell 10% of the units, get the money from the bank, build, and then they had to dump the 90% on the market - when the market could least handle it. Supply was far more than demand, hence the prices dropped. While I'm not saying there won't be a correction (my guess is sometime in 2010), the condo market has evolved from an undesirable alternative to owning a home, to a way of life that is actually desired by many. Until this past year (which is why I think 2010 will be a year of potential reckoning), most new condos were sold to people who actually live in them. Watching the listing:sales ratios and the condo rental vacancy rate will give us the most accurate forcasting of what might happen and right now the vacancy rate is less than 1% in new condos, and the ratio is 1.9:1 (a healthy balanced ratio is 4:1, so it's still very much a sellers market).

It's also important to look at the numbers in the US before the recent runup and collapse. Even with prices dropping some 40% (and I have no idea where you get this number from unless you're including the depreciation of the US dollar into your equation), these homes are still worth more than they were 5 years ago. If you had just gotten into the market, then yes, you're kinda screwed, but just as with the last US home correction - once it had run it's course (which took about 2 years), it only took another 3 years for the homes to get back to their highest valuations. So, like any good investment, it pays to sit and wait out the market. I agree that speculators aren't good for anyone.

Well put Sim. I tend to exaggerate my bias sometimes but I agree with most of what you stated above. In my opinion though, the degree of speculation has accelerated and is approaching the levels seen in 89.

In 89 most projects were probably 40-50% presold before construction started. Today that number is probably 60% but the presales are mostly to bogus syndicates and offshore (and onshore) investors. So really what's the difference? Either way you have a shadow supply of units that aren't owner occupied.

I agree that the condo vacancy market should serve as a guide but that info is not at all reliable. Most owners don't care to give out info on whether their units are vacancy or occupied, or even for rent. It is not a matter of public record to know what private owners do or don't do with their suites.

I believe that the speculation that we've seen in 07 will only serve to punish prices with more severity when the big dump hits the market. And I'm not talking about a snowstorm!

 

[cabeman]

All they have is my 10% and my suite has already increased in price by 150000.

Simuls ... is the increase in price you're quoting there a typo? (I bought pre-construction in the King/Spadina area and my unit hasn't increased anywhere near that much).