vita on the lake

How To Make Money Buying Pre-Construction Condos

Posted by neil on February 28, 2017
General / No Comments

 

 

Hi There,

 

I hope you are doing well.

Today I would like to talk to you about:

Renting VS. Buying A Pre-Construction Condo In Toronto.

 

If you are familiar with what is going on with the real estate market in the Greater Toronto Area (GTA), you probably know by now that the market has gone completely Bananas.

There have been massive price increases all over the GTA with all different property types.

Many knowledgable experts say that the real estate market here is changing forever.  In that, Toronto is finally becoming a true international real estate market, similar to London, and Hong Kong.

With the transformation of the Toronto landscape occurring, this is having a ‘ripple effect’ on the housing prices all over the GTA.

If you own real estate in the greater Toronto area, you probably feel like a champ.  The price gains have been great, and life is good for you I am sure.

If you don’t own any real estate, and you are on the ‘outside looking in’, things may seem a lot more depressing for you.

You might be wondering to yourself how you will ever be able to afford anything in a market like Toronto where the prices keep on going up.

 

The Reality

 

The reality my friends is that for the people who sit back and do nothing, life will get a whole lot more depressing because they are going to get priced out of the market…. and priced out FAST.  

The market is moving so fast, it is leaving people behind in the dust.

This may seem like an overly dramatic statement, but let me qualify it.

As a Real Estate Broker who specializes in pre-construction and residential re-sale all over the GTA, I see first hand how prices keep on going up, and how people sitting on the fence are getting priced out and left behind.

If have the capacity and the finances to get into the real estate market, my Goodness man… DO IT!

Here is a quick and basic math exercise to show you the benefits of taking action and not sitting back.

 

Renting Vs. Buying a Pre-Construction Condo in The Greater Toronto Area

 

Let’s pretend that you are a youngster. (If you are not already one)

Or you can think of a youngster that you know  (your child, neighbour’s kid, nephew/niece) that is eager to buy something in the real estate market in the GTA.

A lot of youngster rent.  We know this.

What we also know is that for many new condo projects in the GTA, approximately a 20% downpayment is required by the builder.  

We also know that depending upon when you buy into one of these projects, the completion date can be up to 4 years into the future.  

So now let’s do a little bit of math… shall we?

 

Time For Some Math…

SCENARIO #1

 

In scenario One, the youngster is renting a one bedroom plus den condo somewhere in the GTA.

Let’s assume that he or she is paying $1850/month.  Sounds fair?  I think so.

Depending upon the location of where they are renting, this price will obviously change.

Let’s go with $1850/month.

Without looking at inflation and rent increases, let’s say that they rented for the next 4 years.

The total amount of money that they would have put towards their rent payments over this time would be:

 

$1850 * 12 months = $22,200

Now multiply $22,200 by 4 years = $88,800.

 

Therefore, over 4 years, $88,800 would have gone towards rent.

 

SCENARIO #2

NOW let’s look at a scenario where at the start of those 4 years, the youngster purchases a pre-construction condo in Toronto instead.

Just so we can keep this math simple ( I am NOT a math whiz), let’s assume that the youngster bought a pre-construction condo for $330,000 somewhere in the GTA.  Does that purchase price look fair to you?  I think it does!

 

So the condo at the time of purchase is $330,000.  

 

Let’s also assume that there is a 4 year window for completion.  Since it is February 2017 at the time of writing this, let’s say the occupancy date is Feb 2021.

 

Unless you are always looking for the sky to fall on you, it is an accurate prediction to say that the real estate market is going to continue to rise in the GTA over these next 4 years.

 

Now here is the $1 billion dollar question……

 

How much will the market go up by?

 

Given that the real estate market (detached homes) in Oakville, Ontario went up by 38.4% year over year from November 2015 to November 2016 , would it be a fair assumption to say that the market will go up 5% per year in the condo market in the GTA?

Is that too high?

You think it is?

Okay, fine.  Let’s be super, ultra conservative and say that the market only goes up 2.5% per year.

This figure may seem ridiculously low to those of you who understand what is truly happening with the real estate market in the GTA.

Okay… let’s assume a 2.5% increase in the market, over the next 4 years.

Okay… here we go.

 

Purchase price of in Feb 2017:   $330,000

Price in Feb 2018 – $330,000 * 2.5% = $338,250

Price in Feb 2019 – $338,250 * 2.5% = $346,706

Price in Feb 2020 – $355,374

Price in Feb 2021 – $364,258

 

So as you can see, by using an abnormally low figure for appreciation at 2.5%, this condo that the youngster purchased, will have gone up $34,258 over 4 years.  

Keeping in mind that experts predict that the market is going to rise a lot higher than this.

Even if we take these low numbers and compare them, this is what we find.

 

Comparison

 

If the youngster buys real estate, he or she would have made $34,258 in equity appreciation over these 4 years.

If he or she had been renting over these same 4 years, based on our figures, it would have cost them $88,800 over the same 4 years.

There are of course other variables and factors to consider when running these types of numbers, but from a high level you can see that it pays off financially to buy real estate and get into the market now.

If you are interested to get into the market, and don’t know where to start, here are some options for you:

 

Vita On The Lake By Mattamy – This is my favourite pre-construction project currently.  It is being built on the shoreline of Lake Ontario.

 

Time And Space Condominiums – If you buy early here, you are going to make a lot of dough. The project is in the Downtown Toronto Core.

 

Liberty Central By The Lake – Awesome if you want to live in Liberty Village now.
EMPIRE: Rain And Senses – Amazing furniture package of $10,000.  Limited time offer.

 

To Your Success!

-Neil

ps: I am a Real Estate Broker and a VIP Realtor.  I specialize in pre-construction projects and residential resale in the Greater Toronto Area.  I have access to over 100 new condo projects all over the GTA.  Sign up  to receive special builder DISCOUNTS and INCENTIVES that you cannot get from going direct.  To your success!

 

 

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Unobstructed Lake Views

Posted by neil on February 27, 2017
General / No Comments

Hi There,

I hope all is well on your end.

Vita On The Lake By Mattamy is a new condo project in Toronto that I really like.

I talk about the pre-construction condo in length in my recent blog post here: Vita On The Lake By Mattamy

If you missed my earlier blog post, I recommend that you read it.

To summarize this earlier post for you, I really Vita On The Lake By Mattamy  for a number or reasons.  2 of these reasons are:

  • A) The Location
  • B) The Builder

Let’s talk about the Location first…

A) Location

If you are not familiar with the Humber Bay in Toronto, you are missing out.  Below is a picture that shows you where Humber Bay is located:

 

That “Blue” you see in the picture is Lake Ontario.  Vita On The Lake is being built on the shoreline of Lake Ontario!!

 

According to Mattamy, this building is now approximately 75% SOLD OUT.

This should not come as a surprise to anyone that is familiar with the Toronto real estate market, any major real estate market for that manner.  If a builder builds condominiums on the shoreline of a water body in a major city, they are obviously going to sell fast!

 

B) The Builder

Now let’s talk about the builder, Mattamy.

Mattamy is a HUGE builder that is extremely reputable.

Buyers are comfortable in dealing with them because they have a proven track record of delivering a superior product.

As a VIP Realtor, I enjoy working with them as well.  They are extremely organized and I like the technology they use in their Presentation Centre for Vita On The Lake.

ie: Through an interactive touch screen TV, you can pick any suite in Vita On The Lake, and you can see a panoramic view of  Lake Ontario and The City of Toronto, from the perspective of the suite that you have just selected.  For example, you can see your viewpoint from a suite on the 5th floor or a suite on the 46th floor!

 

What You Need To Know…

 

Mattamy is doing a final “push” on some of their HIGHER END suites, as well as some of their unsold LOWER priced suites.

Mattamy is still offering incredible builder incentives through VIP Realtors (such as myself).

 

If you don’t know, VIP Realtors (like myself) have special relationships with builders.  We get discounted prices and special builder incentives for clients, that you cannot get by going directly to the builder.  

 

So if you are interested in pursuing a suite in this building, be sure to contact me…

Here is a description directly from Mattamy’s marketing department on the remaining suites that they are selling off at Vita On The Lake:

 

BIG.  BOLD.  BEAUTIFUL.

CORNER SUITES WITH UNOBSTRUCTED VIEWS OF THE LAKE AND WRAP AROUND BALCONIES.  WHO COULD ASK FOR ANYTHING MORE?

These two bedroom plus den super suites featuring oversized bedrooms and closets, are now available on floors 46 through 49 in Vita On The Lake.

The suites are as impressive as the unobstructed south and east views that you’ll enjoy from the Humber Bay shoreline to the downtown skyline.  

At Vita On The Lake you’re close to Pearson Airport and downtown and as close to perfection as lakeside living can be.  

Contact your VIP Realtor and visit the Sales Centre with them today.  

 

 

If you have any questions regarding Vita On The Lake By Mattamy, feel free to email me direct at:

neil@firstrentalproperty.com

 

Sincerely,

Neil

ps: Here are some pictures of Vita On The Lake…

 

 

 

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