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Baby, we got a bubble!?

urbandreamer said:
I heard through the agent I know that presale pricing is starting to come down, around $475-$525PSF downtown. Condo George--or any other agents--what have you been hearing/seeing?
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I have not seen any price reduction in presale, the only projects with that price range $475-$525 psf are on the east side like Trinity, Sync, King east, Ninety or the west like Liberty Village, queen west. but downtown core you do not find anything less than $575-$600+ psf.
 
urbandreamer said:
I heard through the agent I know that presale pricing is starting to come down, around $475-$525PSF downtown. Condo George--or any other agents--what have you been hearing/seeing?
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what kind of projects are we talking about here?

if it's stuff like carturo15 mentioned, then that's not really a discount.
if dt core, then that's more appealing but still $$$ IMO.
 
This is put on the UT projects today. I copied it and put it here as I think it is relevant to what is being discussed. It is by Brian Persaud.

I have bolded what I think is really telling: Bisha #1 at 29% sold. Other launches less successful. This is a marked drop from last years successes.

To me the real message is "look for incentives". This is effectively a price reduction in a different form. Could add to UD's comment that he heard presale pricing is starting to come down. Can price decreases be far behind when they are effectively being offered (for eg. Free parking spot) brings the costs down.REal Experts GTA Condo Report
Project Developer District #Units Sold $/PSF
Bisha Lifetime King/Spadina 334 100 $743
Chaz on Charles Edenshaw Yonge/Bloor 324 77 $663
Ventus 2 Metrogate Tridel Kennedy/401 314 56 $430

In July there were 861 sales (down 33.4% year over year)
Year to Date 2010 - 12,193 sales (up 78.4% from last year)
Unsold Inventory - 14,657 units (down 3.5% last year)
More Info check out Project Developer District #Units Sold $/PSF
Bisha Lifetime King/Spadina 334 100 $743
Chaz on Charles Edenshaw Yonge/Bloor 324 77 $663
Ventus 2 Metrogate Tridel Kennedy/401 314 56 $430

In July there were 861 sales (down 33.4% year over year)
Year to Date 2010 - 12,193 sales (up 78.4% from last year)
Unsold Inventory - 14,657 units (down 3.5% last year)

Observations

Significant drop is sales from July 2010 and August 2009 (HST?)
YTD sales still much higher than last year. This is still a fantastic year and ranks only behind 2007 in volume

Index pricing up 9.4% this year and up 50% over the past five years

Opening month is not going as well as previous years. Bisha at #1 sold 29% of its units.Tridel doing a great job working the broker channel selling Ventus II

Big drop off from the top selling project to the 5th best selling project
Developers have stepped up market efforts and doing a great job with being innovative
Lots of broker anticipation for Tableau and Backstage this month should cause a sales uptick for October. After November, real estate agents and buyers historically start slowing down

Conclusions same from last month:


29+ launches set for fall, REal Experts expects to see sales fall and incentives to go up
Source: Real Net and the Lyon Report, pic from UrbanToronto (taken by udo) Posted by Brian Persaud at 5:37 AM
Real Experts Inc is a real estate investment company that is focused on delivering above market returns to its investors and to provide in depth real estate market research to the general public. Real Experts Inc is your source for up-to-date real estate market research and information.

Our research looks at 8 key local market conditions and trends that drive long-term real estate value appreciation. We consult with various government groups (local, municipal and federal) and private research organization to compile market data. All pertinent data points and information are analyzed – both the economic and real estate specific variables.
 
Interestingly, I was in Bisha yesterday for about an hour and while I love the concept (although it would get tired very quickly), it's prices are out of whack. I was the only one in there for the whole hour. This did contrast however to a very busy Post House sales centre I visited on the weekend. There's only one decent unit in the entire building so while it didn't impress, clearly there were others that it did. I also visited The Mercer and it has firmly skewed itself down about 15 years in its revamp. I don't think it will be more successful as they've missed the timing boat and won't open to the public until November. While I can only think of 1 project that died during the recession, I think we will see at least 5-10 die in the next year dwntn. We've overbuilt and need time to catch up.

As for prices. Speaking to a sales rep, Bisha is offering the same prices to the public as it did to its brokers and VIP's (not on the price sheet but in reality). This is also a very serious form of discounting and only the tip of what I think is a very big iceberg. Remember, just a year and a half ago, X was selling units at 25% discounts. It can happen again.
 
builders will try to keep prices up and offer incentives. Of course, the usual thing is to offer upgrades which are vastly overpriced as it appears they are offering more than they really are.

For eg. Upgrades of $30000 may cost $10 to 15000 for the builder and is much better sounding than a discount of $10000 which is not so much from the buyers viewpoint and doesn't sound nearly as enticing as $30000.

To get back to 25% discounts however Simuls will require a mass psychological shift to that which existed 1 and 1/2 years ago. While I agree things are bad and probably worse than alot of people realize, it would take a crisis again (like subprime or meltdown of stockmarket) to bring on these type of discounts.
 
The "new" Imperial Plaza conversion/new build addition is rumoured to be priced starting at $580psf up to $900+psf, and this apparently after a rumoured $25K in pricing was adopted internally by developer Camrost-Felcorp. Pricing: $300K to $3million.

I don't consider Avenue Road and St. Clair West to be dt, but I do question whether it is worth even that.
 
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cat said:
The "new" Imperial Plaza conversion/new build addition is rumoured to be priced starting at $580psf up to $900+psf, and this apparently after a rumoured $25K in pricing was adopted internally by developer Camrost-Felcorp.

I don't consider Avenue Road and St. Clair West to be dt, but I do question whether it is worth even that.
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Can you calify " a rumoured $25K in pricing was adopted interernally by developer Camrost Felcorp?
Thank you.
 
cat said:
The "new" Imperial Plaza conversion/new build addition is rumoured to be priced starting at $580psf up to $900+psf, and this apparently after a rumoured $25K in pricing was adopted internally by developer Camrost-Felcorp.

I don't consider Avenue Road and St. Clair West to be dt, but I do question whether it is worth even that.
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Avenue Road and St. Clair West have several high-end condos going up, so they are probably trying to capitalize on it ... ($600 PSF is expensive IMO but that's another story)

plus, the original Imperial Plaza supposedly has some very nice features and luxurious finishes that will be revitalized.
 
interested said:
Can you calify " a rumoured $25K in pricing was adopted interernally by developer Camrost Felcorp?
Thank you.
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Sure, I heard that while management wasconsidering initial pricing this summer, those suggested "Manufacturer's Retail Prices" have been slashed by $25,000. Of course, I do not know this for sure. Perhaps someone else has heard more.

The development has not been formally launched but selling is expected to start sometime in November. They are already taking brokers through on building tours.

They also seem to have "beefed up" some extras. I hear that they may adopt an "add your features" a-la-carte menu to the pricing. New greenspace added and I think they are also considering adding another building (designed by Pontarini?) on the SE side of Imperial Plaza, so as not to obstruct the south views.
 
cat said:
Sure, I heard that while management wasconsidering initial pricing this summer, those suggested "Manufacturer's Retail Prices" have been slashed by $25,000. Of course, I do not know this for sure. Perhaps someone else has heard more.

The development has not been formally launched but selling is expected to start sometime in November. They are already taking brokers through on building tours.

They also seem to have "beefed up" some extras. I hear that they may adopt an "add your features" a-la-carte menu to the pricing. New greenspace added and I think they are also considering adding another building (designed by Pontarini?) on the SE side of Imperial Plaza, so as not to obstruct the south views.
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This is a building that will attract mostly empty nester end users. They are much more careful and scrutinizing than the herd lining up for units in the multi-level-marketing-schemes.

I wouldn't be shocked if this deal craters though. It's a monster building and will be difficult to attract so many demanding buyers pre-sale. Can't imagine that's an easy retrofit either.
 
urbandreamer said:
I think a price war is beginning between Studio/Mercer/Tableaux/Adelaide Residences/etc--expect to see huge discounts by end of January imo.... How low can they go? $450PSF?
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what happened to your prediction that sales and prices are going to pick up later this year ?



carturo15 said:
it won't happen, maybe we wiil see some incentives
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isn't that relatively the same thing when incentives/discounts are taken into account ?
 
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