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Baby, we got a bubble!?

One recently sold in there for just over 700 a sqft, but that is because they removed the second bedroom. Other units are commanding over 800. But there has only been 5 solds this year and 16 expireds/terminated. Numbers are still unclear with the building.

I do stand corrected as it looks like 800-850 is more realistic. I apologize for my error.
 
drewp said:
CG, as of now yes it is, but I am dealing with more and more people realizing that a 500 sqft condo for 1600 is not worth it.
I am being contacted by couples, friends, sisters, colleagues, students more often than indivduals. This has shifted the last year or so which to me is an indication that small two bedrooms like interested said will be the best return on investment in the upcoming years. I would look for small two bedroom units if I were an investor.

Interested like CG said the luxury condo market is new in Toronto and no one really knows what to expect. Unfortunately you will have to wait a couple of years to see how these units sell. I know Ritz is not a good indication but the projected sales price that some listing agents were expecting have been over inflated. We are seeing the same price per square foot as TIFF, around 750 a square foot, for a project that was supposed to command (to some) close to 1000 square foot.
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drewp. As Ka1 asks, do you think it is because Ritz is unique and not that desirable (no opening windows, 2 elevators, no balconies) or is it possibly the fact they are large units vs. Tiff; for example; I think Tiff is better located but a lot of the units are 600 sq.ft. so we are talking about $450K. Minimum size in Ritz is 1250 sq.ft. so we are talking over $900K. Are larger units at Tiff also $750/sq.ft.

How is it that buyers are spending $1200+ at SL and Trump as Ka1 asks still and $1500-1700 at 4S. Do you think drewp that Ritz is not a good indication of the luxury market or that it is a Ritz specific problem. To be honest, I looked at the Ritz and was totally turned off that there was a) no balcony and the fact that I could not open a window at all and would have to ride 2 elevators each time was a total turn off. Also, the Ritz I hear from some people is not that great re the hotel and service and judging by the pictures does not seem to be much higher quality finishing than Tiff though the appliances and the herring bone floors are nice (and the flat ceilings). The kitchen cabinetry and bathrooms seem similar to mildly upgraded over mid range however. For me, the deal breaker was 2 elevators and no outside space and no opening window. I appreciate the air will be exchanged 5x/day but still, I just could not live there personally. I wonder how many people now that the product is ready look and feel the same way.

Also, do you think that the 94 cents/sq.ft. condo fees are disturbing some as this is an on going expense and will be continuous or do you think that people buying at this price accept these rates. I always felt it was not the cost to buy but rather the ongoing costs to run that most "savvy buyers" would look at. I also have to wonder if Ritz can only get $750-800/sq.ft. what will happen when people realize this and then decide that Tiff does not represent value for larger units. I don't think we can compare the 600 sq.ft. units at Tiff as this is a different market than 1250 or 2000 sq.ft at Ritz. I would think that if I could buy at Ritz or Tiff for $750/sq.ft. for 1500 sq.ft., that I would buy Ritz if I liked both. I would conclude that either Ritz was under priced or Tiff overpriced. Also, a lot of units for sale at Ritz are 2000+ sq.ft. and we are talking about $1.5 million and up; a very different market than most of Tiff. Curious as to your and others thoughts. I personally would expect if Ritz sits on the market that larger units at Tiff will start a downward trend. Also, do you think that the stock market decreases, the bad news out of Europe, the slowdown in China, and the US problems, are maybe affecting the crowd buying $1+ million properties more than $450K investments since the high end tends to read the market more quickly and then the low end follows, I believe?

Lots of questions; would look forward to CG, drewp, Ka1, and others opinions on these questions.
 
Interested, my brain hurts from trying to analyze everything you are saying. Recently at TIFF a unit sold for 800 sq/ft but that was a high end unit. Most units are selling in the 725-750 per sq/ft. At Ritz as low as 710 a sq/ft to as high as 950 a sq/ft. A lot of the 2000 plus units were listed in high 800 to low 900 per sq/ft but didn't sell. Realistically based on the numbers I would say fair value is 850 per sq ft. What I am noticing is that the two bedrooms seem to be in more demand than one bedrooms at that building.

I think on paper a lot of people were drawn to the Ritz name, not taking to account the location and the issues that you had with the place. I really don't like Ritz's location to be honest with you. I don't really see the appeal being at that location for that price point, but that is just me.

I have to say Four Seasons is a completely different beast. Its safety net is its location. For Shangri-La it's hard to say what will happen. I do think SL is in a much better location than Ritz. Lets hope it turns out well. I think first impressions are essential, and I think Ritz missed the mark a bit. We will have to wait to see the finished product to get a better understanding of what Shangri-La will command.

This whole area is still up and coming but was marketed as Yorkville/luxury life. I think it was marketed as such but with the stats suggests that this area is not quite up to the level comparable to Yorkville. With more and more projects being erected in the neighbourhood we will see a steady appreciation, whether that translates to the luxury condo/hotel market that remains to be seen.

What I would like to know is who are these buyers. Are their foreign investors are they world travellers, are they coming from money, do the work down the street? That I don't know, and don't know who would be looking for these specific units. I think part of the appeal to these condo/hotels is the amenities and SERVICE that they provide. So far Ritz hasn't reached the potential that I think most people thought they would. I hope that answers some of your questions.
 
drewp said:
Interested, my brain hurts from trying to analyze everything you are saying. Recently at TIFF a unit sold for 800 sq/ft but that was a high end unit. Most units are selling in the 725-750 per sq/ft. At Ritz as low as 710 a sq/ft to as high as 950 a sq/ft. A lot of the 2000 plus units were listed in high 800 to low 900 per sq/ft but didn't sell. Realistically based on the numbers I would say fair value is 850 per sq ft. What I am noticing is that the two bedrooms seem to be in more demand than one bedrooms at that building.
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if i was in the market for such a property and both were in the $750 psf range, i would go for Ritz vs. TIFF. the features and finishes are a higher standard.

both properties are the nearly same distance from everywhere ... except one is on king w. while other is wellington.
 
Thanks drewp. You answered a lot of my questions. I agree with you that the Ritz location on Wellington while close to things I don't think is great. I agree with your analysis of Yorkville as "the place to be".

I think that SL will appeal to more international and Asian investors. It will not be known to North American and US residents other than business travellers I suspect. I would think perhaps our American colleagues would migrate to Trump as it is more familiar.

I am not surprised that 2 bedrooms are more in demand in the Ritz. Someone buying at the Ritz as a home will want a 2 bedroom or at least a 1 bedroom den which I don't believe was offered.. I actually purchased a 1 bedroom den at SL. I would have liked a 2 bedroom but they faced East (which my wife did not like) or alternatively South but the South had quite a premium(was around $1000+/sq.ft.). Also, there were twice as many 2 bedrooms facing East/ twice as many 2 bedrooms facing South, and twice as many 2 bedroom dens but faced North. I thought with 1/2 a many 1 bedroom dens it would be safer for me as an investment (a pied a terre for me) and the West face allowed for sun (which my wife insisted upon) and also had a 200 sq.ft. balcony which was the largest balcony available (save the Estates above floor 50). I value outside space as you can gather from my previous post and also I liked that I could go on the terrace/balcony from both the MBR and the Living room. So for me, this was the ideal compromise but I am in for about $866/sq.ft (which includes my locker and parking spot). When I add upgrades; another $20/sq.ft. approximately so far. That said, there are no units of my type left and further, the last unit I believe was over $1300/sq.ft. but it was on a higher floor (in the mid 30's or 40's (I don't recall exactly) whereas I am at mid 20's: plenty high enough for me though the view at the mid 30's and especially upper 40's is superior but too high for me personally). Also, some have the 1 bedroom/den with 1 bathroom whereas I have it with a bathroom and a powder room. The bathroom shrinks a bit but having a powder room makes it livable for a couple and it is nicer that guests are not in your main bathroom from my view. Also, however, I sacrificed some bedroom space for this. But it means that of the 30 units of my type; about 14 will be like mine and 16 will be the 1 bathroom/larger bedroom design. Means hopefully when and if I sell less competition for my style of unit.
anyhow, as I said, it is for personal use and meets more our needs but the Ritz selling so cheaply I think will hurt Trump and SL. Not sure if it will affect 4S for the reasons you point out. Yorkville is Yorkville. Since we like theatre and concerts and go regularly, SL location fits our needs better (walk to these events). I hope SL hotel executes better than the Ritz. A promising thing is that SL Vancouver, same developer; was named #1 in the SL chain. Let's hope it carries over to Toronto.
 
Mortgage rules should be stricter: TD chief

Mr. Clark believes cutting the maximum length on federally insured mortgages to 25 years, from 30 years, would be a good step to slow rising household debt, which hit a new record this week, surpassing that of the United States and Britain.

---

Yes, decreasing it from 30 to 25 would slow lending. However, you know what? Personally I think 30 years max is fine.

Rising interest rates, when they finally do actually happen, will slow lending enough IMO.
 
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cdr108 said:
according to this R/E blog, the Iranians comprise the bulk of foreign buyers, not the China chinese as noted by other sources. According to high-end developers and agents, Iranians are biggest client group for real estate sales.


http://www.torontorealestatedirect.com/toronto/22-the-foreign-appeal-of-toronto’s-real-estate/


if it's not one group, it's another ... boiler room pump and dump
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There is no date on this blog. It seems to be quite old. On the right hand side, archive9 previous) blog is dated August 2008. It seems that this blog was posted around this date.

Needs to be completely ignored.
 
Condo George said:
Lux condo concept is new to Toronto, will take time to see upward price appreciation.
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I honestly don't know whether to laugh or cry at the absurdity of this statement.

Luxury condos are new Toronto, eh?

The many residents of:

-The Prince Arthur
-1 St. Thomas
-The Windsor Arms
-10 Bellair
-80 & 100 Yorkville
-The Regency
-The Hazelton Hotel
-The Renaissance Plaza (in it's day)
-77 Avenue Road (in it's day)
-The Benvenuto (in it's day & now)
-The Lonsdale (in it's day & now)
-The Balmoral (timeless)

...And I'm certain I'm overlooking dozens of buildings....

Would beg to disagree with your offensive assertions no doubt.

The reality is that the market for units at the Ritz is probably about $850 psf depending on the floor, layout etc. We shall all see where the market for the other *NEW* luxury buildings settles.
 
Good work CN, I was meaning brand name hotel/condo such as Four S, Shangri La, Trump, Ritz etc are new to Toronto But I could see how you might have perceived it as above.
 
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Condo George, Your one post has elicited lots of responses and made this thread 'live' again.

Please come back here periodically.

Never mind the bricks that are thrown at you:)
 
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