Statistics for April 2015 show that the average sale price of real estate in the Greater Toronto Area, including all condos, has risen to $667,000. This price is 15% higher than it was in April last year. This increase is a disturbing new high. The average sale price for the city of Toronto itself is now $731,000 (also including condominiums). The danger here is that prices are capable of rising to a breakpoint where Buyers will not qualify for conventional mortgage financing based on income. I have written before about new Buyers entering the market with gifted down payments. If prices continue to rise as dramatically as they have over the last year, those down payments will have to represent an ever larger percentage of the purchase price.
There are two factors that create real estate bubbles:
1) cheap money
2) a prevailing mentality that prices will always go up.
Another concern with a 15% increase year-over-year in the average sale price is that speculators may start entering the market. 15% flipping real estate competes nicely with GIC's or managed stock portfolios. So far, owner users have the field to themselves. The land transfer tax may be enough to keep the speculators from jumping into the market the way they did in the inflationary 80's, but a 15% increase in price translates into a much larger return for the speculator who finances his adventures.
The first quarter of 2015 saw an increase in Lawrence Park real estate. As compared with the same period of the previous year, the price of detached homes rose by an average of 7.25%. In Q1 2014, 61 houses were sold. In 2015, 69 properties changed hands, an increase of 13%. The number of days a house typically took to sell went from 10 days to 14. With 30 days being the average time a properly priced house takes to sell, 14 days on market is still fast-paced. The sales-to-list-price ratio remained at 104%, indicating competition for some properties. The big picture is of a sought-after neighbourhood that continues to increase in value.
In February, 1995, a newspaper advertisement for a new condominium proclaimed The Residences of Lawrence Park to be an “… opportunity to live in one of Toronto’s most preferred mid-city residential neighbourhoods.” The first owners began moving in two years later and the project has been living up to its advertising ever since.
2727 Yonge St. is a healthy example of mixed-use development. Retail outlets at street level encourage pedestrian traffic and the building itself is set well back from the sidewalk. The east-facing units overlook the gardens of St. Hilda’s Avenue. There are 101 apartments, ranging in size between 803 and 2,656 square feet. Amenities include an indoor pool, a guest suite, visitor parking, a rooftop terrace with 3 barbeques, a party room with a kitchen and an incomparable front desk. The entire condominium is wheelchair accessible. Pets are allowed with some restrictions.
“The Residences of Lawrence Park” satisfies the first requirement of any real estate purchase: “Buy location, location and location.” A stroll down Yonge Street to Eglinton Avenue will take you past many destination shops and restaurants. Three blocks north, the shops of Yonge and Lawrence provide the same village atmosphere. The permanence of these shopping districts is underwritten by the subway stations at Eglinton and Lawrence Avenues.
The first choice of empty nesters and downsizers is usually to move within their neighbourhood. 20 years after The Residences of Lawrence Park was first advertised, there are very few alternatives for homeowners wanting to trade grass cutting and snow shoveling for the freedom offered by condominium ownership.
2727 Yonge Street will be a destination address for many years to come.
The sale of 25 Scrivener Square, #1007, as featured in the Toronto Star.
"There were many factors that contributed to this fast sale. Some of those factors include a wrap-around terrace with a gas barbecue, three French door walkouts, direct ..."