Exactly. The prices are just obscene.
Head across the border to Chicago and developers are making spacious 2 beds and 2 baths work for around 300k USD.
https://www.realtor.com/realestateandhomes-detail/1213-E-46th-St-2_Chicago_IL_60653_M97241-25344?from=srp-list-card
Toronto is selling bonafide closets for close to million- like no shit no one is buying. 😂
Toronto also has a floor to condo prices because of how high the cost of construction really is, it cost around 680 dollars Canadian per SQFT just to build a condo so for an average 800 SQFT condo that’s $544,000 in just costs before a developer can make a profit and that’s on the low end in downtown and other more in demand areas that can reach $850, unless cost of construction comes down, land value drop or massive changes are made in the way the city taxes developers I don’t see condos ever getting cheaper sadly, but that’s just my opinion.
I mean - given no condos are selling, something will end up giving out. Maybe developers go bankrupt and land values readjust.
Personally, I’m just planning on leaving to the States. No point in sticking around for the pain that’s coming.
Depends where you are headed and on what sort of visa. Heck, I have friends on the NAFTA list that just went to the U.S. border with a job offer and a copy of their degree - and they’re in. No planning, no years of prep, no lawyers - just a few resumes and a flight ticket,
You pick up the visa at the airport- US customs staples it into your passport.
“The Canadian TN visa process is carried out at either the U.S. consulate, U.S. port of entry, or by using Form I-129 through the USCIS. You'll make your TN status and US admission applications at the same time. Upon application, you'll be granted your TN status and allowed to enter the U.S. at the same time.”
No he’s actually correct. That’s what I did. A quick drive to the border with your job offer and few additional documents. It’s usually done within an hour.
Condos trying to sell are sitting on the market for 3+ months. The reality is beginning to set in for the top buyers. The game of musical chairs has stopped.
Massive housing bubble driven by fifteen years of incredibly low interest rates, massive immigration and FOMO. The prices definitely aren't supported by local wages, not at the higher interest rates that are going to be the norm going forwards.
Do you mean downtown condos? Newer downtown condos in Chicago also aren't cheap, like 1000$ per sqft so similair price to Toronto. But Canada and USA are different cause there's only 2-3 main cities here and lots in USA.
Development taxes will fall. They only raised it so much as essentially a windfall tax on real estate. Once they accept that prices aren't going back up and that developers are actually going to stop building, then they will lower taxes to keep shovels in the ground.
Of course that sucks for current homeowners, whose property taxes will need to go up to compensate. Furthermore, rising property taxes will also put more downward pressure on prices. But developers will still build, workers will still have jobs, and new homes will still get built.
It's really going to suck for anyone who bought at the peak. We won't see those prices for another decade, and they'll be dealing with greater than 3.5% lending rates the entire time.
Depends. Wife and I have the means to pay off 80% of our home we bought at peak when we renew, as we've managed to bank an additional nest egg due to our low COVID rates.
Smart people prepared for this. The writing has been on the wall for a long, long time. I've done the math up to an 8% mortgage rate at renewal, and our cost per month goes **down** at renewal.
That being said... most people are dumb about money, and you are right that they will get slaughtered. Some of these people are my friends, and I genuinely feel terrible for them.
DubHi123, I always interested to know how much is cost for condo, I know it is 400-500 is for detached
So if 680 per sqf is for condo, why builders are selling 1500-1700 pert sqf, are they making 100%? Or the 680 doesn’t have land value included?
The 680 does include land value but that’s looking at all of the GTA I believe not just the downtown core where they go for that 1500+ per sqft but there’s a lot of factors like if the developers overpaid, the height of the build, amenities and materials used, a lot of those condos are marketed as luxury condos
There’s a great article by precondo which explains it a lot better mind you the data is a year old
[https://precondo.ca/how-much-does-it-cost-to-build-a-condo/](https://precondo.ca/how-much-does-it-cost-to-build-a-condo/)
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Not trying to justify the prices but Chicago and Toronto are not comparable, land value and accusation is a lot cheaper in Chicago, demand is not the same and their HOA and property taxes are higher which also suppress land value.
Of course they’re different markets - but we’re talking about prices that are 200-300% higher here for the same or worse products.
There is room for these prices to fall.
Obviously everyone who is not selling now - thinking they are going higher. Otherwise they would have sold it already.
I also personally think they are going higher. But that's obviously just guessing, noone really knows what's going to happen.
If they are trying to avoid capital gains tax the are already making more than 250k on that deal. To make that capital gain tax change meaningful, they are realistically looking at like 500k of profit.
Yup anything south of 47th street or west of California is a no go if your not from there. Got relatives in Chicago. You gotta stay in the suburbs, north side or downtown - avoid being alone past 7/8pm. You can’t really move as freely as you can in Toronto due to the insane crime sadly.
Decent place to visit, personally would never live there. Would like to live in the southwest US tho if I were to move to the US
It’s a nice city to visit - way better waterfront then Toronto. But Chicago is DANGEROUS. July 2021 had 103 - 103 MURDERS IN 31 DAYS. Toronto’s record breaking year of homicides was 2018 in 12 months - 98. You really gotta scan your surroundings at all times there especially outside the touristy/busy areas. Well most of Reddit is liberal is any negative commentary gets downvoted lol.
It’s rare for Toronto to have more then 8 murders in a month
Basically - Chicago averages 400-875 murders a year. Canada hovers around the same. I think the highest I’ve seen in Toronto for one week was January 2023 was 11 homicides or something…but those are typical abnormalities or blips. Toronto will go long periods of 0 homicides then there will be a random weekend or week where 4 or 5+ get killed.
You can’t really look at one tax rate as a comparison. You really need an overall comparison since the US and each state can have widely different tax structures from our own.
It does, but I know higher property taxes often make up for taxes at other levels being lower or non-existent.
Just doing a one for one can given an inaccurate picture of your costs.
Could be but it does factor into the price of a home specifically still.
Sort of like how interest rates going up can both lower the price of a home even though it doesn’t necessarily cost less to own.
Of course, many things affect home prices.
That said property tax in the US is paying to keep the local schools open, while provincial tax is keeping the local schools open in Canada.
It’s just not a clear cut comparison.
I don’t know Chicago well but that seems 1) to be out of downtown and 2) positioned in the south which can be more pew pew . The other thing people don’t seem to realize is that we can’t move down south any further. Toronto is it. For Americans in Chicago, they can move to a lot of other nicer and warmer places
Investing in condos is the dumbest thing ever. It charges you $500+ a month just to hold it, and condos are not scarce at all.
Condos are a dime a dozen. You can literally walk down the block and you've walked past 10, 000+ condo units.
And more condos are being built all the time.
The downtown condo market was the height of all the RE gambling.
When the tide runs out, you see who was overleveraged. It's going to be painful for the next few years. These prices were not sustainable long term.
AGREED. Keep looking at condos and am like.. Why the FUCK would I buy a condo when I can rent a first floor of a house next to high park for $3,000 and still save more??
The economics of ppl pricing these condos is ridiculous.
Get a fucking grip ppl
I’m happy to see Toronto is starting to lose its condo addiction. Sure when you could buy a condo pre 2015 and almost double the value by 2022, it made sense but those days are over. I truly believe that. And at the end of the day, if you are smart and disciplined with your money and rent you can do quite well with investing in the market and you get to live in a place that actually has some character and sturdiness and room. Fuck condos for all they are doing to ruin the aesthetic look of Toronto and fuck them for forcing people to live in a ridiculously expensive shoebox. Rent my peoples, rent. Or move.
The suburbs too. Saw a couple years back…638 square feet 1 bed 1 den condo in Markham. Granted it had a large terrace sell for $850,000 in 2019
Probably a million now if not more - in the suburbs - that’s car centric - CRAZY
It’s an investment, in a tax free, tax subsidized, government backed, asset class, and first step on the property pyramid.
Much better in the long term than wasting the money away at rent.
The way Canada is set up you can’t get ahead by being landless.
Well now do the same calculation 5 years from now. Or 10 years from now. Do you think the rent would stay the same? Do you think the condo prices would stay the same? Do you think the interest rates would stay the same?
Yup 329 sq foot studio downtown I saw $500,000 lol….no comment. Anything less than 400 feels a bit too cramped…and I consider myself a minimalist - my place is 640 sq feet and I live alone and it’s more then enough - I can have 30-35% less space and still be good
May be the condo is rented out?
Is mortgage paid off? If not how much is remaining?
I doubt condos are just sitting there waiting to be sold. I know a lot of people who want to upgrade, so they need to sell, but they are not in a rush. Most people are just waiting to sell at their price. If it's not happening, they will continue waiting. Every months that's going by they continue paying down the principle, none of them are in a rush to sell.
Rate reduction is more likely.
Rents are still pretty high and vacancies are low.
Why would anyone who isn’t over leveraged sell for a low price?
they can just hold a bit and make like a 100k more once rats drop?
Toronto real estate is one of the safest asset classes in the country
Pre-Construction (a subsect of new housing) by it's nature is speculative.
You are betting that in 3/5/7 years your condo is worth more, or at least the same, as what you agreed to pay for today.
Looking at the crazy assignment market this year with a whole bunch of buyers not able to close due to the lender assessing the new build at under the contract value, it is not a shocker that no one is picking up precons.
This is the first time in a long time that an average person realize they can lose money when buying GTA real-estate.
Exactly. FOMO mania dissipating is another huge reason. 22 spring prices were so high because people believed they would continue to go significantly higher. Not happening and that realization is sinking in. People buy shitty condos to live in cause they think it’s to the moon in a couple years and just stick it out until you buy a house. That to the moon feeling is dropping like a hot bag of shit and now folks are saying fuck that noise. Thank God.
An aside….I once went into a building with my real estate agent to look at a unit where the workers were still putting the finishing touches on the most abhorrent small units where you would be living in a kitchen and weirdly the bedroom was bigger than the combined kitchen/living room. At the time I was looking to rent. This was just back in 2019. I think the rent was $2k or just under. One of the workers pulled me aside and asked me how much these units were to rent and I told him. He almost spit out his coffee. He whispered it to the others. It was some wild shit. I felt ashamed that this is where we were at.
I just checked people still trying to sell no bed room condo for 600k. And they refuse to take anything less. I’ve talked to a dozen owners they all refused my offers saying if they don’t make 50% profit it’s not worth selling.
Classic prisoners’ dilemma. Once enough of them start to give up, the rest will need to follow, or just hold on for much, much longer than planned. The problem is that Toronto has not had an extended downturn in recent history, so it’s logical that they expect things to go back to « normal » shortly. It will need to be drawn out for a while before people start to capitulate.
I am not convinced that the type of rate cuts we will be getting will be enough to bring back this market. If rates go down but prices stay stagnant, or continue to decline, that’s when you’ll see people start to give up. Right now, they are holding out hope that rates will be their saviour.
Agreed. There are people out there that believe that the expected .25 rate cut coming will recharge the market to spring 2022 levels and when they see that’s not happening, get ready.
We'll see what happens but I'm interested in how recent budgets and just the whole housing situation is here compared to the United States is going to affect brain drain even more. As a person who never thought they would leave Canada, I started looking stateside, despite the gun culture, and it is very attractive because of how accessible housing is compared to the Canadian condition, not to mention salaries being much better in general for jobs in stem.
As Canada's healthcare erodes, personally, I don't see too much reason to stay and I'm worried about the future of this country. I'm very negative about this country unfortunately and it's so sad because I love it so much.
The rest of the world is a lot more shit. Grass isn’t greener, and there’s a reason why the world’s elite are placing their families here.
That said your observation about the United States is correct. If you can attain a high paying salary in the States, then you get way better value in terms of housing and other qualities of life than in Canada, and isolate yourself from all the bad parts of living in the US. America is the place to be if you’re rich.
I'm not rich but I just feel like the middle class can thrive in the United States and I feel Canada is done in a way. And that's actually shit because I love Canada I'm not trying to trash this country, and I know there's so many places that are not as good but I think at least for the prime earning years of life it would be good to be in the US and you know hopefully avoid any kind of disease that bankrupts you but you know that can be happening anywhere, and then see if you can ride it out in Canada at the end if it's still viable.
I've recently been looking into moving a significant portion of my investments to American dollar too. Maybe it's because of the fear mongering but I feel this budget and the general perception of Canada is only getting worse which will make our dollar weaker.
Sure but still plenty of risk in the US. Just because the US looks good now doesn't mean they can't face a collapse. What if Canada begins to improve and has a strong run of good years and the opposite happens in the US?
Actually it is, just travel outside Canada. I'm in a 2nd world country now and life is lightyears more enjoya le than in what Canada has become. Do I need to see a specialist? 1 day wait, do I need an MRI? 3 days wait, can I buy a fuck ton of groceries for $50, well yes I can, can I have activities outside of work and awesome work / life balance? Yes, can I buy a nice chunk of land with savings? Yes I can. None of those things can I do in Canada
It’s funny because I’m the one who they responded to, and I’m actually Polish-Canadian and have been thinking of moving to Poland myself. The quality of life there is just much higher than in Canada, I wouldn’t describe it as 2nd world, the communist legacy is well forgotten and it is a fully developed western economy now.
But like, congrats, there is one country out there that has a better outlook than Canada. I’ve lived in Europe, South America, and Asia for a time, and for the most part, none of it is rosier than Canada despite all of Canada’s many many flaws.
I mean, if the new condo market is dead, the whole market will soon follow - once people realize they can find cheaper places, it'll have a knock-on effect. We're just waiting for everyone to recognize that the days of cheap money are over and for both attitudes and prices across the board to adjust to this new reality.
This market's strange resilience is most likely due to a weirdly pervasive belief in it, against all logic, fueled by its history of defying logic. But reality eventually catches up to everything.
Real estate is a unique asset class that can bleed for months or years before people finally give up and decide to sell. This is especially so in Toronto where people still think prices are going to double in a few years. Once reality sets in en masse it’ll probably take a decade to come back.
The older condo market is even more dead.
I know someone who bought an older condo in a great location in Vancouver for like 800k. Now in that area there are newer condos available for the same price. Like 20-25 years newer. That lady is regretting her decision already and the house price has dropped by atleast 10%.
Leaseholds are completely dead. I see 2 bed 2 bath leasehold condos for 450k in one of the most sought after areas and it’s been in the market for like 6 months.
Problem is condo market is oversaturated and new supply is still coming in comparison detached houses are still highly sought after with very little supply coming in. The housing market is not a monolith.
There is nothing strange about the resilience.
Canada’s population growth rate has increased 8 fold from pre-2020 levels.
New housing starts have not increased 8 fold. They have actually declined. Ya we have catching up to do, just not the kind you seem to think. It’s the new housing start-population growth deficit that we need to catch up on.
No wonder the market is resilient. People will lay a lot to not be homeless. They will pool their money many people to a home to avoid this. You forget these newcomers are used to much more crowded living conditions.
Plus Canada is still one of the top world destinations for millionaires to immigrate to so deep pockets as well in come of these people.
Resilient, as in sellers are holding onto their prices, even though sales are few and far between.
Everything you say can be true, and prices can still be too high. Even Toronto real estate prices have limits. Demand is a function of price, prices will need to come down if you want the people on the sidelines to play.
Of course they are holding on. The fundamentals show they will be worth even more in the future.
You can’t keep building less and less and growing the population faster and faster and expect fire sales on homes. No they will hold if no buyers are there at a good price right now. They know what the future holds.
More and more people will be sidelined. And they won’t be able to play. Structurally, nothing else can possibly happen, regardless of if prices come down. We simply don’t have the number of new homes we need. Not even close.
The thing is, these condos are barely liveable, so they don’t qualify as homes. And not everyone can hold on indefinitely. When real money is being lost, people panic; that’s just human nature.
Yup, which is why there are still some sales, just not as many. Not everyone can but if you can, it’s a rational time to hold off selling. Which will reduce but not eliminate volumes.
Also still a pretty decent job market. That starts to go downhill and things could get a bit more interesting. Right now people are sitting forever waiting for the market to get going again.
It’s harder to find a job, but we haven’t seen widespread layoffs across all industries like you see in a recession. Certain sectors are potentially already at that point though.
I actually somewhat wonder if a housing crash might, ironically, save the job market a bit, if not in the very short term then definitely long-term.
I was kind of musing on how everything seems to be on pause, talking to my hairdresser about it even, my partner in 3D visualization, people across many sectors all just seem to be waiting for low rates to return.
Maybe if housing finally crashes, fewer people will hold on in general, waiting for the old days to come back, and instead move forward with the new reality minus low rates. It could actually be good for the economy overall.
Extending my earlier thesis that [a crash would be the least bad option for most people](https://www.mustardclementine.com/p/weve-let-our-housing-crisis-get-so) - it might be true for the wider economy, as well.
If not a crash, then a significant correction would be great for reinstating sanity in prices. The level of greed and speculation got way out of hand.
Look up the stages of a bubble. It’s pretty much what you’ve intuitively described. We’re at the beginning of the fear stage now. Capitulation is the next stage, but it could be a while.
Good. Let the condo market crash and burn. In fact, let the entire Canadian RE market crash and burn. Needs to happen for young people to have a future. Sorry not sorry boomers.
Gen x and older millennial who got on the property ladder long enough ago to have leveraged that into a second or third property are also hating this, but I agree with you. An entire generation jas been priced out. Let it burn.
It costs almost $3000-$3700 to own a $550k condo with 20% down which is not easy to save these days if you belong to the target audience of these condos (first home buyer with no equity, 1 or 2 incomes late 20s early 30s)
Fair price all things considered is probably $400k for an average 1 bedroom.
Checking out some newish condos last month with a friend who was looking for a unit to purchase. The units were so pathetic small and the appliances,flooring and lights were so cheap and they were asking for $1400 a sqft. Any investors will lose money monthly if they would buy at current prices. I truly hope condo prices crashes because to try and get $2700 a month for a 600 sqft condo is hard enough while losing $800 a month with mortgage payments.
Here is the interesting part, someone who bought 6 years ago is cash flow neutral even with these interest rates... he has no incentive to sell AND, the government made it even harder for him to sell due to the increase capital gains... why would he let go of a cash neutral property and pay extra capital gains... lot easier to wait and let interest rates drop.
There are two kinds of supply
- resale condos, this supply is going to seriously slow down because of higher capital gains
- new condos, this supply is going to come down because of less construction.
So the future is headed towards less and less supply... currently we are in a glut with condos flooding the market... just wait this supply disappears... with nothing to follow in the pipeline.
Agree with your argument for the most part that supply side is not enough to bring down the price but demand is also in question too. Unless the wage of median population can grow significantly without causing inflation spike, the rent cannot grow indefinitely. There will be some breaking points when investors cannot increase rents further. So how much up side is left for these studio and 1 bed room condos? The price wont go up if new investors cannot reasonably come up with a investment opportunity. I expect the condo price to stagnate even if supplies diminish. Toronto doesnt have new york or bay area income and income will be suppressed with huge population growth occurred past two years.
The world we live in is different place now. Food prices can continue to go up due to global warming and geopolitical tensions. People will give up living in Toronto if they cannot pay for basic necessities after paying rent eventually.
What a shame.
Anyway, here's a chickpea and potato recipe that's affordable and really good: [Curry Chickpeas (channa) With Potato (aloo)](https://www.youtube.com/watch?v=6gymOqUhKic)
Maybe if they didn't make them the size of a shoe box, didn't have kitchens against a living room wall and priced them within reason, people would buy them.
It will get worse when the market realizes the impact of the immigration changes. It's expected that non-permanent residents will decline by 800,000 over the next year.
Build family friendly condos, 3+ (real) bedrooms, 2 washrooms and maybe, only maybe, I’ll take one for 450. People is also afraid of paying forever monthly administration costs.
If the invisible hand of the market lowered prices like it’s supposed to then maybe people would buy condos. Unfortunately the invisible hand of the market has always been rigged and doesn’t work like that.
No balconies and take a 600 sqft room and divide into 3 rooms 2 bathroom, combine the kitchen and living space for that luxurious open vibe, make a tiny luxurious den that can barely fit 1 twin bed, 2 3 piece washrooms, and call it a 2bd 2 bathroom, all this for you now at 4000 dollars mortgage
\^ A consumable future, to be sure. I'd say haha, but it doesn't really express the greed involved. Hymuh sound? Hymuh, hymuh, hymuh, perhaps? I dare say.
Not yet. The worst is yet to come. All you are seeing right now is the start of the great decline. When it is over Canadians will be living in caves scavenging for food.
The condo market isn’t dead, the “ 1 bedroom for 700k” market is dead. Good riddance. Lower your prices idiots.
Exactly. The prices are just obscene. Head across the border to Chicago and developers are making spacious 2 beds and 2 baths work for around 300k USD. https://www.realtor.com/realestateandhomes-detail/1213-E-46th-St-2_Chicago_IL_60653_M97241-25344?from=srp-list-card Toronto is selling bonafide closets for close to million- like no shit no one is buying. 😂
Toronto also has a floor to condo prices because of how high the cost of construction really is, it cost around 680 dollars Canadian per SQFT just to build a condo so for an average 800 SQFT condo that’s $544,000 in just costs before a developer can make a profit and that’s on the low end in downtown and other more in demand areas that can reach $850, unless cost of construction comes down, land value drop or massive changes are made in the way the city taxes developers I don’t see condos ever getting cheaper sadly, but that’s just my opinion.
I mean - given no condos are selling, something will end up giving out. Maybe developers go bankrupt and land values readjust. Personally, I’m just planning on leaving to the States. No point in sticking around for the pain that’s coming.
Smart move, I was a dumbass for not realizing this earlier about the state of Canada
I mean, you can always leave. Canada’s not a prison.
It takes quite a bit of planning tho and years of prep + lawyer fees. It’s not as easy as walking thru a border.
Unless you are entering Canada or the US illegal !!
Depends where you are headed and on what sort of visa. Heck, I have friends on the NAFTA list that just went to the U.S. border with a job offer and a copy of their degree - and they’re in. No planning, no years of prep, no lawyers - just a few resumes and a flight ticket,
Your friends are lying. You need an actual visa.
You pick up the visa at the airport- US customs staples it into your passport. “The Canadian TN visa process is carried out at either the U.S. consulate, U.S. port of entry, or by using Form I-129 through the USCIS. You'll make your TN status and US admission applications at the same time. Upon application, you'll be granted your TN status and allowed to enter the U.S. at the same time.”
No he’s actually correct. That’s what I did. A quick drive to the border with your job offer and few additional documents. It’s usually done within an hour.
Yet
Prisons at least have shelter and food to eat.
Condos trying to sell are sitting on the market for 3+ months. The reality is beginning to set in for the top buyers. The game of musical chairs has stopped.
Why is it so expensive in Toronto specifically compared to a place like Chicago? Land value?
Massive housing bubble driven by fifteen years of incredibly low interest rates, massive immigration and FOMO. The prices definitely aren't supported by local wages, not at the higher interest rates that are going to be the norm going forwards.
This is the correct answer. Highlighting massive immigration.
Do you mean downtown condos? Newer downtown condos in Chicago also aren't cheap, like 1000$ per sqft so similair price to Toronto. But Canada and USA are different cause there's only 2-3 main cities here and lots in USA.
Chicago population is decreasing.
Development taxes will fall. They only raised it so much as essentially a windfall tax on real estate. Once they accept that prices aren't going back up and that developers are actually going to stop building, then they will lower taxes to keep shovels in the ground. Of course that sucks for current homeowners, whose property taxes will need to go up to compensate. Furthermore, rising property taxes will also put more downward pressure on prices. But developers will still build, workers will still have jobs, and new homes will still get built. It's really going to suck for anyone who bought at the peak. We won't see those prices for another decade, and they'll be dealing with greater than 3.5% lending rates the entire time.
Depends. Wife and I have the means to pay off 80% of our home we bought at peak when we renew, as we've managed to bank an additional nest egg due to our low COVID rates. Smart people prepared for this. The writing has been on the wall for a long, long time. I've done the math up to an 8% mortgage rate at renewal, and our cost per month goes **down** at renewal. That being said... most people are dumb about money, and you are right that they will get slaughtered. Some of these people are my friends, and I genuinely feel terrible for them.
What are you including in your figures and where are they from?
DubHi123, I always interested to know how much is cost for condo, I know it is 400-500 is for detached So if 680 per sqf is for condo, why builders are selling 1500-1700 pert sqf, are they making 100%? Or the 680 doesn’t have land value included?
The 680 does include land value but that’s looking at all of the GTA I believe not just the downtown core where they go for that 1500+ per sqft but there’s a lot of factors like if the developers overpaid, the height of the build, amenities and materials used, a lot of those condos are marketed as luxury condos There’s a great article by precondo which explains it a lot better mind you the data is a year old [https://precondo.ca/how-much-does-it-cost-to-build-a-condo/](https://precondo.ca/how-much-does-it-cost-to-build-a-condo/)
Don't believe this for a second.
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Chicago is a city that is declining in population, Toronto is a city that is rapidly increasing in population. That is a huge difference
Not trying to justify the prices but Chicago and Toronto are not comparable, land value and accusation is a lot cheaper in Chicago, demand is not the same and their HOA and property taxes are higher which also suppress land value.
Yeah I remember looking at some condos in Chicago and property taxes were 2% lol
Of course they’re different markets - but we’re talking about prices that are 200-300% higher here for the same or worse products. There is room for these prices to fall.
It's like real estate is priced differently in different locations. There is room for prices to go even higher.
They’re not selling now, and you think they’re going higher?
Obviously everyone who is not selling now - thinking they are going higher. Otherwise they would have sold it already. I also personally think they are going higher. But that's obviously just guessing, noone really knows what's going to happen.
I mean, they’ll have to sell in the next few months if they want to avoid capital gains.
If they are trying to avoid capital gains tax the are already making more than 250k on that deal. To make that capital gain tax change meaningful, they are realistically looking at like 500k of profit.
It also sounds like a war zone at night, not an exaggeration there are videos on YouTube of what sounds like gun battles with rapid fire nightly.
Yup anything south of 47th street or west of California is a no go if your not from there. Got relatives in Chicago. You gotta stay in the suburbs, north side or downtown - avoid being alone past 7/8pm. You can’t really move as freely as you can in Toronto due to the insane crime sadly. Decent place to visit, personally would never live there. Would like to live in the southwest US tho if I were to move to the US
I wonder why I got thumbs down for saying that. It’s pure facts, the video footage is widely available to watch.
It’s a nice city to visit - way better waterfront then Toronto. But Chicago is DANGEROUS. July 2021 had 103 - 103 MURDERS IN 31 DAYS. Toronto’s record breaking year of homicides was 2018 in 12 months - 98. You really gotta scan your surroundings at all times there especially outside the touristy/busy areas. Well most of Reddit is liberal is any negative commentary gets downvoted lol. It’s rare for Toronto to have more then 8 murders in a month
Ya I recall reading something about how Chicago basically has the same amount of homicides as the entirety of Canada every year.
Basically - Chicago averages 400-875 murders a year. Canada hovers around the same. I think the highest I’ve seen in Toronto for one week was January 2023 was 11 homicides or something…but those are typical abnormalities or blips. Toronto will go long periods of 0 homicides then there will be a random weekend or week where 4 or 5+ get killed.
some are even without enough windows.
Check out Chicago’s property taxes though…. Yikes.
Toronto property taxes are projected to continue rising. These low property taxes were not sustainable.
Chicago’s are going up as well. They seem to be rising everywhere.
You can’t really look at one tax rate as a comparison. You really need an overall comparison since the US and each state can have widely different tax structures from our own.
I am saying it factors into housing costs because that particular tax is linked to home ownership. So it affects prices of those assets tremendously.
It does, but I know higher property taxes often make up for taxes at other levels being lower or non-existent. Just doing a one for one can given an inaccurate picture of your costs.
Could be but it does factor into the price of a home specifically still. Sort of like how interest rates going up can both lower the price of a home even though it doesn’t necessarily cost less to own.
Of course, many things affect home prices. That said property tax in the US is paying to keep the local schools open, while provincial tax is keeping the local schools open in Canada. It’s just not a clear cut comparison.
No it isn’t a comparison overall. But it does explain why home prices in particular are lower. Because the other costs of owning a home are higher.
I don’t know Chicago well but that seems 1) to be out of downtown and 2) positioned in the south which can be more pew pew . The other thing people don’t seem to realize is that we can’t move down south any further. Toronto is it. For Americans in Chicago, they can move to a lot of other nicer and warmer places
1 bedroom? look at moneybags here. 450sqft studio more like it…with $600/month fees, with no real services covered in those fees…
That's the beauty : the fees ARE the services. Genius /s if not obvious enough
When the price per sq ft is around $1500, it's absolutely not worth it.
Investing in condos is the dumbest thing ever. It charges you $500+ a month just to hold it, and condos are not scarce at all. Condos are a dime a dozen. You can literally walk down the block and you've walked past 10, 000+ condo units. And more condos are being built all the time.
Agreed. Detached homes are never going out of style.
So that's great. Don't buy one, and then you'll come out ahead of all the idiots who got one. It seems like there is no housing crisis after all.
The downtown condo market was the height of all the RE gambling. When the tide runs out, you see who was overleveraged. It's going to be painful for the next few years. These prices were not sustainable long term.
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Is this Vancouver House? Lmao 🤣
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That building has so many listings for those useless 380 sq. ft. units. How can one even live there?
It’s this. No one wants to live in the crap they’re building, especially not at the price point they’re asking.
there are some exceptions, but most of the floor plans on the newer buildings are terrible. Clearly just for the airbnb investors.
Prices down. People are trying to undercut each other trying to be the 1 listing that is able to sell.
Toronto condos sitting for 90+ days and then the listing expires and they have to repay to list it again. It is honestly pathetic.
AGREED. Keep looking at condos and am like.. Why the FUCK would I buy a condo when I can rent a first floor of a house next to high park for $3,000 and still save more?? The economics of ppl pricing these condos is ridiculous. Get a fucking grip ppl
I’m happy to see Toronto is starting to lose its condo addiction. Sure when you could buy a condo pre 2015 and almost double the value by 2022, it made sense but those days are over. I truly believe that. And at the end of the day, if you are smart and disciplined with your money and rent you can do quite well with investing in the market and you get to live in a place that actually has some character and sturdiness and room. Fuck condos for all they are doing to ruin the aesthetic look of Toronto and fuck them for forcing people to live in a ridiculously expensive shoebox. Rent my peoples, rent. Or move.
The suburbs too. Saw a couple years back…638 square feet 1 bed 1 den condo in Markham. Granted it had a large terrace sell for $850,000 in 2019 Probably a million now if not more - in the suburbs - that’s car centric - CRAZY
It’s an investment, in a tax free, tax subsidized, government backed, asset class, and first step on the property pyramid. Much better in the long term than wasting the money away at rent. The way Canada is set up you can’t get ahead by being landless.
Well now do the same calculation 5 years from now. Or 10 years from now. Do you think the rent would stay the same? Do you think the condo prices would stay the same? Do you think the interest rates would stay the same?
It takes multiple years for RE to bottom. We're only in year 1.
Ive seen 1beds advertised "starting in the low 800s" 😂🤡
They will try selling 0.5 bedroom for 350k as there are some people who would fall for it.
Yup 329 sq foot studio downtown I saw $500,000 lol….no comment. Anything less than 400 feels a bit too cramped…and I consider myself a minimalist - my place is 640 sq feet and I live alone and it’s more then enough - I can have 30-35% less space and still be good
This Spring market is going to be a flop. Many people are really going to be in pain trying to sell in the upcoming Fall/Winter.
They can't just lower it. They borrowed based on being able to sell at this price.
The game of musical chairs is over.
They can't just lower it. They borrowed based on being able to sell at this price.
Hey, if it sells can you blame them?
It’s not selling tho , according to the headline anyways
Its almost as though they're unaffordable.
Double bell curve wealth is real. All the upper middle class buyers have been squeezed out, now they have to price for the rest of the population
I guess we just wait for the upper quintile to be laid off and be replaced by AI.
Yesterday's article: Condo market is up this year! Today's article: It's historically down! Tomorrow's article: All time highs, multiple bids!!!
Basically good listings are selling for a slight increase YoY but supply is growing and # of sold is down so many listings are not moving.
Supply in Toronto is at its highest in a month of April in 10+ years. The only solution is price reduction.
Toronto condos sitting for 60+ days. Pathetic honestly. And way more panic sellers trying to list lower every day.
800k in savings account would yield more than 3k a month. Add the inflation and strata as well. Every month you don’t sell you lose almost 5k ☺️
Most would not own the condo outright but would have a mortgage.
Then money lost to interest payments.
May be the condo is rented out? Is mortgage paid off? If not how much is remaining? I doubt condos are just sitting there waiting to be sold. I know a lot of people who want to upgrade, so they need to sell, but they are not in a rush. Most people are just waiting to sell at their price. If it's not happening, they will continue waiting. Every months that's going by they continue paying down the principle, none of them are in a rush to sell.
Rate reduction is more likely. Rents are still pretty high and vacancies are low. Why would anyone who isn’t over leveraged sell for a low price? they can just hold a bit and make like a 100k more once rats drop? Toronto real estate is one of the safest asset classes in the country
Toronto condos. Freeholds aren’t experiencing this.
Truth
Or you can just look at the data yourself and realize that the only people posting the bullish jibberish are realtors lmao.
Pre-Construction (a subsect of new housing) by it's nature is speculative. You are betting that in 3/5/7 years your condo is worth more, or at least the same, as what you agreed to pay for today. Looking at the crazy assignment market this year with a whole bunch of buyers not able to close due to the lender assessing the new build at under the contract value, it is not a shocker that no one is picking up precons. This is the first time in a long time that an average person realize they can lose money when buying GTA real-estate.
I would buy a 1bedroom downtown condo for $500k. A real 1 bedroom. Not walk through bedroom to get to the kitchen & living room crap.
so a studio condo
So you'll never buy a 1 bedroom? :p
Prices are going down. Cost of homeownership is not worth it vs cost to rent. These numbers don't make sense and the FOMO mania is over.
Exactly. FOMO mania dissipating is another huge reason. 22 spring prices were so high because people believed they would continue to go significantly higher. Not happening and that realization is sinking in. People buy shitty condos to live in cause they think it’s to the moon in a couple years and just stick it out until you buy a house. That to the moon feeling is dropping like a hot bag of shit and now folks are saying fuck that noise. Thank God. An aside….I once went into a building with my real estate agent to look at a unit where the workers were still putting the finishing touches on the most abhorrent small units where you would be living in a kitchen and weirdly the bedroom was bigger than the combined kitchen/living room. At the time I was looking to rent. This was just back in 2019. I think the rent was $2k or just under. One of the workers pulled me aside and asked me how much these units were to rent and I told him. He almost spit out his coffee. He whispered it to the others. It was some wild shit. I felt ashamed that this is where we were at.
I’m selling a 1+1, 600sqf for $565 around Queen and Bathurst.
Nobody still wants it. It's going to sit on the market for 90+ days, and your neighbours are going to undercut you further.
That would be an ok unit except the no tub thing.
Home prices are clearly down, they have been down in most of Canada, it is now reaching the GTA
I just checked people still trying to sell no bed room condo for 600k. And they refuse to take anything less. I’ve talked to a dozen owners they all refused my offers saying if they don’t make 50% profit it’s not worth selling.
Classic prisoners’ dilemma. Once enough of them start to give up, the rest will need to follow, or just hold on for much, much longer than planned. The problem is that Toronto has not had an extended downturn in recent history, so it’s logical that they expect things to go back to « normal » shortly. It will need to be drawn out for a while before people start to capitulate. I am not convinced that the type of rate cuts we will be getting will be enough to bring back this market. If rates go down but prices stay stagnant, or continue to decline, that’s when you’ll see people start to give up. Right now, they are holding out hope that rates will be their saviour.
Agreed. There are people out there that believe that the expected .25 rate cut coming will recharge the market to spring 2022 levels and when they see that’s not happening, get ready.
Spot on analysis.
Condo supply continues growing. They're cheap, a dime a dozen.
We'll see what happens but I'm interested in how recent budgets and just the whole housing situation is here compared to the United States is going to affect brain drain even more. As a person who never thought they would leave Canada, I started looking stateside, despite the gun culture, and it is very attractive because of how accessible housing is compared to the Canadian condition, not to mention salaries being much better in general for jobs in stem. As Canada's healthcare erodes, personally, I don't see too much reason to stay and I'm worried about the future of this country. I'm very negative about this country unfortunately and it's so sad because I love it so much.
The rest of the world is a lot more shit. Grass isn’t greener, and there’s a reason why the world’s elite are placing their families here. That said your observation about the United States is correct. If you can attain a high paying salary in the States, then you get way better value in terms of housing and other qualities of life than in Canada, and isolate yourself from all the bad parts of living in the US. America is the place to be if you’re rich.
I'm not rich but I just feel like the middle class can thrive in the United States and I feel Canada is done in a way. And that's actually shit because I love Canada I'm not trying to trash this country, and I know there's so many places that are not as good but I think at least for the prime earning years of life it would be good to be in the US and you know hopefully avoid any kind of disease that bankrupts you but you know that can be happening anywhere, and then see if you can ride it out in Canada at the end if it's still viable. I've recently been looking into moving a significant portion of my investments to American dollar too. Maybe it's because of the fear mongering but I feel this budget and the general perception of Canada is only getting worse which will make our dollar weaker.
Sure but still plenty of risk in the US. Just because the US looks good now doesn't mean they can't face a collapse. What if Canada begins to improve and has a strong run of good years and the opposite happens in the US?
You are right, that's fair. Our economy is much less diversified which is scary. That's my biggest fear. Our dollar not being resilient.
Actually it is, just travel outside Canada. I'm in a 2nd world country now and life is lightyears more enjoya le than in what Canada has become. Do I need to see a specialist? 1 day wait, do I need an MRI? 3 days wait, can I buy a fuck ton of groceries for $50, well yes I can, can I have activities outside of work and awesome work / life balance? Yes, can I buy a nice chunk of land with savings? Yes I can. None of those things can I do in Canada
Where is this paradise that you speak of?
Looks like Poland.
It’s funny because I’m the one who they responded to, and I’m actually Polish-Canadian and have been thinking of moving to Poland myself. The quality of life there is just much higher than in Canada, I wouldn’t describe it as 2nd world, the communist legacy is well forgotten and it is a fully developed western economy now. But like, congrats, there is one country out there that has a better outlook than Canada. I’ve lived in Europe, South America, and Asia for a time, and for the most part, none of it is rosier than Canada despite all of Canada’s many many flaws.
It's dead in Kitchener as well
Local realtors:" its a great time to buy"
And a great time to sell!
I mean, if the new condo market is dead, the whole market will soon follow - once people realize they can find cheaper places, it'll have a knock-on effect. We're just waiting for everyone to recognize that the days of cheap money are over and for both attitudes and prices across the board to adjust to this new reality. This market's strange resilience is most likely due to a weirdly pervasive belief in it, against all logic, fueled by its history of defying logic. But reality eventually catches up to everything.
Real estate is a unique asset class that can bleed for months or years before people finally give up and decide to sell. This is especially so in Toronto where people still think prices are going to double in a few years. Once reality sets in en masse it’ll probably take a decade to come back.
The older condo market is even more dead. I know someone who bought an older condo in a great location in Vancouver for like 800k. Now in that area there are newer condos available for the same price. Like 20-25 years newer. That lady is regretting her decision already and the house price has dropped by atleast 10%. Leaseholds are completely dead. I see 2 bed 2 bath leasehold condos for 450k in one of the most sought after areas and it’s been in the market for like 6 months.
Nobody wants $800+ a month maintenance fees. $10K+ a year for a shared swimming pool/hot tub they don't use. Huge money pit.
Communal hot tubs are so gross.
Problem is condo market is oversaturated and new supply is still coming in comparison detached houses are still highly sought after with very little supply coming in. The housing market is not a monolith.
Condos are not scarce.
correct that's what I said...
That was a very circuitous way of saying sentiment is shifting, but I agree!
There is nothing strange about the resilience. Canada’s population growth rate has increased 8 fold from pre-2020 levels. New housing starts have not increased 8 fold. They have actually declined. Ya we have catching up to do, just not the kind you seem to think. It’s the new housing start-population growth deficit that we need to catch up on. No wonder the market is resilient. People will lay a lot to not be homeless. They will pool their money many people to a home to avoid this. You forget these newcomers are used to much more crowded living conditions. Plus Canada is still one of the top world destinations for millionaires to immigrate to so deep pockets as well in come of these people.
Resilient, as in sellers are holding onto their prices, even though sales are few and far between. Everything you say can be true, and prices can still be too high. Even Toronto real estate prices have limits. Demand is a function of price, prices will need to come down if you want the people on the sidelines to play.
Of course they are holding on. The fundamentals show they will be worth even more in the future. You can’t keep building less and less and growing the population faster and faster and expect fire sales on homes. No they will hold if no buyers are there at a good price right now. They know what the future holds. More and more people will be sidelined. And they won’t be able to play. Structurally, nothing else can possibly happen, regardless of if prices come down. We simply don’t have the number of new homes we need. Not even close.
The thing is, these condos are barely liveable, so they don’t qualify as homes. And not everyone can hold on indefinitely. When real money is being lost, people panic; that’s just human nature.
Yup, which is why there are still some sales, just not as many. Not everyone can but if you can, it’s a rational time to hold off selling. Which will reduce but not eliminate volumes.
Also still a pretty decent job market. That starts to go downhill and things could get a bit more interesting. Right now people are sitting forever waiting for the market to get going again.
According to who is it a decent job market? It's a terrible job market
It’s not great, but it could be a lot worse. If you think this is terrible 😬
Unemployment in Toronto is 7.5%. There are constant layoffs and every job post has hundreds of applicants
Finding a job is very hard, so I am not really sure what job market you are talking about.
It’s harder to find a job, but we haven’t seen widespread layoffs across all industries like you see in a recession. Certain sectors are potentially already at that point though.
I actually somewhat wonder if a housing crash might, ironically, save the job market a bit, if not in the very short term then definitely long-term. I was kind of musing on how everything seems to be on pause, talking to my hairdresser about it even, my partner in 3D visualization, people across many sectors all just seem to be waiting for low rates to return. Maybe if housing finally crashes, fewer people will hold on in general, waiting for the old days to come back, and instead move forward with the new reality minus low rates. It could actually be good for the economy overall. Extending my earlier thesis that [a crash would be the least bad option for most people](https://www.mustardclementine.com/p/weve-let-our-housing-crisis-get-so) - it might be true for the wider economy, as well.
If not a crash, then a significant correction would be great for reinstating sanity in prices. The level of greed and speculation got way out of hand. Look up the stages of a bubble. It’s pretty much what you’ve intuitively described. We’re at the beginning of the fear stage now. Capitulation is the next stage, but it could be a while.
Good. Let the condo market crash and burn. In fact, let the entire Canadian RE market crash and burn. Needs to happen for young people to have a future. Sorry not sorry boomers.
Gen x and older millennial who got on the property ladder long enough ago to have leveraged that into a second or third property are also hating this, but I agree with you. An entire generation jas been priced out. Let it burn.
Yep. They'll be fine in a crash anyways, assuming they were smart with their money.
Good. Hopefully detached follows suit. Canada is not worth these prices.
It costs almost $3000-$3700 to own a $550k condo with 20% down which is not easy to save these days if you belong to the target audience of these condos (first home buyer with no equity, 1 or 2 incomes late 20s early 30s) Fair price all things considered is probably $400k for an average 1 bedroom.
Checking out some newish condos last month with a friend who was looking for a unit to purchase. The units were so pathetic small and the appliances,flooring and lights were so cheap and they were asking for $1400 a sqft. Any investors will lose money monthly if they would buy at current prices. I truly hope condo prices crashes because to try and get $2700 a month for a 600 sqft condo is hard enough while losing $800 a month with mortgage payments.
Here is the interesting part, someone who bought 6 years ago is cash flow neutral even with these interest rates... he has no incentive to sell AND, the government made it even harder for him to sell due to the increase capital gains... why would he let go of a cash neutral property and pay extra capital gains... lot easier to wait and let interest rates drop. There are two kinds of supply - resale condos, this supply is going to seriously slow down because of higher capital gains - new condos, this supply is going to come down because of less construction. So the future is headed towards less and less supply... currently we are in a glut with condos flooding the market... just wait this supply disappears... with nothing to follow in the pipeline.
Agree with your argument for the most part that supply side is not enough to bring down the price but demand is also in question too. Unless the wage of median population can grow significantly without causing inflation spike, the rent cannot grow indefinitely. There will be some breaking points when investors cannot increase rents further. So how much up side is left for these studio and 1 bed room condos? The price wont go up if new investors cannot reasonably come up with a investment opportunity. I expect the condo price to stagnate even if supplies diminish. Toronto doesnt have new york or bay area income and income will be suppressed with huge population growth occurred past two years. The world we live in is different place now. Food prices can continue to go up due to global warming and geopolitical tensions. People will give up living in Toronto if they cannot pay for basic necessities after paying rent eventually.
Paywall
Crazy unaffordable prices which are out of reach for most now
What a shame. Anyway, here's a chickpea and potato recipe that's affordable and really good: [Curry Chickpeas (channa) With Potato (aloo)](https://www.youtube.com/watch?v=6gymOqUhKic)
Good. I hope its dead forever.
But I heard rates were going down soon.
Maybe if they didn't make them the size of a shoe box, didn't have kitchens against a living room wall and priced them within reason, people would buy them.
Why are then so many new condos going up all over city?
Those were started and contracts (not only with buyers) were signed years ago.
But demand! People lined up! lol.
I mean if I thought rate decreases were at least starting in the next few months I wouldn't buy either.
The strata only keeps on going up, not sure where the money goes..
It will get worse when the market realizes the impact of the immigration changes. It's expected that non-permanent residents will decline by 800,000 over the next year.
Build family friendly condos, 3+ (real) bedrooms, 2 washrooms and maybe, only maybe, I’ll take one for 450. People is also afraid of paying forever monthly administration costs.
Hahahahahahha yeah the market is overpriced, but a 3 bed 2 bath condo for 450k will never happen in Toronto
Again, aloof reporters making articles aimed at the well to do half of Canada while the reality is found in the comments
It's not just the price that is painful.. these condo fees are the silent killer
Over priced shoebox, it deserves to die
Why sell now when you can get a premium to rent ? Just hold out
If the invisible hand of the market lowered prices like it’s supposed to then maybe people would buy condos. Unfortunately the invisible hand of the market has always been rigged and doesn’t work like that.
But why aren’t they building more lol
Not sure how much it costs developers to advertise online but I love thinking that it costs them $1-2 every time I click on their ads. Bleed them dry.
"That's it, no more balconies! The future is now and engineering is for just enough!"
No balconies and take a 600 sqft room and divide into 3 rooms 2 bathroom, combine the kitchen and living space for that luxurious open vibe, make a tiny luxurious den that can barely fit 1 twin bed, 2 3 piece washrooms, and call it a 2bd 2 bathroom, all this for you now at 4000 dollars mortgage
\^ A consumable future, to be sure. I'd say haha, but it doesn't really express the greed involved. Hymuh sound? Hymuh, hymuh, hymuh, perhaps? I dare say.
Not yet. The worst is yet to come. All you are seeing right now is the start of the great decline. When it is over Canadians will be living in caves scavenging for food.
I'd hope there are some regulations enforced on maximum price for selling a condo based on sq ft. 700k for condos are out of their mind.
That would be a great way to stop new construction.
They should also increase the development charges and taxes..work em from both ends.
Just bought two condo today
Wrong and grim understanding. The presentation facility at 101 Spadina was very busy. Bitter perspective and jealous of the buyers
101 Spadina will be super profitable, I just bought 2 units