Your Condo World Blog

If you want we can tell you what the answer to this question is right away. The answer is yes and no.
Statistics from our London-St.Thomas Real Estate Board tells us that the typical listed condo for sale on the MLS system in the month of April 2012 sold out in 47 days. Compare that to a typical MLS house sale that sold in 37 days.
March figures by comparison were 46 and 41, February 50 and 40 and January 56 and 51. Looking at these numbers can we safely say that a typical residential listing, for lack of better terminology, sells on average five or ten days quicker than a condo? Yes and no. One must also consider that almost every standard offer to purchase condo form has in it a request for ten or twelve or even fifteen days for the purchaser to request and approve the details found in a status certificate. This in part explains why on paper condos tend to take longer to sell. That’s the way we see it anyways.

P.S. The average condo in London sold for $168,668 in April of 2012 which was up from $166,398 in January of 2112.

When you have 35,000 students or so attending one learning institution there will always be a heavy demand for four plus one bedroom condos with three or four bathrooms that are within walking distance to the university. Just imagine what kind of cash flows one of these units could pull in. On our website you will note that we have posted the average selling price to be $230,250 in 2009 of the condos in the complex at 1548 Richmond Street.
Let us now take a closer look at resale prices in that complex since that time. In 2010, eight M.L.S. sales occurred (there are forty six units in this complex) with an average asking price of $251,900 and an average sale price of $258,300.
In 2011, six M.L.S. sales occurred with an average selling price that matched the average asking price. That number was $283,500 and five of these eight sales sold out over list.
In the first four months of 2012 four sales have occurred on our M.L.S. system, with an average list price of $291,900 and an average sale price of $304,750.
Yes interest rates are at near record breaking lows so that might help to explain in part what is happening. Does this history of rising resale prices mean that prices will continue to trend higher? Only time will tell but it would be a safe bet to say that five or ten years time down the road these units will cost more. That’s the way that we see it anyways.

As realtors we find ourselves working with people from all walks of life-everyone from the presidents of airplane companies looking for executive rentals with private landing strips to people arriving here in town by Greyhound looking first to find a mortgage broker who is willing to work with them on getting 100% financing.
What do you do when you met someone who tells you that they want to purchase the lowest priced condo for sale in town? Do you try and reason with them and tell them that everything in the very bottom end price range of the market is priced that way for a reason? Is it best to try and shy away from the entire situation, knowing full well that at the end of the day the amount of time and energy that it will take to put together such a deal might help to drive you that much closer to the poor house? Few people outside of our industry realize the amount of time, energy and co-ordination that it takes to make a deal like this go together.
Now let us share with you a little secret. There are some one bedroom condos for sale in the south end of the city in White Oaks which frequently sell out in the $50,000-$57,000 price range and two bedroom units that sell out in the $65,000-$69,000 price range. We are talking about the condos at 1580-1590 Ernest Avenue. It’s difficult to believe that a monthly mortgage payment on one of these units would most likely be less than a monthly car payment on a four or five year old Dodge Journey.
What do you get for your money for something priced in the $50,000′s? Well you do get a convenient south end location next to a park and within eyesight of the Rick Hansen Public School. Also close by is the South London Community pool, the Jalna Library, a T.D. Bank, the White Oaks Mall and a grocery store. Buses too are at the door.
One might ask the question that if it is such a good location and if prices are so reasonable then why are these selling prices so low? Well the main reason is that this cluster of six buildings is of the three level walkup design. Many buyers are not thrilled with this arrangement and not everyone is able to, or wants to carry groceries and baby carriages up two or three flights of stairs. Then to there is the aspect that the condo fees include all of the heating and hydro costs which is something landlord/investors typically do not like to see. In the case of the one bedroom units the condo fees are somewhere in the $240.00 per month price range.
Place yourself in the shoes of a landlord for a moment renting out one of these units for lets say $675.00 per month. After paying the monthly mortgage cost, the property taxes, the condo fees and after factoring in ongoing costs for other minor improvements that doesn’t leave very much of a return. Then to there are always the possibility of special assessments for everything from balcony repairs to enhanced security features. Being a landlord can at times be a challenging experience.
Thanks to the wonders of the internet our www.yourcondoworld.com website has become one of the areas leading condo websites. Occassionally we do get calls from “out of province” investors who own units in these complexes and most often the purpose of these calls is to pick our brains as to why the resale prices in these complexes never seem to go up. That seems to be a major fly in their ointment. It is often difficult for us to offer any meaningful words of encouragement and what often complicates these conversations is the aspect that many of these owners have never actually seen the insides of their units. What this means is that their perceptions of the overall conditions of their units are difficult to quantify. Just because a unit has a new paint job and new counter tops in 2009 doesn’t mean that it is in tip top shape. In one of our March blogs about the Jacksway condos in north London we talked about the consquences of having a high ratio of absentee landlords.
As a reader are you now sensing a lack of enthusiasm on our part in reference to these units as being blue chip investment vehicles? Let us be brutally honest in saying why this is so. Prices on these units have remained flat over the last six or seven years. As real estate agents we have access to our Board’s database which gives us these statistics. Imagine purchasing a unit back in 2005 only to be told now that if you are thinking of selling odds are after real estate fees and lawyers fees you will not even be able to get back what you initially put into it!
It’s all in a way very much a catch 22 situation. Should we be encouraging our clients to buy into these complexes when real estate values never seem to improve? Why not purchase a student rental property instead? Yet then again if the purpose of this exercise is to find a warm and comfortable place to live – a place to escape from the rental rat race then this perhaps is it. This is the way we have learned to see it anyways!

You are standing in the kitchen of a condo on a Saturday afternoon open house and you think its a good deal and you want to purchase it. This particular unit is in good shape and its in the right neighbourhood. It’s fresh on the market and you know that you better act quickly.
What do you do? You have gone to the bank so that part of the equation has being taken care of. Do you use the real estate agent who is hosting the open house? You notice that the agents name on the feature sheets is different than the name on the outside for sale sign. The lady doing the open house is probably doing it as a favor for the listing agent or is doing it in an attempt to potentially pick up new clients. While she was polite when she first greeted you at the door she has spent most of her time since you have been there watching a u-tube video over and over again about a fellow and his talking dog. You have also watched this video many times and secretly you feel that your dog could do a better video than this but that is a entirely different issue.
Two other couples also seem to be milling about but no one is really saying too much. Should you start the ball rolling by asking the lady who is hosting the open house how long it has being listed for and have their been any offers put in on it? That would seem like the logical place to start. You already know that the property was only listed a few days ago and there are about fifteen real estate business cards on the dining room table, probably as the results of some sort of an office caravan.
Let’s be honest. Your not in the market to purchase a new condo everyday of your life and you are not really prepared for what may happen next. Is it best to start this offer to purchase with this particular real estate lady or should you be calling up the agent who has her name on the outside for sale sign? Wouldn’t that person have more of a pulse on what is happening with the sale of this particular unit? What about using instead that nice fellow who took you out looking at condos four or five months ago when you initially had a hankering to buy? He was pretty easy on the eyes and he seemed to know his stuff.
Decisions, decisions decisions and your still not even at the point of thinking about how much that you should be offering for the unit. Luckily you have done a fair bit of internet research on how this process works and you are aware of the fact that the real estate industry in Ontario has recently introduced some new paperwork called a ” buyers agency form”. This is a form real estate salespeople ask you to fill out which states that once you find that perfect property you agree to purchase it through that agent. At this particular point in time you know that you are not signed up with anyone. How you go forward from here is really your call.
Is it best to seek out the listing agent and have that person, whoever they happen to be double end the deal? If more than one offer was to go in on the property at the very same time ( thats what your now worried about) and yours was one of them wouldn’t you want the listing agent to be the one on your side? Might that person be in a better position to put a positive spin on your offer or even perhaps cut his or her commissions to get the deal done if there were more than one offer and they were all about equal in price?
It’s kind of a tricky subject and your knowledge of how its all suppose to work goes back to the brief talks you had with that really nice agent a few months back. He said that if a listing agent happens to be in a multiple offer situation with other agents on a property that he or she has listed then the listing agent is free to cut the commissions to make his or her offer look more attractive to the eyes of the seller. This of course is not what always happens however it sometimes does. There is however a condition that goes along with this last minute tatic. It is that before the offers are presented the listing agent who is cutting the commission must tell the other selling agents of his or her intentions to do so and by how much. This then gives the competing agents an opportunity to go back to their buyers with this news. In situations like this their anxious buyers sometimes go in heaps over the asking price anyways.
So what now to do? Do you use the real estate agent hosting the open house, the official listing agent or the fellow that you were once working with? If you do decide to go back to that fellow you were once working with you would feel more comfortable in asking him what the last units in the complex recently sold out at.
It’s time to leave. You do not want the other browsers to know how interested you are in this unit. If only this unit could be yours tomorrow!

I have a client who is in his late twenties who prefers to purchase student income properties and fix them up. I am not talking about just paint and paper and minor decorating. This fellow tears out interior rooms, knocks out walls, adds extensions and raises rooflines. Once he bumps up the income streams on these projects he sells them out. A typical project will take him and a small crew three to four months to finish out. In the last two or three years in spite of our difficult markets he has done very well. He obviously is not in my view a “passive investor”.
Condo investors in this town who rent out condo units are often in contrast a very different breed of investors. On closing they will assume the existing tenants or call up a newly appointed property management company and ask if the carpets should be steam cleaned. The “added value” that they put into a unit is often nill. In many respects they are passive investors relying solely on the income streams generated from one tenant. These passive investors are quite often content on just breaking even and are hoping that inflation and the increases in property values over the long term will work in their favor.
Over the last fifteen or twenty years our London condo marketplace has been a mecca for out of town “passive investors”. Why? Well London for some reason, is often viewed by investors from across Canada as being a safe and stable city in which to invest in. Our city does afterall, have a reputation of being a university city and a hospital and insurance city with a low vacancy rate. Low rise condo buildings on Ernest and on Conway, lowrise and highrise condo buildings on Jalna in White Oaks, low rise condos on Deveron in Pond Mills and low rise condos on Jacksway in London north are just a few of the condo projects in town with a high ownership ratio of out of town investors. That’s just the way it is. Recently we posted blogs about many of these complexes and have noted that their resale prices have being stumbling along without going up in price over the last few recent years.
The question which we would now like to be answered is the following. Is it healthy for our marketplace to have these high concentrations of passive investors in certain complexes? Well it could be argued that having too many long term passive investors in any one complex might actually hold down the values in these individual complexes compared in general to what is happening in the overall condo marketplace. Why? Well one might make the point that those complexes which have a higher ratio of owner occupied units tend to turn over more frequently and also tend to enjoy more ongoing upgrading. This trading activity in upgraded units on a regular basis is in part what often helps to bring up the average selling prices of individual complexes.
In one of our recent blogs about the Jacksway condos we mentioned that prices actually dipped in 2011 and we noted that the complex was well over fifty percent owned by investors. We also noted that during that time period more units in that complex expired unsold than there were sales. At the very same time there were bidding wars on many of the condo complexes just down the road like at the condo complexes at 1548 and at 1570 Richmond Street.
Now think about this. Take a walk down any kitchen cupboard isle or a bathroom supply isle at Home Depot or Rona and marvel at how styles for these type of rooms are changing. Young people now do not want to purchase a twenty-five or thirty-five year old condo that does not have new kitchens and bathrooms. That’s the new reality that so many of our long term passive investors are now starting to wake up to. Often times when these tired units do hit the market they sit for months and months and often ultimately go unsold. Often times they end up back in rental pools to defer the reality of trying to get them sold.
What really is the bottom line to this blog? It is that todays condo buyers, with interest rates being so low often times are willing to pay a bit more and get something that has extra nice finishings.That’s once again, the sobering reality so many existing long term passive investors are now having to deal with in their attempts to cash out. That’s the way we see it anyways. Watch for a future blog about the condos at Ernest and Bradley which for a long time have not gone up in price. It’s going to be an interesting story.

Let’s do the math. A purchase of a $82,000 townhouse on Dundalk Drive in south London with a 5% downpayment leaves someone with a mortgage of about $80,000. Let’s say the mortgage interest rate is 4% with a 25 year amortization period so that leaves one with a monthly mortgage payment of somewhere around $420.00 mark. Then add in the monthly condo fee of lets say $185.00 per month and monthly property taxes of $85.00. Once totalled, the monthly payments owing are somewhere in the $690.00 range. Isn’t that about the very same amount of money, or less that what many people shell out for the rent for any decent one bedroom apartment in the south end town?
What do you really get for that amount of money? Well lets be honest – the living space isn’t really all that large. The two bedroom townhome models have two upper bedrooms, most usually in the 11 X 9.4 and 10.8 X 9.4 range. The main level has a livingroom area in the 14.5 X 11.7 range and a kitchen and eating area. That’s really about it and the lower level may or may not have a finished rec room. This complex of 94 units is a mix of both two and three bedroom units (the ones with the extra bedroom are obviously somewhat bigger) and there is one noticable drawback to the design of the two bedroom units. It is that the floorplan of these units have no rear exit doors. It’s all kind of difficult to explain what the floorplan looks like, however the rear wall in these units where the staircase goes up to the two upper bedrooms is made out of exposed cement block and behind this block wall can be found an identical unit on the other side. This means, once again that you don’t get a rear door on your unit, nor will you get any “cross-breezes” sweeping through your unit in the summertime. This central block wall design is in part what has helped back in the day keep the initial construction costs down so low.
What is the neighbourhood like and what kind of people live here? Well there seems to be a mix of young families (there is a public school within walking distance) and retired people. This complex is also well serviced by numerous bus routes and the White Oaks Mall is only a short cab ride away.
What else can be said about these units? Well the three bedroom units are a little bit more expensive and they do have rear doors with back patio areas. One interesting peice of trivia is that the torando that touched down upon the White Oaks and Cleardale area back in the year 1984 took the roofs off some of these units!
There are people out there with the mindset that condos in general are not a good investment and that you are better starting off with something like a semi detached house or even an older house. Our take on this logic is slightly different. Why not start off here – a least you can get into the marketplace – where the cost of living is managable and spend a few years living here and saving up more money for a bigger downpayment on your next bigger place? If you want you can even move out and maintain it as a rental unit.
Now for one final brief comment. These units may be lacking in square footage and they may be somewhat “utilitarion” in design but they do however offer the element of “home ownership” at a price which is affordable. That’s the way we see it always.
This complex can be found in our Lockwood Park/Cleardale section of our website. PS. If your from Toronto, like a quarter of the visitors to our website happen to be and if you are looking for a university property for students going to school then this complex is not for you. The university is on the other side of town and it would take you an hour to get there by bus. Cheers!

If you are considering the purchase of a high rise condo one of the decisions that you will have to make is whether or not you need a balcony. Most buyers will assume from the very beginning that all highrise condos have this feature however this is not always the case. Some developers opt instead to offer sunrooms or solariums.
What happens if in your search to find the perfect unit you come across something that you like that has the perfect location, the right price, the perfect availability and the perfect choice in decorating features? Everything seems to be right except for one thing – it doesn’t have a balcony. Should this be something that you might consider living without?
Well think about this. People enjoying life in the Blackfriars building do not have this luxury, nor do the residents living at 570 Proudfoot Lane, 695 Richmond Street, 1510 Richmond Street North, 7 Picton Street, 747 Wonderland Road South, 127 Belmont Drive, 45 Pond Mills Road, 1600 Adelaide Street North, 600 Grenfell Drive, 650 Cheapside Street, 135 Baseline Road West. Need we continue?
If you do not have a balcony then isn’t it true that you may miss out on the experience of sitting out in the early morning reading a newspaper, drinking a coffee and watching the sun come up? Will you also miss out on the luxury of having a place to do an occasional barbeque, a place to hang out damp towels to dry, if necessary, a place to grow flowers in flower boxes and a place where visiting guests can occassionally enjoy a quick smoke outside?
Is there a flipside to this equation? Yes. People living in the Blackfriars building,for example, can stroll over to Starbucks on Richmond Row for a morning coffee and cross over Richmond Street for a wonderful stroll through the gardens of Victoria Park. In a similiar sort of fashion the residents of the Picton Street building get to enjoy the early rising sun from a rooftop sitting area.
The logic of not needing a balcony also includes other considerations. On a windy day and with a corner unit who really wants to sit outside anyways? On a hot summer night who wants to be able to eavesdrop in on neighbouring balcony conversations or who wants the waffling odors of someone else’s barbeque? Is it now perhaps slightly easlier to understand why some people actually prefer the option of having a solarium?
Who really needs a balcony in the winter time and if you are studying 24/7 to be a doctor or a lawyer or something like that a glassed in sunroom may be more to your liking.
Our point is that not everyone seems to have a need for a balcony. High rise condo living is after all, to people not accustomed to such an environment a completely different way of living. That’s the way we see it anyways. Cheers!

We would like to start off this blog with the following disclaimer. Most of the luxury condos along Ambleside Drive are owned by professional people who are not students. Yet having said this we would now like to point out that some university students do make these units their homes.
Relax in your jacuzzi tub, read a good book while sitting next to your gas fireplace, park you car inside your garage at nights and barbeque off your private patio. Student living, for those fortunate enough to be able to afford it, can be very much like having a nice home away from home. The Ambleside Drive condos north of the university and south of Fanshawe Park Road offer all of these amendities.
How many university students come from families who are prepared to shell out $220,000 or even more for a nice townhome? Well suprisingly enough, it does happen quite frequently. Real estate for some people is looked a\upon as a commodity that can be readily bought and sold without too much emotional involvement. Real estate has also helped to make many people rich. G.T.A. parents of students going to school in our town find our prices to be very attractive.
It should also be noted that doing real estate deals in London Ontario is somewhat different than trying to do deals in Toronto. Offers to purchase are frequently signed up with good faith deposits being as low as a thousand or two thousand dollars. Home inspections can be done after an offer is accepted as a condition to the offer and not all listings sell out in multiple offer situations. Toronto people looking to purchase here are also often impressed by the uniformity of our north London condo neighbourhoods. Look at all of the expensive new homes being constructed in the north and north-west sections of our city and the monies being spent on building more university facilities. Look at how busy the Masonville Mall area always seems to be. Our north end of town is booming. Condos here that cost in the $220,000 range would probably cost twice that much in areas like Richmond Hill, Thornhill or in Mississauga.
We know that condo listings on Ambleside Drive, condos listings on Richmond Street north of Windermere Road and condos listings on North Centre Road just north of the Masonville Mall always seem to attract an inordinate amount of attention whatever the season happens to be. All we can really add to all of this is “yes we are open to do business.” Cheers
P.S. Thirteen condo units sold on Ambleside Drive in 2011 using our MLS system with an average selling price just shy of the $219,000 mark.

Our U.W.O. has over thirty thousand students in attendance and the location of the Jacksway cluster of condos is undoubtably one of the best locations in the city for students opting to live off campus. The bus service to the university from this location is superb and the Masonville Mall next door with all it’s amenities offers everything students will ever need. These low rise buildings offer controlled entries, balconies, wood burning fireplaces in each unit (just small ones) and plenty of parking.
In our December 15th blog we talked about this complex in depth and we noted was that the average selling price of it’s two bedroom units actuallly declined in the year 2011. That point caught a few of our readers by suprise.
Isn’t the one hundred and forty thousand dollar price range for a two bedroom condo quite reasonable, given what two bedroom units in many of our downtown condo buildings go for? Sure renting out the second bedroom in one of these units will not make you rich but it will help you pay the condo fees,the taxes and the hydro.
In our past blog we also noted that over 70% of the units are owned by investors who then rent them out. What they are simply doing is managing the task of having their rental income’s pay down their mortgages. With interest rates at such low levels this strategy seems to work well.
Now for some inside news. While the lobbies and hallways of these buildings are kept in pristine conditions some units are now in need of interior upgrading. This is especially true of many of the units used for rentals. Improvements now needed to many of these units include floorings, appliances, sinks, countertops, kitchen cupboards and tub surrounds. We are not trying to be insulting in any way by mentioning all of this but that is what sometimes happens to a unit after it is rented for a long period of time.
If you intend to work with a real estate agent to find a unit make sure that he or she digs up the very best for you. The nicer units do tend to sell more quickly.
The second point that we overlooked in our December blog is that there are differences in the two bedroom unit designs. Some two bedroom floorplans have two full baths while others only have one and a half baths. If you intent to have two unrelated people living together in one of these units this design feature may be of importance. There are fewer two full bath models in existance.
Once again, the Jacksway complexes service very well the housing needs of many of our U.W.O. students. Purchasing just the right unit can often be a little bit tricky of an exercise. Hopefully this information will make you better aware of how and why some of these units offer better value than others. Cheers

858 and 860 Commissioners Road East

By Dianne Wilson

London certainly has many condo projects available, we can’t talk about all of them but there are some like the units on Commissioners that always seem to draw an inordinate amount of attention.

Many people downsizing prefer these complexes as do professionals working next door at Victoria Hospital London Health Sciences Centre. London Health Sciences continues to grow with a workforce of over 15,000 employees, volunteers and physicians working across three hospital sites. In fact, with it’s rapid growth it has to shuttle employees from off site hospital parking to the hospital. People also prefer the location due to the proximity to buses, shopping, and downtown. Amenities in this building are abundant with a pool, sauna, tennis courts and exercise room. Many people also prefer the gas “Magic Pack” heat and central air unit over electric baseboard heat. Balconies and open underground parking are also highly desirable.

These units offer extremely good value. Now let’s look at historical selling prices. To also note, each complex has a different management company.

2005
One Bedroom $77,400
Two Bedroom $98,300

858 Commissioners in the year 2010
One Bedroom there were 5 sales: with a low of $95,500, to a high of $106,500 for an average selling price of $100,000
Two Bedroom there were 2 sales: with a low of 119,000 and a high of $125,500 for an average selling price of $122,250

860 Commissioners in the year 2010
One Bedroom there were 3 sales: with a low of $97,500 to a high of $103,500 for an average selling price of $99,667
Two Bedroom there were 7 sales: with a low of $118,000 to a high of $129,000 for an average selling price of $122,557

858 Commissioners in the year 2011
One Bedroom there were 3 sales: with a low of $95,000 to a high of $124,000 for an average selling price of $104,667

Two Bedroom there were 3 sales: with a low of $118,000 to a high of $124,500 for an average selling price of $120,167

860 Commissioners in the year 2011
One Bedroom there were 0 sales
Two Bedroom there were 7 sales: with a low of $116,000 to a high of $124,000 for an average selling price of $119,786

You’ll note that some prices can be an anomaly and drive up the average selling price. This can happen where units have been significantly improved or in multiple offer situations. Also, there are premiums for units on higher floors and premiums for desirable floor plans including corner units, larger floor plans, or more windows for natural light.

So there is much more to pricing condo units than meets the eye and a realtor that is familiar with the complex can directly assess that for you. That’s how we see it anyways.

Cheers!