Archive for March, 2010

The Windsor Condo Market in The 2010 Timeperiod

Tuesday, March 30th, 2010


By Peter Daoust, Broker Remax Advantage Realty Limited Brokerage

The State of Michigan has the highest unemployment rate of any state in the U.S.   In January 2010, the unemployment rate stood at a staggering 14.3%. Yet, that doesn’t mean everyone living there is out of a job. There are some design people busy at Chrysler, working overtime trying to get the bugs out of the new 6.4 liter V8 Hemi engine for their 2011 Dodge Challenger cars (est. horsepower 475-500) to replace this year’s model 6.1 liter V8. The GM designers are equally busy, worrying now if their 426 horsepower motor in their 2010 Chevy Camero is big enough. In a similar race the boys at Ford are excited about their new 412 horsepower motor in their 2011 Mustang GT. Way to go Detroit!

Now back to a more sobering reality. The Windsor economy is tied to the automotive industry and has struggled to stay afloat in the last couple of years. The Windsor unemployment rate is now the highest of any city in Canada. It’s a border town and with the high Canadian dollar and with the new passport requirements, tourists are not coming over in the same numbers to visit as they once did. It’s also a casino town but who can now afford to gamble? That’s what 3,600 casino workers now have to worry about.

2008 and 2009 were particularly bad years for Windsor with a long term garbage strike in 2009 and with GM and Chrysler both going bankrupt. On a more technical note, the value of the Ford stock dropped down to the $1.50 price range during this period of time and has since rebounded back up to the $14.00 range. What a gut wrenching roller coaster ride it has been!

During this period of time real estate prices in Windsor suffered and any sort of a near term recovery is still somewhat questionable. The following four charts of condo sale prices will add more meaning to all of this.

150 Park Street
Windsor’s largest downtown condo building
(398 units)

2009 2008 2007 2006 2005 2004

Number of Units Sold

1 Bedroom 12 (2009) 8 (2008) 9 (2007) 16 (2006) 8 (2005) 19 (2004)
2 Bedrooms 5 (2009) 8 (2008) 10 (2007) 9 (2006) 7 (2005) 10 (2004)

Average Selling Price*

1 Bedroom $ 72,700 $ 71,900 $ 72,200 $ 87,600 $ 89,300 $ 90,600
2 Bedrooms $ 86,200 $104,600 $111,250 $ 97,000 $ 97,300 $110,000

Number of Power of Sales

4 (2009) 5 (2008) 6 (2007) 1 (2006) 1 (2005) 0 (2004)

111 Riverside Drive West
Riverside & Ouellette – in the heart of downtown!
Facing the river and within walking distance to The Windsor Casino.
The second largest downtown condo building

2009 2008 2007 2006 2005 2004

Number of Units Sold

1 Bedroom 10 (2009) 11 (2008) 9 (2007) 9 (2006) 14 (2005) 9 (2004)
2 Bedrooms 1 (2009) 0 (2008) 1 (2007) 0 (2006) 3 (2005) 3 (2004)

Average Selling Price

1 Bedroom $ 67,700 $ 50,500 $ 59,900 $ 56,200 $ 77,900 $ 61,100
2 Bedrooms $ 90,000 – $133,000 – $111,400 $ 81,500

Number of Power of Sales

4 (2009) 4 (2008) 5 (2007) 4 (2006) 2 (2005) 4 (2004)

9099 Riverside Drive East
One of the largest high rise condo buildings, across from the city marina.

2009 2008 2007 2006 2005 2004

Number of Units Sold

1 Bedroom 10 (2009) 9 (2008) 10 (2007) 7 (2006) 12 (2005) 12 (2004)
2 Bedrooms 2 (2009) 2 (2008) 3 (2007) 2 (2006) 2 (2005) 2 (2004)

Average Selling Price*

1 Bedroom $ 84,200 $ 77,700 $ 85,500 $ 95,900 $ 100,000 $ 97,400
2 Bedrooms $ 99,000 $ 100,500 $ 111,300 $ 115,500 $ 128,500 $123,500

Number of Power of Sales

0 (2009) 1 (2008) 1 (2007) 1 (2006) 0 (2005) 0 (2004)

3936 Wyandotte Street East
A typical older nine storey high rise condo building,
One block from the river.

2009 2008 2007 2006 2005 2004

Number of Units Sold

1 Bedroom 5 (2009) 2 (2008) 1 (2007) 3 (2006) 10 (2005) 5 (2004)
2 Bedrooms 2 (2009) 0 (2008) 1 (2007) 1 (2006) 1 (2005) 1 (2004)

Average Selling Price

1 Bedroom $52,500 $ 60,500 $ 75,000 $ 74,500 $ 85,000 $ 75,700
2 Bedrooms $75,500 – $ 78,000 $ 128,000 $ 125,000 $ 120,000

Number of Power of Sales

3 (2009) 0 (2008) 0 (2007) 0 (2006) 0 (2005) 0 (2004)

It’s not only the selling prices of high rise condo units that have taken it on the chin. Million dollar properties along the river facing Belle Island are now not moving when put up for sale and townhomes in some of the older industrial/residential areas like “Forest Glade” and “East Riverside” have experienced in some cases even more pronounced price decreases. Behind every bank repo is a sad story and in most cases it involves working class families who have been hit hard with these new realities.

On a more positive note, what can be said to paint a brighter picture? Well, the people of Windsor are known to be resilient and many of them have lived through these types of downturns before. Windsor is still a town blessed with many pockets of very opulent houses. Watch the traffic go by on Riverside Drive on a nice sunny day and you will be surprised at the number of people who are driving high end convertible automobiles or drive out to any of their golf course parking lots and you will be hard pressed to find an empty parking spot! All of the regions tool and dye plants have made many people very rich over the years.

Ford swept the North American Car and Truck of the Year awards at the North American International Auto Show, for its 2010 Ford Fusion Hybrid and the 2010 Ford Transit Connect and Chrysler is still busy shipping out its popular passenger vans. One additional bright spot in the Windsor economy is the recent announcement of a bi-national, Detroit River International Crossing Project (a new bridge just to the south of the existing one), proposed for the federal, state and provincial government in The United States and Canada. It’s expected to be fully operational by the year 2014 with an estimated price tag of five billion dollars or so. Of course, that’s only a government estimate so the final ticket price will most likely be a few dollars more.

The U.S. Coast Guard is rejecting some aspects of the plans for this new project, which is adding a last minute wrinkle to things, however it is only a matter of time before that sorts itself out since early construction of the nine kilometer – 1.6 Billion dollar Windsor-Essex Parkway has already started. It is estimated that 15,800 construction jobs in Windsor and Detroit will be added over the five year construction period and that 30,000 permanent jobs will be added to the regional economy after its completion.

It seems to be somewhat of a safe bet to say that Windsor someday will see better times ahead. At least that’s what everyone seems to be hoping for. Forward looking government “think tank” type people like to talk about Windsor’s strategic positioning next to our country’s biggest trading partner, the university, and the working relationships it has with the learning institutions across the river, and its culturally diversified workforce. In the short term, all we can really say is that its real estate prices continue to be somewhat of a bargain. Where else, after all, in an Ontario city, can you still buy a nice condo unit in an upscale downtown high rise building for under $75,000? That’s the way we see it anyways.

Watch for the future launch of the new www.yourcondoworld.com Windsor site.