A few days ago in The Globe and Mail, Steve Ladurantaye wrote about supply and demand. He didn't refer specifically to that but regardless, that was the story.
Writes Steve, "Investors rushed to buy Toronto condos in the good times, now there is worry that they will rush to the exits as the economy weakens and they realize that profits are hard to come by in an overbuilt market."
Yes, that's obvious. If the supply of new listings increased substantially, it will indeed affect the market. However, to all of my clients and would-be clients of condos, don't despair. You're in good hands.
The reason I feel so confident that all is well with your purchases is that you did not buy in the condo ghetto, the buildings that are primarily owned by offshore investors, the buildings with major problems. These are the condos that will be hit the hardest.
Yes, the condo market will take some sort of hit in the near future. In the past year, 45,000 new units came on the market. Also, if you look around the city, you can see there are many more buildings under construction or close to it. Many of these are large major projects with hundreds of units already sold. I wouldn't want to be that investor tying up many thousands of dollars for 2 or more years. This money is invested in a high risk game and the potential return is in my view, minimal at best.
I've said it here many times. If you buy a good house on a great street in a good Toronto neighbourhood, your investment is solid. Similarly, if you buy a good condominium in a great development in a good Toronto neighbourhood, your investment is solid.
I just learned about another problematic building on Wellesley Street and I'll write about that soon.
