Why Bidding Wars Are Back Big Time for 2015

Bidding Wars. It's the FIFA World Cup of the real estate world. Several teams play in the competition, but there can only be one winner. It can be a crazy game with plot twists and surprises, or it can play out as every one expects. Of course, most transactions do not involve a bidding war. So don't expect one every time you set out to buy or sell a property. Still, 2015 so far is proving to hold many more bidding wars than last year, and in areas that did not have them before.

Up until recently most bidding wars were predominantly found in downtown neighbourhoods in the old city of Toronto (pre-amalgamation), and it pricier parts of North York. Many advanced emerging neighbourhoods draw in quite a few bidding wars when they are well located, well staged, well marketed and well priced properties. Since houses, as opposed to condos, are in low supply in Toronto, that is where most of the bidding wars have been, and will likely remain.

Some neighbourhoods are more prone to them than others. And some price ranges are more prone to bidding wars than others. A property in Leslieville, Roncesvalles, Trinity Bellwood or the Junction Triangle will likely bring in a higher number of bidding wars.

I should be clear that a neighbourhood that has more bidding wars does not necessarily mean the properties are more valuable. It means that some neighbourhoods have a more prevalent culture of bidding wars over others. Some neighbourhoods seem to expect bidding wars. Other neighbourhoods, such a Cabbagetown, you'll find the list price higher, but the difference between list price and sale price to be much smaller than in neighbouring Riverdale. Why is that? Are houses less valuable in Cabbagetown? Well, not at all. Buyers expect a more realistic list price in Cabbagetown than in Riverdale. It's just a different way of doing things.

The bidding war culture is spreading though. I'm seeing it in areas of north of the 401 that did not have them last year. I am hearing about them as far off as Durham Region. I am also seeing a few bidding wars with condos, though this is still much less common than with houses. Bidding wars were much more common ten years ago with condos, but have slowed down with the growing supply. This past year, however, does show that condos are increasing their level of bidding wars. I think it speaks to an increase in the demand for condos, particularly ones that are distinct and well-located.

Bidding wars are also a result of price point. A home for sale for $3,000,000 will draw in fewer buyers than a home for $600,000 (that will net a lot more buyers simply because there are very few people who can afford a $3,000,000 home).

The rise of bidding wars can also be blamed on real estate sales people. Yes, people like me. Some believe that bidding wars are a good way to reveal the best price for a given property. It's almost like a blind auction where the home goes to the highest bidder. It is a strategy that can yield great results for sellers. Of course, some agents price their properties so low  that they receive 20 plus offer, which I believe is a waste of time for buyers and their agents. Some agent like to pad their stats. So,  if they sell $350K over asking they can be talked about in the Toronto Star or use these stats in their next listing presentation. They can brag that are the reason that their sellers have received hundreds of thousands over the asking price when the reality is that the listing agent has priced the property far too low.

Not all properties that sell well over asking are a result of an agent listing low. Sometimes you can have a change in the market where one house makes a leap ahead of the other. It is the best home put on the market that week, and buyers flock to that particular property. But lets temper our expectations, sellers.  To have a competitive house there is a lot at play. Yes, it has to do with location, but also your marketing plan, and how your house is laid out and staged.  Not all houses are sold in bidding wars, and that's not a bad thing! Other strategies work too.

Buyers, don't let your ears hang low like a dog because of your fear or disappointment with the bidding war culture. There are strategies to buying as well. If you want to live in a certain neighbourhood, you'll have to be competitive, but if you don't have time, the stomach or the money, there are other ways too.

The Fall Market Coming: What To Expect This Year

If you are anything like me, you may be wondering what happened to summer this year. Nights were cool, temperatures over 30 degrees were rare, and the humidity haters were one happy lot.  Still, even though it may feel like summer has barely started this year, there is no denying that it's exiting soon. Already, I hear the sing along jingles of back to school commercials. I wait longer in the traffic on Lake Shore because of the CNE. And I notice the nights this week coming a little bit earlier than last week.

Though the temperatures and the early evening may come gradually, the real estate market in Toronto more closely matches the beginning of the school year when summer ends abruptly. You wake up and poof! It's packed up and gone. Unlike the Spring market that may start as early as late January or as late and early March, the Fall market is predictable. Once you clear Labour Day, the new listing start rolling out, the buyers and sellers return to the market, and we see a busy period in September and October that slows down a little in November before really slowing down during the December Holidays.

Even though there are a collection of quality condos and houses that go up for sale in the summer, there does tend to be less activity during this season. The passion of the Spring market can trail off into July, but August is often very slow. Next to the festivities of December, August often has some of the fewest transactions of the year.

But what will the Fall market be like this year?  What will happen as the engines restart on Toronto properties? I suspect it will be like the Spring market of 2014. Condos will continue to have one of the best years they have seen in the 2010s. I don't think we'll see outrageous bidding wars or wild price appreciations here, but I think prices, for the most part, will be healthy, and we'll continue to see many condos sell in large numbers, generally better than last year. Of course, as I've said many times before, make sure you pick the right condo in the right neighbourhood. Not all condos are created equal.

For houses, the chronic low inventory will keep them in high demand. I don't think we'll see the number of bidding wars we saw in the early part of the Spring in most Toronto neighbourhoods. In some in-demand neighbourhoods, we saw houses go for $100K to even $200K over asking. I think the Fall market, however, will be more reflective of the late Spring, where a quality house would likely go into a bidding war, but not the scrappy shack in a lacklustre neighbourhood. First time buyers hungry for houses will likely cause emerging neighbourhoods like the Danforth Village and the Junction Triangle to continue to have significant price appreciations. Bargain hunters may look further afield in Caledonia/ Fairbanks, parts of the Danforth Village or Scarborough. Detached will still be king. For condos, the shift will continue to be to the downtown core away from the activity in midtown.

In terms of inventory, this will vary widely between the condo and the house. Certainly condos will have a steady stream of supply. No worries there. The trick is to pick the right one. Resale is still king though new condos are now offering much better incentive than in the past. It's hard to see how many houses will come up for sale. Still, it's easy to predict that buyers will outnumber sellers. Not all houses will go to bidding wars, but if you have a house in an established or emerging neighbourhood, you will do well with the right marketing plan.

So, whether your selling or buying or  already planning your next winter trip to Costa Rica, summer is fading fast and Fall is coming. There's simply no denying it any more! Hello cooler temps, a  light jacket at night, and a Toronto real estate market that is waking up from a short summer nap.

Shortfall: Know this Term if You're Buying A House This Spring

Planning on buying a house this Spring in Toronto? Then you have likely gone through your check list. Down payment?  Check! Pre-approval from the bank? Check! An estimate of what land transfer tax you will need to pay out?  Check!  Moving costs, insurance, bills?  Check, check, check!  It would appear that you have everything lined up and ready to go, but there is one more thing that you should add to your checklist.  And that's money for a shortfall.

"What is a shortfall?" you ask. Well, before I get into the nitty gritty of what it is, let me offer up a little backstory first.

As almost anyone who reads a newspaper or blog knows,  houses in Toronto are hot again this Spring. I know, not terribly surprising. There are many more buyers than there are houses to buy. How do I know this? Well, I have been in my share of bidding wars this past few months, and I have seen it first hand, though you don't need to be a real estate salesperson to clue into this.

It seems that at this particular moment in time, we are experiencing the quick ascension of two emerging neighbourhoods, namely the Danforth Village in the east and the Junction Triangle in the west.  Why? Well, they are the last two affordable places to buy a house that is close to a built subway line.

This low level of  inventory is not just in these parts of Toronto. It's happening in many areas of the city, but the Junction Triangle and the Danforth Village are two good examples of where some first time buyers or first time house buyers are heading to buy their home in Toronto. Quite frankly, I think these neighbourhoods have a lot going for them, and are transforming in really cool ways. I can see why there's some demand.

With that said, anyone who would like to buy a house in a hot Toronto neighbourhood right now will need to sport their war helmets and pull out their smiting sword, for battle.  Not for every property, but for many of them.

So, now that we have set the stage, let me explain a shortfall by way of example.

Let's say a couple has qualified for a mortgage that is $850,000 dollars. They have $160,000 to put down on the house after all their expenses. They find a nice big detached home for sale at $699,000. They know that houses have recently sold for a little more in the area, and in the past few months, they’ve been going for a lot more. On offer day, there are 15 offers. The buyers want the property badly enough and put in a bid of $950,000 to get the property. You may think that bidding $250,000 over the asking price is unheard of, but it's not. Though it was close, the buyers’ offer is accepted! Then the bank that is offering them the mortgage sends out an appraiser. The buyers’ financing depends on what this appraiser is going to say. The appraiser drives in from Mississauga, not really sure of the Toronto market, but with a lot of accreditations on how to do appraisals, and tells the bank that the property is only worth $750,000 according to their estimations. So, there is a SHORTFALL of $200,000 between what the buyers have paid and what the bank will cover in the mortgage.

What does that mean for the buyers? Well, it means that they have to fork over $200,000 of their own money to cover the difference between the purchase price and the appraised price PLUS they need a downpayment on the mortgage of $750,000. With $160,000, that is not enough.

I know, scary stuff. This is, however, a VERY extreme example of a shortfall. They are usually not so big, though it is always a good idea to anticipate that there could be a shortfall, even it if is as low as $10,000.

The trouble is, it is difficult to assess the shortfall because you do not know what the appraised value will be. Some appraisers come back higher than others. I have heard of appraisers appraising the same property with 20% spread in value.

There are some things you can do though to prepare for this:

1. Do the math. Know the comparable solds in the area so that you can have an idea if your offer is close to this value. If not, you need to factor a potential shortfall into your calculations. If you are tired of losing out in bidding wars, then you will know that a shortfall may be needed to win on some properties in in-demand neighbourhoods.

2. Work with an agent who knows the area where you are looking and knows what is required to win in theToronto neighbourhoods where epic battles of real estate take place.

3. If you find your appraisal to be lower, you can always try another mortgage at a different bank or you can appeal your appraisal. Remember, appraisers are not always going to come up with the same number.

Of course, if all of this is just too strange for you as a buyer, then you just need to pick another neighbourhood that has fewer bidding wars, what I call the NEXT emerging neighbourhood, or you may want to head to something less competitive, like a condo.

What Neighbourhoods Have the Best Price Appreciation?

In the spirits of the Olympics, I thought I would discuss something of a competitive nature. That is, I thought I would explore some recently compiled stats on homes in Toronto neighbourhoods and how they stack up against one another. These statistics were based on the sales from the Toronto Real Estate Board from January 2012 to January 2014 for detached homes. Out of the 36 Toronto districts, the top 5 districts were as follows:

1. C9: The Richie Rich (Rosedale and Moore Park)
2.  C2: The Centre of the Universe (including Annex, Wychwood, Yonge-St.Clair)
3. C1: Also the Centre of the Universe (including Niagara, Trinity-Bellwood, Dufferin Grove, Palmerston-Little Italy)
4. W02: Emerging Neighbourhood Emerging Fast (including the Junction Area, High Park North  Wallace-Emerson, and the Junction Triangle)
5. W03: Early Emerging Hoods Rising From Their Inexpensive Past (Rockliffe-Smythe, Keelesdale-Eglinton West, Westom-Pellam Park)

For a complete list of detached home sales in Toronto please click here for complete results.

Now lets look at the winners. Clearly the top spot speaks to the amount of money that is entering the high end market in the past two years. C09 had an increase of 115.63% in just two years.  I do find these stats to be a little questionable. I will discuss this below, but it does indicate that high end is back in Toronto. The centre of Toronto is still very strong showing us how much demand there is for detached houses in these neighbourhoods. C02 has a increase of 71.25% and C1 had an increase of 54.02%.

I think some emerging neighbourhoods really showed their growing value in past two years. A more advanced emerging neighbourhoods can be found in W02, that has increased by 51.69%. And for a place where houses have been remarkably inexpensive by Toronto standards, the early emerging neighbourhoods of W03 have increased by 40.61%.

Now all, this info may be a little overwhelming.These are remarkable increases. If you have bought in the top neighbourhoods, especially if it is a detached house, you will be thrilled. You may be crying over your keyboard if you wanted to buy in these areas but decided to wait a few years.

But before you get too smug in your foresight or crushed by your buyer position, let's look at these stats with a critical eye.

First of all, let's be clear that these are detached homes only.  Detached homes are king. Even if you want to live in a dense city like Toronto surrounded by people, Torontonians still covet the detached home. And these stats prove it. More than any other housing type, detached homes in this city have surged ahead in value. Detached homes across Toronto sell for a much higher average than other housing types, though semis, row houses and many low rises have also done well in the past few years. So, if you cannot afford detached, the other property types are still great investments that are appreciating in value as well.

Another pattern you can see from these stats: Emerging neighbourhoods, whether they are newly emerging or later in the cycle are good investments. Neighbourhood is still key to the success of a purchase whether it is a condo, a detached house or a town home. Pick wisely.

Despite what these stats may hint to us, I do tend to be fairly critical of them too, and for good reason. One of the fundamentals of gathering statistics is to have a large enough sample. If you don't have a large sample, your stats can show some pretty wild variation that may lead to a misrepresentation of a given neighbourhood. So, take Rosedale and Moore Park, for example. In the last year, there were less than 100 detached houses that sold in Rosedale and Moore Park. That is not a large enough sample to give meaningful results, making it much more prone to wilder fluctuations. It could simply mean that bigger and fancier homes have sold more in the last year than two years ago. So, in a nutshell, its #1 position may just be a lucky fluke.

Other neighbourhoods have some unlucky results based on these statistics. This past year I have experienced detached homes in bidding wars in the Oakwood-Vaughan area, and yet the statistics position this neighbourhood, along with Forest Hill, in dead last. The results just don't add up for me when I see demand in Oakwood increasingly outpacing other areas of Toronto. Again, I believe the small sample of homes reflects the wild fluctuations in the detached homes that have sold.  If you look at the sales statistics for each year in the district of C03,  you'll find that in January 2012 detached homes sold for $1,355,000 then plumetted to $635,000 a year later,  then shot back up to $1,210,000 by January 2014. There was really no reason why home prices would have been cut in half between January 2012 and January 2013 only to shoot back up again between January 2013 and January 2014. If we just regarded the statistics from the last year, Oakwood-Vaughan would have been one of the best performing neighbourhoods in the bunch. Clearly, there was just not a big enough sample of sold homes to give us clear results.

Another reason these statistics may be a little off has to do with how the neighbourhoods are grouped together. Take again the Oakwood-Vaughan area. Homes south of Rogers usually sell for much more than homes north of Rogers. Then we have the wealthier neighbourhood of Forest Hill mixed in C03 district to make three very different neighbourhoods slotted into the same sample with very different communities and styles of homes for sale.  Detached homes in C03 range from sprawling city estates to very neglected homes in need of some serious love.

Regardless if you live in the overwhelming lucky Rosedale-Moore Park or the neighbourhood unfairly disadvantaged in these statistics like Oakwood-Vaughan, it still does show us how home sales can be like the Olympics. Some athletes, like some neighbourhoods have shown us a remarkable improvement on their performance. Other athletes, and some neighbourhoods, often perform well, but were a little unluckily or treated unfairly by the judges. So,  have fun with the stats, but don't take them too seriously.

The Bidding Wars of Summer: Where You'll Find Them

Bidding Wars. Buyers hate them. Sellers love em.  They are certainly less pervasive in real estate than they were 7 years ago. In fact, some Torontonians are starting to get the impression that bidding wars have disappeared from our collective radar like Richard Simmons or Tab Cola. But they're wrong.

In the media these past few months, there have been more than the usual musings and articles on a housing correction in Canada, like it's already happened, despite the fact that prices on average are continuing to rise in Toronto.  In addition, from a personal perspective, I have found myself in bidding wars these past few weeks, despite the latest round of predictions. And this leaves some of my clients scratching their heads. "How come I'm in in bidding war with 15 other people if Toronto is going through a correction?" they ask. It's a pretty big disconnect, and it's understandable why people are confused.

The truth is, bidding wars are alive and well in this market, but it's not everywhere. So, let's explore reason why it is happing in some areas and not in others.

Here is why  it is happening in some locations:

1. First Time Buyer Houses. Under 600K for a house is a hot place to be in most parts of this city, especially if you are close to a subway line in an emerging neighhourhood like the Danforth Village or the Junction Triangle. In these neigbhourhoods, you will likely see more bidding wars. Because of our green belt policy, the city is undergoing a lot more intensification. And building more houses do not intensify any thing. Simply put, houses are in short supply and few new ones are added. And because of that, there are fewer houses to buy.  So, the first time buyer are heading out to buy what's left while they can still afford them. If it's in a neighbourhood with an improving commercial strip and good transit, even better!

2. The Local Expectation.  I notice that some neigbourhoods have far more bidding wars than others. And a lot of it has to do with how homes in a given neighbourhood have sold in the months previous. If every seller is pricing their home below market value and receives a lot of offers, then this becomes the common practice in the neighbourhood. In some neighbourhoods, like Cabbagetown, I find that there are currently fewer bidding wars because agents and sellers seem to prefer to price their homes closer to market value or even a little higher. In other neighbouroods, like Parkdale right now, homes are more likely listed below market value, and then the bidding wars bring it up to market value or beyond.

3. Interest Rates: Sure, interest rates are low, but in the past few weeks they have crept up, just a bit. So, the buyer who locked in at a rate of 2. 89% for a 5 year term that is good until August will be more likely to buy before that rate expires when he or she would roughly have a new rate of 3.39% for a 5 year term. This probably won't make a huge different, but it does, in all areas of the city.

And here is why it is not happening everywhere:

1 High End Homes - High end homes where we're clearing about $1. 4 to $1.6 million just have fewer buyers coming to the table. The vast majority of people can't afford this kind of home. So, they take longer to sell. It's also a segment of the housing market that is just not moving much these days. There's a lot fewer  people buying expensive houses or condos than there are buying a smaller condo, townhouse or starter home. So, bidding wars are unlikely.

2. New Construction: You really don't have bidding wars for new construction, but I mention it here because it seems that some of the sizzle has fizzled these days from new construction. There was a time when people used to line up overnight to buy a condo at a certain project, and the next day it would be sold out. Those days are gone (for now). One reason is that the developers don't offer very good pricing these days. Though there are more and more appealing incentives, it is still not leading to a product that people rush to. Plus, there is a lot of new construction coming on the market. So, from a supply point of view, there is a great deal of new condos to choose from. The exception may be conversion condos and townhomes. Like houses, there is a much smaller number of these types of properties on the market than condo apartments.

3. Giant condos - Condos that are several stories high will have a few bidding wars from time to time, but generally, they don't. I think there's a belief out there that if you don't buy a certain unit you like in a large building, you can wait a month or two and a similar unit will pop up. Or maybe there are several same sized units in the building on sale at the same time. Unless there is some thing special about the unit or there is little turnover, it will likely not be sold a la the bidding war method.

All in all, I'm not saying that bidding wars necessarily mean that a given area is healthier than another. Bidding wars are not always a good thing. When one property sells for 100K over asking with 25 offers, it may have less to do with the property being fantastic, and more to do with the property being underpriced to begin with. Still, it can also indicate that the seller or buyer has  a certain confidence about their property. They feel it is important to let the property be exposed for a certain period of time. Any way you slice it, the bidding war has not gone the way of the dinosaur. As far as Toronto is concerned, the bidding war has gone the way of the raccoon. Still among us.

Links that Stink: Does Toronto Need More Diesel Trains?

I want Toronto to be a better place. I know that sounds all warm and fuzzy. I mean, who actually wants Toronto to be a worse place than it is? But some times, when I see things happening around me that effect me, my clients, and our properties, I scratch my head and wonder: Who thinks this is a good idea?

Take, for example, the proposed Air Rail Link that will run from Union Station to Person. Initially, this air rail link, brought to us by a provincial organization called Metrolinx, was supposed to be done for the Pan Am Games in 2015. It was part of the Toronto proposal for the Games, and we promised to get it done by then. Or at least Dalton McGuinty did when he was around.

Now, I'm all for an air rail link to the airport. I don't know whether it's an economically sound idea. I heard from several sources that it may cost between $15 to $35 for a one way ticket to the airport. Ouch. But still, in theory, an air rail link seems like a good idea for a city of Toronto's size. Imagine being able to get to the airport in some thing other than a cab or a car! This could be great, if done right.

During the planning for the Games, however, Metrolinx decided to go with diesel trains for this link to Pearson. Right now, they have about  50 diesel trains on the line each day, but once the Air Rail link is finished, we will have up to 450 diesel trains using this route each day. And here's what we know about diesel trains. The pollution from them causes cancer. They are noisier. They may require Metrolinx to build sound walls at certain locations along the corridor.

As you may have heard, there have been residence uprisings in many neighbourhoods near the tracks. Understandably, they would prefer electric trains that don't create pollution and are quieter. Not very surprising really. Since the pollution can carry up to 2 kms, some people a fair distance from this area are also involved.

So, if you are like me, you may thinking: Why not just do electric? It must have to do some thing with cost.... Well, you are right at first glance. To build the infrastructure and to purchase the electric trains, it is more expensive. But they are are cheaper to run and cheaper to maintain. You just need more money off the top, then you spend less.

And here's the really odd thing: Metrolinx have actually built the infrastructure for electric lines for the future. So, it seems that the plan is to build a diesel train system possibly with sound walls only to be potentially replaced by electric ones in the future where sound walls won't be required. So, we may pay for it twice. And why? To meet a deadline for a 3 week sporting event? I feel it's great that Toronto is having the Pan Am Games. I love sports. I'm even a little excited for the Pan Am Games, but I also have to live in the city when it's done.

The funny thing is, Canada is the only Western nation without any electric trains in them. The U.S. has them in the Northwest and soon in California. All of Europe is covered in them from Spain the the UK to Russia and the Ukraine. Japan has them. Australia too.  Even developing nations like India and Malaysia have them.

The good news: There seems to be a slight change in the air around this issue. We have a new leader in the provincial government. This government did not make the same commitments as the last one, and hopefully they can see how this diesel train idea is a bad one. Some politicians have hinted that there may be some reconsideration going on. The light has been turned back on at the end of the tunnel. So fingers crossed that reason will reign here and electric will be done right from the get-go, and we can skip this diesel stuff all together.

How to Navigate in an Inconsistent Market.

A couple of months ago, when I was obsessed with the Olympics, I suggested that the housing market and the condo market were not in sync any longer. They are synchronized divers no more, to use an Olympic analogy. 

And this desynchronizing has only become more pronounced since the summer. To simplify, the housing market is a sellers' market with its limited supply and a decent amount of bidding wars. (In fact, I was in battle yesterday with 7 bids!) And the condo market is generally a buyers' market with it's larger supply and very, very few bidding wars.

But I wish it were that simple. Some great houses still don't sell. It's a mix of where you are and whether your neighbourhood is in demand. For some areas, I have a collection of buyers looking for houses in a certain price range who are frustrated by the bidding wars they have encountered despite the crabby, sky-is-falling real estate forecasts. 

As far as condos go, don't panic if you have one. And don't think the world is your oyster if you are planning on buying one soon. Yes, the market has certainly cooled in the condo department, but it may not last as long as every one thinks. Just be wise on how you invest.

Here are a few tips:

1. Don't buy new. It's really not very appealing at the moment. Developers often project what they think a condo will cost on the completion date. They will use past sales patterns to project what they think a property will cost in say 2015 when the condo should be built. The thing is, it's 2012, and they don't know how much a condo will cost in the future.  They're generally overpriced. In fact, as far as condos go, I say buy converted lofts - they are in short supply and usually increase in value. 

2. All neigbhourhoods are not created equal. I am still a firm believer that if you are near an improving commercial strip, you will be making a wise investment. Look what a great commercial strip did for Leslieville? Now I'm looking at Danforth Village, Junction Triangle, Bloordale, Long Branch. When the economy tanked in the late 80s, the commercial strip in Little Italy on College kept on improving, bringing up the values of the homes nearby up in value. 

3. Don't buy in a giant building. If you have to sell in a buyer's market, you'll likely be up against someone in your building. Buy under 8 stories. At least you may be in a building that is not in a constant state of selling. Some units, however, in massive places are great if the unit is unique. The other exception: When you are a first time buyer on a limited budget, big condos an be affordable with maintenance fees that are spread out between more condo owners. 

Residents' Groups: Friend or Foe of Toronto?

Toronto is a city of neighbourhoods. We've all hard this countless time. It's all a part of the Toronto brand. And though this point may have been driven home a little too much at times, it's true! In fact, we are becoming increasingly more splintered into a greater buffet of neighbourhoods. And I think that's a pretty amazing thing.

Even neighbourhoods that have never existed before have sprung up in the last 10 to 15 years with a new identity and a group of residents that are proud to be a part of their little village in the big city. There's the Junction Triangle, Liberty Village, and even the Distillery District that just didn't exist as identifiable neighbourhoods not too long ago. 

And what makes these areas successful are the people who live there. They form residents groups, condo boards and business improvement associations. They encourage fresh businesses to come to a given area. They bring in farmers' markets. They go to derelict land and plant pretty gardens. They make you walk through your neighbourhood with a feeling that things are getting better, that life is getting better, and that you should have pride in living in your neighbourhood. And for all of that, I give kudos to the residents' groups of Toronto. 

But it's not all flowers and farmers' markets. These groups can be quite powerful as well.  They can shut down some of the biggest developers in the city.  When a developer was planning on putting in a massive Smart Centre south of Eastern along the southern boundaries of Leslieville with a Walmart as it's potential anchor, the neighbourhood rose up in revolt and stopped the development in its tracks. In this case, the villain, Walmart, is an easy target as the bland, box store that could decimate any distinctiveness a little neighbourhood may have. So, it's easy to cheer on the residents' group here. 

For the most part, I am thrilled that neighbourhood assoiciations exist to keep developers in check. Still, I've seen neigbourhood associations get crazy. And strangely, it often happens in more established neighbourhoods where the residents don't want any thing to change. A classic case of NIMBYish (Not in My Backyard). So, at at time when the Beach could use a bit of an overhaul on it's tired commercial strip, the residents association rises up and shuns the idea of a condo being built, a condo that is mid-sized, and will bring in more residents to the area, and in turn, more people to support better businesses. 

I don't want to weigh in too much here on this particular debate, but I do want to make a point: The problem with some residents groups is that they want to block every thing. Keep their neighbourhood from changing in any way. There's no doubt we are living in a city where there is going to be more densification in every corner of Toronto. So, get used to denser living. Dense living does mean we may have less privacy, and more traffic, but it also means better businesses and more vibrant commercial hubs because there is a larger base to support the businesses. I've witnessed some interesting condos get turfed for the wrong reasons by the power of a residents group. I've also witnessed the same group block a really bad condo idea. Developers do need to be kept in check, and even shut down at times, but I think it's wiser to come to the table with some creative ideas on how to make change work, not screaming: No way! Not in my neighbourhood! And hopefully this will lead to the right kind of change in your corner of the city.  

Getting In On An Emerging Neighbourhood

Usually in these rants, I like to go on about the city as a whole or zone in on a specific emerging neighbourhood  - those transforming areas of Toronto that are changing from downtrodden or dull to culturally cool and distinctive. They're places where I believe you could invest wisely now, and  see better price appreciation on your home than the average Toronto neighbourhood. There's Danforth Village, Mimico, and the Junction Triangle to name a few. But today, I want to be very specific and move in from Toronto neighbourhood to a property in an emerging neighbourhood. Namely, a condo unit between the Junction Triangle and Brockton (sometimes called Bloordale), near Lansdowne and Bloor, that I believe has quite a bit going for it.

Now let me be clear because I am a real estate agent after all. This is not me trying to promote my own listing. I will not make any money on the sale of this unit. It is, however, a great property in a neighbourhood that may still has a few strip joints on the main drag, but that also has a growing number of art galleries and restaurants moving in. And it doesn't hurt that it's on the subway line.

This unit itself is in an authentic converted loft - a much more unique condo option compared to the cookie cutter giant boxes in some areas of Toronto. It is 900 square feet on 2 floors with a living room, dining room, office and bedroom.  I rarely like to recommend condos that have no parking, but in this particular location, the street parking is not such a bad option because you can actually find parking on the street. It's listed at 355K. And for its size, you would have a hard time finding an authentic loft condo in other parts of the city for a similar price.

If you don't believe me and my hype, see for yourself.

Lansdowne and Bloor revisited

You know, I went to a nice little restaurant, last night, called Zocalo. Less than year old. It was set up on Bloor Street near Lansdowne and Bloor, an intersection famous for it's low-end strip joints and seediness. Despite the neighbourhood, the place was full. Great food at a very reasonable price. Happy customers that kinda felt like they just discovered a well kept culinary secret.  I think there's some thing to be said about being a pioneer in an emerging neigbhourhood like Lansdowne and Bloor. But what does a successful business have to do with residential property demand, you ask? Well, a healthy commercial strip leads to a strong/cool/in demand community, then, eventually,  it becomes a destination that every one wants to travel to, a place too expensive to buy unless you bought early or you have money.  If you're looking for a home close to transit that I believe will have some of the best appreciation over then next 5 to 10 years, then consider this neighbourhood, whether you call  it the Junction Triangle, Bloordale Village or just Bloor and Lansdowne, the seeds have been planted, and good things are gonna happen  here. It won't happen overnight, but at some point the character of this corner is gonna change.