When Developers Fear, Opportunity Comes - Scarcity at Classic Winning Neighbourhood Yonge & Finch
Every crisis is an opportunity.
There is a very specific crisis happening in the Toronto housing market right now.
It is not obvious and you might not see it from the surface.
But if you can identify it, you can make it an opportunity and profit from it.
Make sure you stay till the very end because I’m going to unveil a rare opportunity.
In 2023, we are going to have 2 record highs.
A record high number of newly completed condo units, we talked about that last week.
And a record high interest rate in recent years.
So it doesn’t seem to make sense to buy a condo now, does it?
That’s the way most people think.
Indeed, data from Urbanation shows that pre-construction condo sales plummeted 79% in the third quarter of 2022.
Typically, developers have to sell 75% of the condo units in a project in order to get financing.
So if the developers are having a hard time selling, they can’t get financing and they can’t start construction.
You see, when buyers are stepping to the sidelines, developers are also stepping to the sidelines.
When developers worry that they won’t do well in sales, they would rather delay or cancel their projects.
Last year, 2022, 35,000 pre-construction condo units were anticipated to launch for sales.
And how many did we end up with?
Only around 25,000.
That’s almost 30% less than anticipated.
The developers who are still launching condo projects for sale in this market have 2 things in common.
One, they are financially very strong.
Two, they have great products on hand.
Remember, there are still 20% people buying and they are very selective.
High quality projects and high quality buyers will remain the characteristics of the pre-construction condo market in at least the first half of 2023.
Now the big question, can you see the crisis in this?
10,000 units less last year, maybe another 10,000 units less this year.
We’re going to run into a very serious shortage.
But this is not going to show up 3 to 5 years later because that’s the time required to construct these buildings.
And in the meantime, we are getting supply from condos that started construction a few years ago, so it would seem like we don’t have a problem.
Here’s the thing.
On one hand, our government keeps increasing the immigration targets for the next 3 years and beyond.
On the other hand, our future housing supply is going to run into shortage because of the current market atmosphere.
And what’s going to happen when supply fails to meet demand?
Of course, as an investor, we want to ride with that price hike and not left behind.
But the mortgage rate is so high now.
Then, just avoid it.
You can do exactly that by investing in a pre-construction unit now.
You put down some cash deposit, pay no mortgage and just wait and ride with the price hike 5 years later.
When everyone fears, opportunity comes.
Apparently 20% of the people have already cracked this code.
Did you know that the top 20% of Canadians own almost 70% of the country’s wealth?
Take action or wait-and see?
Be part of the 20% or the 80%?
If you are the 20%, here’s an opportunity that you should consider.
It is a rare location for pre-construction because it is a fully developed neighbourhood.
It has been the north end subway station since 1974.
Yonge and Finch.
Classic winning neighbourhood.
What you see, what you get, everything is there already.
The developer, Capital Developments, was able to get this remaining corner at Olive and Doris.
5 years later, this will be the only brand new condo within a 5 minute walk to the Finch subway station.
So what you’re really investing into is scarcity in a classic winning neighbourhood.
The project is called Olive Residences and 1 bedroom units will start from just the $600’s.
And you only need to put down 15% deposit instead of the usual 20%.
If you have extra cash on hand and you see this as an opportunity, click the link below and schedule a call with me now.