Personal Finance

Dissapointed with realtors, should I be expecting more?

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  • Dec 14th, 2013 12:58 am
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Jun 14, 2012
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kingrukus wrote:
Dec 6th, 2013 8:46 pm
None of them are able to offer real technical financial advice on whether it is a good investment.
I'll save you the trouble: It's not.

Condo market in toronto is so overpriced now it's not a good investment no matter how you look at it. It's impossible to buy a condo in toronto today that will yield positive cash flow after mortgage, tax, and condo fee, considering how low the market rent rate is compare to purchase price. And if you buy with the intention of flipping it's impossible to make money because the prices have stopped appreciating as much as they were several years ago. If you're buying it to live in yoruself that's ok but if you're buying it as an investment you're not making a wise decision.
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professor24 wrote:
Dec 7th, 2013 1:54 am
If you think that's all I do then all the power to you. I absolutely make a plan with my clients. We look at what kinds of plans they have in the next 5 years and develop a exit strategy. We also help the credit and debt challenged clean their mess up, put them on the right track that hopefully they will follow. We also take in client's that have been declined by major lenders, look at the file and repackage the deal with the result of the client being approved soon there after. Now mind you some brokers wont do this kind of stuff. They would rather do what you think we do. However, on my end I can assure you that I am a business owner and a professional.
what credentials do you have?
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Mar 31, 2013
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Xiaohaibao wrote:
Dec 7th, 2013 3:42 pm
I'll save you the trouble: It's not.

Condo market in toronto is so overpriced now it's not a good investment no matter how you look at it. It's impossible to buy a condo in toronto today that will yield positive cash flow after mortgage, tax, and condo fee, considering how low the market rent rate is compare to purchase price. And if you buy with the intention of flipping it's impossible to make money because the prices have stopped appreciating as much as they were several years ago. If you're buying it to live in yoruself that's ok but if you're buying it as an investment you're not making a wise decision.
I'm not saying it is the best investment or anything, but I bought 2 years ago and I pay less (yes, even after taxes, condo fees and mortgage) than I would in rent. The ROI still may not be worth it especially since the property value could fall, but you are just saying something that is false. I would have positive cash flow right now if I rented out my unit instead of living here myself.
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K1Toronto wrote:
Dec 8th, 2013 10:56 pm
I'm not saying it is the best investment or anything, but I bought 2 years ago and I pay less (yes, even after taxes, condo fees and mortgage) than I would in rent. The ROI still may not be worth it especially since the property value could fall, but you are just saying something that is false. I would have positive cash flow right now if I rented out my unit instead of living here myself.
If you bought that same unit TODAY at todays prices, could you beat out renting?
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Mar 31, 2013
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sirex wrote:
Dec 8th, 2013 11:01 pm
If you bought that same unit TODAY at todays prices, could you beat out renting?
Yes, not by much though. Rents have gone up by a greater pace (at least in downtown Toronto) than condos since I bought, but interest rates are also a bit higher.
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K1Toronto wrote:
Dec 8th, 2013 11:07 pm
Yes, not by much though. Rents have gone up by a greater pace (at least in downtown Toronto) than condos since I bought, but interest rates are also a bit higher.
Show me the numbers.

How much does your unit cost today?
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Mar 31, 2013
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sirex wrote:
Dec 8th, 2013 11:12 pm
Show me the numbers.

How much does your unit cost today?
Units that are $350-360k can rent for about $1800/month right now. It isn't that hard to figure out that it would be close in cash flow so the claim that "it's impossible" is wrong. Numbers can change from cash flow positive to negative depending on variable vs fixed mortgage rates and how much downpayment.
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Apr 15, 2005
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Xiaohaibao wrote:
Dec 7th, 2013 3:42 pm
I'll save you the trouble: It's not.

Condo market in toronto is so overpriced now it's not a good investment no matter how you look at it. It's impossible to buy a condo in toronto today that will yield positive cash flow after mortgage, tax, and condo fee, considering how low the market rent rate is compare to purchase price. And if you buy with the intention of flipping it's impossible to make money because the prices have stopped appreciating as much as they were several years ago. If you're buying it to live in yoruself that's ok but if you're buying it as an investment you're not making a wise decision.
I already ran the numbers and at today's rents I will definitely make positive cashflow on it. Sure it was a better time to buy earlier... I mean isn't that almost always the case? Yes there are some seriously overpriced units, but there are a lot of decently priced ones as well. I am prepared to face a correction in the market after purchase. What I am banking on is an even larger correction with detached homes in the suburbs.

I personally think rents will remain relatively high even with new units coming online in 2015 and interest rates going up, which will either keep purchase prices stable or even send them down. With commutes getting increasingly worse, immigration continuing at the current rates, and a lot of young people simply not being able to afford to buy, I see rents staying high in the downtown core.

Then again this wouldn't be my first bad investment..lol. At least this time I will have a place at worst to live in, rather than a few paper statements to cry over ;)
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Nov 24, 2004
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I can understand the OP's frustration, since many Realtors and RE brokerage companies (and sometimes mortgage brokers) do set themselves up as experts on investing in RE. You have to remember that they are, as previously mentioned, really just salespeople, and that the formal qualifications required to enter the business are not particularly rigorous.
I am prepared to face a correction in the market after purchase. What I am banking on is an even larger correction with detached homes in the suburbs.
OP can run through the numbers but I would be cautious here, based on historical precedent: the 1990-1994 housing crash in the GTA hit condos much harder than single-family homes, primarily because many condos were speculative plays at that time (you can make the same argument in 2013). There are also IMO a lot more unknowns when it comes to maintenance costs for condos (increases in monthly fees and special assessments). Caveat emptor.
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If I'm paying $1800 to live in a condo, I'd better have 3 roommates to split the bills with.
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vaportrails wrote:
Dec 9th, 2013 12:43 pm
If I'm paying $1800 to live in a condo, I'd better have 3 roommates to split the bills with.
downtown condo living isn't for you then. I don't agree with the cost myself, but if the market dictates it...
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mattieuk wrote:
Dec 7th, 2013 3:23 pm
What exact services are you looking for? Judging by your comment about them not offering investment advise, I have a feeling you may have higher expectations for what a Realtor should be doing than is typically seen. For example not getting investment from someone who ia unqualified to provide it, whilst delivering a sales pitch is typically seen as a good thing...

If you are going off the HGTV world of being toured around 10 different listings a weekend for a month, and expecting a similar service in the real world, then you may not find many Realtors who are able to offer that service.

With regards to assignment units, have you searched out Realtors who specialise in this? I've seen a few Realtors who market this as their area of speciality - and assignments could well be one of those areas of the industry where professional connections are far more important than access to secret MLS information.

If the service is really that bad, why not represent yourself? No one is forcing you to work with a buying Realtor.
I was hoping for solid knowledge of the downtown core, where to stay away from, where they project will head up in value compared to other neighboring areas, and logical reasoning behind it. Also the ability to provide solid comps and use that as a negociating tool with sellers.

I have received more agent's contacts from guys I work with who already own units downtown. I am hoping this may be a better experience. I will check to see if they specialize in assignment sales and such.

If I don't feel like any of these new agents are anymore capable, then you are right I will need to represent myself.
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kingrukus wrote:
Dec 9th, 2013 12:54 pm
I was hoping for solid knowledge of the downtown core, where to stay away from, where they project will head up in value compared to other neighboring areas, and logical reasoning behind it. Also the ability to provide solid comps and use that as a negociating tool with sellers.

I have received more agent's contacts from guys I work with who already own units downtown. I am hoping this may be a better experience. I will check to see if they specialize in assignment sales and such.

If I don't feel like any of these new agents are anymore capable, then you are right I will need to represent myself.
look up Condoman

I think he's an alright guy over all. Might seem a bit sharkish, but hes on track and on point. I think he wil be able to give you good advice for investment properties/good price per sq ft and good areas/upcomming areas.

With downtown Toronto you're pretty much looking at a fairly simple grid pattern.

a) You got liberty village. Strachan and king to Atlantic and King, and then south of that.
b) You got King West, basically King and Spadina to King and Strachan.
c) You got King and Dufferin to Queen and Gladstone.
d) You got Bremner and all the condos around the ACC
e) You got Lakeshore and Bathurst + surrounding areas
f) You got Bathurst and Front to basically Blue Jays way and Front.

Those are pretty much the condo corridors in down town Toronto.

I dont like East of Yonge, but some good stuff out there.

I would probably say that King West is going to be the best area no matter how you spin it because a) its right on the main street car artery b) it's good the best access to shops on queen, parkettes, dining, grocery stores etc.

You go south and getting onto the main ttc arteries is a pain. you go to far west, and it gets to grimy. You go to far east, grimy. You go down to the ACC area, to much headache.
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Dec 9, 2013
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Well this is a common problem. To be true there are only a very few real estate brokers who serve for the well being of the client. The rest just wants their commission that’s all. You were talking about them not giving you advice on the benefits of the investment; the thing is that most of the realtors don’t know much about. So they tell you about what they know, like the recent deals that happened in the locality. And if are serious about getting a license for yourself I will second that. My brother-in-law got a home inspections license for himself after being fed up of the formalities and having a row with the officers and he is gloating now.He did a distance education course from the Freedom Business School in California. Maybe you should try out getting a license. After all it is an extra means of income.
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sirex wrote:
Dec 9th, 2013 6:24 pm
look up Condoman

I think he's an alright guy over all. Might seem a bit sharkish, but hes on track and on point. I think he wil be able to give you good advice for investment properties/good price per sq ft and good areas/upcomming areas.

With downtown Toronto you're pretty much looking at a fairly simple grid pattern.

a) You got liberty village. Strachan and king to Atlantic and King, and then south of that.
b) You got King West, basically King and Spadina to King and Strachan.
c) You got King and Dufferin to Queen and Gladstone.
d) You got Bremner and all the condos around the ACC
e) You got Lakeshore and Bathurst + surrounding areas
f) You got Bathurst and Front to basically Blue Jays way and Front.

Those are pretty much the condo corridors in down town Toronto.

I dont like East of Yonge, but some good stuff out there.

I would probably say that King West is going to be the best area no matter how you spin it because a) its right on the main street car artery b) it's good the best access to shops on queen, parkettes, dining, grocery stores etc.

You go south and getting onto the main ttc arteries is a pain. you go to far west, and it gets to grimy. You go to far east, grimy. You go down to the ACC area, to much headache.
Yeah those are pretty much the same neighborhoods I have looked at. There is also the moss park and regent park areas which are being revitalized as well. However given the sketchy people around that area, the prices of the condos there do not make it worth it.

Any thoughts on the bathurst/lakeshore area and Liberty Village area? A lot of people I work with live in both areas and seem to like it.. I am concerned with liberty village's transportation bottle-neck with the queen line, and more-so with the booming condos where city infrastructure is clearly not keeping up.

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