Real Estate

Is purchasing resale condos even worth it anymore?

  • Last Updated:
  • May 14th, 2020 3:11 pm
[OP]
Jr. Member
Oct 27, 2017
129 posts
120 upvotes

Is purchasing resale condos even worth it anymore?

I've been looking for resale condo to get some cash flow going but with the insane cost of maintenance fees, is it even worth it, assuming I'll buy the unit cash?

It seems maintenance fees is ridiculously outpacing rent costs! What will be the solution when maintenance fees is equal to rental cost?
38 replies
Deal Fanatic
Mar 27, 2004
6670 posts
4571 upvotes
Toronto
SKOMO85 wrote: What will be the solution when maintenance fees is equal to rental cost?
How can anyone even take you seriously with this question when you make statements like that?
Full-time Realtor
[OP]
Jr. Member
Oct 27, 2017
129 posts
120 upvotes
oasis100 wrote: How can anyone even take you seriously with this question when you make statements like that?
If you cant think of a proper answer to my legitimate question, please move on to the next thread
Deal Expert
Feb 29, 2008
17363 posts
14756 upvotes
Tarrana & The Ri…
You really have to find a good building with a good board. My maintenance fees for my primary have gone from $600 to $690 in 6 years now for 970 sqft.

At some point the maintenance fee pushes the price down.

BTW: Mainteance fees will go up even higher after the pandemic.
[OP]
Jr. Member
Oct 27, 2017
129 posts
120 upvotes
JayLove06 wrote: You really have to find a good building with a good board. My maintenance fees for my primary have gone from $600 to $690 in 6 years now for 970 sqft.

At some point the maintenance fee pushes the price down.

BTW: Mainteance fees will go up even higher after the pandemic.
It's true it does push the price down. You can find units for 299k with a $870 maintenance fee

Doesnt make sense to invest long term. What will they do when nobody buys the units anymore? Lol. This baffles me
Deal Fanatic
Apr 5, 2016
5773 posts
4189 upvotes
Calgary/Vancouver
I find Toronto has extremely expensive strata fees. What does this even pay towards? Few condos I own in GVA, the strata fees are around $250-420 for sizes 618-950sqft. This is even after a spike in condo insurance. Plus, there's a decent size in contingency fund too and inspection and maintenance all done on schedule. The swimming pool adds a hefty sum but nothing crazy that warrants a $500-900 a month fee.
Deal Fanatic
Mar 27, 2004
6670 posts
4571 upvotes
Toronto
SKOMO85 wrote: It's true it does push the price down. You can find units for 299k with a $870 maintenance fee

Doesnt make sense to invest long term. What will they do when nobody buys the units anymore? Lol. This baffles me
there are condos w 2k maintenance fee at the Shangri La that people still buy. same with the Ritz residences.
183 Wellington
180 university
Full-time Realtor
Deal Expert
Feb 29, 2008
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bomber17 wrote: I find Toronto has extremely expensive strata fees. What does this even pay towards? Few condos I own in GVA, the strata fees are around $250-420 for sizes 618-950sqft. This is even after a spike in condo insurance. Plus, there's a decent size in contingency fund too and inspection and maintenance all done on schedule. The swimming pool adds a hefty sum but nothing crazy that warrants a $500-900 a month fee.
It is the great unknown.
[OP]
Jr. Member
Oct 27, 2017
129 posts
120 upvotes
oasis100 wrote: there are condos w 2k maintenance fee at the Shangri La that people still buy. same with the Ritz residences.
183 Wellington
180 university
That's crazy. How much is rent there?
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Dec 13, 2016
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SKOMO85 wrote: I've been looking for resale condo to get some cash flow going but with the insane cost of maintenance fees, is it even worth it, assuming I'll buy the unit cash?

It seems maintenance fees is ridiculously outpacing rent costs! What will be the solution when maintenance fees is equal to rental cost?
The same can be said about property tax. How cum you are not scared about that? My aunt lives in very average house in Laval, Quebec (what's the average salary there, people always complain about Toronto prices being too high) and pays $4,500 annually in property tax. House was built in 1986 and last time she paid 20,000 for a roof repair.

How about the cost of shoveling snow, making your garden in order and removing leaves so you don't get a ticket? 4,000 in electric anually?

The annual costs you save on having a house are (to some) offset by saving on car payments, gym membership, heating costs (some condo fees also include electric), shoveling snow, security, etc.....

I have never seen a rental being the same as condo fees. Not 1 example. Even in the most run down buildings that were scammed by a property management there were special assessment fees that lasted 1-2 years.

There were a few buildings in Vancouver that I remember suffered from structural damage and unit owners were required to pay close to 100,000 each. I wonder how that ended up.... it was over a decade ago I think.
Last edited by BiegeToyota on May 10th, 2020 9:30 am, edited 1 time in total.
Deal Fanatic
Mar 27, 2004
6670 posts
4571 upvotes
Toronto
SKOMO85 wrote: That's crazy. How much is rent there?
You can look this up yourself. but I can assure you its significantly more than the maintenance fee.
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Jan 29, 2010
1702 posts
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Toronto
If condos aren’t increasing in price like the last 5 years, then the cash flow aspects doesn’t make it an attractive investment because if you buy now, the property will definitely be negative cash flow by several hundred.
Member
Nov 5, 2017
248 posts
234 upvotes
One big support of appreciating condo prices was or is intrest rate which is zero. Cant go lower than zero.

Rent will not go up for at least few years.

Inflation, taxes and maintenance will eat away any remaining +ve cash flow.

To me investing in condo at this point doesn't look promising.
Member
Nov 5, 2017
248 posts
234 upvotes
Govt will step in with full force though.
1) remove stress test
2) bring back 30, 40 year mortgage
3) zero down payment
4) share equity program
5) tax deduction for intrest paid on real estate
6) decrease land transfer tax
7) dont pay mortgage for 1st year.
8) 5k to 10k gift for first time home buyer and new immigrant
9) start insuring property over million
10) increase limit of borrowing from 5 times to 10 times your income
Well I know at least 10 policy which can pump real estate to Mars. Its already on the moon.

I would wait until govt intervene and steps up support and than buy investment property
Deal Addict
Jan 17, 2006
2256 posts
2385 upvotes
Toronto
SKOMO85 wrote: If you cant think of a proper answer to my legitimate question, please move on to the next thread
It is not legitimate, it is as silly as it gets.
Deal Addict
Feb 19, 2019
1569 posts
2355 upvotes
Stouffville ON
JayLove06 wrote: It is the great unknown.
You hire people and companies to do everything for you who hire people and companies to do everything, as well as engineers, accountants and lawyers to ensure many regulations are followed. Since it's not their money it is not done in the most efficient way, but I don't know of a better solution.
I am sure you know all that ;-)
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[OP]
Jr. Member
Oct 27, 2017
129 posts
120 upvotes
ilim wrote: It is not legitimate, it is as silly as it gets.
Its slowly happening. Would you buy those old beat up brick condos with a $900 maintenance fee and a $1,700 rent?
Deal Expert
Feb 29, 2008
17363 posts
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Tarrana & The Ri…
senasena wrote: You hire people and companies to do everything for you who hire people and companies to do everything, as well as engineers, accountants and lawyers to ensure many regulations are followed. Since it's not their money it is not done in the most efficient way, but I don't know of a better solution.
I am sure you know all that ;-)
I've seen situations though where the board will pay a contractor and that contractor will flip money to a board member. Or that they just spend freely when they didn't need to. I know a condo downtown was maybe 3 years old, the board went and completely renovated the lobby for a lot of money and people were pissed about it. For sure there is money there that gets wasted/misused. We see the paper trail in the yearly docs but it doesn't show everything.

That said, pick your poison I guess. You want to do everything and follow up on all the maintenance and do the legwork and physical work? Get a house. You want to sit back and relax and let somebody else do it? Get a condo/tonwhouse.
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Jan 27, 2004
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T.O. Lotto Captain
SKOMO85 wrote: It's true it does push the price down. You can find units for 299k with a $870 maintenance fee

Doesnt make sense to invest long term. What will they do when nobody buys the units anymore? Lol. This baffles me

Most likely just turn into a rental.
Someone will buy it. The price and speed of sale is another story.
Deal Addict
Jan 17, 2006
2256 posts
2385 upvotes
Toronto
SKOMO85 wrote: Its slowly happening. Would you buy those old beat up brick condos with a $900 maintenance fee and a $1,700 rent?
Is your example appropriate for your OP?

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