It can be easy for first-time buyers to get swept up - way up - in touring the multi-unit highrise developments expanding across the city's skyline. We understand the allure of "new", but taking a deeper look into Toronto's condominium market reveals the benefits of purchasing a unit in one of the city's older boutique buildings.
Downsizing from a house? Because they offer so much more square footage for the price, buildings of the 1980s (or so) vintage are quite popular with buyers whose needs are changing and are in search of the perfect smaller home.
First-time buyer? Older condos are also drawing in younger buyers whose priority is location. Their first choice might be to own a house, but - due to ever-increasing Toronto home prices - turn to larger-sized condos as an attractive alternative. These buyers are happy on balance - they acquire a decent amount of living space, gain an array of amenities, and minimize their commute being able to work, live and play in Central Toronto.
In search of their perfect unit in an older condo building, buyers should keep the following points in mind. First, keep an open mind when touring units and distinguish between what can - and cannot - be changed. We encourage buyers to focus on location and parking, which are two fixed assets in any property purchase, and older buildings often have the advantage on both fronts. Older condos are often in premium locations, some nestled in Toronto's most desirable residential neighbourhoods. Many older condo buildings include parking; meanwhile, new construction units oftentimes offer parking spots for purchase (and these can be pricey).
Because older condo units are often updated by buyers to suit their needs, it is a good idea for offers to include a home inspection condition. The inspection can reveal important information that might affect renovation plans, such as water damage, plumbing or HVAC issues. Once buyers own the unit and all (if any) conditions are waived, the new owners can begin to customize their new home. Before renovations, however, be sure to contact the property management company regarding any alterations and ensure the board approves the work. Become informed of all guidelines pertaining to the renovation, including times of day when work is permitted and processes for waste removal. Perhaps this goes without saying, but select a patient and skilled contractor to ensure compliance with the sometimes complex rule-set of your new building.
The building's demographics are also likely to impact your happiness as a resident, not to mention the property's resale value. While we caution over-generalizations, it is true that older buildings often have older (which can mean quieter) residents. We make it a priority to inform our clients about building demographics and we encourage buyers to get a feel for their potential new neighbours by speaking to building staff and current residents. In terms of resale value, we always provide a detailed history of the unit, and the building, as well as offer buyers insight into the unit's future resale price. In doing so, our team stays up-to-date on Toronto's development plans. If you find a building of interest and want to be sure no new high-rise might soon block your view, we suggest that you walk around the neighbourhood keeping an eye out for signs of development and visit the City of Toronto's Development Applications website here.
Finally, maintenance fees and ownership structure are features of condo life worthy of mention. In older buildings, maintenance fees are generally higher than for new-builds. New construction, however, often sees a quick rise in maintenance over the first years - particularly in the case of less experienced builders or those operating on tight timelines and budgets who may not use quality finishes. In terms of ownership, some older buildings are co-operatives (or co-ops), which present a unique type of ownership whereby you own shares rather than your unit; thus, co-op units cannot be rented out. Co-ops also expect a relatively higher percentage for the down payment and require board approval prior to purchase. With co-ops, the maintenance fees include the property tax, thus monthly fees may seem relatively high but keep in mind that tax is embedded.
Overall, we strongly encourage condo buyers to give Toronto's older buildings their due, both as a nice downsize option or a great purchase for one's first home.
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