JohnAmardeil.com

As you no doubt know, the GTA condo market is on fire. This is good news for us in the industry, but does raise important questions, such as how long will prices continue to rise, and more importantly, whether we’re facing a bubble that could burst anytime.

Last Thursday, I attended a high-rise forum analyzing the GTA condominium market. Organized by BILD, the forum sold out quickly, which is hardly surprising given the significance of the topic at hand.

So if you couldn’t make it to the forum, you’ll likely appreciate the following summary.

According to a Condominium Market Survey that Urbanation carried out last December, 53% of developers, lenders, brokers and consultants surveyed worry about price growth.

Little wonder: the sold index pricing in the Toronto census metropolitan area is up 8% annually to $509 per square foot, compared with $388 per square foot only 4 years ago.

Of course, as the price has gone up, so has the investors’ share of sales, which may reach as much as 80%, according to some in the industry. Indeed, investors are now seeing an increase in incentives designed to lure them rather than homeowners, such as lower down payments, capped closing costs, and guaranteed rental programs.

The problem with rentals is that condo rental appreciation isn’t keeping up with the new index price growth — in fact, index rents declined in the first quarter of last year.

Add to this decline the possibility that investors will experience less price growth, and you get a scenario that could see the Toronto condo market disrupted.

In the end, although we may not have to endure a bubble burst, it pays to act in a way that will mitigate the risks. Possible measures include:

• Keeping 15% to 20% deposits for all units regardless of projects’ percentages sold, eliminating extended deposit structures,
• Eliminating free or inexpensive assignments, and
• Keeping broker commissions at 4%.

What are your thoughts on the GTA condo market?

No longer restricted to downtown.

Something different is happening.

As I wrote in my previous blog post, the Toronto condo market is the hottest in North America (and one of the hottest in the world).

What many people don’t realize is that more condos are now being sold (and, soon, built) in the 905 area. As supply and affordability of low-rise housing in this region are eroded, sales of condos there have been increasing (particularly in Oakville, Markham, and Vaughan).

In fact, 905 is now outselling 416, with sales in the 905 eclipsing the 416 numbers at a ratio of 59 to 41.

This is understandable. Why wouldn’t you buy a condo in the place where you can get the most bang for you buck, especially if you already work in the area, which would save you a painful commute downtown?

This trend isn’t just a first in my career — it’s also good news for my company BAM Builder Advertising & Marketing. We may have mostly dealt with low-rise builders in the past, but we know the 905 area like no 416 marketer does.

Moreover, we have a long history, in the manner of most condo marketers, of selling emotion and lifestyle and dreams and life memories, rather than features and floorplans.

These are what sell homes. And now that high-rise has arrived in our backyard, we intend on making the most of it.

Now it’s your turn: how is this new trend affecting your business? I’d love to hear from you!

Everyone knows Toronto is at the moment one of the world’s busiest condo markets. Everyone also knows the U.S. is suffering a serious economic downturn.

So I was surprised to note, on a recent visit to New York, that the condo market seemed almost as busy there too as it is here.

Having decided to look it upon my return, I confirmed two things.

First, there are indeed more condos under construction in Toronto than in any other city in North America.

Second, New York is almost as busy — indeed, the Big Apple currently has 86 high-rise condominium buildings in construction against Toronto’s 132. (The second busiest city in the Americas being Mexico City with 88 condos under construction.)

Under normal circumstances, the fact that many condos are being built in New York shouldn’t shock anyone, at least not as much as the fact that even more condos are being built in Toronto.

After all, our city has long had a low housing intensity, and only jumped on the condo bandwagon when different factors combined together: households began getting smaller, immigration increased, and land costs, housing prices and gasoline prices went up.

Still, it is somewhat surprising (not to mention reassuring) to find so many condos being erected south of the border, if only because of the gloomy financial outlook.

Much is made, in blogs and social media, of the potential of touchscreens in the real estate realm. I for one have already blogged about this topic, commenting on the successful use of touchscreens in a presentation centre that catered to empty nesters — not the first demographic to come to mind when touchscreens are involved.

The attention is understandable. Touchscreens can, after all, help answer a typical question of most homebuyers: what will the community and the homes look like?

True, scale models and presentation centres provide them with an idea, but touchscreens have the potential to take this idea to the next level by allowing consumers to interact, zoom in and out, choose different finishes, compare home models side by side, and more.

Consider the videos below:

 

People’s interest in touchscreens isn’t limited to their choice of homes. My social media staff tell me giveaways and contests involving an iPad invariably get a very high response rate. The iPad, it seems, is a foolproof way to get people involved – no matter what the demographic is or where the community is located.

Interestingly, touchscreens aren’t just influencing the way we marketers peddle our wares or homebuyers decide which new home they should buy. An increasing amount of people in the industry are using iPads to show ideas to clients as well as to check their email and calendars.

That’s exactly what I did two days ago — I finally got myself an iPad. Having one will allow me to do what I wrote above and also to understand the technology and the product better.

Now I turn it over to you. Have you used touchscreen technology to market a product?

Do you have an iPad or a tablet? If so, did the experience change how you use touchscreen technology as a marketing tool?