Monday, 26 March 2012

Mimico, New Toronto, Long Branch - Can You See the Difference?

I know. Toronto isn't getting any cheaper these days, despite all the chatter of prices leveling off or bursting bubbles. And that makes it tough for trying to find a home you can love and one that's a good investment. Only10 years ago, some of Toronto's emerging neighbhourhoods have gone from no man's land to impossible to get in on.  Prime Leslieville, Beaconsfield and the rapidly transformed Ossington strip are perfect examples. 

That doesn't stop most, though, from speculating on what is the best emerging neighbourhood these days. And many of the local publications have weighed in. Toronto Life says Mimico is the best place to buy now(click here for article). The Toronto Star says New Toronto is the most undervalued neighbourhood (click here to see this article).

The thing is, most people couldn't tell ya the difference between Mimico or New Toronto. Throw in that Long Branch is another emerging neighbourhood in south Etobicoke, a little west of these ones, and it's no surprise that there is some confusion. So, I thought I would try to differentiate these communities a little to make it easier for those looking to get in on some of these current emerging neighbourhoods.

Before we get into these nuances, I think it's a good idea to see what makes these locations similar. The lake shore communities of Mimico, New Toronto and Long Branch have a lot in common.  All are in South Etobicoke with homes close to the lake shore at a much more reasonable cost compared to other parts of Toronto (e.g. the Beach). They have quite a bit of parkland, some areas more than others. They all could use some better business development along the Lake Shore strip.  And all of these neighbourhoods are linked to downtown by the Queen car.

Now for the differences:

1. Mimico - This neighbourhood is the most famous of the three. It runs south of the Queensway to the lake. From the Humber River to just past Royal York. There are tonnes of huge condos to the east. They feel somewhat cut off from the rest of the neighbourhood. It's the closest one to downtown, and probably slightly more expensive than the other two. Unlike New Toronto and Long Branch, there is not a lot of housing south of Lake Shore.

2. New Toronto runs south of the tracks to the lake between Royal York and 23rd Street. Traveling west from the city on Lake Shore Blvd, you'll know you've hit New Toronto when all the streets are named after numbers. New Toronto has the lame-est name. There's just not much charisma behind some thing called New Toronto. What's interesting about New Toronto, though, is the amount of affordable housing you can get just blocks from the lake - no highways or busy streets to cross. Just a quiet stroll down a residential street. It's not cheap, just better priced for close to the lake. It also has Humber College who came along and tranformed an old asylum into a college. The college is key in this neighbourhood. It has impacted the main drag along Lake Shore Blvd. by buying up crusty buildings and turning them into some thing students can use while improving the look of the neighbourhood. Also, if you have a basement for rent, it can easily be matched up with a college student. And even if you can't live close to the lake, the parks near the lake are fantastic.

3. Long Branch. This most westerly hood of the three lakeshore communites runs south of the tracks to the lake from 23rd St to Brown's Line. It probably has the best collection of newer and interesting new shops along Lake Shore near Brown's Line with a Burrito Boyz, an organic coffee shop and an Italian restaurant.  Despite these businesses, there is a lot of land here to develop north of the lake shore that used to be zoned industrial. So, the condos are coming. And so far, it doesn't seem to be a concrete curtain to the lake, like the eastern portions of Mimico. The condos are well-designed and are only 4-7 stories, well integrated into the commercial strip. Houses here are more extreme than Mimico and New Toronto. You'll see mult-million dollar giant homes on the same street as a creepy bungalow held together by glue.

Do I have a favourite? Not really. Each neighbourhood has good and not so good pockets. All have easy access to the Gardiner and al have some of the most accessible and pleasant parks in the city. I don't think the pace of transformation will rival Leslieville or Ossignton, but it's still a pretty place with a lot of potential.

Wednesday, 21 March 2012

Real Estate Investment from Overseas: Good for Everyone?

I think my favourite tag line for a Toronto real estate news story this month has to be:

Toronto Bungalow Sells for $421,800 Over Asking Price in Market's "New Reality"

New Reality? Really? This tag line suggests every one is going to start bidding $400K over the asking price in order to get a bland, beige bungalow in North Toronto. Truth be told, the house was listed for about $150,000 under the comparable sales in the neighbourhood. So, it was not listed at market value. Not even close.  This house in Willowdale was bought for $1,180,800, and was purchased by a university student from China. And who could blame so many Chinese from purchasing here. Compared to the rest of the world, Toronto seems pretty stable in the real estate department. And cheap. Downtown Toronto condo's can sell for $800 per sq foot where in Beijing the price is $2000 per square foot. And in Hong Kong it's $4000.  So, you can see how some foreign investors would find Toronto appealing. And it's not just the Chinese who are finding Toronto to be a deal. The Indian, Russian, European and Middle Eastern investors are also showing some interest here. In Canada, we think Toronto is extremely overprices, but it's all relative. Pricey compared to many other Canadian and American cities, but not Switzerland, parts of China and parts of Australia. 

Of course from a hometown perspective, overseas investment in real estate can certainly effect the local market. Unlike the U.S. , the Canadian government does not currently keep comprehensive records of foreign investment in real estate.  So what does this mean? Well, we don't really have a good idea of whose investing in our local real estate market and how much. The  worry is that too much offshore investment can drive up the prices to crazy heights.  Since we don't keep any records, we don't really have a good idea if this is even happening, and if it is, how much is it effecting prices.  I know that the bungalow that sold for over $421, 800 over asking is an extreme example. It is very unusual. It is definitely not the "new reality". 

If this is a concern,  it is my understanding that most overseas  investors  focus on downtown and North York. Areas like Leslieville or Mimico are not considered areas where you'll see heavy investment by overseas investors. Condos are also more likely to be places to be bought as investment because they can be managed more easily from overseas. 

Now don't get me wrong. The houses in many emerging neigbhourhoods are showing very strong sales right now, well above the Toronto average, but if you're worried about the influence of overseas investments in most emerging neighbourhoods causing the pricing to go off kilter,  I think you shouldn'st worry so much. 

Wednesday, 14 March 2012

Can Regent Park Make a Comeback?

Regent Park. Outside of Toronto those words never meant much, but here in our city, it is often known as the dodgy neighbourhood that went very, very wrong for a very long time.

The funny thing is, Regent Park was initially a place of great optimism.  It was the first social housing project in Canada when construction began in the late 1940s. At the time, Canadians felt they were really making greats strides in taking care of those in need by building affordable housing, albeit kinda ugly housing too. Well,  even though the good intention was there, a ghetto formed in this area of the city over time.  It wasn't all bad of course. Many new immigrants got their start here, and managed to form viable and strong community groups. But let's face it, Regent Park ended up ghettoizing the poor in what became lousy, neglected housing. Businesses tanked, and drugs, crime and bad things moved in. The wackiest crack heads in wacky land felt right at home here.

As many know, a revitalization project began a few years ago where the old social housing of Regent Park would be knocked down. And out of that rubble, a new Regent Park would emerge with glass condos, a Sobeys, townhouses, and a community centre all combined in a mixed housing situation. This approach has worked well in places like the St. Lawrence Market area in Toronto where those who need social housing and those who buy a condo live in the same neighbourhood.

Right now, the project is only partially completed. There are 4 phases and phase 1 is done and 2 are well under way. And now you have completed condos that are fairly affordable, and very close to downtown. Sounds like a dream for condo buyers. But there is a hitch. You're part of an experiment. Will this housing mix work? Though it has worked in other parts of Toronto, will it work here where the reputation of Regent Park tends to carry a pretty hefty stigma?

As some of you know from many of my rants, I find that a viable commercial strip where residents will use and visit make for a better community and better property values. For many years, I'd say Regent Park would have a hard time turning that commercial strip around, the one that runs along Parliament, south of Gerrard to Queen Street East.  But I'm beginning to see a few kernels of change. First, and most surprising, there is a new, sixty seat dance studio at Parliament and Dundas called The Citadel. This beautiful brick building used to be the Salvation Army Soup kitchen. Now, it's some thing quite different thanks to the efforts of the husband and wife team behind the dance troupe Coleman Lemieux and Compagnie and a key investor from the Daniel Corporation (who brought us the new development of Regent Park, Part 2). Also, on a smaller scale, there's the incredible success story of Sukho Thai, a Thai restaurant that doesn't look like much, but has been wildly successful. So much so, that the owner were able to build a fancier location on Adelaide right downtown where you need two weeks to get a reservation.

Regent Park still has a long way to go. Oh does it have a long way to go. Most of the commercial strip is still quite desolate. Still, if you are an investor or a pioneer or you want to live close to downtown but you want to pay a lot of money, you may see a pretty good opportunity in front of you. Prices are still lower than average here. Once (and if) the commercial strip turns around and all four phases of the revitalization are complete, prices won't stay low for long.

Tuesday, 6 March 2012

South Florida: The Great American Sale?

Today I'm gonna mention an emerging neighbourhood that's pretty far afield. In fact, it's not even in Canada. I couldn't sell there myself, but it's certainly worth mentioning.

I just arrived home from Miami and the Florida Keys, home of art deco, Key Lime pie, bikinis and rock bottom real estate. In fact, I had three Canadian friends who were on a spending frenzy buying up Florida real estate.

Canadians probably make up a good chunk of the population of this state in the winter. And this year, they're feeling pretty confident. Why, you ask? Because properties that have plummeted in price over the past 5 or 6 years are starting to turn a corner.

My friends are considering properties less then half of the price of what they were back at the peak of the American market in 2006. And it doesn't hurt that our dollar keeps bumping up above par against the American dollar these days. Before it all sounds too good to be true, I should mention that taxes are high in Florida, and because hurricanes love Florida as much as Canadians, the insurance is pretty expensive. So the extra costs can get pricey fast.

In terms of timing, it's almost the perfect moment for us Northerners looking to invest. The perfect moment to buy may have already passed. Some agents claim the bottom of that market was about 6 months ago. Still, there are  plenty of foreclosures and short sales in South Florida to be explored. Foreclosures can be complicated, however, but plain old mls listings are also quite affordable too.

All in all, if you're an investor or someone looking for a home under the sun in the winter, Florida, especially hard-hit South Florida, is looking like a nice juicy orange ready to be plucked.