Earlier this year, I helped a buyer purchase in a pretty amazing loft conversion at a reasonable price on the subway line. We were not the only ones who thought it was amazing though. There were two offers on the property. The funny thing: a year earlier, during a time when the housing and condo market was pretty strong, few were buying the condos in this particular building. Why, you ask? Timing.
Once new condos are registered, there are usually a flood of condos that come to market for a particular project. Most developers will not let buyers sell their condos until the building is registered, though assignments can happen before this date. Often, a number of investors, particularly in large condo developments, want to get rid of their condo as soon as they can so they don’t have to pay a mortgage and condo fees, especially when they have no intention of living in their unit. Unfortunately, when all the condos come up for sale at the same time, there is too much competition for a given product and condo remain unsold or sells for less.
Flash forward a year or two and glut of condo sales on a new, healthy development usually passes.
I would say the best time to sell a condo is about 5 years after you buy it, especially in an established or emerging Toronto neighbourhood. At this time, your condo hopefully has become more in demand, and there are fewer number of units coming to market. The design of the condo has not become too out of date and condo fees have not started to increase to cover aging heating systems and infrastructure of a given building.
You may not be able to time the market, but you could have a better shot of timing the sale of your condo.