I help families earning $400,000+ build wealth faster by using the most advanced tax strategies available to Canadians. Our goal is to dramatically reduce your tax bill every year for the rest of your life.
Condo sales across the GTA and Hamilton area continues to struggle with sales in Q2 down 70% from the 20-year average and 66% from Q2 in 2023. Out of all of the launched presale units in 2Q2024, only 17% sold! Due to the lack of sales, there are now over 25,000 units for sale – it seems sellers have not adjusted their expectations down to where demand sits. There are an estimated 10,000+ units being completed in the second half of this year, adding to the supply-demand imbalance. From the Globe and Mail: “In Toronto, the average price per square foot was $1,529 in the quarter ended in June, according to Urbanation. That is more than double the $606 price per square foot in 2014. In the regions surrounding the city, the average price per square foot was $1,153 in the second quarter of 2024, compared with $484 in 2014.” Would you pay over $800k for a 550-sq. ft. condo? To me, that’s a tough value proposition. If you had 20% to put down on that condo, say you got it for $800k even, your mortgage would be $640,000. At 5%, that puts your monthly payment at over $3,700. Plus condo fees, plus taxes, plus…etc… you’re well over $4,200 per month. Compare that to the average monthly rent of a one-bedroom of ~$2,500. The natural justification is that you’re not building any equity while your rent. Note that almost ¾’s of your mortgage payment goes to interest, not equity, for the first 10-years. For renters, you can take that difference ($4,200 - $2,500 = $1,700/mo.) and save/invest it. This simply suggests that prices at these levels are tilting the math towards renting.
