TheKingEast
Senior Member
WTF? That is awful. Awful!
Aren't builders supposed to have the building inspected prior to occupancy?
|
|
|
Baby, we got a bubble!?
- Thread starter simuls
- Start date
WTF? That is awful. Awful!
Aren't builders supposed to have the building inspected prior to occupancy?
Eug
Senior Member
Having owned a new construction condo townhouse (and sneaking in every week to the construction site to take pix as it went up) and now a house undergoing a reno, and after seeing the above videos, I am now convinced that to ensure a good build, it helps a lot to supervise it yourself. Unfortunately, 98% of the time, it is impossible to supervise these things yourself.
My contractor is very conscientious, but nobody's perfect. For example, I had a supporting wall in my basement knocked down. The contractor went out and got the proper support beams (as specified by the engineering drawings), cut them down to size, and properly installed them... except that if you looked closely at the architectural plans, the amount of supporting wall knocked down was less than specified. What this meant was that while everything was done properly, safely, and to code, it would have screwed up the hallway dimensions and hallway orientation in one spot. That in turn would have led to changes in the room size and shape.
(Click to enlarge) 
In red and blue are the supporting walls that were supposed to be knocked down. The space in between was the existing hallway entrance. Above that was a rectangle of a secondary hallway leading to the two bedrooms. Knowing that I wanted the bathroom enlarged, the contractor knocked down the wall in red, and then installed the proper supporting beams.
However, the original plan was to have the supporting walls in red and blue both knocked down, with the supporting beam spanning right across. That way the room at the top right would be much bigger, as that secondary hallway would be diagonal, not rectangular.
So, I had them remove the freshly installed support beams, knock down the proper length of wall, and then re-buy and install new support beams that were longer. Major PITA, but it made the hallway flow much better, and consequently maximized usable space in the room beside it. (The picture on the right is what the final looks like, with a closet which has a triangular wall at the top end of it.)
I am sure that had something similar happened in a rushed townhouse build, they would have simply rejigged the room beside it to compensate.
OTOH, I wonder how closely those people in the video paid attention to room sizes. Yeah, the construction quality is terrible, but were the room sizes known in advance? One person mentions that a queen bed is too large for the room. Maybe, but that's quite common in condo construction these days, even if the final room sizes do reflect the original drawings. Queen beds are 80 inches long plus frame, but a lot of rooms are designed nowadays (unfortunately) for double beds, which are only 75" long plus frame. From the looks of the video, a double may have fit in some of those rooms. Plus they can't use stuff like sleigh beds, because of the deep headboard design, etc. You need shallow designs, built for spaces like these, such as this one.
My contractor is very conscientious, but nobody's perfect. For example, I had a supporting wall in my basement knocked down. The contractor went out and got the proper support beams (as specified by the engineering drawings), cut them down to size, and properly installed them... except that if you looked closely at the architectural plans, the amount of supporting wall knocked down was less than specified. What this meant was that while everything was done properly, safely, and to code, it would have screwed up the hallway dimensions and hallway orientation in one spot. That in turn would have led to changes in the room size and shape.
(Click to enlarge) 
In red and blue are the supporting walls that were supposed to be knocked down. The space in between was the existing hallway entrance. Above that was a rectangle of a secondary hallway leading to the two bedrooms. Knowing that I wanted the bathroom enlarged, the contractor knocked down the wall in red, and then installed the proper supporting beams.
However, the original plan was to have the supporting walls in red and blue both knocked down, with the supporting beam spanning right across. That way the room at the top right would be much bigger, as that secondary hallway would be diagonal, not rectangular.
So, I had them remove the freshly installed support beams, knock down the proper length of wall, and then re-buy and install new support beams that were longer. Major PITA, but it made the hallway flow much better, and consequently maximized usable space in the room beside it. (The picture on the right is what the final looks like, with a closet which has a triangular wall at the top end of it.)
I am sure that had something similar happened in a rushed townhouse build, they would have simply rejigged the room beside it to compensate.
OTOH, I wonder how closely those people in the video paid attention to room sizes. Yeah, the construction quality is terrible, but were the room sizes known in advance? One person mentions that a queen bed is too large for the room. Maybe, but that's quite common in condo construction these days, even if the final room sizes do reflect the original drawings. Queen beds are 80 inches long plus frame, but a lot of rooms are designed nowadays (unfortunately) for double beds, which are only 75" long plus frame. From the looks of the video, a double may have fit in some of those rooms. Plus they can't use stuff like sleigh beds, because of the deep headboard design, etc. You need shallow designs, built for spaces like these, such as this one.
Last edited:
lafard
Active Member
In principle, yes.
In reality, Vancouver has always had an issue with shoddy construction, and the system there is hopelessly corrupt and ineffective. Go read up on the Leaky Condo scandal 10 years ago - as you can imagine the weatherproofing was not quite up to par, in a climate where dampness is the primary feature of the weather for 9 months of the year.
This problem is only compounded by a high fraction of foreign investors, absentee landlords who are often not even aware of the
building problems, and if they are, don't really care.
marsh
Active Member
An interesting article from Saturday's National Post on one man's story in real estate investment/home ownership in Toronto over the past 30 years.
William Hanley, National Post · Mar. 26, 2011 | Last Updated: Mar. 24, 2011 6:01 PM ET
You can buy a 900-square-foot, two- bedroom apartment behind the State Department store in Ulan Bator for US$103,700. I know this because I was sent an e-mail touting this deal and others in the Mongolian capital just this week.
The vendor is casting a somewhat wide sales net in trying to sell this property. I can’t imagine someone in Kitchener, Ont., getting excited about a two-bedroom real estate opportunity in Ulan Bator. But, then, I’m not in the market these days.
That said, property and its value still has a place in my scheme of things, even if it is as a virtual real estate tourist after an adult lifetime of actually buying and selling houses and condos with mixed financial results. And with spring comes a renewed interest in property as the market traditionally heats up in Canada and elsewhere. Here in Waikiki, I have had any number of conversations recently about real estate prices here and back on the mainland.
My own long history of “investing” in houses was brought back to me recently when a friend very kindly sent me a link from a Canadian newspaper outlining the price and details of a house sale in Toronto. The house, at 87 Langley Avenue in Riverdale, happened to be my home from 1980 to 1985. And the friend was actually yanking my chain, giving me an ironic dig about my own questionable real estate decisions.
The house, a handsome detached Victorian, sold in just six days for $917,000, well over the asking price of $849,000. Previously, it had sold for $697,500 in 2006, $655,000 in 2004 and $390,000 in 2000.
To put this in further perspective, we sold 87 Langley in 1985 for $169,900 when we moved to England. We loved the house but didn’t wish to be long-distance landlords. Meantime, the house did have an obstinate damp problem with a skylight.
Besides, we thought we had been handsomely repaid for our “investment” in 1980. We had bought for $114,000. So, we had made a return of almost 10% per annum over that five years. And the proceeds were all in cash in our hand, there being no mortgage on the property.
We moved to London satisfied that we had made the right decision, having magically levered an original “investment” of $2,500 down on a small house in 1968 to $155,000 in the bank in 1985, astutely buying and selling along the way.
Of course, “astutely” is as “astutely” does. Within a year of selling 87 Langley, the buyer sold for almost twice that $169,900 in the great 1980s bubble. Another dear Toronto friend phoned us in London with the news, the merry schadenfreude evident in his voice even at such long distance. The Hanleys, long winners in real estate, had come a cropper.
I allowed as how my time machine was not working, so we couldn’t go back and undo the deal. Besides, we had made out well by the standards of a year earlier. Yet I did quietly rue the decision for a while.
Looking back at that time and looking at 87 Langley’s recent sale, I see the lessons I have learned and others might have learned in the great sweep of the Toronto and Canadian housing markets.
First, a house is a home, not strictly an investment. True, over that long sweep, the price of a house will likely appreciate, perhaps to the tune of inflation, plus the growth in the economy and a little extra thrown in. But the three main points house buyers must consider is whether they like the feel of the home, whether they like the neighbourhood and whether they can afford the mortgage payment even if rates rise considerably. The investment aspect is not incidental, but not paramount.
Our old house at 87 Langley might not be a perfect proxy for the Toronto or Canadian house market. Nevertheless, the rise in price in the past decade to $917,000 from $390,000 in 2000 is perhaps instructive.
A compound annual gain of about 12% is impressive and underscores the fact that Toronto was underpriced versus similar world cities. Now, though, it just may be well-priced compared with, say, Melbourne, Australia, and perhaps overpriced versus some U.S. markets.
Not that it makes a lot of difference to us. We have our modest condo in a great area of Toronto not far from 87 Langley and our real estate-buying days were over when we moved there from our house in 2001.
It did occur to us that the condo is worth less than half 87 Langley at current values. So be it. We’re not interested in actively building more assets, just enjoying the ones we have.
The condo will see me out, my leaving of it feet first at some very distant date, I hope.
And yet, after all our adventures in real estate for all those years, I still have a semi-detached interest in property. Even a $103,000 apartment behind the State Department Store in Ulan Bator can get my interest
William Hanley, National Post · Mar. 26, 2011 | Last Updated: Mar. 24, 2011 6:01 PM ET
You can buy a 900-square-foot, two- bedroom apartment behind the State Department store in Ulan Bator for US$103,700. I know this because I was sent an e-mail touting this deal and others in the Mongolian capital just this week.
The vendor is casting a somewhat wide sales net in trying to sell this property. I can’t imagine someone in Kitchener, Ont., getting excited about a two-bedroom real estate opportunity in Ulan Bator. But, then, I’m not in the market these days.
That said, property and its value still has a place in my scheme of things, even if it is as a virtual real estate tourist after an adult lifetime of actually buying and selling houses and condos with mixed financial results. And with spring comes a renewed interest in property as the market traditionally heats up in Canada and elsewhere. Here in Waikiki, I have had any number of conversations recently about real estate prices here and back on the mainland.
My own long history of “investing” in houses was brought back to me recently when a friend very kindly sent me a link from a Canadian newspaper outlining the price and details of a house sale in Toronto. The house, at 87 Langley Avenue in Riverdale, happened to be my home from 1980 to 1985. And the friend was actually yanking my chain, giving me an ironic dig about my own questionable real estate decisions.
The house, a handsome detached Victorian, sold in just six days for $917,000, well over the asking price of $849,000. Previously, it had sold for $697,500 in 2006, $655,000 in 2004 and $390,000 in 2000.
To put this in further perspective, we sold 87 Langley in 1985 for $169,900 when we moved to England. We loved the house but didn’t wish to be long-distance landlords. Meantime, the house did have an obstinate damp problem with a skylight.
Besides, we thought we had been handsomely repaid for our “investment” in 1980. We had bought for $114,000. So, we had made a return of almost 10% per annum over that five years. And the proceeds were all in cash in our hand, there being no mortgage on the property.
We moved to London satisfied that we had made the right decision, having magically levered an original “investment” of $2,500 down on a small house in 1968 to $155,000 in the bank in 1985, astutely buying and selling along the way.
Of course, “astutely” is as “astutely” does. Within a year of selling 87 Langley, the buyer sold for almost twice that $169,900 in the great 1980s bubble. Another dear Toronto friend phoned us in London with the news, the merry schadenfreude evident in his voice even at such long distance. The Hanleys, long winners in real estate, had come a cropper.
I allowed as how my time machine was not working, so we couldn’t go back and undo the deal. Besides, we had made out well by the standards of a year earlier. Yet I did quietly rue the decision for a while.
Looking back at that time and looking at 87 Langley’s recent sale, I see the lessons I have learned and others might have learned in the great sweep of the Toronto and Canadian housing markets.
First, a house is a home, not strictly an investment. True, over that long sweep, the price of a house will likely appreciate, perhaps to the tune of inflation, plus the growth in the economy and a little extra thrown in. But the three main points house buyers must consider is whether they like the feel of the home, whether they like the neighbourhood and whether they can afford the mortgage payment even if rates rise considerably. The investment aspect is not incidental, but not paramount.
Our old house at 87 Langley might not be a perfect proxy for the Toronto or Canadian house market. Nevertheless, the rise in price in the past decade to $917,000 from $390,000 in 2000 is perhaps instructive.
A compound annual gain of about 12% is impressive and underscores the fact that Toronto was underpriced versus similar world cities. Now, though, it just may be well-priced compared with, say, Melbourne, Australia, and perhaps overpriced versus some U.S. markets.
Not that it makes a lot of difference to us. We have our modest condo in a great area of Toronto not far from 87 Langley and our real estate-buying days were over when we moved there from our house in 2001.
It did occur to us that the condo is worth less than half 87 Langley at current values. So be it. We’re not interested in actively building more assets, just enjoying the ones we have.
The condo will see me out, my leaving of it feet first at some very distant date, I hope.
And yet, after all our adventures in real estate for all those years, I still have a semi-detached interest in property. Even a $103,000 apartment behind the State Department Store in Ulan Bator can get my interest
Eug
Senior Member
Update:
Article and video from Global Edmonton
None of the buildings can be saved.
"I was talking to one couple there with a small child. They were living in a van." Maynard said.
Their condo insurer apparently went bankrupt.
They were given an extra 15 minutes to get their stuff. Apparently, people basically ran around their condos and threw stuff out the window onto the snowbanks below to save time.
Article and video from Global Edmonton
None of the buildings can be saved.
"I was talking to one couple there with a small child. They were living in a van." Maynard said.
Last edited:
Kenny
Active Member
Those are three good points. Too bad all three points depend so much on the price of the home, making the investment aspect pretty darn important.
caltrane74
Senior Member
New Yorkers talking smack about Toronto.. figures..
Stock Market: Two Biggest Fears Getting Closer
By Michael Lombardi on March 28, 2011 | More Posts By Michael Lombardi | Author's Website
The stock markets remind me of the real estate market in Toronto, Canada. While the U.S. housing market crashed, the real estate market in Toronto is as strong as it has ever been.
In fact, builders can’t find enough lots to build homes on and developers can’t put condo buildings up fast enough in Toronto. In decent areas, the prices of condos have gone up from $400.00 per square foot to well over $1,000 per square foot and buyers are lining up.
Same thing with the stock market: There are so many people out there saying “It’s overpriced,” but stocks just keep rising. Why? Simply, stocks keep rising because there is too much money around, too much liquidity in the system. I can’t see the Fed doing much else other than dropping money from helicopters to increase monetary stimulus. With so much liquidity around, stocks rise.
The S&P 500 companies alone sit on about $1.0 trillion in cash. Stock markets do not fall when with so much cash in the system.
But here is when stock markets do fall: when inflation rears its ugly head, and when interest rates rise.
My dear friend, neither of these two events is far off. All we need to do is look at the bellwether 10-year U.S. Treasury. Last October, the 10-year Treasury yielded 2.4%. Today, despite the crisis we have witnessed in Japan, which should have sent investors running to the security of U.S. bonds, the 10-year Treasury yields 3.4%, up 41% in less than six months. In fact, this bond is up drastically in the last three trading days.
Yes, stocks will continue to rise in the very immediate term, just like the condo and housing market in Toronto. But the warning signs of trouble ahead are getting clearer every passing day. Enjoy the bear market rally while it lasts, because it won’t last forever.
http://www.dailymarkets.com/stock/2011/03/28/stock-market-two-biggest-fears-getting-closer/
Stock Market: Two Biggest Fears Getting Closer
By Michael Lombardi on March 28, 2011 | More Posts By Michael Lombardi | Author's Website
The stock markets remind me of the real estate market in Toronto, Canada. While the U.S. housing market crashed, the real estate market in Toronto is as strong as it has ever been.
In fact, builders can’t find enough lots to build homes on and developers can’t put condo buildings up fast enough in Toronto. In decent areas, the prices of condos have gone up from $400.00 per square foot to well over $1,000 per square foot and buyers are lining up.
Same thing with the stock market: There are so many people out there saying “It’s overpriced,” but stocks just keep rising. Why? Simply, stocks keep rising because there is too much money around, too much liquidity in the system. I can’t see the Fed doing much else other than dropping money from helicopters to increase monetary stimulus. With so much liquidity around, stocks rise.
The S&P 500 companies alone sit on about $1.0 trillion in cash. Stock markets do not fall when with so much cash in the system.
But here is when stock markets do fall: when inflation rears its ugly head, and when interest rates rise.
My dear friend, neither of these two events is far off. All we need to do is look at the bellwether 10-year U.S. Treasury. Last October, the 10-year Treasury yielded 2.4%. Today, despite the crisis we have witnessed in Japan, which should have sent investors running to the security of U.S. bonds, the 10-year Treasury yields 3.4%, up 41% in less than six months. In fact, this bond is up drastically in the last three trading days.
Yes, stocks will continue to rise in the very immediate term, just like the condo and housing market in Toronto. But the warning signs of trouble ahead are getting clearer every passing day. Enjoy the bear market rally while it lasts, because it won’t last forever.
http://www.dailymarkets.com/stock/2011/03/28/stock-market-two-biggest-fears-getting-closer/
cdr108
Senior Member
i don't think he's talking smack ... it's the reality.
assets have gone up in value because there is so much liquidity from QE1 and QE2.
CN Tower
Banned
A little more than embellishment from this stock market rag peddler. To be sure, in 'decent areas' prices have gone from about $350 to $500 per square in the past 5+ years and only in highly desirable areas are prices even approaching $1000 per square foot. Furthermore, the line ups are scarce and staged.
Not that I disagree with his assertions that external capital outflows, being Asian or otherwise, are the foundation for the new sales market in 2011. Without that influx of buyers and their reps we would be the proverbial 300 lbs man sitting on a 3-legged wooden chair.
Eug
Senior Member
Yeah, those numbers are basically just made up. $1000? What's he smoking?
---
In light of the new transit announcement, do you think it's time to buy close to the Eglinton corridor? Nah, I don't think so either. Not yet anyway.
---
In light of the new transit announcement, do you think it's time to buy close to the Eglinton corridor? Nah, I don't think so either. Not yet anyway.
redfirm
Active Member
There are only handful of buildings in TO that command $1,000/sqf. They are all uber 5 star brand name properties. Using this as an example of why Toronto is facing its bubble burst is, to say the least, not true.
Bubble is on the other side of the market .... where "poor people" put 5% down and mortgage themselves to the bone, asuming that r/e prices always go up and interest rates will never go back to 7-8%.
Bubble is on the other side of the market .... where "poor people" put 5% down and mortgage themselves to the bone, asuming that r/e prices always go up and interest rates will never go back to 7-8%.
KA1
Senior Member
That's exactly my contention. R/E market in TO is fragmented and each section behaves in its own way. There is GTA market, downtown and core downtown. Then there are high density developments in the downtown area or just on the edge of downtown market -- City Place, around Rogers Centre. Most of the units here are rental units purchased with, mostly, 5% down payment. Because at any time quite a few units are available for sale in these developments -- mainly, 1 bedroom or 1+1 -- prices rarely go up sharply. However, they do down considerably when TSE is down by, say, 150 points or there is a hint that interest rates might go up.
In other areas, especially core downtown, prices behave differently. A 2 bed 2 bath 830 sqft unit on 19th floor in RoCP1 was sold in June 2010 at $ 480,000. In January 2011, the same size unit on 28th floor was sold for $ 521,000 -- only $1,000 less than the asking prices. Talk about slow down in R/E market or a hint of interest increase or decrease in mortgage amortization period has no effect on this segment of the market.
Eug
Senior Member
Well, I think trying to separate individual 1+1 Cityplace sales from 2 bedroom sales at one other building is trying to split things too finely. Remember that sale prices on identical units can vary by say 5% just by the luck of the draw. Furthermore, there are factors that may alter sale prices in individual buildings which don't necessarily represent the local neighbourhood market, just that building.
That's why I like the more general Teranet numbers to assess the city. BTW, it was recently updated with the January numbers.
June 2010: 125.98
July 2010: 127.43
Aug 2010: 128.00 (peak)
Sept 2010: 125.98
Oct 2010: 124.85
Nov 2010: 124.21
Dec 2010: 124.43
Jan 2010: 125.11
That's why I like the more general Teranet numbers to assess the city. BTW, it was recently updated with the January numbers.
June 2010: 125.98
July 2010: 127.43
Aug 2010: 128.00 (peak)
Sept 2010: 125.98
Oct 2010: 124.85
Nov 2010: 124.21
Dec 2010: 124.43
Jan 2010: 125.11
redfirm
Active Member
2 bedroom in RoCP going for around half a million - bet you most of these are bought with downpayments of $100-200K and morgtgages of $300-400K. Not really a stable bullet proof segment .... Four Seasons, Shangri La and Trump I can see being different, although these atracted some gamblers, too.
KA1
Senior Member
Agreed that purchase in RoCP with 100-200k downpayment not really a stable bullet proof segment. However, the purchaser will not walk away easily if mortgage rates inch up a bit.
To muddy the waters a bit more, the unit was listed and sold by an individual with Chinese/vietnamese sounding name. Could be that some one from Vancouver or mainland China bought the unit with full payment and no mortgage.