Condominium Owner’s Survey Released
Is Condo Flipping driving prices sky high in Canada’s two hottest markets?
It might shock you to see the results that CMHC has released concerning the spending habits of people purchasing Condominiums in Canada’s two hottest markets. Toronto and Vancouver of course.
You can find the complete survey on the CMHC website to get additional information if you like.
The study found out that:
- 23.5% of householders in these areas own at least one secondary condominium in addition to their personal home.
- Nearly half of these investors purchased their unit for the rental income.
- Over 55% of them expect their value to appreciate over the coming year.
- The study showed only 53% of these investors had a mortgage on their last condo purchase.
- More of these people living in Toronto believed their values would increase than Vancouver. But Vancouver is closing in fast on that optimism.
- The study showed that generally these buyers are planning to be in the market for more than 5 years. There was a trend to take longer term mortgage products out as well.
- Near 70% of these people only own one additional investment condo. As well 90% do not anticipate buying another investment condo in the coming 12 months.
- This report does not include people who only own one home which may be a condo. As well it does not include folks that own a secondary unit and rent out their primary residence.
It really appears to show that these condo investors are in it for the longer term. Buy and hold these for a 5 to 10 year window. *Very interesting indeed. I was personally surprised by CMHC’s “objective” report to see that most of these folks really were not crossing their fingers and hoping to sell for HUGE profits in a very short window. AKA flipping the unit on or before possession.
Can it be that these investors are just looking for a place to park their money in an uncertain world economy right now? * I think so. I was pleasantly surprised at the number of people who did not use leverage or mortgage borrowing in order to purchase these secondary condo investments.
Over all this study shows quite a bit more stability than I had thought was out there. I guess the findings do make sense. If people have the cash today they are looking for a safe place to park it for a while.
So for now anyhow it looks like a nice steady climb will ensue for both the Toronto and Vancouver investor condo owner markets.
Very interesting to see!
All the best!