BUYERS: WARNING! WARNING! WARNING!

BUYERS:  WARNING! WARNING! WARNING!

The following was written to me by a broker.  This is not the first time this broker and others have been blunt in the serious situation and truth of the condominium industry.  All the hyped ads with many being lies hide the truth.  There are many articles with facts and truth posted and this adds to the dozens of thoughts to think and talk about.

"With so many condo buildings around, the resale ones have many units to choose from and price becomes very competitive. If the resale is 5.1M, and new ones are same or even less, buyer would get instead the new unit than the resale. This is what us, senior brokers say that, investment is not making any profit at all. And worst, developer will tend to renegotiate their prices to be able to make a sale. Developers dictated price are 50%-70% per condo unit. If buyer wish to transact with developer and not with sales personnel to get a reasonable discount, it is possible provided payment terms are shortened. Or if buyer is a corporate investor who will buy say 10-15 units for their employees or for business rental....then developer will consider mark down cost per unit. On the agreement that terms are 35%-50% dependent total amount of unit cost.

And, the fact that building depreciates 17% per year, you loose each year on cost of purchase and not gain. That is the truth because it is not a lot that earns interest and value. The structure has life term of 50 years only, but factly by 35th year, building is subject for rehabilitation or dependent on findings of structural and city engineers...if it need be demolish."

The broker sent another text afterward when I asked if I could post the above.

"Yes, you can.  Those are the facts and reality of commercial and residential buildings.  The life span of a structure is 50 but the actual term duration is 25-35 years.  St. Francis Square is one example of a structure that did not reach 50 years.  It was renovated totally leaving the main post which is the footing of the structure.  All levels were re-enforced with new iron bars, new concrete pouring and finishing however, the sewerage pipes were not properly rehabilitated that resulted into leaks in lower floors.  Others clogged.  That is the disadvantage of rehabilitation instead of total demolition to restore it into a "new" structure in compliance to city engineer, and building code by law of construction."

This was another post on value from the past - http://sohocentralcondominium.blogspot.com/2013/04/50-year-clause-or-old-age-decision.html