Welcome to urbaneer.com's Home Of The Month. This feature provides a snap shot of what urbaneer.com's Buyers have recently bought in the City of Toronto.
If you're a regular reader of my blog you know I encourage my clients to make their primary residence their first purchase (Canadian residents don't have to pay full capital gains tax on the sale of their principal residence) followed by at least one investment property (ideally where your tenants pay down your mortgage facilitating a retirement income stream). Click HERE to read about the difference in buying a recreational property, a condominium high-rise, and a multi-unit freehold residence in a past 'Home Of The Month' post.
My clients bought their first house just over 8 years ago in Dufferin Grove before it gentrified and the prices doubled. That prudent purchase, where they've executed a stunning renovation, has built a tidy sum of equity. To make this equity work for them, my clients decided to take some of their savings and their equity line of credit to purchase their first investment property. They chose this vintage end of row house a hop, skip and a jump from the Lansdowne Subway Station, just one stop west of their current residence on the Bloor line.
It took a year of sleuthing before my buyers purchased this classic Toronto three bedroom residence. We'd seen a number of houses that were a mish mash of parts yet lacked the 'solid bones' these buyers wanted. They'd consider some properties on busier arterial roads which were definite contenders, though even they frequently spiked in competition higher than ideal. So when this two-kitchen two-bath property came to market at a reasonable $379,900 list price, it definitely caught our attention.
There's a pretty good chance if you ask a local long time Torontonian what they think of Bloor and Lansdowne, they'll tell you it's a marginalized location dotted with strip clubs and a transient population. However, they would have also described the intersection of Bloor and Dufferin in the same light less than five years ago, and it's now the subway stop for owners of $1million homes. Bloor at Lansdowne is certainly in the early stages of gentrification, but you can already see the beginnings of revitalization with a burgeoning art gallery scene and some pretty grooving restaurants and pubs. Plain and simple, if gentrification is in its infancy like we saw in Leslieville ten years ago and Ossington five years ago, then there is no way but up when it comes to this very central location with a very convenient subway stop. As far as I'm concerned (and my buyers agree), the opportunity to purchase something in the low 400s a four minute walk to a subway station is pretty much money in your future bank account.
Although the house was a top-to-bottom antique, it did have a recent furnace and a newer roof. However, the wiring was knob and tube, the windows were shot, the plumbing was obsolete and there was no central air. It also had a chopped up space plan and was crying for some tender loving care. The photos below reveal exactly how original this house was (and the spacious proportions):
While everyone starts with a plan, when it comes to a real estate acquisition it will inevitably change. The original discussion revolved around keeping the house as two illegal units, but the risks associated with that and the added expense of upgrading two kitchens and finishing the basement made the capital expenditure relative to the income stream the same cost as deconverting it into a stylish single family residence. Besides, renting a quality single family unit to a calibre single family tenant can potentially ease the stress of navigating the role of landlord.
What I didn't count on is that my buyers, who are creative professionals in the world of entertainment, actually thrive on smashing things up and rebuilding them. As I can attest to their inventiveness in renovating their primary residence, this duo have the skill set, renovation moxie and design eye to create some magic for a little more than cost + a lot of hard work. Not the least bit shy of tackling a project, the house was subsequently stripped down to the studs and is being reinvented as a new turn-key income property. Sound familiar? I'm doing it myself, recounted in my posts called the Tales of Upper Hillsborough. In the interest of full disclosure I am not, like my clients, physically picking up a hammer.
Here's a couple of snaps of the house right now:
Listed at $379,900, my buyers bid 11 percent over the list price to secure this property by only a few thousand dollars more than the next highest offer. As you can see. it's currently in the throes of a renovation but that didn't stop someone from knocking on the door and asking to rent it. This property will garner $2400 per month plus utilities on completion. Certainly, for those looking for a smart buy and long term hold, I consider this house and its up-and-coming location an exceptional opportunity for those with a long term vision.
If you're interested in purchasing an investment property in the City Of Toronto, or know someone who is, please know this is one of my fortes. With a multi-disciplinary education in housing, over twenty years of real estate sales, marketing and development including a sterling reputation as one of Bosley Real Estate's Top Producers, I, and the urbaneer.com team, make it my mandate to guide buyers and sellers through all their real estate needs.
~ Steven and the urbaneer team