Wednesday, October 22, 2008

Shopping for a used condo in west Toronto

While out showing properties this month, I have been focused on working with an investor; who is viewing the condo market with great opportunity.

Instead of evaluating the condo's on their sales literature and proposed amenities his evaluations are very pragmatic based on the square footage, maintenance costs and historic sales values as compared to square footage and the cash flow available from rentals.

In the process of our analysis we can across a wonderfully improved three bedroom condo unit in Mississauga. Although the maintenance costs were higher, (twenty year old building) the lack of amenities outweighed the fees associated with ownership when one compared the square footage of almost 1600 square feet compared to the new condo's averaging 760 to 880 square feet.

As a pure rental the 1600 square foot three bedroom unit would appeal to a greater tenant pool.

This particular unit was owned by a younger fellow who was an electrician by trade. During the course of his ownership he had altered (renovated) some walls to become knee walls (half height) making the unit more spacious and visually pleasing. The ceilings had their stipple finished removed and reapplied when he had improved the ceiling with a line of in ceiling POT LIGHTING. The work was very well done and first rate in its finish and appearance.

The issue that comes light (if you pardon the pun) is that this owner has improved his unit without permission of the condominium board of Directors. I am not suggesting that the Board would approve or decline the changes but the material fact in this circumstance is that the owner is changing features to the common elements of the building. His drilling and installing ceiling based pot lighting is in his ceiling but in someone else's in floor heating.

Although I am confidant that all the work was done to code; in strict adherence to safety issues and concerns about the in ceiling heating and wiring, once sold this benefit becomes someone else's liability.

Condominium Ownership has many advantages for the owners but also carries the responsibilty of following the Rules and Regulations of the Condo Board.

If you are considering a condo purchase I urge you to investige the existing condominium market along the Humber Bay Shore for some good values compared to shopping new.

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