A tale of two condos

In 1973, I bought my first condo. My buying choice was between two new condominium developments: PCC # 26 at 1615 & 1625 Bloor Street East in Mississauga and YCC # 82 at 4645, 4673 & 4689 Jane Street.

At both sites, a two-bedroom unit with two-bathrooms cost $17,000. I picked the Mississauga location and I lived there in bliss for nine years.

When I sold my unit, I got $27,000. That worked out to be an average annual compounded increase of 6%. Not bad; not bad at all.

1615-1625 Bloor St. W. Mississauga

Recently I drove by PCC # 26 and saw that it still looks as good as it did forty-two years ago. I have also drove past YCC # 82 and was shocked how depressing it looks.

Both started equally so how do the two condo corporations compare?

Two-bedroom units at PCC # 26 now sell for $225,000, a price that is steadily creeping higher. Incredibly, that condo corporation has managed to continue to appreciate at compounded 6% per year over the last 42 years.

YCC #82
What about YCC # 82?

A unit that went for $17,000 in 1967 now sells for approximately $40,000 on power of sale. There seems to be a lot of power of sales. That works out to be an average annual compounded increase of 2%. Pretty grim.

How do those prices stack up?
In 1973, a condo unit in both corporations cost approximately ten times the price of a new Toyota Corolla. Today, you can buy eleven basic Toyota Corollas for the price of a unit at PCC # 26 and only two Toyota Corollas for the selling price of a unit at YCC # 82.

So one condo corporation retained 110% of its original value, after accounting for inflation, and the other has retained 20% of its original value.

What's the lesson here?
Buy a unit in a smaller condo corporation rather than a large one. Keep informed of what is going on in your condo. Read the AGM package and attend the meetings. If everything is going well, bask in your good fortune.

When it looks like your condo is neglecting maintenance, you have too many rental units, there is political infighting among different factions, there is a constant turnover in property management companies, selling prices have stagnated, or all of the above; get out before the roof caves in. Cut your losses early before the condo drags you down with it.

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