How one buyer dodged the recession and escaped from condoland
In early 2008, the news was filled with stories about people buying condos off plans and flipping them for profits before the glue on the granite countertops had dried. Zhan Luo, a financial analyst originally from Guangzhou, China, was 28 and had just moved to Toronto from Seattle to get his MBA at Rotman. He’d saved up about $75,000, and he was pre-approved for a 40-year mortgage. The Toronto housing market seemed like a sure bet. Like almost everyone else, he had no idea the world was months away from a cataclysmic financial meltdown.
The first crush
Yonge Street (at College Park)
Purchased for $429,500 in March 2008
Sold for $642,000 in April 2015
Zhan set his sights on Aura, the 80-storey skyscraper above College Park, which was still in its planning stages at the time. When he showed up three days before the sales centre opened to the public, there were already some 70 people waiting to make deposits on pre-construction condos. He struck an agreement with the other people in line to return every three hours between 6 a.m. and midnight or lose his place. Three days later, he got a 15-minute session during which he was able to choose one of the remaining unsold units. He picked a two-bedroom suite on the 14th floor. Ten days after that, he paid the first instalment of his $85,000 deposit. The place wouldn’t be ready for five years, though, and Zhan was tired of sleeping on an air mattress in his parents’ apartment, so he borrowed some money from them and bought a place where he could live in the interim.
The stopgap solution
Navy Wharf (near Blue Jays Way and Spadina)
Purchased for $295,000 in June 2008
Sold for $383,000 in June 2013
Just as he was settling into his new one-bedroom-plus-den in CityPlace, the economy face-planted, the condo market froze, and then-finance minister Jim Flaherty put the kibosh on new 40-year mortgages. It wasn’t long before the real estate market revived, but life beside the Rogers Centre, with its dog-poop-littered sidewalks and post-game traffic jams, didn’t entirely agree with Zhan. By the time his Aura condo was ready in 2013, a pipe had burst in his CityPlace building, flooding his unit. After fixing the floors with insurance money, he redid the whole kitchen. He credits the overhaul with helping him sell the place for $88,000 more than he paid.
Hazelwood Avenue (near Danforth and Pape)
Purchased for $871,000 in 2015
Things were going well for Zhan: he had his MBA and his fancy condo was finally finished. Except, it turned out, he hated Aura. When he moved in, the upper part of the building was still a noisy construction zone, the elevators were often out of service, and pot-smoking neighbours would toss roaches onto his balcony from above. By 2015, condo prices were again breaking records, and Zhan had a new wife, so he put the place up for sale. A $212,500 gain allowed them to outbid another couple on a brick three-bedroom semi in Greektown. Zhan loves the shops and restaurants on Danforth—and he couldn’t be happier with his new neighbours, who always pick up after their dogs.
The bottom line
Zhan grossed $300,500 on his two condo sales. Even after costs, he still came out six figures ahead, and his new home is appreciating in value with the rest of the city’s real estate market.