Oakville, ONT

[mattrussell]

Hi all,

I was recently talking to a local lawyer and restaurant owner in the Oakville area. As some may be aware, there is extraordinary growth going on in the Dundas/Trafalgar Rd. area - something like 60,000 new homes (single family, townhouse, etc)! I took a drive up there this evening and couldn`t believe it! I was wondering if anyone is from this area, or possibly even already investing in this location. What a change!

Kind Regards,

Matt Russell

 

[rforgiel]

Matt,

I have lived a little further down from Trafalger and Dundas at Appleby & Dundas for the past 10 years in what Garth Turner (our former MP) would call one of the McMansions with a little front lawn. It was nice when we first moved in and with pressure from the Niagara Escarpment Group and Save The Moraine people it was in the city plans that development would be limited and there would be no development north of Dundas but as you saw developers always get their way even in the protected areas north of Dundas.

Prices have gone up nicely since we bought but I don`t know how much of a lift is left in these homes. They are higher end in the $300K - $500K range and am not sure if you could make a go of them as an investment. Maybe you could do something with rent to own or form an alliance with corporations for executive rentals.

I have wondered around the old neighborhoods off Lakeshore in Oakville and have looked at some of the older modest size homes. You can find two or three in a row looking in good shape and boarded up. I am wondering what is going on there. Is it a developer buying them up and looking to put something else up there. What kind of play in there in these neighborhoods for the little investors like us.

 

[NeilUttamsingh]

QUOTE (mattrussell @ Sep 27 2009, 06:57 PM) Hi all,

I was recently talking to a local lawyer and restaurant owner in the Oakville area. As some may be aware, there is extraordinary growth going on in the Dundas/Trafalgar Rd. area - something like 60,000 new homes (single family, townhouse, etc)! I took a drive up there this evening and couldn`t believe it! I was wondering if anyone is from this area, or possibly even already investing in this location. What a change!

Kind Regards,

Matt Russell

Hi Matt,

I am from Oakville and have lived there for 21 years, this October.
The Dundas and Trafalgar area all the way along to about Dundas and Bronte has witnessed significant appreciation over the past several years. Prices have slowly crept up since about 2003.

I own a townhouse at Dundas and 3rd line which has appreciated nicely since I bought it in 2005.

This entire stretch in my opinion is a great area for a principal residence. The area now is not well suited for investment properties due to the increased price of the homes.

I continually run numbers on townhouses in this area, but it does not make sense to buy here, as you cannot cashflow these, if you are putting 20% down and using today`s five year fixed mtg rates.

This area however, is an area with tremendous upside. There is development that is going to be occuring north of Dundas, and approximately 50,000 new homes are going to be built here (as per current Town plans). Also, the Oakville Trafalgar Memorial Hospital is moving to the Dundas and 3rd Line area. Construction will be starting soon.

In summary, Oakville, and especially this particular area is an amazing place for long term appreciation, however, it is not an ideal area to buy positive cash flow investment properties.



Regards,
Neil.

 

[mattrussell]

I appreciate both your responses - and you`re right, Oakville is an amazing place to live (just moved to the west side). I`m glad I`m not the only one who think this area holds some major long term appreciation potential. What about a little more west, closer to Bronte and maybe even East Burlington - are there any deals to be had in these locations? Bronte has really turned a corner in my opinion - and they`re going to start "The Shores" right on the waterfront shortly (looks beautiful!). This is definately an area worthy of some attention.


Kind Regards,

Matt Russell










QUOTE (NeilUttamsingh @ Sep 27 2009, 08:27 PM) Hi Matt,

I am from Oakville and have lived there for 21 years, this October.
The Dundas and Trafalgar area all the way along to about Dundas and Bronte has witnessed significant appreciation over the past several years. Prices have slowly crept up since about 2003.

I own a townhouse at Dundas and 3rd line which has appreciated nicely since I bought it in 2005.

This entire stretch in my opinion is a great area for a principal residence. The area now is not well suited for investment properties due to the increased price of the homes.

I continually run numbers on townhouses in this area, but it does not make sense to buy here, as you cannot cashflow these, if you are putting 20% down and using today`s five year fixed mtg rates.

This area however, is an area with tremendous upside. There is development that is going to be occuring north of Dundas, and approximately 50,000 new homes are going to be built here (as per current Town plans). Also, the Oakville Trafalgar Memorial Hospital is moving to the Dundas and 3rd Line area. Construction will be starting soon.

In summary, Oakville, and especially this particular area is an amazing place for long term appreciation, however, it is not an ideal area to buy positive cash flow investment properties.



Regards,
Neil.

 

[rforgiel]

Matt,

Neil summed up the investment potential well in stating the numbers do not work out at this time. Burlington would be a little cheaper but still you would not get a positive cash flow from a traditional buy hold and rent strategy. I started my real estate journey by seeing what was possible in my back yard and it did not cash flow.

There is a house down the street from me in power of sale so there may be a bargain or two out there.

I came across a non REIN group that specialized in finding families that could not qualify for a mortgage but wanting to purchase a home. They offer rent to own to these families and find the newer built homes like you are talking about worked out. They seem to have done well with this strategy. This may be another way to invest in the area.

 

[mattrussell]

Can you suggest an area within an hours radius of Oakville that has some solid opportunities (other than KWC - I`ve already lived there for 20 years so I know it inside out ! )?

p.s. I`m really liking your Blog Neil - very cool!


- Matt








QUOTE (rforgiel @ Sep 28 2009, 06:06 AM) Matt,

Neil summed up the investment potential well in stating the numbers do not work out at this time. Burlington would be a little cheaper but still you would not get a positive cash flow from a traditional buy hold and rent strategy. I started my real estate journey by seeing what was possible in my back yard and it did not cash flow.

There is a house down the street from me in power of sale so there may be a bargain or two out there.

I came across a non REIN group that specialized in finding families that could not qualify for a mortgage but wanting to purchase a home. They offer rent to own to these families and find the newer built homes like you are talking about worked out. They seem to have done well with this strategy. This may be another way to invest in the area.

 

[NeilUttamsingh]

QUOTE (mattrussell @ Sep 28 2009, 10:32 AM) Can you suggest an area within an hours radius of Oakville that has some solid opportunities (other than KWC - I`ve already lived there for 20 years so I know it inside out ! )?

p.s. I`m really liking your Blog Neil - very cool!


- Matt

Thanks Matt.

KWC is the Number one Town to Invest in as per the REIN research.
A lot of investors are investing there and doing well. If you have lived there for so long, and know the place inside and out, you are definitely at an advantage.

If you do not want to invest `at home`, closeby to Oakville is Hamilton.

Hamilton in the ugly duckling turned cash flow.

Regards,
Neil

 

[brad]

Bronte is poised to explode in my opinion. The infrastructure and transportation improvements @ 3rd Line/QEW, and Bronte/QEW are HUGE. Smaller war time homes are being leveled and million dollar homes are being dropped in like no tomorrow. Bronte doesn`t have the posh of east Oakville, but she has turned the corner nicely and people are very soon going to be priced out of this awesome chunk of land right on the Lake.

Just my 2 cents.

Brad

 

[mattrussell]

I agree with Bronte as a future hotspot. I wouldn`t know if it`s on the verge of `exploding though.` From what I`ve seen, prices are already astronomically high (granted not as high as Oakville). If "The Shores," is done properly, that building could set the tone for the rest of the area. The plans for it look beatiful (places go for up to $2.5 million!). Very interesting area.

Matt

ps. Ever been to that Gelato shop on Bronte rd? Amazing.




QUOTE (brad @ Sep 28 2009, 12:35 PM) Bronte is poised to explode in my opinion. The infrastructure and transportation improvements @ 3rd Line/QEW, and Bronte/QEW are HUGE. Smaller war time homes are being leveled and million dollar homes are being dropped in like no tomorrow. Bronte doesn`t have the posh of east Oakville, but she has turned the corner nicely and people are very soon going to be priced out of this awesome chunk of land right on the Lake.

Just my 2 cents.

Brad

 

[NeilUttamsingh]

QUOTE (mattrussell @ Sep 28 2009, 08:16 PM) I agree with Bronte as a future hotspot. I wouldn`t know if it`s on the verge of `exploding though.` From what I`ve seen, prices are already astronomically high (granted not as high as Oakville). If "The Shores," is done properly, that building could set the tone for the rest of the area. The plans for it look beatiful (places go for up to $2.5 million!). Very interesting area.

Matt

ps. Ever been to that Gelato shop on Bronte rd? Amazing.

Hi Matt,

One important thing to remember is that even if you were to buy in one of these so called `hotspots`, there is no guarantee that the values will go up at a good clip.

The REIN philosophy teaches to buy positive cash flow properties. Equity appreciation is just a bonus.
In my opinion, don`t speculate in Oakville. You could win big with appreciation, then again, you could get stuck holding the bag. (which is not a fun thing)

The sound way to grow one`s portfolio is to focus on purchasing positive cash flow properties.

I would be lying to you if I said that people did not speculate in Oakville. They do.

However, these people are speculators, not true real estate investors.

Regards,
Neil.

 

[brad]

I live on Bronte so I may be a little biased, but I also see what is going on here every day. Between driving to and from where ever, and giving my dog crazy long walks, I know this area very well.

Original owners (homes build in late 1960`s and early 1970`s) are on there way out of the area and young families are snapping up the homes. Knock downs, additions and renovations are all over the place. You can`t drive down many streets in the area and not see a dumpster bin in a few drives.The "Shores" condos are definitely a big boost to the area, but there is so much more going on. The power center and movies @ QEW/Burloak, closing of the Petro Canada refinery, on/off ramps/bridges @ Burloak and Bronte and 3rd line, Hopedale mall is getting a face lift, work/live townhomes on Lakeshore, big fancy (700k plus) townhomes that were but up on Marine Dr. across form Bronte Harbour boat club, Sobey`s mall is getting demolished and 2 condos going up. I could go on, but you get the point.

If you already live in Oakvile you will benefit from the ripple. BUT, if you are considering buying a principle residence in Oakville I don"t know why you would consider any other part of Town. The homes here are unique and COME WITH LAND AND TREES. I can`t stress how appealing the lot size and mature trees are. New sub divisions have a billion homes in them, they all look the same, narrow roads, small lots, no trees, tight driveways, been there done that!

For the comment that this area is very expensive, consider the surrounding homes along Lakeshoe, east into Oakville, and west into Burlington. The 400k to 500k for a single family home on a 60` wide and 130` deep (minimum) lot, and you are getting insane value. You don`t have to drive 2 km either direction and you are surrounded by homes that hit the high hundred thousands all the way up to a very common 1.5-3 million.

For a principle residence, this is an absolute jack pot, for an investment you would be looking at going tear down and re-build, The #`s don`t work well here for a "typical" rental.

Just my 2 cents.

Brad

 

[mattrussell]

Brad,

Great points - thanks! I`d be looking at getting into something (single-family, townhouse) in the next 3-4 years and starting my practice...my timing could be great (would a basement rental suite be a good idea)? I think the tear down/rebuild idea is intriguing - but not following the economic fundamentals...this could be risky! All in all, I`m really excited for this area and will watch it closely. I`m walking distance to Bronte Harbour...those townhomes are beautiful!


- Matt








QUOTE (brad @ Sep 29 2009, 07:50 AM) I live on Bronte so I may be a little biased, but I also see what is going on here every day. Between driving to and from where ever, and giving my dog crazy long walks, I know this area very well.

Original owners (homes build in late 1960`s and early 1970`s) are on there way out of the area and young families are snapping up the homes. Knock downs, additions and renovations are all over the place. You can`t drive down many streets in the area and not see a dumpster bin in a few drives.The "Shores" condos are definitely a big boost to the area, but there is so much more going on. The power center and movies @ QEW/Burloak, closing of the Petro Canada refinery, on/off ramps/bridges @ Burloak and Bronte and 3rd line, Hopedale mall is getting a face lift, work/live townhomes on Lakeshore, big fancy (700k plus) townhomes that were but up on Marine Dr. across form Bronte Harbour boat club, Sobey`s mall is getting demolished and 2 condos going up. I could go on, but you get the point.

If you already live in Oakvile you will benefit from the ripple. BUT, if you are considering buying a principle residence in Oakville I don"t know why you would consider any other part of Town. The homes here are unique and COME WITH LAND AND TREES. I can`t stress how appealing the lot size and mature trees are. New sub divisions have a billion homes in them, they all look the same, narrow roads, small lots, no trees, tight driveways, been there done that!

For the comment that this area is very expensive, consider the surrounding homes along Lakeshoe, east into Oakville, and west into Burlington. The 400k to 500k for a single family home on a 60` wide and 130` deep (minimum) lot, and you are getting insane value. You don`t have to drive 2 km either direction and you are surrounded by homes that hit the high hundred thousands all the way up to a very common 1.5-3 million.

For a principle residence, this is an absolute jack pot, for an investment you would be looking at going tear down and re-build, The #`s don`t work well here for a "typical" rental.

Just my 2 cents.

Brad

 

[mattrussell]

POWER PLANT GOT APPROVED!!!! - darn it

QUOTE (mattrussell @ Sep 29 2009, 02:32 PM) Brad,

Great points - thanks! I`d be looking at getting into something (single-family, townhouse) in the next 3-4 years and starting my practice...my timing could be great (would a basement rental suite be a good idea)? I think the tear down/rebuild idea is intriguing - but not following the economic fundamentals...this could be risky! All in all, I`m really excited for this area and will watch it closely. I`m walking distance to Bronte Harbour...those townhomes are beautiful!


- Matt

 

[LifesMoneyPeople]

QUOTE (mattrussell @ Sep 30 2009, 06:07 PM) POWER PLANT GOT APPROVED!!!! - darn it

I saw that on BNN today too congrats to everyone in the area and sounds like it will provide tons of jobs for the area

 

[mattrussell]

I read only 25 permanent...and 600 short-term construction.



QUOTE (GreatNorthernInvestor @ Sep 30 2009, 04:24 PM) I saw that on BNN today too congrats to everyone in the area and sounds like it will provide tons of jobs for the area