better investment 1 bedroom or 2 bedroom?

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MORGAN GRAY

Buzzer

better investment 1 bedroom or 2 bedroom?

So here is the question, is it a better investment to buy a one bedroom in the 400 to 500 range or a two bedroom in that same range?

It is for an end user not an investor and he would live there for 2 - 4 years.

The area is Spadina to Sherbourne and the Lake to College

I feel it really depends on the price you pay for a specific unit and the area but that two bedrooms do open you up to a larger segment of buyers.

As I understand it the less bedrooms the faster it will appreciate (%) but a one bedroom might take longer to sell if it is up in the 500 range.

Can someone correct or elaborate on this for me? I appreciate it.

Thanks,
Morgan Gray

Canada / General Chit-Chat

MARCO DIFOTI

BabbleBee

476

Could you clarify something. Are you asking about $400k to $500k, or 400SF to 500SF?

MORGAN GRAY

Buzzer

No problem at all, 400K to 500K is the price range

MARCO DIFOTI

BabbleBee

476

I am a big believer that the pre-construction housing market is a bit askew from investors purchasing smaller suites, whereas after the building is built, real people actually want the larger suites to live in.
This is especially true for two-bedroom suites, which are often too small for the suites to actually be a used as a two-bedroom.
So, if you have the chance to buy a larger two-bedroom suite, I would snap that up!

EUGENE MEZINI

Buzzer

156

Marco said:
I am a big believer that the pre-construction housing market is a bit askew from investors purchasing smaller suites, whereas after the building is built, real people actually want the larger suites to live in.

This is especially true for two-bedroom suites, which are often too small for the suites to actually be a used as a two-bedroom.

So, if you have the chance to buy a larger two-bedroom suite, I would snap that up!

Agreed! The units are getting way to small downtown. Size Matters! Take for example Peter Street Condos, those floorplans are Tiny! But then again their prices are good so it works out fine. If you haven't seen the floorplans, you can take a look at them here: www.insidercondos.com/peter-street

So to answer the original question, as an investment I would choose the 2 Bed over the 1+1 because at least people have the option of deciding between using the second bedroom as an actual bedroom or more as an office.

ROY BHANDARI

BabbleBee

467

Too many variables to answer simply:
In terms of resale, "popular" 1 bedroom sizes are approximately 500-650sq.ft. "Popular" 1+1 sizes are 600-700sq.ft. "Popular" 2 bedrooms start from 750sq.ft.
That's not to say there isn't some crossover. We've seen 900sq.ft. 1 bedroom units priced at $500,000 and we've seen 600sq.ft. 2 bedrooms priced at $300,000. "Most" buyers with a budget of $500,000 would probably expect 2 bedrooms in a "standard condo" (not including luxury product here) - so as you said, it would probably take longer to find a buyer.
In terms of appreciation rates, we've studied a LOT of different buildings across Toronto, and 2 bedroom units tend to appreciate 1%-1.5% slower than 1 bedroom units.
HOWEVER, note the following:
a) Two bedroom units are typically priced higher, therefore despite having a smaller percentage increase, it has a larger dollar value increase
b) My numbers also assume 2 bedrooms are larger than 1 bedrooms (and thus, more expensive). I have no data to back up what appreciates more when the 1 bedroom and the 2 bedroom are the same size and price.
So to answer your question in a very roundabout way: The "popular" choice is to go with the 2 bedroom in that price point.

BRIAN PERSAUD

BabbleBee

274

I'm reading your question, and what I hear you saying is you really need a good realtor.

ROY BHANDARI

BabbleBee

467

^ Best post of the day?

EUGENE MEZINI

Buzzer

156

Agreed!

URBANDREAMER

Buzzer

both investments suck--why follow the herd? if you wanna do the opposite of what most ppl are doing, buy a house in an older suburb, perhaps weston or even parts of eastern mississauga, downtown milton or preston. either renovate and flip it or sit on it...