TORONTO STAR Apr. 27, 2002. 01:00 AM
Katherine Harding
STAFF REPORTER

Whirlwind condo quest
Couple start frenzied hunt in cut-throat market and move into loft three weeks later

I blame Mike Harris.

And the Bank of Canada Governor, David Dodge, is also in big trouble too.

Harris, because of the former premier's bizarrely named Rental Protection Act, which has allowed landlords to charge outrageous rents in this city.

Dodge, because the pipe-smoking banker spent the last year hacking down interest rates to historic lows.

Until last February, I paid a reasonable rent ($660 per month) to live with roommates in an apartment in a sprawling old house in midtown Toronto. We had three bedrooms, parking, hardwood floors and two sunrooms.

It was rental heaven.

But that all changed when I was suddenly plunged headfirst into the most frenzied real estate market Toronto has ever experienced. As a 27-year-old, single cub reporter/intern saddled with student debt, even the thought of leafing through condo listings and arranging marathon-viewing sessions was laughable to the point of being hysterical.

I was content to rent, but for the last six months everybody around me has started to buy — including one of my roommates.

I should have sensed my time was coming. Twenty somethings can't go to a party or out for dinner anymore without hearing conversations that begin with "We've locked into a mortgage of ..." or "Look at my paint chips. We are going with smokestack gray and honey-mustard yellow." Ugh.

The message was clear: "Get a mortgage, everybody is doing it!" The peer pressure was killing me.

When my boyfriend, Jeremy Krol, and I decided to disappoint our parents and live in sin, he refused to even look at apartments. Too expensive, Jeremy said. "I don't want to throw my money away," he scoffed.

I caved. And to my utter surprise, we had enough money saved between us for a decent down payment.

Five days later, we spent a very discouraging sunny Saturday afternoon looking at eight downtown condos that had just gone on the market. I knew right away that this was going to be pure hell.

The first place we saw was a complete dump. Crap carpet, tiny solarium and ceiling fans — 750 square feet of pathetic. But when we walked in, there were more than 20 real estate agents' business cards planted on the kitchen counter. Evidence that more than 20 people had already viewed it. And the kicker: The "complete dump" had just been sold. Our agent showed it because he wanted to give us a "sense of what the market was like."

What were we getting ourselves into? It was like we had entered a different world where logic and reason didn't exist.

 

LESSON NUMBER 1: If you are going to get the place you want in this market, pick an aggressive but honest real estate agent. It's a finders-keepers-losers-weepers market out there. You don't have a lot of time to hem and haw about a place.

To be ready to close a deal on a dime, you'll need to assemble a real estate "dream team." You're never buying alone. Choose an agent, banker and lawyer you can depend on — night or day. Poll your friends and family for the people they used. And don't be afraid to dump part of your "team" if you don't feel like they're working for you. But be reasonable — you aren't the only person in Toronto trying to find the home of your dreams right now. The line behind you is long, and often ruthless.

We decided to get rid of our first agent, and it was the best decision we made.

 

LESSON NUMBER 2: Don't settle. I actually tried to con myself into liking one downtown condo with a balcony overlooking the building's stinky dumpster. "Summer isn't that long. I could live with that," I told myself. It was official: I was beginning to lose it. I was overwhelmed and tired of looking. The pickings are slim out there if you aren't planning on spending more than $200,000. Especially when you factor in that that price range is undoubtedly the most sought after right now. Patience is a definite virtue.

 

LESSON NUMBER 3: Know your financial limits and roughly what you are looking for before you jump into your agent's luxury sedan to start hunting for your new digs. You're buying property, not a pair of expensive shoes. And expect to get into at least one bidding war. Those are the worst. They are an emotional roller coaster, especially if you break the cardinal rule of first-time house hunting — don't get too attached to a property. We got into a bidding war that would have had us paying way, way too much for a place. Thank goodness we lost.

And while we are on the topic, make sure you have been pre-approved for a mortgage before you start looking. Our agent said this is the biggest mistake being made by first-time buyers in today's market.

 

LESSON NUMBER 4: Don't be a sucker. The real estate industry preys on the credulous and uninformed. I couldn't get over how vulnerable I felt during the entire process. You'll have a lot of sleepless nights. It seems everybody is trying to take advantage of you. So do your homework. Understand all the jargon. Ask a lot of questions.

When we finally locked into a place, my heart sank when our bank called to say that the pre-approved mortgage we had wasn't going to be insured. The bank's insurance company said that the property we picked wasn't worth the risk because it was built on polluted industrial lands. The only way we could hold on to it was if we put down 25 per cent of the asking price. What? Why would the developer build a new condominium on a toxic cesspool?

 

Do your homework. Understand all the jargon. Ask a lot of questions.

 

I was ready to pull our offer off the table, but my boyfriend persisted. Jeremy was sure that the insurance company was wrong and he asked our dogged lawyer to check it out. A few hours later, our lawyer called with the good news. The insurance company was wrong and now the developer's lawyers were threatening to sue them for spreading false information about their property in a red-hot real estate market.

Three weeks to the day after we got into this Wild West-like real estate market, we moved into our brand-spanking-new 710-square-foot King West Village loft on March 29. The two-storey open-concept loft has floor-to-ceiling windows, a balcony (with a downtown view), hardwood floors and walk-in closet. Maintenance fees are $275 a month and the building comes equipped with an exercise room.

I expected buying to take a lot longer, but it turned out to be a whirlwind process. It happened so quickly (we bought March 18) that we don't even have a couch yet. We have piled blue cushions on top of an old trunk until our new one arrives.

I'm relieved that we decided to buy, so I guess I owe Mike and David an apology. My share of the mortgage payments will only be $100 a month more than my old rent. And I — a former grad student who hasn't had a permanent address since the tender age of 19 — actually own something.

Now that's hysterical.