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New condominium developments and high-rise towers can loom over existing buildings, causing fear of lowered property values among the owners of those older condo homes. But have no fear, as regardless of immediate impacts, new development always seems to raise the value of land, commercial property and also condominium homes adjacent to it.
This positive influence can be a surprise to someone who sees a new condominium skyscraper rise to block his view of downtown, or partly impeding her view of the Rocky Mountains. In smaller condo buildings a new tower next door can block much of the day's sunlight that an existing suite's owner used to enjoy. And along with new development comes more traffic and noise that can be seen as negative impacts by long-time residents.
These changes can be enough to cause affected residents to move, but I've not heard of such a seller losing money because of what was built next door or across the street. The buyer of the resale suite never saw the view before that construction came along, of course, so evaluates the resale property based on its location, amenities, quality AND the new investment taking place in the neighbourhood. If the location is good enough to draw a $100 million investment by developers, maybe my investment of $300,000 for an older resale suite in its shadow is a good investment, too, goes the thinking.
And they're right, but that's not all that's elevating the value of the older resale condo properties adjacent to new buildings. There is also a new comparison being made in the marketplace between the cost of new housing and existing housing. When the entry fee for new condo housing adjacent to downtown might be running $500 and approaching $600 per square foot of suite property, $350 or $400 per square foot for older-stock condo housing next door becomes an affordable if second-choice option. Sheer affordability makes resale condo housing competitive amid new development. It allows sellers of those properties to demand more than they once did, and still be affordable by comparison.
For home buyers who want a convenient location that's seeing substantial redevelopment, new homes will always have tremendous appeal. If they missed the boat on first-time sales, there are always investors selling new suites immediately after they take possession in a newly-completed condo building. But for those who can't afford or justify the cost of buying a brand-new condo home, resale options in older buildings nearby become increasingly attractive, and that spill-over effect always seems to raise those values more than if no new view-blocking buildings had appeared.
So if you're lamenting loss of view or daylight in your existing condominium home, be reassured. If you don't like it when the condo buildings around you are complete, you'll be in an even better position to sell for top dollar and make your move….perhaps into one of the very condo towers to which you objected!
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