Cuando, cuando, condo?

What with the no less than 9 semi-erect condo towers I pass every day on my 25-minute walk to work, it's clear that Toronto is in the midst of a full-blown real estate love affair. Part of it is justifiable -- as more people come to this economically sound and culturally active city, there's going to be a need for high-density accomodations so we can house them all sustainably. So I'm not some anti-condo NIMBY by default. But even I've got to say that the whole phenomenon seems to be getting out of hand.

As far as I can tell, the target demographics for these condos appears to be two groups. 1) Twenty-something young professionals who have been priced out of the downtown house market and want to live in funky parts of town, or 2) affluent middle-agers who want to use their wealth to custom-make a living environment for themselves that requires absolutely no maintenance. I don't hear of many condo owners who aren't in one of those two groups.

I'm solidly in the former group, which means you'd assumed I'd be excited about the plethora of developers out there who are more than willing to give me an alleged deal on some pre-built unit. But I'm really not feeling it. Mainly, I find the concept of condo fees really distateful (I can't imagine how frustrating it would be to diligently pay off my mortgage and then still owe some idiot $500 a month, to, I don't know, shovel the sidewalk or something) but there's more to it than that.

It dawned on me recently, as I was sketching out a crude monthly budget on the back of a napkin, that somewhat amazingly, I can probably financially afford to buy a condo right now. I have enough of a down payment squirreled away that if I took the money I'm already paying in rent, plus the money I divert into my savings every month, I could more than afford to carry a mortgage in the $150K-$200K range -- more than enough for a starter one-bedroom in this town.

And yet, I have no immediate plans to do so. Some of that is probably cold feet about having to "grow up" and put my plans to run away to some adventure (there's always been a little Peter Pan in me) but it's more than that. Granted, I'm young enough that I'd have enough time to get my money back if I was patient through any sort of real estate crash, but that's a leap of faith I'm not prepared to take at this point in my life.

To be sure, I'm not predicting a cataclysmic correction in Toronto any time soon. The city has a strong economy, and is still a very cheap place to live on a global level. But the returns we've been seeing have been too high for too long. If I have to listen to one more person gloat about how easy it is to make money in real estate because their condo has doubled in value in 10 years, I'll scream. Eventually, the music's going to stop and I'm not willing to be the last man standing.

Maybe next week, I will be.