Banks take hard look at micro condos!

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As micro condos move into the Toronto market with a vengeance, some of the Big Five banks and other lenders still have rules in order to approve mortgages on units under 500 square feet.
“I would say there is still some hesitancy around lending on micro condos,” says mortgage broker James Laird, president of CanWise Financial.
Some 467 units of 500 square feet or less are currently in the occupancy phase in the City of Toronto, about five per cent of the new condos coming on stream in the core this year.
An additional 2,868 of these smaller units will occupy by the end of 2015, making up 11 per cent of all the new condos occupying in the City of Toronto, it says. And thousands more are in the planning or construction phases.
But it will be weeks or months after occupancy, when the building registers, before buyers — be they investors planning to rent the units out or so-called end-users planning to live there — will have to come up with final mortgages for 80 per cent or so of the sale price not already covered by down payments.

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