ApartmentsLivingReal EstateNewer Isn’t Always Better When it Comes to Apartment Buildings — Here’s Why

March 19, 2021by admin0
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Throughout Canada, aging apartment buildings make up much of the rental housing supply that’s in use today. In spite of being built in the 1950s, ’60s, and ’70s, these buildings are the foundation of Canada’s rental universe. Today, there is ferocious competition over this original rental stock and investors are making moves to not only preserve the unique value of aging apartment buildings, but extend their useful lives and improve the quality of stock available to today’s renters.

Newer isn’t always better when it comes to real estate. Today, we unpack a few of the reasons why vintage apartments are worth considering if you’re in the market for a rental.

 

Benefits of living in an older building

  • Competitive cost-value
  • Location, location, location
  • “Good bones”
  • Lesser environmental impact
  • Renovations that add value

 

Competitive cost-value 

Cost is a determining factorif not the determining factorwhen shopping for rentals. One housing truth is you’ll learn from house hunting is that older buildings tend to be more affordable than newer buildingsin terms of rental rates as well as service fees.

One reason for this is the costs of construction. In Canada, building construction prices of all types are steadily rising and this upward pressure will likely persist in the years to come. Peak lumber and wood panel prices, in combination with increasing tariffs on components such as steel, aluminium, rebar, and concrete, and a severe shortage of skilled labourers, are adding thousands of dollars to the cost of constructing new residential buildings. For instance, in Toronto, the cost of construction for new residential buildings has increased by 8.3 percent year-over-year, according to data from Statistic Canada.

Meanwhile, the average selling price for newly-built rentals and newer condominium developments is between $400 to $750 per square, compared to $250 and $350 per square foot for older purpose-built apartments. A more reasonable cost of acquisition means that investors have the latitude to charge less rent in order to recoup their investments. It could also mean more cash in their pockets to upgrade aging apartment supply, bringing it up to spec with the amenities and finishings of brand new builds.

 

Location, location, location

Another factor that is up there with cost is location. As a long-term renter, you might prioritize any number of things, including proximity to good transportation options, grocers, hospitals, employment hubs, and schools. Location is important because it plays into lifestyle, transit, and the overall convenience of your everyday life.

Many older buildings were constructed before there was steep competition between developers for land. As such, older buildings are often found in ideal locations, close to those in-demand urban amenities that we’ve mentioned above. Meanwhile, due to the condo development boom of the 2000s and ongoing competition for land, newer buildings are often subject to the effects of urban sprawl, which force developers to less desirable, outskirt areas.

 

“Good bones”

In Canada, apartment unit sizes have been shrinking for the past decade. According to a report by Statistics Canada, new condominiums are 35 percent smaller than units built in the ’80s, and 33 percent smaller than units built in the ’90s. So, in addition to better affordability, older apartments offer coveted square footage that we’re seeing less and less of in new construction. This is another way in which older apartments offer unique and competitive value to renters.

Another enticing feature of older buildings is that they are well-built and have great guts. In some cases, vintage builds are made of materials that would be far too expensive to use today, such as concrete, which is known for being durable, energy-efficient, and soundproof. Solid initial construction also makes older buildings great contenders for renovating and retrofitting.

 

Lesser environmental impact

Our homes have a part to play in the global climate crisis. The emissions and wastage produced by the residential building sectorand the construction sector on the wholeare incredibly detrimental to our natural world and is a major source of air, water, and noise pollution. 

Making use of existing apartment supply is one way to lessen our ecological footprint, by working with the existing materials and incorporating modern, “green” technologies that can reduce the property’s environmental impact. Moreover, there are a range of energy-efficient retrofits that ultimately reduce energy and water consumption, helping renters to actually save on their utility costs.

 

Renovations that add value

Today, many of the systems and amenities that can be found in new builds can be incorporated into old builds by retrofitting. For example, we mentioned investments into energy efficiency. At one point, cost was a major barrier to entry when it came to sustainable home features, but the cost of energy efficiency has come down over the years and there are plenty of municipal, provincial, and federal government programs that can subsidize the investment.

Older buildings can also be renovated to incorporate upgraded mechanical systems, modern appliances and finishes, digital amenities, and even social amenities, such as rooftop gardens, pools, and recreation centres, making them more competitive on the market and more attractive to renters hoping for a condo-style living experience.

 

Rental apartments in Sault Ste. Marie, Niagara, Sudbury, and Hamilton

If you’re interested in a redefined rental experience, we offer renovated rental apartments in sought-after neighbourhoods in Sault Ste. Marie, Niagara, Sudbury, and Hamilton. From top-of-the-line finishings to energy-efficient appliances to digital amenities, our units have been upgraded to reflect the unique values of today’s tenants. Get in touch today to find out more about condo-style apartment living with CPM Properties.

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