General Urban Kitchener Updates and Rumours

[Bytor]

"…simply because the math doesn't work".

Is it really because the math doesn't work, as in they couldn't break even? Or is it because they are making bank on the atrociously high prices that have jumped 20-40% per year for multiple years in a row, far outstripping any inflationary increases in construction costs, an dthey just don;t want to give up huge profit margins even though they could drop prices significantly from "what the market will bear" and still have a tidy not profit?

It is that the numbers don't work. They will not make any money. What we need to start thinking is that developers need to be making a great profit or these projects won't get built or we end up with situations like Adi in burlington where these people who shouldn't be building cancel deals.

Profit isn't a bad thing. Developer profits are small or at least way smaller than they should be based on the risk.

Is it really "They will not make any money"?

Or is it "they won't have a high a net profit as they wish"?

Because, as I said, the sale price jumps of anywhere form 10% to 40% year over year for the past several years in a row have far outstripped what even 8% inflation in the past year has done to their costs.

From what I can find out is that over the past decade, average developer profits have risen from 8% to 15%.