As pre-construction condos are rising in popularity and we know of all the current builder projects and their plans to expand their developments, it is to no surprise that a brand new 10 Tower project development has been announced. Many have wondered about that large piece of land; 15 acres to be exact, of land that is just to the east of the Grand Park Tower and Grand Park Tower II buildings and what would come of it.
About 3 years ago, Rogers Real Estate had submitted a plan proposing a project that was then named Garden City, which was changed once they filed for the trademark “M City” this July. The trademark included a logo and is related to real estate services. The earlier site-plan that had been submitted with the name Garden City included 5 new streets cutting through the community and still bounded by Burnhamthorpe Rd W to the north, Webb Dr to the south and Confederation Parkway to the east, and the Grand Park Towers to the west.
Today Rogers Real Estate Development Limited & Mississauga Mayor Bonnie Crombie have unveiled the $1.5 billion, 15 acre and $4.3 million sq ft project M City Condos. The land had originally been bought in the 60’s by Ted Rogers and was planned to have a radio transmitter on the site. The site back in the 1960s was purchased for only $170,000. Rogers Real Estate Development Limited partnered up with Toronto’s developer Urban Capital Property Group for this project.
The Downtown21 plan encompasses a more pedestrian friendly downtown core and a great transportation system: the LRT. This site promises just that, a downtown loop of a future LRT, 2 acres of parkland, public spaces, 2 way roads, on street parking, generous sidewalks, and residential frontages along with the best wireless, high-speed Internet and cable technology. The vision is to create a livable, walkable city, home to mixed-use residential and commercial developments that are connected to an extensive public transit network, according to Mississauga Mayor Bonnie Crombie. We have already seen some of the downtown core being transformed into the Downtown21 plan with the renovation of Square One Mall and the north facing side of the mall that has added a pedestrian friendly square with wider sidewalks, greenery and water fountains.
Along with the 2 acres of parkland, the plan will add 6,000 units for rent or sale starting with phase I as early as 2017/2018. This stage will provide 700 units and 51 storeys with 7 floor plates that have a rotating design and will start in the price range of $200,000 – $750,000. The development will have interesting and exciting building designs and will host privately owned condos & rentals with leased commercial space on the lower floors.
The phase I building will be located at the southwest corner of Burnhamthorpe Rd W and Confederation Parkway. The 10 towers are conveniently located within the Mississauga Downtown Core, walking distance to the Mississauga Public Library, The YMCA, Celebration Square, City Hall, Future LRT Transit Stops, Go Bus Stops, Mississauga Public Transit and Square One Mall.
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Tuesday, September 27th, 2016 and is filed
Since the beginning of 2016, we have seen a few new price records being broken in the Square One area. We have seen one bedroom plus den condos cross over $300k, while some two bedrooms are creeping above the $400k mark. While many condo owners are satisfied to see their homes go up in value, the rising prices do raise concerns over a “real estate market bubble“.
In this blog post I will outline some of the key factors which continue to propel the market forward, and why I believe a real estate market crash is less likely to happen than many people tend to believe.
That said; the market can not rise at this pace forever. There will be a tipping point, at which I believe the prices will stabilize for some period of time.
In order for prices to stop going up, one of three things need to happen:
Scenario 1: Condo prices get too expensive and potential buyers cannot keep up with the mortgage payments.
My opinion: If prices get too expensive, those people wishing to buy; will have to rent. After all, people still need to live somewhere.
In Mississauga, about 40% of condos are owned by investors and rented out to tenants. Regardless what happens with the real estate market, tenants will continue to pay the monthly rent which in turn pays the landlord’s mortgage. The chance of mortgage payment default is slim.
Historically speaking rent prices have almost never gone down. This will ensure that condominium prices in Mississauga will hold, regardless if buyers can afford to purchase the condos or not.
Scenario 2: Interest rates go up and potential buyers cannot keep up with the mortgage payments.
My opinion: With interest rates at all time record lows (currently around 2.6% for a 5 year fixed rate), some skeptics say that the rates will go up much higher in the near future.
Although they are correct to say that the interest rates will go up, no one knows for certain when this will happen. As it stands, the Bank of Canada has no intention of increasing the interest rates. The Canadian economy is still seen as fragile and all the instabilities around the world do not help.
Any rise in the interest rates will be gradual and spread over a longer period of time.
Too many Condos
Scenario 3: Too many condos built and there will be an oversupply of condos.
My opinion: Over 200,000 people immigrate to Canada ever single year and more than half settle in the Greater Toronto Area. Mississauga is still seen as “affordable” compared to other major cities.
To put into perspective, new condos in Mississauga sell for about $450 per square foot, whereas Toronto and North York condos go for over $650 per square foot (and they charge extra for parking).
In a typical market crash, the most expensive real estate suffers first and the most.
Mississauga Condo prices are not based on speculation, but rather on people who actually live and work in the area. Most new condos are sold out before they are even completed.
What should I buy?
With pre-construction condos and resale condos being priced almost the same, there has never been a better time to purchase a new condo in Mississauga.
By putting down a 10% deposit, you can secure a condo unit and will not have to pay anything until occupancy.
Over the past year we have seen a sharp incline in request from people in Europe and Asia who purchased units here in Mississauga.
If you are thinking of buying a new condo, I can help. Give me a call and we can chat.
Remember that there are no fees to me, as the builder is always responsible for paying realtor commissions. Looking to hear from you.
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Tuesday, September 6th, 2016 and is filed
Over the past year or so, we are having more and more people inquire about moving into a three bedroom condo. In most cases it’s either a family of four (mom, dad and 2 kids) or a family wishing to take their in-laws in to live with them. With freehold house prices well over $700k on average in Mississauga, larger condos do seem like a good alternative. However, 3 bedroom condos are harder and harder to find in downtown Mississauga. This blog will help explain why this is happening.
Costs are high
For anyone looking to buy a new 3 bedroom condo, the price can be a surprise to them. Since most three bedroom condos are in the 1200-1300 square foot range in size, with a cost of around $475 a square foot, the purchase price is often close to $600,000 brand new.
For this reason most 3 bedrooms condos are reserved for the penthouse units.
Condo fees are calculated based on internal square footage of any given condo. This means that these condos often have condo fees of $750 per month (or more) when they are still brand new. For many people, this simply does not work with the budget.
For anyone trying to rent such a unit, they are looking at $2500 and upwards a month plus hydro. This seems unreasonable, if you can rent a full detached house in Mississauga for the same price.
The disconnect between the investor and renter
When preconstruction condos are getting built, very few people come into a sales centre and wish to reserve a three bedroom condo which is set to be ready in 2-3 years or so. Most people who desire a three bedroom condo, have a specific reason why they want a larger condo, and wish to buy or rent one within three months or so.
At the same time, investors usually prefer to stick to the 1+den or 2 bedrooms condos.
For example, a typical investor will rather buy two 1+den condos for $300,000 each which can be rented for $1600 a month (per unit), over one 3 bedroom unit which rents for around $2500 and costs $600,000. The return on investment is simply not there with larger 3 bedrooms.
Builders have trouble selling these larger units until they are ready; hence condo builders are reluctant to even build three bedroom condos.
The 2016 Den
Ten years ago, when condo builders used to build condos with “dens”, the den would often be a separate room, which in theory was used as a bedroom. Even though, the dimensions were smaller than a regular room, often 7 x 8 feet, but still useable as a third bedroom.
In 2016, the den offered by builders in new construction condos is MUCH smaller and often not a true separate room. Sometimes the den is just more of a “nook” in the wall, big enough to squeeze a home office. The option to convert the den into a 3rd bedroom is no longer available.
For anyone who is looking for a 3 bedroom condo, we almost always suggest looking for a townhouse with our team instead. It’s cheaper and there are more options out there. If you must stick with a 3 bedroom condo, then some of the older condos might have some good options for you.
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Wednesday, June 15th, 2016 and is filed
The first quarter has been a great start to the 2016 real estate market. With home prices once again at all-time highs, buyers found themselves scrambling in multiple offers trying to find the perfect home. Typically this only occurred with freeholds (houses, semi-detached and townhouses), but for the first time this year, we saw this phenomenon carry out into the condo market.
The following trends are now happening in downtown Mississauga.
More Sales / Low Inventory
The number of condo sales in City Centre in 2016 is up by 30% over the same time period last year.
We expect to have even more inventory later on this year as we get ready for the completion of PSV 1 and PSV2.
At the same time, we are seeing less amount of listings available for sale. Buildings which are known to have 15-18 listings on average are now averaging around 10 listings for sale.
Average Price Is Up
With overall prices in downtown Mississauga going up by around 4% year over year, we have seen the strongest movement from one bedroom / one+den condos.
To put this into perspective, in the first quarter of 2015 we have only seen 9 sales of one bedroom condos over the $300,000 price point. In the first quarter this year, we have seen this number jump to 23.
However, not all condos went up in price. Units which are not in great shape and need some TLC have a hard time selling even in this hot market. This is why we always recommend freshening up a unit which needs work, before putting it up for sale!
Firm Offers On Condos
We all heard of properties in Toronto receiving many offers and selling over asking price within a few days. Well, now similar trends are appearing on some Mississauga Condos.
In the last week alone we received two firm offers (with no condo status certificate condition) on some of our listings. This is unheard of by many professionals who have been licensed for years!
Positive Cash Flow
Some of our investor clients, who purchased condos a few years back, are now seeing positive cash flow. How is this possible? Rising rent prices and ultra-low interests rates.
We have seen, condos which have been purchased for $230,000-250,000 a few years back to be worth anywhere in the $270,000-300,000 range. Rent prices for some units have gone from $1300 a month to $1650+ a month.
What Does All This Mean?
Buyers – Being pre-approved for a mortgage is more important than ever! Understanding exactly what you can qualify for and how much your monthly carrying costs will be, will help you secure the unit of your choice.
Be sure to work with our Square One condo buying team, as we can ensure you end up getting a good deal on a condo!
Sellers- If you were waiting for the perfect market conditions, the time is now. Are you thinking of cashing in your investment? Or perhaps upgrading to a larger property? This year our team has already helped over 25 people buy or sell condos.
If you are thinking of buying or selling a condo we are ready to help!
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Thursday, April 14th, 2016 and is filed
Closing costs are the fees which are associated with finishing any real estate transaction. In Ontario, these are usually paid for by the buyer, and usually cannot be added to the mortgage. Buyers must have money set aside on top of their down-payment to ensure they can take smooth possession of their property.
In this blog post we will cover the different types of closing costs and how they apply to both resale and pre-construction condos.
Resale condos (those we find on MLS or on MySquareOneCondo) typically have what is commonly referred to as “standard closing costs”. These usually include items like lawyer fees, disbursements, mortgage charge and land transfer tax.
The buyer’s lawyer takes into account any credits the previous owner paid (such as utilities or property tax) and prepares a statement of adjustments. This document breaks down all of the fees and their amounts.
All of these fees are paid for by the buyer, to their lawyer usually 3-5 days before closing. Although there are no set rules on how much the closing costs should be, they typically range around the 2% of the total sale price of any condo purchased in Mississauga. Keep in mind that unlike Toronto, Mississauga does not have a double land transfer tax, making the closing costs lower in Mississauga than Toronto.
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Wednesday, February 24th, 2016 and is filed
Prices Are Going Up
As we welcome 2016, it’s no surprise that condo prices in Mississauga continue to increase at around 3% per year. The major drivers of this force are freehold homes, which have increased in some places by nearly 60% in the past decade. Condos have become the norm for all first-time home buyers and investors.
Investors continue to enjoy the low 1.2% rental vacancy rates that Mississauga has to offer.
First time-buyers might be surprised to see certain buildings such as City Gate, list one bedroom + dens for around $300k and sell. Similar units 2-3 years ago were selling in the $270’s range.
Local Buyers Compete Against International Buyers
One of the key factors driving Mississauga Condo prices up; are international buyers. Although the exact number of foreign and oversea ownership is not available for public, experts estimate this number to be as high as 15-20%. With the falling Canadian dollar (around $0.68 at the time of writing this article), Mississauga real estate looks like a “good buy” for many people abroad.
This makes it hard for some first time home buyers to break into the market. It’s not uncommon for nice re-sale condo units to still attract multiple offers.
Pre-construction Condos have Inventory
If you are looking to get a brand new unit and you wish to take possession within one and a half years maximum, a few builders are offering interesting incentives which only require up to 5% total down-payment.
The standard down-payment with any pre-construction condominium is usually 20%. With this type of aggressive down-payment structure, I still encourage buyers to have a minimal of 10% down. We will release a blog shortly highlighting these projects but in the mean time please feel free to contact us.
P.S. Investor clients still need a minimal of 20% down regardless.
Do not buy Units with no Parking Spots
In order to keep prices lower for entry level condo units, some condo builders in Mississauga have decided not to include parking spots. This move reduces the overall purchase price of any unit by around $25k.
My strong recommendation to anyone considering to purchase such a unit is NOT to do it.
Even though the savings might seem nice for any buyer not planning to have a car, the re-sale value of the condo eventually suffers. Mississauga is not yet recognized as a super accessible by public transportation city. Unlike cities such as Toronto or even more so Manhattan, where most people living in these metropolitans rely on public transportation.
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Thursday, January 21st, 2016 and is filed
The rental market is a huge contributor to the Canadian economy and its growth. In large cities such as Mississauga, thousands of condos get rented out each year. With the internet at our disposal finding properties has never been easier. However, over the last few years, this has made it easy for internet fraud as well. In the United States alone, around $240 million is estimated in rental fraud and the number seems to be increasing each year. Canada has strict privacy laws that prevent us from finding out just how much money is being lost to rental fraud each year. However, if you were to look up internet scams online, dozens of articles pop up for the GTA alone. In this article I would like to focus on some stories that came to my attention and to let tenants know what to watch out for when browsing for properties online.
Over the past several weeks, we have seen a spike in the number of people calling us that have fallen victim of a rental scam in the Square One area. Below I will outline some scenarios that have occurred and what you need to look out for when you are searching for leases.
In this first case, the tenant was searching online for a property on kijiji. She found what appeared to be a great deal for a large 2 bedroom condo at the Marilyn Monroe buildings for $1500 per month. She wanted a short-term lease for only four months. She did not view the unit, nor she never met the landlord. She decided that she will follow the link in the ad, which lead her to a an official looking website with 50 and 60 Absolute on it. The tenant decided the website looked legitimate, and she contacted the person representing himself as the landlord. She was then asked to pay the money up front, and to transfer money into the landlord’s account. Once it was paid for, the landlord never picked up her calls.
In the above scenario, the tenant should have checked for a brokerage name in the ad. The scam artist also made the ad look real by including a link of the actual buildings in the ad. This can easily misguide anyone that is surfing the internet. As a general rule, you should never transfer money to anyone’s account, not even a real estate agent’s. If a deal seems too good to be true, it probably is.
Another scenario was of a young couple that was asked to pay more money up front as a deposit, and to also transfer the money into a bank account. The landlord in this case showed them the unit, and promised to give them the keys once the money was transferred to him. Once the young couple transferred the money, they never heard of the person again. Although they had contacted police, there was not much that could have been done to help.
Using an rental real estate agent is absolutely free to anyone looking for a property, as the landlord absorbs our fees. If you work with an agent 99.99% of rental scams can be avoided. Real estate agents have access to all the listings in the Square One area. All landlords that are on MLS, also have an agent represent them and their names and other details about them are available to agents. Realtors also use a system called Landregisty to verify if the landlord actually is the rightful owner of the property they are trying to lease. In my brokerages case, Cloud Realty asks for certified cheques, that go into the bank trust were the money is held until you take possession of the property. Once we have the keys, then we can release money to the Landlord.
And lastly, many scams are created by creating fake ads that advertise properties that are far below market value. Media and experts believe that this is being done to entice as many tenants to respond to ads and that in an emotional moment one of them would think that the person is a real landlord and that they can safely transfer money with no worries.
Many culprits, may post someone’s property without the owners knowledge, and they may not even live in the city or the country. Others may simply be tenants of the property that they are trying to lease in order to not default on their payment, and use your money to pay for their rent, while others post a fake property altogether. By using a real estate agent, scams can be avoided and your money will be accounted for.
If you, or someone you know have been a victim of a rental scam we urge you to contact the RCMP.
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Monday, December 28th, 2015 and is filed
Exactly 33 months ago the Canadian dollar was at par; even a little higher than the American counterpart. Cross boarder shopping was cheap and Canadians took advantage by buying anything from clothing to cars, and even properties down south.
Since then, the Canadian dollar went down by roughly 25%. What does that mean for us here in Canada hoping to buy real estate?
Firstly, buying any property outside of Canada automatically costs 25% more than two and half years ago. Those earning income in Canadian dollars prefer to keep their money in Canada as the conversion rate is too high if they were to invest in the United States.
For the majority of us who work and live in Canada this has little effect on our real estate prices.
The low Canadian dollar is however bringing many oversea investors, who are taking advantage of this low rate. Over the past month we have had several clients from Dubai, the Middle East and the United States contact us in order to purchase pre-construction condos.
Putting down $50-60,000 as a deposit allows investors to secure real estate in Canada, and not worry about any payments until its ready. This process, depending on the project, can take anywhere from 2-4 years.
During the pre-construction condo waiting period, many of the investors who purchased a pre-construction condo will closely monitor the Canadian dollar. When the time is right, they hope to covert the currency. A $300,000US investment easily converts to enough Canadian dollars to purchase a two bedroom pre-construction condo in Mississauga. Two years ago it would have cost closer to $350,000 to make the same purchase.
Thinking of buying a new built condo in Canada? Read this article first, and give us a call!
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Tuesday, November 3rd, 2015 and is filed
The Condominium Act in Ontario has been passed 17 years ago. Due to the new dynamic shift, and more and more condos being built, it is to no surprise that the number of condo units owned is estimated to be around 700,000. Over 300 of these condominiums are registered in Mississauga. It is also estimated that there are about 1.3 million condo owners and 10,000 condo corporations. It is inevitable that change comes about.
The new proposed revisions to the act, will be put in place to increase consumer protection for both buyers and owners. Improve how condos are managed and run and to strengthen the reserve fund for condos.
The new addition to the Act would allow disputes to be settled by using a third party, the Condo Authority. Who would in turn offer clearer information on condo owner’s rights & responsibilities, disclose information publicly and have an Auditor General to look over things. This would provide quicker, lower-cost dispute resolutions.
It would protect condo owners and buyers, since it would provide buyers purchasing pre-construction condos with a guide to condo living at the time of purchase, provide clear rules so that no surprise charges may arise to buyers purchasing pre-construction condos, the government will create regulations concerning all documents and amend the new home warranty act.
The act also proposes to strengthen the financial angel of condos, in order to prevent fraud. This will allow condo owners to have a more say in financial matters, if the condo corporations decide to any financial changes. This act will also regulate how much the reserve fund has. Many argue, that the current act is out of date and needs a revision.
This would tie in that the new reform to the act would introduce a new piece of legislation – the Condominium Management Service Act. This means that a new, third party, would regulate condo managers and management companies within condos by establishing a licensing system, which includes proper training and a code of ethics.
In the past we have written various blogs on the issues surrounding condo management companies and the roles they should play for the residence and visitors alike.
Check out the video from Mississauga City Hall and more info on this issue here.
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Tuesday, October 6th, 2015 and is filed
Mississauga condos continue to be a great option for first-time home buyers, investors, couples or people who choose to live alone. With prices still below $500 a square foot in the downtown area, the market continues to favour buyers with prices increasing moderately year over year.
For anyone looking to sell a condo, the market dictates that on average condos in the City Centre (downtown Mississauga) area sell for 97% of asking price and within 39 days (Toronto Real Estate Board Stats for 1st quarter of 2015).
An interesting trend has emerged where those who sell their Mississauga condo move further out west; primary Oakville, Burlington or Milton. These three cities are not known for their high-rise condos, but rather seen as “great places to raise a family”.
If someone has decided to sell their condo and continue to live in Mississauga, chances are that they would have to settle for an older home. Since there is not much more new land to build on in Mississauga, options for newer homes are limited. The idea of buying an older home, scares a lot of condo owners as they are used to the worry-free lifestyle they enjoyed while living in a condo.
Moving east towards Etobicoke/Toronto, is great for those commuting to Toronto every day; however prices tend to rise sharply the closer you get to Toronto. Also, the Etobicoke/Toronto areas are subject to a double land transfer tax, which ends up costing the purchaser an additional 1% of the purchase price.
A third option is moving north, towards Brampton/Caledon. Many clients I talk to, do not consider Brampton as a viable option for a few reasons. The quality of schools, the high costs of auto insurance and poor overall upkeep of the city are amongst the reasons. Further north of Brampton, closer to Caledon does look more promising, however the longer commute does deter many from making the move.
Milton continues to be a popular choice for many home buyers looking for an affordable solution for a newer home. The commute can be a little far, ranging from 15-25min to Mississauga however homes in Milton tend to be around 20% less than similar homes in Mississauga.
Although at least a 30-40min drive to Mississauga; Burlington is an upcoming city in Canada. It does well as a city and attracts families for a number of reasons. It has great restaurants and boutiques and holds some great touristic attractions such as Sound of Music Festival, Art Gallery of Burlington, Spencer Smith Park & holds Canada’s Largest Rib Fest. The city offers 29 public elementary schools and 14 Roman Catholic Schools, 8 public high schools and 3 Catholic high schools.
Oakville has really become one of the best places to live in Canada. With new development going on, great schools and parks, Oakville continues to thrive and grow. The new Oakville hospital is creating a lot of buzz and seems to drive real estate prices up. Oakville borders with Mississauga and is a 10min-20min drive to Mississauga. This may be a reason why many who sell their Mississauga condo prefer to move to Oakville.
These cities out west have come a long way and seem to be very popular and growing in demand for today’s home buyers. Some cities offer more affordable real estate than others. If you are thinking of selling your condo please click here. If you would like to know more about Oakville’s upcoming neighbourhood go check out my new blog on Preserve Oakville.
Have questions? Need advice? Contact us. We can help.
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Tuesday, August 4th, 2015 and is filed