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
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
Over the years we have been blogging about Mississauga condos by mainly offering tips for buyers and sellers. This special blog is being dedicated to all condo property management companies in Mississauga. The purpose of this blog is to shine a different perspective on what Realtors and the public feel is the role of a condo property management company, and how to increase overall condo owner satisfaction within any given building.
As an active Realtor, I have seen it all; the good, the bad and the ugly when it comes to condos and the property management companies that run them.
The “good condos” are simple; the buildings are clean, the guidelines are strictly enforced, there are updates made in some of the older buildings, issues are addressed and fixed quickly.
The “bad condos” have a few problems, that can be fixed relatively easily. Minor things that need to be addressed, such as outdated gym equipment, burnt light bulbs and constant broken elevators. There may also be a need to change a contract for landscaping or the window cleaners, but generally speaking these condos still have hope.
The “ugly condos” are the ones that everyone tries to stay away from. These condos have a reputation which has been damaged during the years and it is very hard to restore confidence in these buildings. These buildings may have special assessments issued to some owners, which caused an increase in the condo fees. These condos may also show major signs of wear and tear even though they are only a few years old.
In this blog post, we will address four categories in which every single condo property management company should exam and look for ways to improve them. These include:
Security / Concierge
Its amazing what kind of an atmosphere a security company can create inside a condo building. Most square one condos do have security and it is up to the property management company to hire great concierge people.
The word “concierge” means service in french. Every person coming to the building should be treated the same, with a common courtesy. There is no need to be rude and unfriendly, it makes people not want to visit or live there. Need not to mention, the residents of that building pay for the salary of both the concierge and the property management company.
What is ironic is that real estate agents often get treated like criminals by the concierge in certain buildings, while showing the building to potential buyers. Buyers do take notice of rude security and it ultimately affects the likelihood of a potential sale for owners of the condo units.
There are some buildings that are two years old but look like they are twenty years old, while other buildings do not show that they age much. The upkeep of any condo building has a direct correlation on the values of the units within that building. To ensure good upkeep, the following should be considered:
– Routine patrols by security of entire premises at least every 24 hours.
– Making it easy for building residents to report problems.
– Ensuring building repairs don’t take a long time to get addressed.
As a side note to all property management companies, please ensure that the cleaners do not put the elevators in service to clean the condo during busy hours. Having one elevator in service during rush hour can be bad for residence.
Be Fair and Consistent
One of the best traits of a well run building is that the condo management is fair and consistent with every resident and visitor in the building. It might be tempting to sometimes grant a favor or exception for a resident however this may lead to greater dissatisfaction should another resident notice this.
Being fair and consistent also means that the property management is responsible for obtaining the best service contracts for that building. In the past, there have been cases that were reported to us, in which the condo management were negligent and got overpriced contracts, which in turn cost the residents money. In a more serious scenario, a condo management company was involved in fraud and used the money in the reserve fund in an inappropriate way.
A well run management company should be particularly concerned about the policies which are in place. Numerous times residents voiced their opinions that the policies and procedures within their building are either inefficient or ineffective. These may include:
– Forcing visitors to get parking passes even if they are staying for 15minutes
– Requiring residents to obtain certified deposits for moving in/out and deliveries
– Not having a suggestion box, that allows for feedback.
– Not having a designated, easy to find indoor spot for Realtor lockboxes.
– Security refusing parcels or keys on behalf of condo owners/tenants.
– Not allowing Realtor Photographers to take pictures of building amenities.
In conclusion, property management companies which constantly evaluate their own role in the condo building and the level of satisfaction they bring to residents of that building have a higher chance in succeeding in the long run. Websites such as mysquareonecondo allow residents of various condos to write positive or negative experiences in any particular building. This transparent process ensures that the condo property managements are ethical, consistent and always serving the best interest of the residents.
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Tuesday, April 7th, 2015 and is filed
If you want to rent a condo in Mississauga, you are required by many landlords to sign a one year lease with them. The one year lease is often seen as a good length of time for a landlord to commit to a tenant, and for a tenant to commit to a property. More than 50% of tenants end up staying for more than a year; sometimes for as long as 5 years. Read FAQ on condo rentals in Mississauga here.
Although there are no official definitions of short-term leases, for the purpose of this blog, I will define short term leases as any residential condominium rental for the period of one day to 90 days, or 3 months.
Why is there such a demand for short term condo rentals in Mississauga?
Unlike Muskoka or Miami, short term rentals in Mississauga are not primarily driven by tourism. Mississauga attracts a lot of short term rentals because of three main reasons:
1) Business – Compared to its sister city Toronto, Mississauga is very affordable and easier to commute in by car. Many business professionals come to Mississauga since it’s close to the airport and it’s the headquarters of many fortune 500 companies. Executives that stay in short term rentals, argue that they prefer condos over hotels. Living at times for a week in a hotel can be depressing and tiresome.
2) In between Condos – Another popular segment of the population who chooses to use short term rentals in Square One are those who are in between a purchase and a sale of a property. It happens that an owner of a condo sells his or her condo, and has to leave before they have a chance to move into their new place. In this scenario a short term condo rental looks like the perfect solution. He or she can move into the short term suite for a few weeks or so, while the rest of his or her stuff can stay in a locker.
3) Lack of modern hotels – This is a huge driving force behind the overwhelming demand for short term rentals. The fact remains that Novotel is the only hotel in downtown Mississauga. This hotel is over 30 years old and dated by today’s standards. Overcrowding and lack of choices of hotels for travelers forces travelers to stay in short terms rentals. Will another major Hotel be built in downtown Mississauga in the near future? I hope so.
Problems that arise with short-term rentals.
On the surface short term rentals can seem great as everyone seems to benefit from them (other than the hotel owners). However, at a closer look many problems seem to arise.
Owners of condo units in buildings that have short term rentals, argue that they are not happy when their condo building is run like a hotel. They claim that not only does it ruin someone’s unit, but it leaves wear and tear on the hallways – walls and carpets from the constant moving. Owners say that in order to fix the run down hallways their maintenance fees go up.
Larger problems arise when owners offer nightly rentals and people who rent these condos start to use them as “party suites”. In a recent extreme event, an owner of a condo in Tridel Ovation contacted me about how upset she was when a short term condo rental was leased for one night to some students. The email further explained that the party got out of control, to the point where a Pizza guy’s delivery car was stolen and cops were called in to investigate. Yikes!
It gets worse.
Condo buyers get often worried about short term rentals and what effect they might have on the value of units in their building. The good part is that, as far as we know Tridel Ovation and Skymark are the only two condos in Square One which legally allow short term rentals. What I mean by legally is that their condo bylaws don’t state otherwise. But, and there is a BIG But, that is not to say that owners in other buildings are not renting their unit out on a short term basis.
Just check out airbnb.com, a billion dollar company (yes Billion), just dedicated to short term rentals. Just at a quick glance, pretty much every single building in Mississauga has illegal short term rentals.
What can be done about short term-rentals?
In some buildings, such as 223 Webb Drive, an active role in “cracking down” on these short term rental suites has taken place. The property management got involved and shut many of these “operations” down.
Unfortunately, if you are an unhappy resident, who wants to take a proactive role in trying to eliminate the short term rentals you might have a lot of work ahead of you. Although it varies from building to building, typically it is up to the condo management on how they deal with short term rentals. Speaking to someone on the condo board should be your first step.
In buildings where short terms are legal and you wish to change that, it is almost next to impossible to do so as a single voice. This would require a change in the declaration and a very high % of unit owners to agree to this change. Since many of the owners in these buildings are already renting their unit out for short term, it will be difficult to get them on board.
How do you feel about short term rentals? Please feel free to share your thoughts below.
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Monday, February 9th, 2015 and is filed
If you are looking to rent a condo in Mississauga, we compiled a checklist to make sure that you have not forgotten about anything.
The first thing you should know is that most leases for condos in Mississauga do require a one year commitment. If you do find something short term, it’s not uncommon to pay a premium of 30-40% more than market rate. Next, 95% of condos available for lease are unfurnished, which means you have to have your own furniture. Furnished condos can difficult to find, and rent for $300-500 more than similar unfurnished units.
Before Submitting An Offer
- The first step to renting is to make sure that you have a job letter from your employer. The job letter usually should state that you are a full time employee, getting paid a certain amount of salary and that your position is permanent. Landlords like to make sure that you are working and that you can pay your rent. If you do not wish to disclose your income, then you can contact us and we can help you out. Another option would be to have a job letter stating where you work and how much you roughly make.
- Next, you will also need to pull your Credit Score. You can get this printout by simply going to here . Filling out your information, It costs about $23.95 and you have your credit score. Clients often say: “My credit score is not that great! Why does a Landlord need this? “This is an inside door into your payment history. Once again a Landlord wants to make sure that you are able to pay your rent on time. The credit score doesn’t revel your payment history, if it’s let’s say 700 or above it means you have good credit and the Landlord will know that you can pay your rent on time and that you are less likely to owe them money.
- Now there is no standard written rule, but more often than not, if your credit score is below 650, you may want to offer to pay a few months up front (legally speaking, landlords are not allowed to request more than 2 months’ rent upfront, but tenants are allowed to offer more than 2 months’ rent up front). A second solution is you can put another person as a co-signer onto the contract. The co-signer may need to provide a job letter and/or credit score..
- Along with the rental application, given to you by the agent, you will need to put references down. Typically 2-3 references are enough. It’s not uncommon for your new Landlord to request a face to face meeting and/or try to contact your previous landlord to see what kind of tenant you have been. If you don’t have a previous Landlord you can put a previous employer down, places that you have volunteered for etc.
After The Rental Offer Has Been Accepted
- Make sure that you book the elevator at least a week, if possible two weeks, in advance to get the elevator. Most elevator bookings have a 3 hour time slot. For example 11-2pm, 2pm-5pm, 5-8pm. So make sure that you or your movers are on time and that you use your time wisely. You can book the elevators with security in your building, where you will be given a form that you need to fill out and you will need to leave an elevator security deposit, which they will give you back once they have checked that there are no new damages made by you or your movers. They may also ask for your rental application to see that you are the lawful tenant who is moving in.
- Make sure to call your cable / internet company a week ahead of time for an appointment. This is to ensure that you get your desired date. Most of these give a 5hour time slot, so make sure to be home.
- You will also need to call your energy (hydro) company, since some condos in Square One have hydro metered separately. The Landlord will not cover this expense or include it into your monthly rent since hydro varies in monthly price, based on how much you use/consume. Typically speaking hydro is about $50/month for a 1+1 and $60/month for a 2 bedroom.
- If you signed a one year lease, you will need to give your landlord 10 postdated cheques before you move in. Sometimes landlords also ask for pet deposits.
- Finally before our move in it is important for you to get tenant liability and personal property insurance (also known as home/condo insurance). Its only costs about $20 a month and it protects you in the event there is a fire in your unit or you have your dishwashers overflow and damage the unit below. This insurance can be obtained from any major insurance company.
- Once you move in be sure to report any damage not caused by you, to your landlord. This eliminates any problems at the end of the lease.
Interested in leasing a condo in Mississauga? Remember our services are free as we do get paid directly by the landlord. Feel free to browse our lease listings found here
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Friday, July 25th, 2014 and is filed
Elevators have become the norm and we often take them for granted. In a condo of more than 20 storeys, there are usually 3 to 4 elevators in service and we rely on these everyday to get around. We sometimes experience a delay, of up to 10min when one elevator is put into service. Yet, day to day we are pretty lucky that the wait is not that drastic and we go about our day as usual, maybe slightly irritated that this mornings wait was an unusual 10min.
However, in Ontario, the International Union of Elevator Constructors (IUEC) have been on strike against the National Elevator Escalator Association (NEEA) since the end of April. The Digital Journal has reported that the average wage of an elevator mechanic is $112,000 in Ontario. This leaves many to question: “Why the strike?” They do not ask for higher wages but rather a safer work environment and a signed contract.
This week some of those mechanics on strike have been ordered back to work in the Greater Toronto Area. However, those forced back to work are still not servicing job sites such as hospitals, nursing homes or residential buildings, but rather the residential construction industry. The NEEA passed a never-used clause in the Labour Act forcing those back on the job that work in the construction, especially residential construction industry.
This strike has left many Mississauga condos with either one or two working elevators for almost two months now. Many condo residents have been getting frustrated with the prolonged waiting times of sometimes more than 20 minutes which would result in a bad temper as they try to make it to work, drive their children to day care or make any other appointment they are having. It is especially frustrating for those that live on high floors and cannot use the stairs to get 30 floors down.
CTV news has had a special video news report on how this strike affected residents in Mississauga, especially the elderly who have a difficult time climbing up or down the stairs even from a lower floor. This must prove difficult for parents with small children, dog owners, as well as pregnant women. But even young condo residents don’t envision themselves walking up or down 35 flight of stairs every day.
This has also impacted the real estate business a great deal. It has proven to be difficult to show units that are on higher floors, and sometimes any floors for that matter. Sometimes you are waiting for 20 minutes for the elevator to arrive along with 10 other people. If you are showing a unit on the 5th floor you are lucky to get out first or second. If you are going up to the 27th floor it takes you another good 5-10 minutes to reach this floor with the elevator stopping on all those floors to let people on or off. By the time you are ready to show the unit, your client(s) is/are tired, frustrated and quickly losing interest just thinking that it will take him/her another 20min to get out of the building. If you are showing multiple units in multiple condos then the client(s) will definitely be unmotivated to see anything anymore after such a bad experience.
What Does This Mean For Mississauga Condo Buyers:
I strongly suggest, that until the strike is officially over buyers avoid going on showings during busy hours of the day, when residents are leaving for work or coming back in the evenings. Friday and Saturday late in the evenings are also considered busy times as many are trying to leave for a night out. This will reduce the waiting time by at least 10 minutes and you will only take a few moments to reach the desired unit for sale.
For those looking to purchase pre-construction condos in Mississauga, it appears that at this time the strike has little to no effect on the delays of the new condo projects.
What Does This Mean For Mississauga Condo Sellers:
As a result of the strike, your unit might not show during busy hours of the day, and fewer buyers might be viewing your unit. Don’t be surprised if agents with potential buyers are late with their appointments to see your place. Be patient, since the strike will be over before you know it.
Many residents of the GTA are still in disbelief that hospitals, nursery homes, hotels and residential buildings are still not being serviced and put on a lesser priority list as compared to pre-construction condos who have the elevator mechanics back to work for almost a week now. It is hard to say when the other workers will be back to work.
Update July 5th 2013 : After long negotiations, the International Union of Elevator Constructors (IUEC) and the National Elevator and Escalator Association (NEEA) have settled. All elevator constructors are expected to return to work by July 10th, 2013.
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Friday, June 21st, 2013 and is filed
Who would have ever thought, that Mississauga would eventually have one of the most active condo real estate markets in the country; with over forty existing condominiums and 15 proposed for the near future. Mississauga has grown substantially in population and, improvements to infrastructure and design are required to sustain this rapid growth.
The solution offered by the city of Mississauga is called the “Downtown21 Master Plan”. The goal behind the Downtown21 Master Plan, is to make downtown Mississauga, also known as the City Centre area, more pedestrian friendly. At the same time, this plan hopes to set out specific strategies for economic development, new transportation systems and overall environmental improvement.
In this blog post, I will cover some of the fundamental changes offered by the Downtown21 Master Plan, and its influence on the future of the Mississauga condo market.
The Plan In Detail
Mississauga has always strived to have a well balanced downtown core. The Downtown21 Master Plan will undergo some changes that are reflected in areas such as the employment, retail, commercial and civic sphere. This in turn will be balanced by residential development, entertainment, and facilities used by business visitors and tourists. Some of the changes which are to be implemented include:
1) The new urban design will be unique and pedestrian-friendly. It will have a strong focus on pedestrian access and amenities.
2) A complete Downtown Core road system which will contribute to the improvement of vehicular, cyclist and pedestrian movement within and throughout the Downtown Core. Most important transit waiting areas will be weather protected.
3) The creation of parking facilities that are sensitive to pedestrians and active streetscape.
4) Implemented development and activities that will enhance the Downtown Core as a destination. This includes development that will increase tourism within the Downtown Core.
5) Continuation to expend the Downtown Core’s retail commercial presence.
6) Expansion of transit and vehicular access to and from the Downtown Core To Pearson Airport and Cooksville Go Transit.
Specific Areas For Improvement
All changes implemented will be seen in the following areas:
Civic Centre Area- more pedestrian walkways and improved pedestrian links, visual openness and introduction of active uses at the street edge. It will accommodate more parking spaces and a variety of programs such as music concerts and theatre events, displays and exhibitions, festival and other special events.
Confederation Parkway Area– public art, further development of the pedestrian system, minimal building setbacks, continuity of built form etc.
Duke Of York Corridor– integrated character, development of pedestrian system, street related built form, public art, easy transit access and high standard of public amenity.
Rathburn Corridor– linkage of pedestrian walkways, continuity of built form, and improved connection to the east.
Burnhamthorpe Corridor– urban development of main streets (ie Hurontario), additional road connections, and architect designs.
Hurontario Corridor- structured parking, more intersections, central landscaping, pedestrian linkages, urban development and prestige buildings and more.
Downtown Core Additions– hotels, restaurant, office spaces, entertainment, recreational faciltities, retail spaces and civic and cultural facilities and proposed transit systems BRT and LRT.
Square One Shopping Mall Expansion
Although Square One shopping mall, which is in the heart of the Mississauga, is not officially part of the Downtown21 Master Plan, it is undergoing a lot of changes as well. Square One Mall is already one of Canada’s largest retail malls, with over 360 retail stores. Currently, it is undergoing a $84 million dollar interior renovation. This massive face-lift includes modernizing the common areas, restrooms and escalators and is expected to be completed by winter 2013. The food court is also getting a new look with some exciting new venues opening. But, perhaps what can be most exciting for many is that Holt Renfrew is investing over $320 million dollars to build a new flagship store right in Square One. This world class luxury retailer carefully analyzes and studies each geographical area before opening a store. Residence of Mississauga should be honored and thrilled that Holt Renfrew picked Mississauga as the next upcoming prime real estate area. This is great news for condo owners and investors.
Downtown21 Its Influence On The Real Estate Market
All of these new changes will attribute in a positive way to the future development of the real estate market in Mississauga. It’s great to live in a city where the people who are making decisions at the top, understand that in order for the city to continue to be attractive to new comers and tourists, it must be willing to continuously adapt. The Downtown21 Master Plan, is exactly what Mississauga needs at this stage. By making the downtown core more walkable, by building on new and existing public transit, and by having a well balanced residential development, entertainment, and business sector, Mississauga’s condo market will condo to blossom in the years to come.
What do you think? Share your thoughts below.
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Tuesday, May 28th, 2013 and is filed
What is an Assignment?
An assignment condo sale refers to buying a condo off a previous buyer before it is officially registered in the Land Registry System. To illustrate the most common type of example in today’s market, please see the following scenario:
A buyer purchases a pre-construction condo through the condo sales office. His or her intention is to live in that condo once it’s completed in a few years. However, plans change after about a year or so, and that buyer decides they want to sell their pre-construction condo prior to taking occupancy or ownership of the unit. This can be accomplished using an assignment sale, where the original buyer finds a new buyer for their condo. This new buyer assumes the responsibilities and enjoys all the benefits which were offered to the original buyer.
Assignments Condos VS. Resale Condos
When you buy a resale condo, you are essentially buying “real estate”; meaning it’s a property which physically exists and which you can touch and see. This property is also officially registered in the Land Registry System. On the other hand, when you buy an assignment, you are not buying “real estate” but rather the “right to own real estate”. Meaning: you are buying a piece of paper which says you will own a condo at a future date.
The biggest differences between assignments and resale condos, is that with assignments you are not required to obtain a mortgage and the closing date is years, not days, away. On the other hand, if you purchase a resale condo, you can typically get away with paying as little as 5-10% down and have a closing date that is 30 days away or even less.
Can I sell my Mississauga Condo via Assignment?
It depends on whether or not your original purchase and sale agreement has an assignment clause attached to it. An assignment clause is essentially the builder’s legal way of allowing you to sell your pre-construction condo before its ready. Not all condo builders allow for assignments to be sold and those that do allow for assignments to be sold typically charge between $3000-5000 should the option be exercised.
When buying your pre-construction condo, carefully review your condo agreement with your Realtor and ensure that this clause is included. Even if you think you are not going to sell your condo prior to occupancy, it is always a good idea to have the assignment clause as a “back-up” option.
How to sell an Assignment Condo?
Most builders do not allow you to put your condo assignment for sale on the MLS website. Since the MLS website is the most popular way of selling your condo, this really imposes a challenge for those looking to sell their unit. The option to advertise to sell your condo is thus limited to other websites such as kijiji and craigslist. The easiest way to sell your unit would be to find a friend who would be interested in taking over your investment.
What Buyers need to know about Assignments?
Since assignments are not advertised well, finding them can get tricky. If you find someone selling an assignment, you can potentially score yourself a great deal provided that the assignment is priced right. You should know that in most instances to complete the assignment sale, as a buyer, you will be required to pay the 15-20% of the purchase price, plus any profit the buyer asks for. Always consult with the builder and a qualified lawyer before proceeding with the assignment sale.
What Sellers need to know about Assignments?
As addressed above, in order for a seller to sell their condo by way of assignment, he or she will need written permission from the builder. Advertising on MLS is in most cases prohibited, thus finding a buyer can seem challenging at times. Understanding why most buyers get discouraged from considering an assignment should also be noted. These reasons include:
Price – If a buyer can get the same condo for the same price directly from the builder, then why should they buy it from you?
Closing too far away – You simply cannot expect to buy a pre-construction condo and sell it six weeks later. Condos take some time to appreciate in value
Closing costs – For pre-construction condos closing costs are an unknown variable. This gets some buyers worried. Historically speaking, these costs are around the $8000 mark for a one bedroom in Mississauga.
Condo Assignments are not for everyone. At times condo assignments can be a great way for a desperate seller to unload his pre-construction condo and for a buyer to strike a great deal. However, they do require extra patience and expertise which many buyers, Realtors and lawyers have a hard time committing to.
At the present time, I myself as a Realtor; do not handle assignment condo sales. This might change in the near future.
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Saturday, April 20th, 2013 and is filed
As many of you already know, in Canada, taxes are due each year on the last day of April. Now I know that for many, taxes are one of the least favorite things to talk about, yet lots of people seem to be misinformed about tax basics and the implications they have on real estate. By no means am I a tax expert, but in this blog post I want to clear up some of the basic tax questions I get asked.
Capital Gains Tax– Capital gains occurs when you sell a property at a higher price than you paid for it. The difference is known as your “capital gain”. Any property (with exception to your primary residence) is subject to a capital gains tax.
Calculating Capital Gains Tax – The formula for calculating capital gains tax on real estate is : Capital gain x 50.00% x marginal tax rate = capital gain tax. This can be best illustrated through the following example.
Let’s say you bought a 2 bedroom investment condo in Mississauga back in 2007 for $300,000, and now you have sold this condo for $350,000. You have made a $50,000 profit, of which $25,000 is subject to capital gains. This $25,000 is then multiplied by your marginal tax rate. Lets say your reported income was $80,000 (so you’re looking at 35% marginal rate). Thus, your capital gain tax would approximately amount to $8750.
Secondary Residence vs. Primary Residence – The most frequently asked question amongst my buyers is ‘ if they could claim their Mississauga condo investment property as a “primary residence”, also known as a “principle residence” ‘. The simple answer is no. According to Canada Revenue Agency a principle residence can be a house, a condo, a cottage or even a mobile home, which has been occupied primarily as your residential home, and has been owned by you or jointly with another person during the tax year. Owning two principle residences is possible, if the properties in question are in separate cities and are both used as a place to live in during the tax year. However, do exercise caution and seek professional advice, when claiming two properties as principle residences.
Renting Your Condo Unit As a Non-Resident – If you are not a permanent resident in Canada but do wish to hold real estate in Canada, then I would strongly advise you to hire a professional accountant. They should explain to you that the first step is to obtain a tax account number. You should also know that your rental income will be subject to a 25% withholding tax. Now, I know this rate may seem high, however not to worry, as this will be reduced when you file your NR4 slip. The NR4 form reports the gross rents you collected and the withholding tax that you remitted to Canada Revenue Agency. Finally, as with other parts in the world, when you file your annual tax return on your investment property, you can deduct tax expenses such as: property tax, repairs, general maintenance, insurance, condo fees and fees paid to any agencies who take care of your property.
Paying Your Taxes – In Canada taxes are due on April 30th of each year. Unlike in other parts of the world, Canadians do not have an option to file for an extension. If you are late with your taxes, you will be subject to a 2% penalty for each month you are late. Make sure to stay organized so that when tax time arrives you are ready to submit everything !
Once again, I would always encourage people seeking any tax advice to speak with a licensed tax personal. I do have some names which I can recommend for anyone searching for a good accountant. For more quick tips please visit the Canada Revenue Agency website found here.
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Friday, April 5th, 2013 and is filed
In this blog post we covered some of the interesting facts for Mississauga downtown condos. Enjoy!
Currently there are over 20 pre-construction condos planned for downtown Mississauga
The Onyx condo, is the only newer Square One condo which has a rooftop patio and a lounge on the 36th floor
The Marilyn Monroe condos have Mississauga’s fastest elevators and if you live anything higher than the 30th floor you can expect to have your ears “pop” on the way down
Out of all the newer Square One condos, the SkyMark condo has the lowest condo fees per square foot and they even include hydro!
Limelight is the only condo in Mississauga with a full sized basketball court
According to RealNet, PSV Tower 1 was the fastest selling pre-construction condo in the GTA (Greater Toronto Area) this spring
As of October 10th 2012, there are currently over 509 older and newer condos for sale in the Huronatrio and City Center Area
A Parking Spot in downtown Mississauga sells between $15,000-$25,000 depending on the condo and parking location
The Chicago condos have a rock climbing wall as a part of their amenities – How cool is that?
The average selling price for a Square One condo in September 2004 was $204,412. Fast-forward 8 years, and the average selling price for a Square One condo in September 2012 was $291,257. That’s up by 43% or 5.3% per year!
Every single Square One condo build after 2001 has a balcony
In May 2009, over 50 Pay and Display parking machines where installed around the Square One area
Mississauga Celebration Square, which is located in the heart of downtown Mississauga, received over 1 million visitors since it opened in June 2011
In September 2012, the average Square One condo took 36 days to sell and sold for 97% of the asking price
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Monday, October 8th, 2012 and is filed