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Posts tagged with: mississauga condos

What are the current prices for Mississauga houses or condos?

May 3, 2015 - Updated: May 3, 2015Buying Real Estate

Mississauga house or condo prices

 

When buying a Mississauga condo or house it is important for buyer’s expectations to be realistic.  Especially in a climate where inventory may be lower and demand is high.  According to the Toronto Real Estate Board, sales for Mississauga from January to March have had an average selling price to listing price of 99% and be on the market for an average of 25 days.  Buyers should expect to be in a best case situation to pay closer to asking price and in a worst case scenario be in a bidding war and pay over asking.

 

How to be prepared to buy a condo or house in such conditions?  Buyers need to be prepared as much as possible.  I recommend having a preapproved mortgage already set by the time buyers start their search.  Taking into consideration buyers will probably like a property other buyers will like. It’s smart then to look for houses 10 to20 thousand below their maximum preapproved amount in case they have to go over asking price.  With condos as there is more inventory I would say it’s safer to go to maximum, but don’t be surprised to get into a bidding war for the pretty ones.

 

Recently I showed a property to a first time home buyer.  This was a detached house which needed lots of TLC and money to make respectable.  At the time of showing I counted no less than 6 agents showing this property at about 6 pm on a Friday evening.  The average selling detached house price in this area is around 800 thousand dollars.  The asking price for this house was 450 thousand dollars.  My client wanted it at 350 thousand dollars because of all the work he would have to put into it but he didn’t like it enough to put in an offer.  The next day this detached house had fetched 24 offers to buy by time I checked at 6 pm.  It ended up selling for close to 100 thousand above asking.

 

Lately listing agents have started to ask all buyers to have certified cheques with a specific dollar amount to be included at the same time as the offer is made and accepted.  I know of situations where buyers with higher offers have lost in a bidding war to lower offers just because they were not prepared to give the deposit as per seller’s request.  Buyers must have deposit money liquid meaning the monies are not tied up in RRSP’s, GIC’s, stuck overseas etc…and be available immediately.  Take note of special instructions like having deposits ready upon acceptance.

 

Buyers who don’t put in the effort to find out if they qualify for a mortgage and shop within their means will find it very hard to be a winner in this game and only have frustration.  The Mississauga real estate market is fast paced and only the strongest, realistic and most prepared buyers come out on top.

 

By Todd Lee

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5 Renovations Mississauga Condo Buyers Want

June 8, 2013 - Updated: April 22, 2014Renovations

renovated condo

    Working as a real estate agent in Mississauga is a real joy for me.  I’m often showing a condo to a buying client and I get a chance to study their reactions to the condo I’m showing.  Sometimes they can be really excited, other times they are indifferent and on occasion they are repulsed.  Let’s focus on the renovation’s that gets a buyer excited about making an offer for your Mississauga condo.

5.  Lighting

    Lighting can be vague as a description, but generally people want a small boxed space to feel open and aerie.  Lighting of the space both natural and artificial is crucial to achieving this effect.  The choice of window coverings is usually governed to some extent by the condominium rules, however blinds, drapes and shutters of the highest quality and in tasteful colours (usually neutral) makes a good impression. 

    California Shutters when closed can block out much of the sunlight during the day which is good for people wanting absolute darkness for sleeping or even privacy, while when opened fully can reveal the full glory of the condos view of the city.  Automated window coverings that open and close with the touch of a button takes things to the next level of impressiveness.

    Modern lighting (such as chandeliers and pot lights) made of glass, crystal, stainless steel, brushed nickel or fabric can set the mood for showings.  Buyers not only want to be able to see the space, but also appreciate if the light fixtures have been upgraded from the 1980’s ceiling ball or brass coloured fixtures.

4.  Smart Storage Solutions

    Imagine you have lived in a detached house and then were to move into a condo with a livable area that equates to half of what you were used to.  Downsizing is inevitable, but not always practical.  Certain space is reserved as storage in a Mississauga condo.  Finding ways of maximizing this storage spaces potential is huge plus for potential buyers. 

    Closet dividers and custom made organizers or ones you can find at places such as Ikea can make your condo stand out from the rest.   Buyers will see the value added to your condo versus the competition.  Also, a well-organized condo that is neat and clean will always give a good impression that the owner has probably kept the good care of the place. Typical places of upgrading storage are the walk in closets, bedroom closets, linen closets, laundry room, kitchen pantry and coat closets.  Also, if you kind spare un-used space adding extra storage to bedrooms, kitchens, bathrooms and living rooms will also catch the buyer’s eye.

3.  Hardwood Flooring

    Hardwood flooring throughout the condo is becoming pretty much a norm now for buyer’s expectations.  It’s easier to clean and also is better for people with allergies.  It also looks superior to the old fashioned shag carpet of the 70’s and early 80’s.  It’s more durable than broadloom, looks better than the parquet that might be the original flooring and is real, not fake such as engineered hardwood or laminate which is so common in the new build Mississauga condos.  Colour choice will depend on your overall interior design scheme, but make sure you get at least 4” width, as anything smaller looks cheap.

2.  Bathrooms

    Many older Mississauga condos are in dire need of upgrading the bathrooms.  This in definitely one of the places the condo buyers get repulsed at.  Often over time owners have neglected to do basic maintenance so things like mildew form, tiles work gets cracked or falling off, drywall may be bubbling, toilets look as though you are at a truck stop, doors are falling off the hinge, flooring is outdated or dirty.   Upgrading the sinks, lighting, mirrors, fixtures, cabinets, toilets, bathtubs, walk in’s and tile work…basically the whole enchilada.  Buyers know bathrooms are expensive and that’s why they want to see at the very least a well maintained clean and organized bathroom.  What they really want is a modernly upgraded bathroom with materials like granite for the countertops and nice clean lines and neutral colours for the tile work.

1. Kitchens

    Both men and women are at home at the kitchen these days.  So it stands to reason that upgrading this one space which will probably benefit either of the sexes is a good place to put your money.  Large tiling for the floors, hard durable granite for the counter tops, custom cabinetry with easy closing drawers and lighting under the cabinets.  Stainless steel appliance and combination range hood with microwave is smart to keep countertops open.

By Todd Lee

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Tagged with: mississauga condos renovations buyers kitchens bathrooms hardwood storage lighting

Condo Fees

July 31, 2012 - Updated: April 18, 2014Condos

 

    While working with clients to find real estate I am often asked questions about condominium fees.  There seem to be a little bit of pessimism probably due to a lack of knowledge about condos.

Let me address the first question, what are condo fees?

    A condominium owner owns an equal share of the common elements ie. The building facade, windows, landscaping, amenities etc… The unit owner also has an equal responsibility to pay for the “maintenance” of these elements.  The condo fee is simply the dollar amount that has been calculated by the condo management and billed to the unit owner every month.

How much are condo fees?

    In Mississauga where I predominantly sell real estate, the condo fees are all over the place.  There is a good reason for this too. It depends on many factors including how well maintained the building is; the size of the unit; the floor the unit is on etc.   In general, I try to see the value that comes with the condo fee in comparison to like condos.  For instance, if condo “A” is 3 bedrooms on the 22nd floor, has an area of 1600 sq. ft., has 24 hr. security, hydro, heat and water are also all included vs. condo “B” is 3 bedrooms on the 1st floor, has an area of 1100 sq. ft., has no security and no utilities are covered by the condo fee.  Then I would expect unit “A” to have a much higher condo fee vs. unit “B”.  If this is not the case then unit “B” would be considered to have an expensive condo fee in comparison.  To generally answer the original question I would estimate for a 1 bedroom unit the condo fee would be between $400-$500 on average, 2 bedrooms unit would be around $500-$600 on average and 3 bedroom unit will be in the neighbourhood of $600-$700 on average as of summer 2012.

What utilities do the condo fees cover?

    In the past many condos had all inclusive condo fees where the unit holder did not have to worry about paying anything extra.  In the past 5 years the government has given the condos incentives to go with metered hydro billing in a quest to reduce the demand for hydro.  As a result many condo fees will only cover heat and water these days.  Hydro is usually billed separately.  This may not be such a bad thing however.  The unit holder can now control their hydro costs directly often leading to a savings.  For others who still use hydro unwisely, have probably seen their cost go up.

Why would I buy a condo when the fees to live there are so expensive?

    This question is ultimately one of personal life style choice.  Consider how much it would cost to own a freehold home but adding all of these amenities:  Having a 30000 sq ft recreation centre with state of the art equipment, personal trainers, yoga classes, indoor and outdoor swimming pools, party room with kitchen, movie theatre, bowling alley, putting greens, virtual golf, lounge, barbecue area with plasma TV’s, courts for basketball, tennis, squash and landscaped terraces.  All of these amenities have a maintenance cost that is covered by the condo fee.  In addition the fee also covers cost to maintain the building, pay for security guards, removal of snow, landscaping, having an onsite superintendent, some funds are put a side for major repairs or renovations, insurance, paying for the management company to oversee the general operations and even the heat, water and hydro used by everyone in the common areas.

    If you prefer not to have all of those benefits in favor of doing it yourself that’s perfectly fine.  You will probably save lots of money.  For those who see the value in not having to cut and water the grass and living in a state of the art building with a modern recreational facility will save time from going to the local fitness club.  The management company looks after the up keep of the building and puts away money for a rainy day, whereas most individuals are not that prudent.

    Where some people see expense I can see value.  As always the choice is yours.  When shopping for a property it is very important to work with a knowledgeable real estate professional who knows the area.  Every ones situation is different and my stated points of view are for general knowledge.   

See a comparison of all fee's for Mississauga condos.

Thank you for reading my blog and as always please contact me at info@toddlee.ca if you have any questions. 

By Todd Lee

Tagged with: condo fees real estate todd lee mississauga condos condos

Buying Mississauga Condos: It just makes Money sense.

June 30, 2012 - Updated: April 18, 2014Condo Investments

 

    My clients often ask me the question: is Toronto the best place to buy a condo for investment purposes?  It’s easy to see there are plenty high rises buildings in development as you drive along the Gardiner Expressway.  Why wouldn’t there also be lots of money to be made?  Otherwise, why are there so many buildings going up?  My quick answer is, yes. The Real Estate Market is hot especially for rentals or the investor might be able to cash in big by flipping.  However, there is a “but” to this answer.  With so many condos built and being built the market can get over saturated. The most recent information from TREB indicates just that, as year over year appreciation was lower for condos in comparison to other segments in the Real Estate Market.  This is not to say you won’t make money on condos, but maybe not as much.

    This is where buying condos in Mississauga comes in as a great opportunity for the condo shopper.  While not being Toronto, Mississauga is located very close to the centre of Canada’s financial center and all of its vibrant night life, restaurants, attractions, museums, university’s, shopping etc… are within driving or public transit range .  This is not to say Mississauga is a barren waste land either.  The fact is, Mississauga has a very diverse population, has a vibrant city centre, a lakeshore, sports stadium, a Performing Arts Centre, night life, restaurants, trails, parks, great schools and is also home to the busiest Airport in Canada and to 61 of the Fortune 500 Canadian companies. Mississauga in essence is a mini version of Toronto but is also debt free and does not seem to be hit routinely by strikes and protestors.

   Investing into Real Estate is just like any other business venture.  Costs of investment and the potential return have to be studied and analyzed.  Let us examine the statistics posted by The Toronto Real Estate Board for the quarter one of this year.

The average sell price to list price for condos is around 97%-98% in Mississauga and Toronto.  We will simplify the comparison by just using the average list price for condos.  In Toronto, the average list price for a condo for Q1 was $360,892.00 while the average in Mississauga was $254,584.00.  What this means is on average the condo buyer will spend about $106,000 less to buy in Mississauga which obviously represents a cheaper cost.

Figure1.  Summary of Condo transactions created by TREB.

    If we focus on just the Toronto downtown core we also see the most popular units sold are one bedroom and one bedroom + den.  This segment of Toronto does represent the average price of condos listed.  By comparison, in Mississauga City Centre the most popular units sold are; two bedrooms +den and a close second place, two bedrooms and 1 bedroom +den.  The average of these units dose represents the average list price of condos in Mississauga.  Clearly, being able to purchase a bigger sized unit in Mississauga represents a greater value!

Figure 2.  Summary of condos sold in Down Town Toronto.

Figure 3. Summary of condos sold in Mississauga City Centre.

    Now let’s examine the percentage of appreciation for condos.  TREB lists the first quarter 2011 average price in the city of Toronto as $348,779.00 and for Peel Region (Mississauga represents the vast majority of condo sales in this region.  TREB did not collect data far back enough to see Mississauga’s exact numbers) $231,010.00.  As well, the average price in Peel for quarter 1 2012 was $246,688.  Doing the math the appreciation results from quarter to quarter looks like this:

Figure 4.  Condo Market Summary created by TREB.

  • Toronto condos + 3.5% in value.
  • Peel region condos +6.7% in value.

    The conclusion should be made that by percentage, appreciation of condos in Peel and more specifically Mississauga and Brampton is higher than in Toronto by almost double.  This also indicates a possible trend that wise investors are leaving Toronto for greener pastures west of the city.  One probable reason is the land transfer tax situation in Toronto.  It’s been well documented in the media that buyers are seeking other opportunities to invest their money as the cost of Real Estate is getting to be high in part, because of this tax.

    As an example if the investor (not a first time homebuyer) were to buy the average priced condo in Toronto they could expect to pay $7200.00 in Land Transfer Tax.  OUCH!  By comparison if the same investor were to buy a condo in Mississauga for the same price the Land Transfer Tax would only be $3888.00 thus saving $3,312.00.  Take also into consideration the average condo in Mississauga is cheaper and bigger than in Toronto.  If we use the average condo price in Mississauga, the result is $2294.00 of tax payable, representing a savings of $4906.00 in Land Transfer Tax versus Toronto condos!

    Another aspect of investing into condos is the potential to make rental income.  The goal for any landlords is to make money.  Thus, it’s very important to charge a tenant a rent which covers all of their investment expenses or even exceed it.  In reality most are not successful in reaching this goal, but are rather satisfied to have their tenants help to pay down the mortgage while covering the cost of condo fees and utilities.  The appreciation in value of the condo over time plus the accumulation of equity without having to put up all the money themselves can still be lucrative in the long run.  The key to renting is simple.  The Landlord must have a reliable tenant and any vacancy will add to the expense of the investment property.

    Let us have a look at the vacancy rate for condos in Toronto vs. Peel as per CHMC, 2011 Fall Rental Market Survey.  We can see the rate in Toronto is very disproportionate at 1.3% in comparison to Peel which is at 0.3%.  The disparity can be explained by perhaps the type of tenant.  In Toronto one bedroom condos is king for sales.  If we assume many of these are being rented to business clients or students, it’s less likely they will stay long term causing the Landlord to fill vacancies with more regularity.  We know the two bedroom +den is king in Mississauga which can mean young couples or small families are renting, thus are more likely to stay longer meaning less vacancies.

Figure 5.  GTA Condo Vacancy Rate

    The last factor to consider is the cost of financing your investment.  The Federal government hinted that in the first quarter of 2012 that interest rates will probably increase this year. They also made it clear they think certain Real Estate Markets were too hot and perhaps growing without following the fundamentals.   Since the early part of the year when this was stated, some things around the world have changed.  The Euro market was in turmoil.  Now the European Union has made some changes to protect hard hit Euro economies making markets around the world more confident and perhaps negating the need to raise interest rates so soon.  However, the Feds still want to control the debt levels that Canadians are taking on.  The Feds response was to change the Mortgage rules to make it more expensive to borrow for Real Estate. They took away 30 yr. amortizations so the maximum is now 25 yrs.  To illustrate I will give an example of a monthly mortgage payment for $500,000.00 amortized by 25yrs and 30yrs.

  • 25yr mortgage = $2104.08/month, also requires an income or at least $78903.00/yr.
  • 30yr mortgage = $1902.07/month, also requires an income of at least $71328.00/yr.

    That $300 makes a huge difference in affordability as the buyer would have to make at least $7600 more a year.  Therefore, investing in Mississauga condos, the more affordable option puts you the investor at less leveraging risk.

    Another factor to consider when determining your potential to buy is how much down payment you can afford.  Assume you want to avoid the CHMC insurance fees for high risk mortgages.  You will need to have 20% of $360,892 for the average condo in Toronto which works out to $72,178.40.  In Mississauga the 20% down payment for the average condo would be $50,910.80.  In other words, you could save $21,267.60 by investing in Mississauga.

    Ultimately as a condo investor you have to ask yourself the questions…Do you prefer a rate of return of 3.5% or 6.7%?  If you are buying the condo to live in or rent would you rather have a 1 bedroom or 2 bedroom +den?  How often do you want to find Tenants?   How much can you afford to be leveraged without going into financial disaster if things don’t work out the way you had hoped?  How much down payment do you have?  After reading my blog I think you will be better prepared to answer that question yourself.

Thank you for reading my blog and as always if you are interested in my Real Estate services please don’t hesitate to contact me at:  info@toddlee.ca

*All statistics and charts are from the Toronto Real Estate Board.

By Todd Lee

Date posted - 30/06/2012

 

 

 

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