What’s going on in Mississauga’s real estate market?
One thing that strikes me is the way the media constantly asks us if the time is right for buyers to step into the market. It is a fair question. But has any real estate expert said that this is not the time to buy?
Admittedly, there is indeed interplay between economic trends, market data and real estate projections. Realtors like me rely on current economic and industry data to present our views or projections on real estate markets. And if the reference data is skewed for any reason, the real estate projections could become incorrect.
Just to give you an example, the industry assumption of investor owned pre-construction condos is one-third of condos under construction. Should this actual percentage be higher, it can make the forecast incorrect.
Having said the above, active real estate professionals, those who seriously work full time in this profession and are experienced in all types of real estate market conditions, can provide first hand information which is relevant to local events in their niche markets.
The global recession is imminent; world’s real estate prices are coming down, it is natural to see some effect in every real estate market in general. Mississauga is no exception. Real estate markets have always been cyclical.
The following CMHC charts show resale home sales, average prices, and their forecasts for the Toronto area.
Prices just cannot keep going up forever. Markets are relative to the economic situation, demand and supply. Housing affordability plays an important role, as also other factors, such as, the job market, inflation, cost of borrowing, personal savings and investment goals. Remember, it is the market that drives the real estate prices and not the other way around.
Given below is a quick snapshot of some Mississauga neighbourhoods where I actively work, namely Mississauga’s Square One and West Mississauga (Eglinton/Hwy 10, Erin Mills area South of Eglinton, Credit Pointe, Churchill Meadows, Mavis/Eglinton area, Heartland Centre area, Meadowvale, Britannia/ Terry Fox, Mavis/Derry, Derry/Ninth Line, Winston Churchill/Britannia, Erin Mills Pk Way/ Eglinton, Streetsville, Glen Erin/Thomas St.)
W15 (Square One and area) district is in a buyer’s market mode. The average home sale price in Sep 2008 was $237,000 down 5.4% from the same time last year. However, the average condo apartment’s price was up by almost 6% during this period (comparing Sep 07 and Sep 08). The sold to listing ratio of apartments dropped down 4% from same time last year to 27.8%, almost no change in no. of active listings. Reason: slower sales, lots of supply and competition amongst similar properties (small entry level condos). Reason: lots of supply and competition amongst similar properties (small entry level condos).
Competition amongst the newer condo development sellers keep prices in check. This in turn helps smart buyers to snap up great deals from motivated sellers. Those investors who don’t see profits on flipping are turning into landlords. This keeps their investments safe, helps renters and keeps rental rates from surging.
In W19 average home price in Sep 08 moved up approximately 1.47% than same time last year to $359,554. There is a lack of supply of newer homes.
In W20’s Churchill Meadows area activity has slowed down (higher sold to listing ratio). Prices of detached homes are somewhat down by 3.7% in Sep 2008 to $451,929 in comparison to the same time last year. The average home price remained unchanged in the same period, which can mean that other home types performed better.
Mississauga’s unique proposition lies in the basic economic principle, i.e.; supply and demand of properties. Mississauga is almost out of suburban housing market and is set to grow up wards (high rise condo developments in Mississauga City Centre).
With much less supply of land and low inventory of new builder homes in comparison to other Toronto suburbs-Brampton, Oakville, Burlington and Markham, the fundamentals don’t point towards major price correction in Mississauga. Even if the prices will fall below ten percent they should come back sooner than the other suburbs.
Mississauga has always been in big demand and will always remain the most popular destination for the knowledge based new immigrant or move upper buyers from other adjoining suburbs.
Neighborhoods/ condominium buildings where properties rarely come up for sale, a slightly overpriced listing may still be snapped up faster.
There are also elements within each individual property listing that reflect positively or negatively on the listing/ selling price. A property owner may accept a lower sale price and still consider receiving full compensation when there is perceived monetary value in other aspects of the sale, or the seller may demand a higher price when asked to make concessions to a buyer’s needs, like closing date, conditions and financing, chattels and fixtures inclusion/ exclusion (appliances, lighting fixtures, furnishings etc.)
Further, price depends upon specific location or street, condominium building, type of property, competition amongst similar properties, number of bedrooms, bathrooms, frontage, square footage, taxes, overall condition, upgrades, basement, landscaping, exposure, balcony, parking, and locker.
For a free market evaluation of your home or condo, feel free to contact me.