Invest Young. Build your fortune faster!

October 27th, 2014

Investing in Property

Investing in PropertyI feel that “Millennials” or the Generation Y (those born from early 1980s to early 2000s) are far more communication savvy and tuned in to global economics today that many of us ever were in our 20s or 30s. They have grown up seeing swinging inflation, vacillating stock market conditions and career fluctuations that affected many of their lives personally. This has given them greater awareness and better knowledge about starting on the career path young. However, there are lesser books on sound investment decisions for young millennials than there are books on History, Geography or French!

As an experienced Mississauga broker, I would like to tell them that nothing offers more financial security than investing in your own property as early as possible.

Patrick O'Shaughnessy, Author of "Millennial Money: How Young Investors Can Build a Fortune” reinstates my view with some great tips to help young investors get rich and stay rich. He believes that most people wait till they are in their 40s or 50s to invest in their own property. What they don’t realize is that if they wait that long, they lose out on valuable time.

If you can invest when you are young, you can get significantly ahead”, he says. I have to agree with him.

So how young is young before you can invest? When do you have enough money? Do you ever have enough money in your 20s and 30s to invest in your own property?

In my view, Millennials should start out by taking baby steps towards investing. You should invest small amounts in your tax free savings account. It is important to appoint a financial consultant at your local bank while doing so. 

As Patrick correctly states, the average growth of each dollar you save in your 20s grows in value by leaps and bounds over the years. If you wait till you are in your 40s, that growth percentage lessens considerably.

When it comes to property, once you invest at least 5% down payment, you are well on your way to buying your own home and stop renting. Doesn’t that sound great?

If you are one of those privileged young people who have the luxury of living with your folks, the going can be even more fantastic! This gives you the opportunity to continue saving and build enough equity to buy an investment property for renting.

As Patrick O’Shaughnessy states, your home feeds your psychological needs. Stocks might have outperformed the real estate market in the long run but real estate investors get richer faster when their properties are not bought with 100% cash. Most investors put down 20% or more and banks loan the balance of the home's price.

For example, in our GTA market you can invest in property by putting down 20% or more down payment. This is called leveraging. It makes good sense when your properties are rented to good tenants and your rent is greater than or equal to your investment property’s expenses (mortgage, property taxes, insurance, maintenance expenses etc.).

It is prudent to consult a financial advisor before investing and even more important to find a good real estate broker specializing in investment properties if you are considering owning property. Parents can also assist their young investors get a head start by helping with the down payment.

If you are a young millennial thinking of venturing into real estate investing, give me a call. We have a lot to talk about. 

Category: Investing

New immigrant to Mississauga?

September 8th, 2014

See how Mississauga real estate makes you feel at home.

New Immigrant MississaugaSummer has brought in many new immigrants to Mississauga. Sometime ago I read in Reader’s Digest that both in the USA and Canada, new immigrants are responsible for a thriving economy. Immigrants as a whole are better educated and those with marketable skills get brownie points. With their advent, industries grow and job vacancies rise.

Canada especially stresses on skilled immigrants who have gone on to strengthen the economy with their valuable expertise. Canadian immigrants come from different cultures and nations which consequently translate to greater expertise, linguistic skills and connections with their country of origin, promoting trade and strengthening international relations.

However, with a shrinking local population in some provinces and declining skills, a shortfall of 3 million skilled workers by 2020 is estimated in the future.

Undoubtedly, Canada has the highest per capita immigration in the world, even though the immigration rate has declined sharply since the early 20th century. The high immigration rate is attributed to the country’s rich economy. Canada is one of the world’s largest suppliers of natural resources such as lumber, metals and oils. In recent times, the real estate, medical, pharmaceutical and IT sectors have also registered a sharp growth in investment and sales, which is most visible in the Greater Toronto Area, especially Mississauga.

Even as the demand for immigrants is on the rise, the difficulties they face after arriving here make many others think twice. To beat this trend, the government in Canada, especially Ontario, has taken it upon themselves to make things easier with several grants and benefits for first time buyers, especially in housing and real estate. For example, new immigrants are offered home loans with down payment of 35% even with no credit history and job. 

Canada Mortgage and Housing Corporation’s (CMHC) newcomer’s guide to Canadian housing gives useful insight into the Ontario Housing market. If you have set your sights on Mississauga, visit Mississauga neighbourhood links to find out about the best places for living, working, schooling, shopping etc.

Mississauga believes in the spirit of community. No matter which part of the city you choose to live in, you will find people who can help you adapt to your new life and fit into our Canadian society. In the weeks, months and years ahead, you will have many opportunities to participate fully in Canadian life. You and your family can grow together, side by side with other Mississaugans and make a better life for everyone. This is your new home. Welcome to Mississauga!

Category: Investing

Tridel Islington Terrace Condos VIP Sale

August 22nd, 2014

Hurry-VIP Brokers Sale! This is a One day event!

Islington Terrace Condos

Each year 100s of condo projects enter our GTA market. In my opinion, only a handful of those projects are worth investing in.

Good projects are measured on the reputation of builder, prices, location, return on investment, finishes, demography, timing of completion among other variables.

​I keep an eye out for good projects for my valued clients, and I only represent projects that make sense to me. Tridel Islington Terrace is one of those few projects. 

Quick Facts About Islington Terrace Condos: 

Developer: Tridel (One the most reputed GTA builders)

Tridel Islington Terrace Condos Location: 64 Cordova Ave, Etobicoke, ON

Phase: 1st of 3 towers (prices move up with every tower)

Floors: 45 Floors

Unit Size: from low 500 feet

Price range: from $228K (1 BR suite)

Condo fees excluding pkg & locker maintenance: estimated at $0.49 per sq. ft. 

Estimated completion: Summer 2018

Deposit structure: 20% over 365 days

Proximity to Islington Subway: Within a few steps

Amenities: Outdoor Pool, BBQ, Entertaining area, Fitness Studio, Yoga Room, Movie Theater, Party Room, Aqua Spa & Games Room

Special incentive for my VIP clients:

No assignment fee at Islington Terrace Condos

Capped closing costs & levies

Extended deposit structure

A+ tenant on closing (1 year lease)

A la carte Property Management Services

Register for priority access:

Category: Hot Deals, Investing

Mississauga becomes hot property

August 6th, 2014

Invest in Mississauga

MississaugaAs Canada comes to the forefront of the real estate map, Mississauga is increasingly taking centre stage.

The scenic suburb, located on the shores of Lake Ontario on the western end of Toronto is already packed with an affluent, well educated population of 750,000+ and growing by the day as the country’s 6th largest city. Not surprisingly, Mississauga currently rates as one of the best cities in Canada to live in, all set to score as the country’s city of the future.

As investment pours in to buy more properties and condos in Mississauga and build more residential and commercial complexes, all efforts have been taken to hold on to the pristine beauty, both within the city and around it.

Over 480 parks and woods have been preserved through the joint efforts of the government and community. Property prices are more affordable than Toronto, with no compromise on urban conveniences in the way of public transport, shopping complexes, medical and educational facilities as well as entertainment through the Celebration Square and Living Arts Centre, among others.

Mississauga holds Canada’s largest and most famous airport in the GTA – Pearson International Airport that also connects you to seven major highways. The city offers job and business opportunities in several key sectors: Biomedical/ Pharmaceutical, FIRE, Consumer Products, Information Technology, Automotive, Aerospace, Finance & Telecommunication. We have prestigious higher learning institutions – The University of Toronto Mississauga and the Sheridan College at the heart of Mississauga City Centre making the city a prime educational centre.

Now you know why Mississauga is declared No.1 mid-sized American City of the future 2013/2014, by Foreign Direct Investment (fDi) Magazine, beating 79 other cities to the title.

The City of Mississauga has earned 'AAA' credit rating consistently since 2003 by Standard & Poor's Ratings Services, based on the exceptional liquidity levels, debt-free position and bustling economy. Most importantly Mississauga is also one of the safest cities to live in Ontario with the lowest crime rates” he stresses.

Having said that, each positive assertion comes with its downside!

As more and more people from all over the world settle in to make it their home, Mississauga is also running out of vacant land.  There is little land left for large scale housing developments, except for a few hectares for high density housing downtown. As the demand for housing shoots up and the city continues to grow, I would say that it couldn’t be a better time to buy property in Mississauga now. Real estate prices in Mississauga can defy any economic slowdown.

Churchill Meadows neighbourhood was the last new builder housing development that was completed in 2014. The only exception is the new builder condominiums in Mississauga Square One.

Most Mississauga neighbourhoods are safe and self-contained. There is a choice of well planned neighbourhoods for all cultures and ages. It helps to have an experienced local real estate broker to short list just the right one for you.

You also have a selection of new homes and resale homes. Both come with their pros and cons.

Then there are condos that come in all shapes and sizes, including apartment style and townhouses. Condos also come in stacked form. These are small buildings that have apartments styled townhouses built on top and on the side of each other. Most of these building are come with eco-friendly construction. The condo fees are kept low as these building do not offer high maintenance amenities like swimming pool gym, sauna etc. Owners pay a fee for the maintenance, upkeep and replacement of common elements, snow removal, landscaping, security etc.

But luxury condos in Mississauga offer a great lifestyle and come with all the bells and whistles. One can find many high rise buildings in Mississauga Square One that come with world class amenities.

Mississauga-Population, Demography & Housing

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Category: Realty Talk

Investment property in Mississauga

July 17th, 2014

Should I buy a condo apartment or a freehold home in Mississauga?

investment propertyThis is a question that I get asked all the time!

A common perception is that investing in a freehold home in Mississauga makes more sense, given that historically freehold homes in Mississauga have appreciated more than apartments, plus there is also a lack of supply when it comes to freeholds.

When investing in older properties, one should think at least 10 years ahead. For example, a freehold home in Mississauga that is already 10 years old, will need a new roof, windows, appliances, furnace, A/C, flooring, bathrooms, paint etc. when it is time to sell it after 10 years. This should be applicable for most properties that are 20+ years in age.

A condo apartment on the other hand may not need an extensive overhaul. In the case of the latter, simply replacing floors, bathrooms, kitchen, appliances and paint should do the trick.

In both cases, putting 30% -35% down payment should be in enough to carry the monthly property expenses through rental income. However, a condo apartment (a decent 1 BR Mississauga condo sells for around $240K), needs a smaller down payment as compared to a freehold property (3 BR semi in Mississauga sells for around $530K).

Like with any other investment, real estate investing makes sense as long as one does not go overboard. 

A good investment property should be:

  1. in a great location
  2. affordable to buy as an investment property
  3. easy to rent, or in other words it should be popular with renters
  4. able to carry all of its expenses from the rental income
  5. easy to maintain/repair/improve
  6. easy to sell

Before buying an investment property, one should simultaneously plan an exit strategy. It is prudent to select the right person who can not only help secure the right property, but also help rent it to qualified tenants (very important). Sometimes passion/ desire for higher returns, takes over logical thinking and people make their decision based on the future growth without fully analyzing the subject matter.

Investment property and ROI

Investing is about generating wealth and return on investment (ROI) works best on leveraging. Real estate investing makes little sense when an investor puts 100% down when properties grow at a mere 3% to 5% on an average. Leveraging makes ROI mind boggling and helps create wealth.

A word of caution: Leveraging can also generate losses if the prices fall or the interest rates increase.

In my opinion, one should invest in properties that are most popular with renters.

Tell me, why should I rent if I can afford to buy with 5% down payment? 

Out flow on a 1 BR condo is $1,600 per month, as seen in the above blog link. 

The above figure also hints that maximum number of renters in Mississauga are available for properties that rent within $1,300 to $1,700 per month price range. So shouldn’t one fish where the fish is?

For more on selection of investment properties, both condos and freeholds, contact me at 905-339-5111

Related link: Historic Stats (includes all residential properties, both homes and condos) – Toronto MLS Sales and Average Prices

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Category: Investing, Realty Talk