Home Buying Options 2022 – Trends & Outlook

Home Buying Options 2022 – About Mississauga

Are you a First Time Buyer, a millennial looking to purchase your first home, a newcomer to Canada, someone wanting to buy a home on a Work Permit looking to make your first or next home purchase in the GTA, or someone looking to downsize?

Are the soaring home prices of 2021 and 2022 keeping you away from securing a home or even making your first move?

Staying informed about the market and making a move when the time is right is crucial!

About Mississauga

Mississauga is Canada’s sixth largest city, located in Southern Ontario on the beautiful waterfront of Lake Ontario. It is a convenient 30-minute drive from downtown Toronto. Mississauga is also within close reach of Niagara Falls and less than 1.5 hrs from the US border.

Mississauga is one of the most expensive cities of North America. Still it is also one of the most sought after cities for new immigrants. It is the closest suburb to downtown Toronto where most of the high net worth or high flying jobs are. It is popular among university students, doctors, lawyers, Bay Street finance companies etc.

Mississauga is like a brand & residents are mostly affluent

Mississauga is home to 76 of the Fortune 500 companies, the University of Toronto’s Mississauga campus, Sheridan College Campus and two of the province’s fastest growing employment zones.

Mississauga has a diverse business community that makes up some of the largest knowledge-based industries in Canada, including Advanced Manufacturing, Financial Services, Information & Communications Technology, Life Sciences, Smart Logistics etc.

Royal Bank of Canada, TD Bank Financial Group, Tim Hortons, Trillium Health Partners, University of Toronto Mississauga, Walmart Canada Inc. are among some of the top employers here.

Mississauga is known for its historic villages, recreational parks and shopping centres. It is also home to the Toronto Pearson International Airport, Canada’s largest and busiest airport, making it easily accessible to both domestic and international visitors.

It is no wonder why so many people would like to come and live here!

A study ranks Mississauga second-most expensive city to live in North America relative to income, behind New York!

  • With an average monthly net salary of $3,302.38 in Mississauga, a typical Mississaugan spends 56.4% of it in cost of living. (For Vancouverites it is 50%).
  • With an average monthly salary of $6,359.51 in New York, a typical New Yorker spends 57.6% of it in cost of living.

What are the choices available for 2022 for home buyers in Mississauga

We had a huge jump in prices of approximately 47.5% in the last two years (Jan 2020 avg. price was $782,415 and Jan 2022 avg. price was $1,153,635). Now prices are down by 15% approximately from their peak in March 2022.

As interest rates go up, prices can go down slightly more but again no one can predict how the markets can go up or down. Most of the market movement is government driven like we have discussed in our previous blog post covering the May GTA Real Estate Market Update.

At the same time, if you are thinking of buying, what are your current options?

These are the options for different categories of people.

Investors

It is a great time to buy!

1-bedroom condos which had reached around $720K are now selling around $600K, so they are already down by $100K.

It is a great opportunity to buy because more and more people are coming and settling down in Mississauga. So the rental market potential is huge. People who are coming as new immigrants want to rent for a few years before they buy. The average rent for a 1 BR apartment as of June 2022 is $2,100 and that of a 2 BR is around $2,600 per month.

With prices so high many people prefer to rent than buy. So it is a good time for people who are looking for a steady cash flow from affluent good tenants, which is the quality of tenants Mississauga attracts compared to smaller towns of Ontario.

Quality of tenants in Mississauga is super good especially with high paying jobs and people coming on work permits with great packages.

Our team can not only find you good condos but also put top quality tenants in them!

First Time Home Buyers

If your average household income income is $140K, you don’t have any major debts then you might be a good candidate to buy a property in Mississauga with a minimum down payment of around 6.1% or approx. $40,000 for a $650,000 condo.

As a first time buyer, you may also be entitled to $4,000 land transfer tax rebate. So you will need a total cash savings of approx. $51,000, including your down payment, mortgage insurance, land transfer tax after rebate and lawyer’s fees.

FYI, most banks give loan of 4.5 times of your gross income in order to qualify for a mortgage. If you earn an income of $140K, you might be approved for $630,000 mortgage. Add to this amount your cash savings to reach the home price you can buy. Homes above $1 million require minimum 20% down payment.

First time buyers with a household income of $150,000 are good candidates for 1 Bedroom and 1 Bedroom + Den condos in Mississauga with minimum down payment.

Buying your first home can be overwhelming.

We have been helping first time home buyers since 2003. Our home buying sessions are done in-person or through Google Meet-up and are totally free. Feel free to book a home buyer session with us at any time!

If you are a married couple and you make approx. $200,000 in household income, then your options increase and you can go up to $900K worth property. At this price, we can still find you great condo townhouses in Mississauga.

By the way, these townhouses had crossed $1 million in price point in March and April of this year (2022) and now they are down by $100K, so it is a good time to snap up such properties.

So first time home buyers have the option of buying a 1-Bedroom, 1-Bedroom + Den, 2 Bedroom high rise condo apartment or a low rise single family townhouse, depending on your household income, plus available cash to put as down payment.

Great Current Listings! Contact Team Kalia if you are interested in one of these!

1 BR with Solarium Condo in Erin Mills neighbourhood of Mississauga

1 BR + WR Condo Loft at Webb Dr in Square One area of Mississauga

Existing Homeowners who want to Upsize

If you are already a homeowner and living in a 1, 2 or 3 BR condo or living in a townhouse, this is a great opportunity to upgrade.

As you know, buying has simplified a lot with the prices down almost 15 -20%. We are not experiencing the same multiple offer situations like we used to in 2020, 2021 up until March of 2022.

The current market is a very real traditional real estate market which we have been used to since 2003 (my career). We are no longer in a market condition with super low interest rates which have been creating a surge in prices and increased competition from buyers.

So this is a great time for you to sell and move up to a bigger property.

Even if you sell low, keep in mind that you will also be buying low. It’s a win-win as you will get more choices and less pressure from competition.

The key is to prepare and market your house in a way to attract the right kind of buyers. We still have buyers in the market and transactions are happening. The numbers have become low but still there is a lot of activity.

Well priced properties which are marketed nicely are still selling. We have been selling Mississauga homes successfully since 2003. Our services include free home staging, and top marketing. Contact our team for a free home evaluation!

Retirees or Empty Nesters looking to Downsize

If you are downsizing or selling to move into a rental property we are here to help you and over these years we have helped so many clients buy great properties or downsize into rental apartments from larger homes.

Immigration in Mississauga

Lack of housing inventory and immigration are main drivers of a strong real estate market in Canada.  New immigrants in the GTA usually rent an apartment in Toronto or Mississauga. Even those on a work permit or students take a unit from the tight rental supply, further fueling prices. As people and organizations are slowly getting back to normal, people are again clamoring to live in small units in big cities and the demand for urban rental units is growing.

Since 2020 when the coronavirus pandemic hit us, immigration to Canada came to a halt and its effects were felt our real estate markets. While the government intended to welcome more than 400,000 newcomers to Canada, only 184,000 successfully immigrated to Canada. This was the lowest level since 1998.

However, the government is attempting to open its borders again! It plans to bring in more than 400,000 immigrants annually, starting this year. The current proposal calls for 401,000 immigrants in 2021, another 411,000 in 2022, and 421,000 in 2023, bringing the total to approximately 1.2 million over a three year period.

Source: BNN Bloomberg

New to Canada?

Read our useful tips on homebuying in Canada and browse the RE/MAX Home Buyer’s Guide below:

Home Buyers Guide

Closing Comments

Housing is an investment that you make for the long term. Ultimately, you are buying a home to live and raise a family. So, in due course prices will stabilize and pick up again. In the long run prices are always going up.

Contact Team Kalia to Buy Your First Home or Condo in Mississauga

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