Should you buy a Mississauga Central Erin Mills Condo from the resale market or from a builder?

Before we discuss this topic, let me briefly explain the major difference: Builder’s new high rise condo is a future purchase price that you accept today. Resale price is the market current price of what is selling today. One can read more about their pros and cons of new vs resale condos on our site.

First time buyers or renters opt for resale condos for many reasons. They prefer to move within 2-3 months and also can end up paying as low as 5% down payment vs. builder condos that require up to 20% down payment.

For example, if you were to buy a resale condo for $600,000, you can buy with as as low as $35,000 down payment (5.8% of purchase price). Now if you were to buy a condo for $600,000, you would typically have to pay 15% of the price in the 1st year, $90,000.

Builder’s price is always more than the current resale market prices because the future price is based on many variables like cost of land, cost of construction, development costs, builder’s financing terms, comparable offering of other builders etc.

There had been great opportunities in the Mississauga builder condo market segment in the past, where buying a builder’s new condo reaped excellent rewards for our investor clients.

M City 1 and M City 2 condos,  Perla condos, Crystal condos,  Amber condos,  Grande Mirage condos, Mill Square condos and Erin Square condos in Central Erin Mills, are some good examples.

No one has a crystal ball when it comes to predicting the future but a good look at the price gap can tell an investor if buying a builder condo makes sense or not. The right method of buying a builder condo is to analyze correctly the gap between the builder’s new and resale price.

If the gap is less, it makes all the sense to buy a builder condo. But if the gap is substantial, it would make less sense to buy a builder condo. So before buying a new condo from the builder, compare today’s resale market prices to the builder’s prices.

Just to give you an example of this week’s launch prices of Daniel’s The Kith condos across the Erin Mills mall. The project comes with A++ location but looking at the prices, it makes little sense to buy, as a value shopper investor. And here’s why:

Last month, I bought a gorgeous 825 sq. ft. 2 BR, 2 WR, with 1 parking unit at Downtown Erin Mills condos (4655 Glen Erin) for $710,000 only for one of our investors. This is a gorgeous building which was built in 2019.

Having said this, not all models or floor plans can be looked at with the same lens. An expert condominium realtor should be the best person to help you with your investment, be it resale or builder new.

Call us if you are looking to buy or sell your condo or home in Mississauga and surrounding areas.

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