Toronto Condo Foreign Buyers

One of the hottest topics in real estate circles in Canada these days is the proportion of offshore buyers, and if and how they are inflating prices in local markets. This month, the Canada Mortgage and Housing Corporation has released a report which investigates the extent of foreign ownership in the condominium markets of Canada’s major cities. One of the interesting stats to come out of the report is that foreign ownership of condos tends to be higher in newer buildings – those built since 2010 in the cities of Toronto and Vancouver.

CMHC reports that the rate of foreign ownership in the overall Greater Toronto Area (CMA) is less than 2% for condominium projects completed before 1990, but foreign ownership rises to 7% for condos completed since 2010.

For Toronto, foreign ownership of condos is highest in the downtown core of the city, where the numbers approach 10%.  CMHC does note that the methodology used for their study allows for some leeway in the exactness of the numbers.

The foreign ownership totals are higher in Toronto, somewhat surprisingly, than they are in the Vancouver area, where foreign investors count for less than 2% of the projects built before 1990, a number which increases to about 6% for those completed since 2010.

Also interesting to note, there are some fairly large statistical jumps from 2014 to 2015 – for example, in the overall Toronto CMA, foreign ownership of condos in that single year jumped nearly a full 2 percentage points  – from 5.5% to 7.4% – for buildings completed 2010 or later. It’s important to remember, however, that some of these numbers can be skewed by condo construction completions, and when there are a large number of completions in a single year, the foreign ownership numbers will grow correspondingly. The growth in foreign ownership of condos, nevertheless, as shown by these CMHC statistics, is obviously real , and hard to ignore.

So what are we to make of foreign ownership of condos, and how does it affect our local market in the Greater Toronto Area? I think that the numbers are still relatively low, although certainly 10% foreign ownership of newer condos in the downtown core of Toronto will have a effect on the market. Toronto’s growing role as a global city brings added pressures on real estate market pricing, it’s a simple matter of supply and demand. That new offshore investors are most interested in newer projects indicates that attention is being paid to many of  the latest condo project launches, many of which are being marketed globally. It appears that the word is getting out there that Toronto, and its environs, are a good, stable, and safe place to invest. Going forward, I believe this trend will continue.

5 Government Programs that help Home Buyers in Ontario

There are a number of programs available from both the provincial and the federal government, which provide help for home buyers in Ontario. Each of these can help you to save money, either directly, or when you file your tax return. Here are 5 helpful programs which can save you money:

 

Ontario Energy and Property Tax Credit

This is a tax credit that helps low to moderate income individuals with property taxes and the sales tax on energy expenses. The credit is part of the Ontario Trillium Benefit and refunded on your tax return.

http://www.fin.gov.on.ca/en/credit/oeptc/

 

Home Buyers Tax Credit (HBTC)

This is a tax credit for first time buyers which reimburses a portion of closing costs. The credit is refunded on your tax return.  The max is $750.

http://www.cra-arc.gc.ca/gncy/bdgt/2009/fqhbtc-eng.html

 

Ontario Healthy Homes Renovation Tax Credit

This tax credit benefits seniors and can help them with the renovation costs to improve safety and accessibility in the home. Seniors are eligible for up to 15% back when they spend a max of 10,000 on home renovations.  Amounts are refunded on your tax return.

https://www.ontario.ca/page/healthy-homes-renovation-tax-credit

 

Home Buyers Plan (HBP)

First time home buyers can withdraw up to $25,000 from their RSP’s tax free to use towards down payment and closing costs when buying a home.

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/rrsp-reer/hbp-rap/menu-eng.html

 

GST/HST New Residential Rental Property Rebate

This rebate is for purchasers of a newly constructed home for use as a rental property and GST/HST was payable at closing. As a landlord, you are eligible to receive most of it back by filling out an application and mailing it in.

http://www.cra-arc.gc.ca/E/pub/gp/rc4231/rc4231-e.html

We hope you find these programs useful. With thanks to Sherry Love, Home Financing Advisor at Scotiabank Mississauga, for her expert input. You can reach Sherry at (416) 908-8563.

Got questions about home financing? You can equip yourself with all the latest money saving tips, by clicking here. Get all the answers to help you with the purchase of your next home.

Top 100 Neighborhoods to Invest in Canada

Mississauga was recognized as one of the Top 100 neighborhoods to invest in Canada, in the recently published annual investment guide put out by Canadian Real Estate Magazine. I was asked to contribute to the article, and in it we review three separate areas of Mississauga – Clarkson, Cooksville, and Meadowvale Village. In the guide we review detailed information on population, population growth, vacancy rates, cap rates, average price, average rent, and projected cash flow.

Canadian Real Estate Magazine puts out this special issue every year to provide investors with comparative information for cities across Canada. See the video here:

Clarkson

Clarkson has been selected as a good place to invest due to several reasons. It is an older area, where the price of housing is a bit less than some of the newer areas of Mississauga. It nevertheless has an excellent location, with close proximity to the QEW highway, the Clarkson GO station, as well as good schools and shopping. One profitable strategy for investors in Clarkson has been to purchase semi-detached homes with a separate basement apartment. This way, the investor benefits from two streams of income – one from upstairs, and one from downstairs.

Cooksville

Cooksville, along with Clarkson and Meadowvale, was one of the original towns which were amalgamated to form the City of Mississauga. Cooksville is centered near Dundas and Hurontario streets, the old intersection known as 5 + 10. It is also an older area, with pockets of reasonably priced homes that attract good rents. Cooksville may also benefit if the planned and fully funded Hurontario LRT is eventually built. As it is today Cooksville is ideally located near the QEW highway, and features Trillium Hospital, a major employer and source of good tenants.

MeadowVale Village

Meadowvale Village is situated in the extreme northern edge of Mississauga, and has great connectivity to Pearson Airport, highway 401, and the major employment areas which surround the airport. Once again, for the investor we recommend the semi-detached house, with a separate basement apartment, for an ideal source of two streams of income.

These are just three neighborhoods in Mississauga which we are highlighting in Canadian Real Estate Magazine. There are many other options for anyone looking to invest in real estate, including excellent opportunities with condos in the Square One area. For much more information, see my main site here: www.randyselzer.com

Tweetable: Canada #realestate is a great place to invest. Check out the top 100 Neighborhoods. http://ctt.ec/AdSHN+ @randyselzer
 

Eve Condos – Mississauga

Eve condos were the second tower to be completed in the Mississauga Square One area by Amacon Corporation of Vancouver. Together with its sister towers of Eden Park and Elle, Eve features attractive modernist architecture, standing 32 storeys tall. Municipal address for Eve is 3515 Kariya Drive.

Eve Condo Mississauga

Eve, like its sister towers Eden Park and Elle, is blessed with a terrific location in the heart of the City of Mississauga, only steps away from the massive Square One shopping mall, dining, entertainment, parks, good schools, and public transit. The amenities in the condo itself include indoor swimming pool, hot tub, spa, gymnasium, exercise room, BBQ pit areas, and a children’s play area. Further details for Eve Condo’s amenities can be found at https://www.randyselzer.com/eve-condos-mississauga/

For a full profile and review of this fine condominium, see my main site here – Eve Condos Mississauga.

Elle Condos – Mississauga

Elle condos, along with its sister towers Eden Park and Eve, comprise a group of luxury condominium towers that were recently completed by Amacon Corporation of Vancouver, B.C. Situated just south of the bustling Square One area of Mississauga, Elle is a 31 storey high rise condo, with a matching podium. Elle features the handsome modernist style of architecture that is also found on its sister towers Eden Park, and Eve. Together they form a visually striking trio in the Mississauga City Centre core. Municipal address for the Elle condo is 3525 Kariya Drive.

Elle Condo Mississauga

Residents of Elle can enjoy an impressive list of features and amenities provided by the condo – 24 hour concierge, indoor swimming pool, whirlpool, sauna, gym, workout room, BBQ area, and much more. One of the best features of the Elle condo is its location, situated just a few minutes walk  from the 300+ store Square One shopping mall. Being in the heart of the city, there is no shortage of dining and entertainment options, and public transit is literally on the doorstep of this condo.

Visit my main site for a detailed profile and review of the Elle condo Mississauga.

House Prices – Why Most ‘Experts’ Have it Wrong

A steady stream of experts in the mainstream media have been predicting a fall in Canadian real estate prices. How can prices be so high? And how can they keep on rising? Surely we are due for a correction!

Some nationally known authors such as Garth Turner have been preaching doom and gloom for over 10 years now, Turner for so long that he has actually missed the entire bull market….and yet he still gets press attention, even after being dead wrong for so many years..

Most of these so-called experts make a fundamental mistake when examining the Canadian real estate market – they confuse Cause and Effect. The high prices in Toronto and Vancouver, you see, are not the Cause of the market – they are the Effect.

So when they decry high prices in Canada, they are missing the point..they are attacking the Effect of the market, not the Cause – a fundamental mistake.

The causes of the bull market we have enjoyed in Canada for the last 15 years or so are three fold:

1.) low interest rates

As long as interest rates remain low, the market will continue

2.) a decent economy

As long as the Canadian economy remains decent, and there are jobs being created, the market will continue

3.) continued immigration into Canada

Here I am talking about the Greater Toronto Area (GTA), my area of expertise, although the same rule applies for any Canadian cities where there are large numbers of people moving into the area.

As long as government policy facilitates continued immigration into Canada’s large cities, the market in those cities will continue.

If we look at these three Causes – the Causes of the real estate boom in Canada, there is still room for optimism. Our Federal Government is loath to increase interest rates, as it boosts the Canadian dollar too high, killing our manufacturing industry vis a vis the United States. The U.S., with its current set of problems, has indicated that it will retain low rates for at least the next two years, so the outlook for Canada’s rates remains low for the foreseeable future.

As for a decent economy, the Canadian economy actually seems to be improving; everywhere I look these days in my home town of Mississauga, or anywhere in the Greater Toronto Area, there are ‘help wanted’ or ‘now hiring’ signs….so the economy, in spite of some global macro issues, seems to be on the right track.

And finally, unless there is a change in government policy, Canada continues to welcome new immigrants from all across the globe. All these folks (reportedly 100,000 per year moving into the Toronto area) need somewhere to live, and many arrive in Canada with money to buy property. God bless ’em..

So there is my take on the Canadian real estate market. Sure, there are issues of absolute affordability, but we in the GTA have only to look at Vancouver to see that much greater prices are indeed possible, as long as the three causes of the market remain in place. If any of these change – is rates start rising, if the economy goes in the tank, or if immigration dries up – then the market will slow. Until then, the future is bright. Whenever you read a self-proclaimed ‘expert’ in the mainstream media saying that the market will fall because prices are ‘too high’, know that they are mixing up cause and effect; they are addressing the effect of the market, not the cause.

Mississauga Square One Condo Investing – Impact of Sheridan College

On December 15th, 2009 official groundbreaking took place for phase one of the new Sheridan College campus at Mississauga Square One. The new college facility is being built under the Federal-Provincial Infrastructure Stimulus Funding program, and as such, the 150,000 sq. ft. building must be completed by March 31, 2011. Some 1,700 students will attend classes when the school opens in the fall of 2011, including 1,200 business students, plus there will be 560 spaces for new Canadians who are being retrained to enter the workforce. Actual construction will commence in February, 2010, and is being managed by Bird Construction.

The campus will be located on an 8.5-acre parcel of land, just north of the Living Arts Centre, between Prince of Wales Dr. and Rathburn Rd. W. and will include such features as a pedestrian bridge, open parkland and a traffic roundabout.

When phase two of the campus is built after 2011, there will be room for 5,000 students.

How will this new campus impact condo investment in the Mississauga City Centre (MCC)?

Well, the news is all good. Vacancy rates are currently low in the MCC area, despite all the new developments recently completed. And the addition of 1700, and later up to 5000 university-age students in the immediate area will only add to the pool of available renters. Current large projects in the sales stage, such as Amacon’s Parkside Village, should see a sales boost from this new campus. We predict a decline in rental vacancy rates once the campus is up and running, with the potential for a firming of rental rates.

Investors looking for long term potential gain in the Mississauga Square One city centre area should look upon the addition of the Sheridan College campus as a major windfall.