What to expect of the Mississauga and Ontario real estate market this late summer going into fall
Published August 22, 2023 at 3:55 pm
“As we enter the month of September, primarily due to the pent-up demand for property, I expect home prices to hold despite higher interest rates,” says Mississauga real estate mogul Sam McDadi.
McDadi is one of the top and foremost experts in real estate – he has made a career of selling homes for over 35 years, and his brokerage (Sam McDadi Real Estate Inc.) has consistently been awarded the top GTA real estate team since its inception in 2012.
Recently he celebrated a major milestone with over 15,000 homes sold, which averages out to more than one property sold for each day of his illustrious career.
As for what’s to come in Mississauga and the overall Ontario real estate market, Sam McDadi shared his years of experience and vast knowledge during an interview with Insauga.com’s Khaled Iwamura.
What are your thoughts on further interest rate increases?
McDadi: The last quarter percent rate increase itself did not create much of an impact on the market. Our bigger concern is the talk around more rate increases to come. If rates continue to rise, then it’s going to be very problematic. People are already struggling with the high cost of living – gas, food, and escalating real estate costs with rates going up so significantly (in less than one year, five per cent). We’re really urging the government to be mindful and to be sympathetic towards how people are enduring this – or in many cases not enduring it. It has been a challenging time for a lot of people.
In a recent poll, half the respondents indicated that they were very concerned about their finances. They cited that as their biggest worry after two recent quarter percent increases to interest rates. We really want the government to be sensitive towards their needs.
How much impact are rising interest rates having on the market currently?
McDadi: They’ve impacted the market a lot, as interest rates increased by more than five per cent in just over one year. It is probably the steepest rate increase we’ve seen since I’ve been in the game, and that’s 35 years. So that’s really significant, and understandably it did have a material impact and it’s still affecting people today.
How are home sales now?
McDadi: December 2022 and January of this year were not very good – April and May were very strong months, and while the optics of the recent rate hike did cause some concern, the pent-up demand of people needing properties will continue to fuel sales in the fall. All the buyers that were on the sidelines earlier are getting ready to get back into the market.
What home type is selling most right now?
McDadi: The market for homes under a million has been really strong – people are mindful that if they go over a million then they need a much bigger down payment (down payment requirements for a home lower than one million is 5% minimum down up to 500K, balance up to one million is 10% down). For homes over a million, if they’re second-time buyers, they’ve got equity and they can parlay that into the next opportunity as well.
So while we’re seeing buyers come in strong for homes under a million, the market is still very robust for homes one to two million. When you start getting into the luxury homes, say four or five million, ironically there’s still activity but you’re not going to get multiple offers in this segment of the market. You’re looking for that one good buyer who appreciates the property and what it has to offer.
Where are the most economical places to buy a home in Mississauga?
McDadi: Economical may not be the right word today, but I think there are places that are less expensive. Clearly South Mississauga closer to the lake has gotten pretty pricey, so I think North Mississauga has some better opportunities. Condo living is still relatively affordable. So while there are pockets of less expensive housing, I don’t think there’s anything that’s really inexpensive.
What is your advice for someone looking to buy a first home today?
McDadi: Get in the game. If you can get into real estate in any shape or form, even if you have to buy a little outside of your preferred area or stretch your budget slightly or go vertical, like a condo, you’re going to do well. The earlier you can get in the game, the more you will start to see equity appreciation. Home prices traditionally double every 10 years, so if you buy for say $500,000 today, in 10 years the same home is going to be worth a million. There are strategies that your mortgage expert can suggest to pay down your mortgage sooner which will net you even more. In 10 years, you could have a million-dollar asset free and clear.
Don’t try and ‘Time the market’; sometimes buyers try to speculate on the right time to buy, and that’s ill-advised. Last year, for example – Q4 of last year and the first month of this year – was actually a great time to buy. If people had had the courage to buy, they’d be up 5 to 10 per cent today. At the end of the day, most people’s wealth is created through real estate.
What is your advice for someone looking to sell a home now?
McDadi: It really depends on the motivation. Despite the recent rate increases, the market is still performing reasonably well. Sellers need to manage their dollar expectations. The market is fluid and homes will continue to sell.
If you still have questions about buying or selling your home, you can contact McDadi 24/7 for a quick and easy consultation. And with seven office locations serving residents across the GTA, you’ll never have to go too far to speak with a real estate expert.
insauga's Editorial Standards and Policies