Harmonized Tax Increases Costs for Buyers
Under the provincial government's plan, the harmonization of GST and provincial tax will make costs related to the purchase of a home, such as lawyer fees, home inspections and real estate commissions subject to the 8% provincial tax. This applies to homes sold for $400,000 and above.
Keep in mind, the additional 8% genearlly applies to closing costs for resale homes, however new home sales will take the major hit as the tax applies to the sale price of a new home.
At a time when the land transfer tax is already having an impact on the market and the economy has it's own challenges, it's hard to believe there was much rationale in this decision. For every home that is not purchased, an average of $33,000 is taken out of the economy in spin-off spending.
We're busy focusing on repealing the land transfer tax, and now they hit with this!?!
Read more below...
Blended tax drives up costs for both new and resale home buyers in Ontario
The Canadian Press - TORONTO — Homebuyers in Ontario will face higher costs for most newly built houses and for services to close deals on resold homes as part of the Ontario Liberal government's plan to harmonize the GST and provincial sales tax.
In its budget Thursday, the provincial government released details of a initiative, which will apply a 13 per cent tax to new homes sold for more than $400,000 starting next year.
The tax plan will provide a rebate for new homes sold between $400,000 and $500,000, though it will fully tax the value of new homes worth more than $500,000.
A 13 per cent tax on a high-end house in Toronto worth $1 million would add $130,000 in taxes on the property, in addition to provincial and local land transfer taxes currently charged.
Resold homes are exempt from the sales tax on their value, but buyers will still face higher taxes on all the upfront costs associated with closing the deal, such as legal fees, movers, real estate commissions and home inspection charges.
The shift will be particularly hard on Toronto residents because they're still reeling from a city land transfer tax introduced last year on top of the provincial land tax.
"The timing of this tax is lousy at best," said Toronto Real Estate Board spokesman Von Palmer.
"The reality is that the timing is never good, but this is bad."
Palmer said that could cause some Ontario residents to be more reluctant to buy.
"We know that housing is the economic engine. Every housing transaction you take out of the economy you lose $33,000 in economic spinoffs - furniture, appliances, renovations," he said.
A recent study from the Building Industry and Land Development Association said that the tax will add an average $46,676 to buying a new home in Toronto - costing home buyers $2.4 billion more each year.
However, the industry group noted there were some measures in the budget to cushion the tax impact, including a rebate of part of the provincial portion of the tax for new homes priced up to $500,000.
"Harmonization of PST and GST without any offsetting measures by the provincial government could have ripped $2.4 billon out of the pockets of new homebuyers, slamming the homeownership door shut in the face of many Ontarians," said Stephen Dupuis, president and CEO of the house building group.
The tax changes sparked concern at the Ontario Real Estate Association which warned that resale homes would face more than $2,000 in extra charges related to closing fees, such as legal services and moving costs.
Currently, Ontario consumers pay only the five per cent GST on those services, but would face a 13 per cent blended tax under the new system.
"Now is not the time to be erecting barriers to home ownership," said Pauline Aunger, president of the association, which represents the province's 47,000 real estate brokers.
"We need consumers to invest in housing to help get our economy going again."
The association, whose members rely on real estate sales for their livelihoods, said home sales in Ontario fell 29 per cent in February from the same year-ago period.
Most experts say the sales slump reflects increasingly nervous consumers worried about job losses and the recession and high prices and rising local taxes that have driven up the cost of buying a house.
"These additional taxes could price some homebuyers, especially first-time homebuyers, right out of the market," said Aunger. "Harmonizing will not help homebuyers in any way."
The industry group said that for a resale house priced at $360,000, a harmonized tax could add more than $2,000 to closing costs. In total, such a tax would add $313 million annually in new taxes to resale home transactions.
Copyright © 2009 The Canadian Press. All rights reserved.
Energy Audit Proposition
Adding yet another bump in the road to home ownership and real estate transactions, the Ontario government proposed that every home sold be subject to a mandatory energy audit, costing home sellers approximately $300.
But the cost is not necessarily the issue. The details of how this proposal would be implemented is what's cause for concern. Limited numbers of authorized auditors, standardization of the audit process, and much more.
Read on to find out the implications of this proposal...
Mandatory energy audits on home sales wrong, real estate agents say
Globe and Mail - KATE HAMMER
February 25, 2009
In the wake of a new municipal land-transfer tax and unmoored by a sinking economy, Toronto real estate agents are bracing for a new storm on the legislative horizon: Mandatory energy audits for home sales.
Ontario Minister of Energy and Infrastructure George Smitherman's proposed Green Energy Act, which was introduced to the Ontario legislature Monday, contains loosely defined "mandatory conservation and energy efficiency practices" that would cost home sellers about $300.
But with homes lingering on a stagnating market, and average sale prices dropping throughout the GTA, even the distant possibility of one more fee or one more bureaucratic obstacle, leaves real estate agents feeling seasick.
"It's not so much the dollars that it costs you to do the audit, I think you have to think long-term in terms of how will that impact your property value, what will that do to the market in terms of potential bottlenecks," said Von Palmer, spokesman for the Toronto Real Estate Board. "So the devil's always in the details and I think that's where we need to be careful."
But "the details" remain fuzzy, and the legislation that was introduced Monday does little to explain the logistics of mandatory audits.
A handful of companies throughout the GTA offer energy audits. Their services vary, but generally involve a battery of tests that measure the efficiency of major household appliances as well as the efficacy of a home's insulation.
"There's several other tests, like they calculate the [efficacy] of the insulation, they check the windows and the window stripping, the efficiency of the furnace, the efficiency of the water heater, the toilets, pretty much anything that can have an impact on the overall efficiency of the home and sort of the energy costs and the energy consumption," said Andrew McRae, an energy representative for EnWise Power Solutions.
Homeowners are also eligible for government rebates toward the cost of the inspection, as well as thousands of dollars more toward implementing suggested upgrades. Most energy auditors will also handle the necessary paperwork for a government rebate.
Some homeowners benefit more than others from an energy audit, according to Mr. McRae. Most modern appliances and materials are relatively energy efficient, and the owners of newer homes may struggle to recoup to cost of an audit, he said.
Sales in Toronto have been down every month since the land-transfer tax was implemented in 2008, according to Mr. Palmer. They plummeted more than 23 per cent in the first two weeks of February this year compared to the same period last year, while the average sale price fell nearly 8 per cent, according to data collected by the real estate board.
The 450 inspectors throughout Ontario will quickly become overwhelmed attending to the hundreds of thousands of homes sold within the province every year, and more will have to be trained to meet the demands of mandatory energy audits, Mr. Palmer said.
Additionally, issues such as standardization, timing, and payment will have to be worked out.
"There's going to be some coinciding policies that need to be made as well that would include the specifics around the energy audit," said Amy Tang, a spokesperson for Mr. Smitherman. But what shape those policies would take, Ms. Tang couldn't say.
Thursday, April 2, 2009
Tuesday, March 17, 2009
My Clients Want Your House!
The spring market is heating up. I have a lot of buyers who are ready to move but haven't found the home they want because supply is so low right now.
That's why I'm proactively putting out a call to action to anyone who is thinking of selling.
Check out my buyers wish list to see if your home or someone's you know fits...
CORE BEACH
- $800,000 - $1.2M
- 3 + bedrooms
- w/parking
*Also same as above but with rental income or 3-plex
- $1M - $2.5M
- 4 bedroom
- pool size lot
BEACH/TORONTO EAST
- $400,000-$600,000
- 2-3 bedrooms
- w/parking
LESLIEVILLE/RIVERDALE
$300,00-$400,000
- 2+ bedrooms
- w/parking
CENTRAL/ANNEX
- $900.000 -$1.5M
- detached or semi
- 4 bedrooms
- victorian style
HIGHPARK/BLOOR WEST
- $300,000 - $400,000
- semi-detached or townhouse
- 2 + bedrooms
- w/parking
BEACH/RIVERDALE
- $450,000-$800,000
- income properties
TORONTO CENTRAL
- $700,000 -$1m
- income properties
Do you have a home, or know anyone whose home meets any of these buyers' wish lists?
Contact me at mark@markrichards.ca or 416.728.2499 today!
That's why I'm proactively putting out a call to action to anyone who is thinking of selling.
Check out my buyers wish list to see if your home or someone's you know fits...
CORE BEACH
- $800,000 - $1.2M
- 3 + bedrooms
- w/parking
*Also same as above but with rental income or 3-plex
- $1M - $2.5M
- 4 bedroom
- pool size lot
BEACH/TORONTO EAST
- $400,000-$600,000
- 2-3 bedrooms
- w/parking
LESLIEVILLE/RIVERDALE
$300,00-$400,000
- 2+ bedrooms
- w/parking
CENTRAL/ANNEX
- $900.000 -$1.5M
- detached or semi
- 4 bedrooms
- victorian style
HIGHPARK/BLOOR WEST
- $300,000 - $400,000
- semi-detached or townhouse
- 2 + bedrooms
- w/parking
BEACH/RIVERDALE
- $450,000-$800,000
- income properties
TORONTO CENTRAL
- $700,000 -$1m
- income properties
Do you have a home, or know anyone whose home meets any of these buyers' wish lists?
Contact me at mark@markrichards.ca or 416.728.2499 today!
RE/MAX Hallmark Realty Ltd. Expands its Reach in the Beach
Toronto, ON (March 13, 2009) – RE/MAX Hallmark Realty is expanding its reach in the Beach with the arrival of three award-winning real estate industry veterans from its largest competitor. Twenty-three year veteran, Al Sinclair and his ten-person strong team ranked among the top five producers for his previous company in the GTA, along with Diamond award winners Michelle Walker and Mark Richards are now part of the RE/MAX Hallmark team.
“We are delighted that these outstanding realtors recognize the growth opportunities and the level of support that are offered by being part of RE/MAX Hallmark,” says Ken McLachlan, Broker of Record, RE/MAX Hallmark Realty Ltd. “Their arrival firmly gives us added presence in the Beach and the surrounding neighbourhoods when it comes to resale and new construction.”
The arrival of Al Sinclair, Michelle Walker, and Mark Richards will allow RE/MAX Hallmark Realty Ltd. located at 2237 Queen Street East, to offer more listings with its market share increasing from 40 to 55 per cent.. Sinclair’s 10-person strong team includes his wife Janet, who specializes in new construction along with residential resale. Michele Walker and Mark Richards have developed over the years a strong reputation in our real estate community. Their client driven focus will continue to flourish under the RE/MAX Hallmark banner.
“RE/MAX is the number one brand for residential real estate in Canada and I am excited to finally be a part of it,” says Al Sinclair. “We have been bringing best of class residential real estate services to our clients for some time. With the RE/MAX brand behind us now, we are going to be able to do even more for them.”
RE/MAX Hallmark Realty has over 500 realtors and seven offices throughout the GTA, servicing central Toronto, Leaside, the Beach, North Riverdale, Lawrence Park, Don Mills, and Richmond Hill.
“Al, Michelle, and Mark are among the best and the brightest in the business and I’m so pleased that they have decided to become part of our team,” says Michael Polzler, Executive Vice President and Regional Director, RE/MAX Ontario-Atlantic Canada. “The mass exodus of top tier talent from a major competitor is proof positive that we set the standard for realtors.”
RE/MAX is Canada’s leading real estate organization with over 17,000 Sales Associates in more than 670 independently-owned and operated offices. The RE/MAX franchise network, now in its 36th year of operation, is a global real estate system operating in over 70 countries. More than 6,800 independently owned offices engage over 100,000 Sales Associates who lead the industry in professional designations, experience and production while providing real estate services in residential, commercial, referral and asset management.
“We are delighted that these outstanding realtors recognize the growth opportunities and the level of support that are offered by being part of RE/MAX Hallmark,” says Ken McLachlan, Broker of Record, RE/MAX Hallmark Realty Ltd. “Their arrival firmly gives us added presence in the Beach and the surrounding neighbourhoods when it comes to resale and new construction.”
The arrival of Al Sinclair, Michelle Walker, and Mark Richards will allow RE/MAX Hallmark Realty Ltd. located at 2237 Queen Street East, to offer more listings with its market share increasing from 40 to 55 per cent.. Sinclair’s 10-person strong team includes his wife Janet, who specializes in new construction along with residential resale. Michele Walker and Mark Richards have developed over the years a strong reputation in our real estate community. Their client driven focus will continue to flourish under the RE/MAX Hallmark banner.
“RE/MAX is the number one brand for residential real estate in Canada and I am excited to finally be a part of it,” says Al Sinclair. “We have been bringing best of class residential real estate services to our clients for some time. With the RE/MAX brand behind us now, we are going to be able to do even more for them.”
RE/MAX Hallmark Realty has over 500 realtors and seven offices throughout the GTA, servicing central Toronto, Leaside, the Beach, North Riverdale, Lawrence Park, Don Mills, and Richmond Hill.
“Al, Michelle, and Mark are among the best and the brightest in the business and I’m so pleased that they have decided to become part of our team,” says Michael Polzler, Executive Vice President and Regional Director, RE/MAX Ontario-Atlantic Canada. “The mass exodus of top tier talent from a major competitor is proof positive that we set the standard for realtors.”
RE/MAX is Canada’s leading real estate organization with over 17,000 Sales Associates in more than 670 independently-owned and operated offices. The RE/MAX franchise network, now in its 36th year of operation, is a global real estate system operating in over 70 countries. More than 6,800 independently owned offices engage over 100,000 Sales Associates who lead the industry in professional designations, experience and production while providing real estate services in residential, commercial, referral and asset management.
Monday, March 16, 2009
Hot Up & Coming Neighbourhoods
Which neighbourhoods are the next Leslieville?
Check out the next hot neighbourhoods in the GTA. Our picks are based on my own favorite spots as well as on the March edition of Toronto Life "A Buyer's Market".
Danforth Village
Check out the next hot neighbourhoods in the GTA. Our picks are based on my own favorite spots as well as on the March edition of Toronto Life "A Buyer's Market".
Danforth Village
Located just east of Greektown, this area of town satisfies a lot of people's wish lists and is a hot area for first time home buyers. It offers easy access to both midtown and downtown either by car or by jumping on the Danforth subway line.
The area is going through improvements but is not perfect yet. There is a good selection of of homes that can be bought and renovated but also great values on homes that have already been improved.
Homes are accessibily priced in the $400,000's.
The area is going through improvements but is not perfect yet. There is a good selection of of homes that can be bought and renovated but also great values on homes that have already been improved.
Homes are accessibily priced in the $400,000's.
Leslieville East 
Located between prime Leslieville and the Beach (Leslie to Coxwell, Eastern up to Gerrard) this area is tucked between two great neighbourhoods that are just 15 minutes to downtown.
Leslieville has already been through the major gentrification and offers amazing shopping and restaurants while the Beach is an established family community.
But there is a little pocket in between the two that is a little rough and has amazing potential for buyers who want the best of both worlds but are willing to let the neighbourhood come up around them.
Detached homes with improvements can be snapped up in the $500,000 and semi's can be had for $350,000-$400,000.
Leslieville has already been through the major gentrification and offers amazing shopping and restaurants while the Beach is an established family community.
But there is a little pocket in between the two that is a little rough and has amazing potential for buyers who want the best of both worlds but are willing to let the neighbourhood come up around them.
Detached homes with improvements can be snapped up in the $500,000 and semi's can be had for $350,000-$400,000.
Birchcliff
I'm seeing a big trend of families who have stuck it out in prime Beach, but who have outgrown the hustle and bustle and want more property to breath, especially as their kids are getting older. A lot of them are heading to the Bluffs.
Again, it has all the markings of great potential - amazing lot sizes, a wide variety of homes (from cute bungalows and homes that need improvement to stunningly renovated homes with inground pools near the water) and you're still a decent commute to downtown or the business parks north of the 401.
The strip along Kingston road is slowly but surely starting to improve and a lot of 'bluffers' have great shopping and restaurants just minutes away in prime or upper Beach as well as the 'big box' standards at Danforth and Victoria Park.
Prices are all over the map depending on what you are looking for but the value and the potential is definitely there.
To have my favorite listings in each hot neighbourhood sent to you today, email me at mark@markrichards.ca.
Cheers,
Mark
416.728.2499
Again, it has all the markings of great potential - amazing lot sizes, a wide variety of homes (from cute bungalows and homes that need improvement to stunningly renovated homes with inground pools near the water) and you're still a decent commute to downtown or the business parks north of the 401.
The strip along Kingston road is slowly but surely starting to improve and a lot of 'bluffers' have great shopping and restaurants just minutes away in prime or upper Beach as well as the 'big box' standards at Danforth and Victoria Park.
Prices are all over the map depending on what you are looking for but the value and the potential is definitely there.
To have my favorite listings in each hot neighbourhood sent to you today, email me at mark@markrichards.ca.
Cheers,
Mark
416.728.2499
Thursday, March 5, 2009
Everybody's Got An Opinion
The most common question I get asked these days is "What is going to happen with the real estate market?"
You might put the question up there with "When is winter going to be over?" or "When will my RRSP statement stop making me cry?".
The truth is, no one really knows. If someone did, they'd be very rich and very lucky.
But I do love to hear everyone's opinion. I'm collecting these predictions on my poll to the right. Email me if you want to put money on it as I'm always up for a good bet. We'll call it the Real Estate Pool.
Although we don't know exactly what is going to happen, I'm going to share my view on the market, as well as things to consider when you read the news reports.
At the end of my blog I've also included excerpts from major real estate organizations and associations if you really want to dive in to the muck.
Real Estate is Local
The majority of what you are reading out there (and in the clips below) is based primarily on national, provincial and city-wide numbers.
Contrast what is happening in the GTA compared to Vancouver and it's a totally different picture. Prices in the west were incredibly over-inflated and now they have a harder fall. It's even different from Rosedale to the Beach.
Lumped into those stats are various types of homes; condos, the burbs, and large detached homes. There is no accouting for the unique nature of each of those markets.
The market on a wider scope can seem daunting, especially when you blend it all together and look from 20,000 feet.
So unless you own homes of every shape and in every part of the country, read on...
Don't Trust the Local Stats Either
You can't take local monthly stats for one MLS sector literally (i.e. E02, C09) as average home prices can sometimes be based on just a handful of sales.
If a home sold for $1M in an area that typically has homes in the $750,000 range, the average price will be pulled up and vice versa.
I've found the best measure of what is happening in the market is to talk to agents as they are the ones who know the history, the activity and the pricing strategies the best.
In the Beach for example, we're seeing about a 7-8% drop since the peak months of 2008 but we don't expect to see much more of a drop this year, if any.
Supply and Price Range
Supply and demand are playing a huge role in countering some of the media predictions. In some areas, we are still seeing multiple offers for homes because they are the only decent property in a particular price range.
Winter Blahs
The recent stats are based on months that are traditionally slow. The winter season is also when sellers are more negotiable as listings in this market usually have a different motivation for a sale (relocoation, purchase of another property etc.).
The typical pattern of listing and shopping in months other than the dead of winter are coming back now that we are in a more balanced market.
The Spring Market
I'm predicting a rush of activity this spring. As per my comments about seasonality, people who have been thinking of selling (but didn't have to before) will be bringing their homes out on the market which will be a nice boost for inventory.
There is a pent up demand of buyers...those who were looking back the in fall but wanted to wait and see, either because of their own circumstances or to see the market drop a bit before they jumped in.
Plus, there is a new influx of buyers who are waking up to the opportunities out there.
I personally just bought a home that had been on the market for 70 days and got it for nearly a $100,000 under its original list price.
Final Preductions on the Market...
My final answer? It depends.
This is not a scapegoat answer, it's the truth. It depends where you are looking and what you are looking for.
Thinking of Selling?
If you are thinking of selling, CALL ME NOW. I have so many buyers (and other agents) who are looking but the low inventory of listings on the market is limiting their search.
I am literally in the process of contacting clients to ask them if they want to sell, knowing their house is perfect for someone who is searching.
There are also a lot of sellers dipping their toes in the water to test things out so keep in mind that the perfect home may not even be on MLS. I have a lot of clients who are listing their homes exclusively first before going on the market formally.
Thinking of Buying?
To wrap up the most common question for buyers, "Should I wait for the market to drop more before I buy?". If you know when the market will drop more, then by all means let me know when you think that is happening and we can find a home.
Sure, there is a possibility that prices may drop more but you may find yourself looking at higher interest rates in tandem. You may also find yourself in competition with other buyers.
My biggest testimonial to my view that there is great value right now is the fact that we recently sold our house and bought our next family home, plus we are about to buy another.
Thinking of doing both?
As I said in a previous blog, now is a great time to trade up as it costs you less in a down turning market than the peak market of the past.
Call me today so we can talk specifics and figure out the timing that works best for you.
Cheers,
Mark
416.728.2499
MARKET REPORT SNAPSHOTS:
Royal LePage
"Nationally, average house prices are forecast to dip by 3.0 per cent from last year to $295,000, while transactions are projected to fall to 416,000 (–3.5 %) unit sales in 2009. In spite of this cooling trend on a national level, price and activity gains are anticipated in some provinces."
Full Royal LePage Forecast
RE/MAX
"By year-end 2009, unit sales should match 2008 levels, while average price is forecast to fall another two per cent to $293,000."
Full RE/MAX Forecast
Canadian Housing and Mortgage Corporation
"Existing home sales, as measured by the Multiple Listing Service (MLS®)1, are expected to decline 14.6 per cent during 2009 to 370,500 units. In 2010 the level of MLS® sales is expected to increase by 9.3 per cent to 405,000 units. The average MLS® price is also expected to decrease over the course of 2009. Average prices are forecast to be $287,900 for 2009, a decline of 5.2 per cent, while 2010 will see little change from 2009 average prices."
Full CMHC Forecast
Canadian Real Estate Association
Prices are forecast to stabilize in 2010, with annual price increases of one per cent or less in five provinces. The weighted national MLS® average price is forecast to decline 6.4 per cent in 2009, and hold steady in 2010.
Full CREA Forecast
Realtor.ca (formerly MLS.ca)
"The beginnings of a Canadian economic recession and a dramatic downturn in consumer confidence late last year means that the housing market is facing significant headwinds in 2009," said CREA Chief Economist Gregory Klump. "Sales activity dropped sharply and price declines accelerated in the fourth quarter of 2008. The consensus economic forecast calls for an economic rebound in the second half of 2009, so an improvement in housing market trends is likely to wait until next year."
Full Realtor.ca Forecast
Toronto Real Estate Board
"It should be noted that the GTA housing market has followed the broader economic slowdown, but was not a cause of the downturn. Home prices remained affordable throughout the new millennium. The average family can still qualify for a mortgage on the average priced home. This remains the case today. Given that we are not facing an early-1990s-style affordability crisis, the rebound in the housing market will likely be quick once economic recovery takes hold."
Full TREB Market Report
You might put the question up there with "When is winter going to be over?" or "When will my RRSP statement stop making me cry?".
The truth is, no one really knows. If someone did, they'd be very rich and very lucky.
But I do love to hear everyone's opinion. I'm collecting these predictions on my poll to the right. Email me if you want to put money on it as I'm always up for a good bet. We'll call it the Real Estate Pool.
Although we don't know exactly what is going to happen, I'm going to share my view on the market, as well as things to consider when you read the news reports.
At the end of my blog I've also included excerpts from major real estate organizations and associations if you really want to dive in to the muck.
Real Estate is Local
The majority of what you are reading out there (and in the clips below) is based primarily on national, provincial and city-wide numbers.
Contrast what is happening in the GTA compared to Vancouver and it's a totally different picture. Prices in the west were incredibly over-inflated and now they have a harder fall. It's even different from Rosedale to the Beach.
Lumped into those stats are various types of homes; condos, the burbs, and large detached homes. There is no accouting for the unique nature of each of those markets.
The market on a wider scope can seem daunting, especially when you blend it all together and look from 20,000 feet.
So unless you own homes of every shape and in every part of the country, read on...
Don't Trust the Local Stats Either
You can't take local monthly stats for one MLS sector literally (i.e. E02, C09) as average home prices can sometimes be based on just a handful of sales.
If a home sold for $1M in an area that typically has homes in the $750,000 range, the average price will be pulled up and vice versa.
I've found the best measure of what is happening in the market is to talk to agents as they are the ones who know the history, the activity and the pricing strategies the best.
In the Beach for example, we're seeing about a 7-8% drop since the peak months of 2008 but we don't expect to see much more of a drop this year, if any.
Supply and Price Range
Supply and demand are playing a huge role in countering some of the media predictions. In some areas, we are still seeing multiple offers for homes because they are the only decent property in a particular price range.
Winter Blahs
The recent stats are based on months that are traditionally slow. The winter season is also when sellers are more negotiable as listings in this market usually have a different motivation for a sale (relocoation, purchase of another property etc.).
The typical pattern of listing and shopping in months other than the dead of winter are coming back now that we are in a more balanced market.
The Spring Market
I'm predicting a rush of activity this spring. As per my comments about seasonality, people who have been thinking of selling (but didn't have to before) will be bringing their homes out on the market which will be a nice boost for inventory.
There is a pent up demand of buyers...those who were looking back the in fall but wanted to wait and see, either because of their own circumstances or to see the market drop a bit before they jumped in.
Plus, there is a new influx of buyers who are waking up to the opportunities out there.
I personally just bought a home that had been on the market for 70 days and got it for nearly a $100,000 under its original list price.
Final Preductions on the Market...
My final answer? It depends.
This is not a scapegoat answer, it's the truth. It depends where you are looking and what you are looking for.
Thinking of Selling?
If you are thinking of selling, CALL ME NOW. I have so many buyers (and other agents) who are looking but the low inventory of listings on the market is limiting their search.
I am literally in the process of contacting clients to ask them if they want to sell, knowing their house is perfect for someone who is searching.
There are also a lot of sellers dipping their toes in the water to test things out so keep in mind that the perfect home may not even be on MLS. I have a lot of clients who are listing their homes exclusively first before going on the market formally.
Thinking of Buying?
To wrap up the most common question for buyers, "Should I wait for the market to drop more before I buy?". If you know when the market will drop more, then by all means let me know when you think that is happening and we can find a home.
Sure, there is a possibility that prices may drop more but you may find yourself looking at higher interest rates in tandem. You may also find yourself in competition with other buyers.
My biggest testimonial to my view that there is great value right now is the fact that we recently sold our house and bought our next family home, plus we are about to buy another.
Thinking of doing both?
As I said in a previous blog, now is a great time to trade up as it costs you less in a down turning market than the peak market of the past.
Call me today so we can talk specifics and figure out the timing that works best for you.
Cheers,
Mark
416.728.2499
MARKET REPORT SNAPSHOTS:
Royal LePage
"Nationally, average house prices are forecast to dip by 3.0 per cent from last year to $295,000, while transactions are projected to fall to 416,000 (–3.5 %) unit sales in 2009. In spite of this cooling trend on a national level, price and activity gains are anticipated in some provinces."
Full Royal LePage Forecast
RE/MAX
"By year-end 2009, unit sales should match 2008 levels, while average price is forecast to fall another two per cent to $293,000."
Full RE/MAX Forecast
Canadian Housing and Mortgage Corporation
"Existing home sales, as measured by the Multiple Listing Service (MLS®)1, are expected to decline 14.6 per cent during 2009 to 370,500 units. In 2010 the level of MLS® sales is expected to increase by 9.3 per cent to 405,000 units. The average MLS® price is also expected to decrease over the course of 2009. Average prices are forecast to be $287,900 for 2009, a decline of 5.2 per cent, while 2010 will see little change from 2009 average prices."
Full CMHC Forecast
Canadian Real Estate Association
Prices are forecast to stabilize in 2010, with annual price increases of one per cent or less in five provinces. The weighted national MLS® average price is forecast to decline 6.4 per cent in 2009, and hold steady in 2010.
Full CREA Forecast
Realtor.ca (formerly MLS.ca)
"The beginnings of a Canadian economic recession and a dramatic downturn in consumer confidence late last year means that the housing market is facing significant headwinds in 2009," said CREA Chief Economist Gregory Klump. "Sales activity dropped sharply and price declines accelerated in the fourth quarter of 2008. The consensus economic forecast calls for an economic rebound in the second half of 2009, so an improvement in housing market trends is likely to wait until next year."
Full Realtor.ca Forecast
Toronto Real Estate Board
"It should be noted that the GTA housing market has followed the broader economic slowdown, but was not a cause of the downturn. Home prices remained affordable throughout the new millennium. The average family can still qualify for a mortgage on the average priced home. This remains the case today. Given that we are not facing an early-1990s-style affordability crisis, the rebound in the housing market will likely be quick once economic recovery takes hold."
Full TREB Market Report
Wednesday, March 4, 2009
Markets & Mortgages
Check out below for the Toronto Real Estate MarketWatch Report and the current prime rate.
If you want more information on any area or to find out the current value of your home, contact me today....416.728.2499 or mark@markrichards.ca.
PRIME RATE
Prime rate is now at an unbelievable 2.5% at Bank of Montreal and other banks are following suit.
What does this mean for your bottom line?
Every $100,000 of a mortgage will only cost you $488.78 per month based on the Bank of Montreal posted 5 year closed variable rate of 3.3% over a 25 year amortization.
Now is one of the chepest times in recent real estate history to buy or trade up.
Contact Peter Majthenyi today at 416.410.3298 or peter@mymortgageplanner.ca to see how he can help you.
TORONTO REAL ESTATE BOARD MARKETWATCH -FEBRUARY 2009
Check out neighbourhoods in the GTA to find out average prices and sales activity for the past month:
Toronto Real Estate Market Watch
TORONTO - Thursday, March 5, 2009 -
Toronto Real Estate Board Members reported 4,120 sales in February 2009 compared to 6,015 sales recorded in February 2008. The average home price was $361,305 last month compared to $382,048 during the same month last year.
“A considerable number of transactions continued to take place in February 2009. Motivated buyers and sellers, who were aware that market conditions changed over the past few months, were able to negotiate transactions acceptable to both parties,” said Toronto Real Estate Board President Maureen O’Neill.
On a month-over-month basis, sales and average price were above January levels of 2,670 and $343,632 respectively. The housing market is seasonal. Traditionally, in the first half of every year, sales and average price climb to their highest levels in late spring before trending lower from July onward.
“While the economic downturn has had an impact, the GTA housing market is resting on a solid foundation. Current home prices and mortgage rates suggest that GTA homes have become more affordable on average,” according to Jason Mercer, TREB’s Senior Manager of Market Analysis. “A greater number of home buyers could take advantage of this affordability once their positioning in the economy becomes more certain.”
Typically the spring real estate market tends to experience more activity and with the Canadian economy experiencing a period of low mortgage rates and strong immigration, this trend could continue. According to Statistics Canada, Canada welcomed 247,202 permanent residents in 2008, 70,000 more than in 1998, and well within the government’s planned range of 240,000 to 265,000 new permanent residents for 2009.
The TREB President pointed out that Greater Toronto REALTORS® are an integral part of the real estate transaction process. “TREB Members are uniquely positioned to help home buyers and sellers adapt to changing market conditions,” added Ms. O’Neill. “In addition, TREB continues to advocate public policies that do not threaten affordability but support home ownership in the GTA such as lower taxation and less regulation.”
If you want more information on any area or to find out the current value of your home, contact me today....416.728.2499 or mark@markrichards.ca.
PRIME RATE
Prime rate is now at an unbelievable 2.5% at Bank of Montreal and other banks are following suit.
What does this mean for your bottom line?
Every $100,000 of a mortgage will only cost you $488.78 per month based on the Bank of Montreal posted 5 year closed variable rate of 3.3% over a 25 year amortization.
Now is one of the chepest times in recent real estate history to buy or trade up.
Contact Peter Majthenyi today at 416.410.3298 or peter@mymortgageplanner.ca to see how he can help you.
TORONTO REAL ESTATE BOARD MARKETWATCH -FEBRUARY 2009
Check out neighbourhoods in the GTA to find out average prices and sales activity for the past month:
Toronto Real Estate Market Watch
TORONTO - Thursday, March 5, 2009 -
Toronto Real Estate Board Members reported 4,120 sales in February 2009 compared to 6,015 sales recorded in February 2008. The average home price was $361,305 last month compared to $382,048 during the same month last year.
“A considerable number of transactions continued to take place in February 2009. Motivated buyers and sellers, who were aware that market conditions changed over the past few months, were able to negotiate transactions acceptable to both parties,” said Toronto Real Estate Board President Maureen O’Neill.
On a month-over-month basis, sales and average price were above January levels of 2,670 and $343,632 respectively. The housing market is seasonal. Traditionally, in the first half of every year, sales and average price climb to their highest levels in late spring before trending lower from July onward.
“While the economic downturn has had an impact, the GTA housing market is resting on a solid foundation. Current home prices and mortgage rates suggest that GTA homes have become more affordable on average,” according to Jason Mercer, TREB’s Senior Manager of Market Analysis. “A greater number of home buyers could take advantage of this affordability once their positioning in the economy becomes more certain.”
Typically the spring real estate market tends to experience more activity and with the Canadian economy experiencing a period of low mortgage rates and strong immigration, this trend could continue. According to Statistics Canada, Canada welcomed 247,202 permanent residents in 2008, 70,000 more than in 1998, and well within the government’s planned range of 240,000 to 265,000 new permanent residents for 2009.
The TREB President pointed out that Greater Toronto REALTORS® are an integral part of the real estate transaction process. “TREB Members are uniquely positioned to help home buyers and sellers adapt to changing market conditions,” added Ms. O’Neill. “In addition, TREB continues to advocate public policies that do not threaten affordability but support home ownership in the GTA such as lower taxation and less regulation.”
Globe & Mail - Optimism returning to housing market, RBC survey finds
Optimism returning to housing market, RBC survey finds
by VIRGINIA GALT
Globe and Mail Update
March 4, 2009 at 4:04 PM EST
Confidence appears to be seeping back into the housing market, with young Canadians the most optimistic that now is a good time to buy, according to the Royal Bank of Canada's annual homeownership survey.
Thirty-year-old David Morris, who owns a condominium in downtown Vancouver, is among those actively planning to purchase a home. He's looking to sell his condo and trade up to a house in Vancouver's trendy Kitsilano or North Shore districts – a move that would have been out of his reach in the overheated real estate market of recent years.
Falling prices, low interest rates – and the fact that he is getting married at the end of this year – have factored into Mr. Morris' decision to buy.
“We have made the decision to move forward. It's not a situation where we're going to force it, but if we can find the right house for the right price, we have made the decision to get serious about it,” said Mr. Morris, a commercial real estate broker.
“From a buyer's perspective, it's encouraging …Now is a good time to come in and find a home that you love, that isn't going to break the bank.”
In a survey of 2,026 Canadian consumers, conducted in the second week of January, the Royal Bank found that 65 per cent of respondents believe it is a buyers' market now.
Of those surveyed, 9 per cent said it is “very likely” they will purchase a home or condominium in 2009 or 2010, and another 18 per cent rated the prospect of purchasing a new home as “somewhat” likely.
“Additionally, almost half indicate it makes sense to buy a home now versus waiting until next year.”
Young adults and renters are most likely to spark an upsurge in home sales, Royal Bank said in releasing its survey results.
“In the under-35 group, 48 per cent said they plan to buy, which is up sharply from 36 per cent last year. Renters also appear to be saying they are tired of paying someone else's mortgage payment, with 38 per cent planning to become homeowners in the next two years.”
Although this optimism is not reflected in the most recent sales statistics – the volume of sales in the Toronto area, for instance, was down 47 per cent year-over-year in January – Royal Bank predicts that lower prices will lure a growing percentage of Canadians back into the housing market in the next two years.
Toronto real estate agent Geon van der Wyst noted that consumers do not always follow through on their intentions – although it is encouraging that more Canadians appear to be thinking about buying homes.
“Intention is the step prior to making an educated decision… and I'm sure a lot of those people with intentions will move forward with purchases, it's just a matter of finding the right time,” Mr. van der Wyst said.
Karen Leggett, the Royal Bank's head of home equity financing, said low mortgage rates “and favourable housing prices are influencing home purchase intentions this year and may be the reason why more Canadians are poised to purchase over the next two years.”
Ms. Leggett said the poll, conducted for the Royal Bank by Ipsos Reid, found that the vast majority of Canadians believe that the purchase of a home is a good investment. “The current economic environment does not appear to have dampened Canadians' overall confidence in the housing market,” she said.
Mr. van der Wyst said there are good deals to be had, from the buyers' standpoint. However, he added, many prospective buyers – particularly first-time buyers – are still uncertain about the best time to plunge into the market.
“We tend to hand-hold these first time-buyers, nervous first-time buyers, especially around here where they know the prices are starting to dip – and who knows where they will continue to dip before the recovery starts?”
Mr. van der Wyst said that, especially in the current economic environment, he screens prospective buyers carefully before taking them to look at properties. He noted that the banks are also “pretty stringent” in qualifying consumers for mortgages.
“Interest rates are at historic lows and borrowing money is very, very affordable. If you have steady employment and you have some financial responsibility along with a good interest rate, now is a really, really good time to purchase a property,” said Mr. van der Wyst, an agent with Royal LePage.
“At this time, employment stability is very important. It would be really unfortunate to see someone lose their job just as they were about to close on a property,” he said.
A number of leading Canadian economists have observed that Canada's rising unemployment rate has eroded consumer confidence, and other recent housing forecasts have been less upbeat than the Royal Bank survey.
Canada Mortgage and Housing Corp. projects that, in spite of falling prices, the volume of existing home sales is expected to drop by 14.6 per cent in 2009, and then rise by 9.3 per cent in 2010.
Average home prices are forecast to fall 5.2 per cent to $287,900 in 2009. Next year, prices are expected to remain flat, according to the federal housing agency's forecast.
Ms. Leggett said Royal Bank is not forecasting “a huge housing rebound, by any stretch,” but there are reasons for cautious optimism that the market will start to recover later this year and next year.
Following the overheated market and bidding wars of the past few years, housing is once again becoming more affordable and there are good buying opportunities for consumers “who have good solid certitude around their job prospects and have the financial picture to be able to get into the market,” Ms. Leggett said.
“Buying intentions are one thing. Whether they translate into actual purchases, obviously time will tell,” she said. “But, anecdotally, we are hearing that there is heightened activity …and interest in the marketplace overall.”
by VIRGINIA GALT
Globe and Mail Update
March 4, 2009 at 4:04 PM EST
Confidence appears to be seeping back into the housing market, with young Canadians the most optimistic that now is a good time to buy, according to the Royal Bank of Canada's annual homeownership survey.
Thirty-year-old David Morris, who owns a condominium in downtown Vancouver, is among those actively planning to purchase a home. He's looking to sell his condo and trade up to a house in Vancouver's trendy Kitsilano or North Shore districts – a move that would have been out of his reach in the overheated real estate market of recent years.
Falling prices, low interest rates – and the fact that he is getting married at the end of this year – have factored into Mr. Morris' decision to buy.
“We have made the decision to move forward. It's not a situation where we're going to force it, but if we can find the right house for the right price, we have made the decision to get serious about it,” said Mr. Morris, a commercial real estate broker.
“From a buyer's perspective, it's encouraging …Now is a good time to come in and find a home that you love, that isn't going to break the bank.”
In a survey of 2,026 Canadian consumers, conducted in the second week of January, the Royal Bank found that 65 per cent of respondents believe it is a buyers' market now.
Of those surveyed, 9 per cent said it is “very likely” they will purchase a home or condominium in 2009 or 2010, and another 18 per cent rated the prospect of purchasing a new home as “somewhat” likely.
“Additionally, almost half indicate it makes sense to buy a home now versus waiting until next year.”
Young adults and renters are most likely to spark an upsurge in home sales, Royal Bank said in releasing its survey results.
“In the under-35 group, 48 per cent said they plan to buy, which is up sharply from 36 per cent last year. Renters also appear to be saying they are tired of paying someone else's mortgage payment, with 38 per cent planning to become homeowners in the next two years.”
Although this optimism is not reflected in the most recent sales statistics – the volume of sales in the Toronto area, for instance, was down 47 per cent year-over-year in January – Royal Bank predicts that lower prices will lure a growing percentage of Canadians back into the housing market in the next two years.
Toronto real estate agent Geon van der Wyst noted that consumers do not always follow through on their intentions – although it is encouraging that more Canadians appear to be thinking about buying homes.
“Intention is the step prior to making an educated decision… and I'm sure a lot of those people with intentions will move forward with purchases, it's just a matter of finding the right time,” Mr. van der Wyst said.
Karen Leggett, the Royal Bank's head of home equity financing, said low mortgage rates “and favourable housing prices are influencing home purchase intentions this year and may be the reason why more Canadians are poised to purchase over the next two years.”
Ms. Leggett said the poll, conducted for the Royal Bank by Ipsos Reid, found that the vast majority of Canadians believe that the purchase of a home is a good investment. “The current economic environment does not appear to have dampened Canadians' overall confidence in the housing market,” she said.
Mr. van der Wyst said there are good deals to be had, from the buyers' standpoint. However, he added, many prospective buyers – particularly first-time buyers – are still uncertain about the best time to plunge into the market.
“We tend to hand-hold these first time-buyers, nervous first-time buyers, especially around here where they know the prices are starting to dip – and who knows where they will continue to dip before the recovery starts?”
Mr. van der Wyst said that, especially in the current economic environment, he screens prospective buyers carefully before taking them to look at properties. He noted that the banks are also “pretty stringent” in qualifying consumers for mortgages.
“Interest rates are at historic lows and borrowing money is very, very affordable. If you have steady employment and you have some financial responsibility along with a good interest rate, now is a really, really good time to purchase a property,” said Mr. van der Wyst, an agent with Royal LePage.
“At this time, employment stability is very important. It would be really unfortunate to see someone lose their job just as they were about to close on a property,” he said.
A number of leading Canadian economists have observed that Canada's rising unemployment rate has eroded consumer confidence, and other recent housing forecasts have been less upbeat than the Royal Bank survey.
Canada Mortgage and Housing Corp. projects that, in spite of falling prices, the volume of existing home sales is expected to drop by 14.6 per cent in 2009, and then rise by 9.3 per cent in 2010.
Average home prices are forecast to fall 5.2 per cent to $287,900 in 2009. Next year, prices are expected to remain flat, according to the federal housing agency's forecast.
Ms. Leggett said Royal Bank is not forecasting “a huge housing rebound, by any stretch,” but there are reasons for cautious optimism that the market will start to recover later this year and next year.
Following the overheated market and bidding wars of the past few years, housing is once again becoming more affordable and there are good buying opportunities for consumers “who have good solid certitude around their job prospects and have the financial picture to be able to get into the market,” Ms. Leggett said.
“Buying intentions are one thing. Whether they translate into actual purchases, obviously time will tell,” she said. “But, anecdotally, we are hearing that there is heightened activity …and interest in the marketplace overall.”
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