Ouch -Here it comes!

The numbers are in for the first half of October and it's not a pretty sight.

According to TREB, compared to the same period in 2007, sales are down 18%, and compared to the same period in 2006, down 10%. Within the City of Toronto, sales are actually down 21%.

Average prices are down, too. In the City of Toronto, average prices are down 15% versus an overall decrease of 11% across the GTA. In the 905 belt, prices are only down 8%.

It's important to note that there's a slightly hidden reason why Toronto's sales are down more than the 905 belt, compared to 2007.

City of Toronto Land Transfer Tax. When the city announced that this tax would take effect in early 2008, it caused an upward spike in home sales as people scrambled to buy and close before that tax kicked in. As a result, sales towards the end of 2007 actually increased instead of the usual decrease. This helped skew the sales figures for 2007 in Toronto.

Inventory-wise, it's great for buyers. Compared to a year ago, there are now 30% more homes on the market. More choices means more sellers are competing for your offer, which means more aggressive pricing and, with a sharp Realtor, more agressive negotiations on your behalf.

For sellers, there are ways to protect and justify your asking price to help put more money in your pocket. Be sure that your Realtor has a sound marketing plan for your house.

Interesting Reads
Here are some recent, interesting articles about the real estate biz.

This one in the Globe & Mail, does a nice job of comparing the default rates of mortgages in the U.S. and in Canada. In short, in Canada, it's 0.27%. In the U.S. for their prime customers it's 4% and for the sub-primes, it's 18% !!!

Time and time again, I'll advise my clients that it's really not a good idea to buy first and sell their existing house afterwards. There are numerous reasons (contact me if you want the full scoop). But here's an example (a bit extreme) in this Globe & Mail article of why it isn't advisable. Imagine being stuck with both houses?