The Real Estate Scoop

2011-12-04T17:10:00.001-05:00

I'm waiting with baited breath already. The early excitement in the neighbourhood at seeing the monster "cherry-picker" crane hanging lights on numerous houses on the street teases us that a great Christmas display is about to happen.

In particular, FOUR houses, side-by-side, have joined together to participate in one enormous light show!
How cool is that?
Has it even been done before? I've never heard of that happening around here and can't recall reading about anything on that scale in the papers before, either. It may or may not be the most total lights, but FOUR consecutive houses all part of one computer-controlled display?

I know they're running a bit behind schedule but regardless, once it's running, this is going to be great!

For more information, including directions, go to www.rigbylights.ca - Come and check it out!

Not A Real Estate Post - For Your Heart!

2011-09-06T09:10:00.001-04:00

Ok, this isn't my regular real estate-related post, but I feel it's important and worth sharing with all of you.
Last week I was in the hospital recovering from a very mild heart attack and angioplasty.
I'm home and recovering and feel fine.

But I wanted to warn you about my mistake when I felt the chest discomfort so that you don't repeat it. I spent my hospital time talking with the staff and learned something worth sharing.

In the "old days", in Ontario, most hospitals were "general" hospitals, in that they pretty much all offered similar services and treatments......like a CARDIAC ward! Or even a CARDIOLOGIST!

Not anymore!

About 10 days ago, I was walking the dog with Marg when I felt a discomfort across my upper chest. I had to go back home and she suggested we go to the hospital to have it checked out.

Great suggestion!

But we made the mistake of DRIVING to the hospital. Believe it or not.

Did you know that in Ontario, they've changed they way that they process and prioritize us?

Did you know that there's no Cardiac unit at Ajax-Pickering Hospital? Not even a cardiologist!!

Hospitals have been joined into groups to provide health care. For example, all cardiac care is done at Scarborough Centenary. Ajax-Pickering just last week received a monster-new MRI machine and is going to be the MRI centre for Durham Region, possibly even broader!

Did you also know that now, you're processed differently if you call an ambulance versus driving yourself to Emergency?

I'm speaking from experience. The staff confirmed it themselves!

On Friday evening, Marg drives me to Ajax-Pickering Hospital where I go to Emergency and go through their admission process. They do tests on me all weekend and then on Monday morning, they transfer me to Scarborough Centenary's Cardiac Care unit.

If I had called an ambulance, it would have taken me DIRECTLY to the Cardiac Care unit at Scarborough Centenary! No, not to Centenary's Emergency Department - directly to the Cardiac Care unit!

I could have been in the hands of cardiac specialists THREE days sooner had I simply called an ambulance!
Who told us?
I never got the memo!
Did you?
That's why I'm trying to tell everyone I can, that if you feel the symptoms of a heart attack, don't do the "old school" thing and drive yourself in, thinking that it's not serious enough, or you don't want to attract attention etc. We never would have even gone to Ajax Pickering if we had known they had no cardiac care!

The hospital processing and prioritizing has changed.
Ambulances, for heart attacks, even from as far as Port Perry, the nurse told me, comes straight to Cardiac Care at Centenary - and I saw them being wheeled in there by EMS with my own eyes!

Drive yourself and you're going through the Emergency Dept route.
Hopefully I'll never have to, but next time, I know better.

It's your heart.
It can't wait.
Do the right thing FOR YOU!
Call an ambulance.

It's easy to be a lazy, lousy Realtor, if that's what you want

2011-08-05T15:30:00.000-04:00

The way to being a lazy, lousy, Realtor is the short way.
A lousy Realtor is going to try to sell their buyers on the first house they tour because touring more than that is just a pain in the azz.
A lousy Realtor is not going to point out things that are wrong with the house, or verbalize reasons why the buyer should NOT buy that particular house because it could require seeing even more houses.
A lousy Realtor is not going to make the extra effort to determine if that asking price is in keeping with the other comparable sales in the area.
A lousy Realtor is not going to bother being aware of future local developments such as the express toll highway being planned to pretty much butt up against the buyer's desired house and advise them of that so that they can make a truly informed decision. (and also better understand why others are selling!)
A lousy Realtor will not look into the history of the buyer's preferred house(s) to see if the house was previously sold as a former-grow-op, or a "stigma property" (where there was a murder/death/suicide etc.)
A lousy Realtor will not look into the sales history of those same preferred properties to try to analyze whether the house is currently being sold as a "flip" or whether the "listed" sellers are the ones truly on title.
Yep, a lazy, lousy Realtor can have it pretty easy.
Fortunately, I prefer the extra work involved and going the extra mile to make sure that my clients are making decisions that are purely in *their* best interests!

Time is of the essence - in almost all aspects of our lives

2011-06-28T12:48:00.000-04:00

While reviewing a offer to purchase, the "time is of the essence" clause struck me for some reason and how almost everything these days seems to be that way.
Everyone is always rushing everywhere. People are in too much of a hurry to even hold doors open for one another anymore. I even see the odd nutbar driving a few yards further up the highway's shoulder just to get a few car-lengths further, sooner in his quest to get the cottage quickly. Are you kidding me?

But in some regards, I have to say that my time is more valuable (to me) than certain savings.

When I was a kid, Mom and Dad lived in a different kind of world, with different values. Time was what they had in spades. Dad was a Chartered Accountant and he knew how to manage their money very, very well and when he passed away, Mom was financially taken care of.

I vividly recall their regular Thursday night grocery shopping run which started after dinner and usually brought them back home after 9pm, when most grocery stores closed. And they had a car-load of groceries!

In their world, (when $5 would buy a half tank of gas *and* get you change back!), they thought nothing of driving to Loblaws to get a certain selection off their list, then go to Miracle Food Mart because their meat selection was better, then to a Knob Hill Farms because grapes and eggs were on special and then to......

Now really, how much cheaper could grapes possibly be in this day, in order to make me drive to a different grocery store *and* line up to check out again just to buy cheaper grapes (and eggs).
I mean, if grapes were 15 cents/lb cheaper, am I rushing to another store just to save 30 cents (assuming I splurged on TWO pounds!)? Even if eggs were also reduced by 15 cents/dozen, come on - how many dozen eggs could I buy to justify this trip?
I'd have to buy a HELLUVA lot of grapes and eggs to justify that trip - I'm talking about skid-loads!
Needless to say, I'm unable to consume enough grapes and eggs to make that trip cost-effective.

With today's cost of gas, and higher traffic, I'm burning up the savings just idling in traffic in the round trip!

And that doesn't even factor in what MY time is worth.
There are lots of theories and methods on determining what your time is worth on an hourly basis.
For the sake of this historical example, I'll go cheap and say Dad's time was worth $10/hour.
So if it takes him an hour and a half to make that round trip shopping for grapes and eggs, his time-cost alone is $15!

I was speaking to Mom yesterday (she's 85 now) and she had been browsing the flyers and was urging me to get to Sobey's for a smoked ham and then to Freshco for potatoes, watermelon, bacon and mayo...
because they were a "good deal".

So are cheaper grapes or eggs (or ham) alone going to make me choose a particular grocery store over another in today's world?
If someone said to me - "would you travel to this grocery store over this other one, just to save a dollar in combined savings, at the expense of your time - and hassle of a another parking lot, checkout etc and an added 45 minutes? Would I do it?
Nope.
Time is of the essence.

A house for $1? Don't bet on it.

2011-06-09T10:29:00.000-04:00

There are even a couple of houses on the market listed for $1 (one dollar!) with a clear intent of creating a bidding war. It’s not a new tactic. Some feel that by removing a particular list price, that you’re telling the market they’re free to set their own price for the house.

Nice in theory.

But Realtors have access to the selling prices of homes on that street and are going to know what’s fair value and what’s not going to fly. And they’ll advise their clients accordingly.

(NOTE: A “client” is one who signed a Buyer Representation Agreement with the agent. That agreement requires the agent to work in the *buyer’s* best interests and provide them with sound advice and historical sales etc. If you don’t sign a Buyer’s Rep agreement, the agent is not obligated to provide that info on your behalf!)

The Sellers and their agent are going to find themselves sifting through a lot of offers that aren’t even in the ballpark for what they’re prepared to sell it for.

So why bother with all of that “noise”?

Are they looking to find that one person willing to hugely over pay? They could have achieved the same thing by listing it for $100,000 less than expected and then eliminate the myriad of lowball offers at the same time. All that this $1 list price is going to achieve is kill a lot of trees through wasted paperwork by a lot of agents with buyers believing they’re going to score some ridiculously sweet deal.

www.Alexa.com reports that www.Realtor.ca is the 49th most visited site in Canada. By comparison, the Star's website is #50.

Lots and lots of people are going to notice that house at that price.

And since the sellers are not obligated to accept just *any* price for the house, they're likely going to get market rate for the place or even slightly above.

But if I'm selling your house, that $1 listing tactic is not something I would do.

Why would you and I want to sift through dozens of ridiculous offers just to weed through them to find the few that are even in the ballpark?

That said, it might be something to consider if the property was a really unique, one-of-a-kind property and difficult to find comparisons with it. But for the average property in the GTA, nope.

To some it may seem "crafty". But they just haven't really thought it through.

Winning in multiple offers - more than just the money

2011-05-26T16:13:00.000-04:00

I enjoy participating in multiple offers (a.k.a. "bidding wars") on behalf of a buyer because often times, it's about more than just who's offering the most money.

I won a bidding war on behalf of my buyers last fall for a condominium in downtown Toronto not because of price. We were neck and neck with another offer but the listing Realtor and the sellers ultimately decided to select mine and work with me simply because I *was there* and they could wrap it up on the spot! I presented in person. The other offer was faxed in. Do you think the other bidding Realtor was going to tell his buyers that they lost out on their preferred condo simply because s/he faxed in their offer?

I won another bidding war on behalf of my clients, again, not on dollar value alone, but because we had also more flexibility with the closing date - and I had made it a point to emphasize that in my offer presentation.

And there was another one I won again, more because of my offer presentation than purely the dollar amount. The sellers still had an emotional attachment to the house. And part of my offer presentation included an explanation of who my buyers were and what they loved about the house (Note: I can't divulge all of my specifics because I consider them a competitive advantage - and one that's clearly been working for me in these situations.) It made a connection with the sellers and we won.

And the odd time, even my best efforts or dollar amount don't work. Several years ago, my buyers and I were involved in a 7-group multiple-offer situation. Offer presentation started at 7pm and by 10:30pm, I finally found out that we won. I went back inside the house to finalize the papers only to have the seller-wife break down in tears about not wanting to sell and pleading with her husband to stay a little longer. He agreed and because they hadn't signed the agreement yet, they pulled out. Needless to say, the selling Realtors (it was a team of two) were as dumbfounded as I was. And one of them had to go outside to vent. I simply thanked everyone for their time, wished them the best and walked out to my car to break the news to my buyers:
We won, yet we lost.

I'll share this tidbit though, obvious as it may seem - manners matter.
I've encountered some huge egos in real estate, some who *try* to bully and some just simply bombastic types. But when you're dealing with a number of people and with an emotional issue like real estate and often dealing with large amounts of money, manners matter. One can negotiate hard and creatively while still being polite and respectful of everyone at the table. It's really an additional negotiating tool.

What's that old saying? "You catch more bees with honey than with vinegar"

Condo fees - too high or too low?

2011-05-22T12:06:00.000-04:00

Condo fees are like the weather. Almost everybody likes to complain about them.

Most of the time, condo owners are likely to complain about the seemingly excessively high fees - and sometimes they're right. I myself have had the next to impossible task of trying to sell a condo that had comparatively high maintenance fees.

But what about when condo maintenance fees are impossibly low?
There was an article in today's Globe & Mail that talked about the perils of low maintenance fees.

Low maintenance fees can be attractive to buyers because it lowers their overall monthly carrying costs. However, if you expect to sell your property for good, competitive value down the road, you can't live in a house or condo without having to invest in its upkeep on a regular basis. In a house, there are some big-ticket items that you have to maintain - I.e. roof, driveway, windows. That's no different in a condo. There's a very large roof, a very large parking area and often hundreds of windows that at some point, all need replacing.

Where does that money come from?
A portion of condo maintenance fees is supposed to go towards everyday type maintenance.
Another portion is supposed to go into the reserve fund, to take care of those costs that only come up every 20 years or so. Everyone is supposed to share in the cost of that repair, not just those who happened to live there at the time.

But what happens when something wears out unexpectedly fast?
What if the parking garage has bad leaks that caused the the structure to crumble beyond expectation?
And what if the maintenance fees were too low to create a sufficient reserve fund to pay for those repairs?
Where does that extra money come from?
It comes from the unit owners.

If the condo board needs to raise money for an unexpected repair, they can levy a "special assessment" which is distributed proportionally to the unit owners based on square footage (just like maintenance fees).

And those fees can't be dodged. They go with the unit.
So if the seller tries to dodge these fees by selling their unit, the buyer should be aware of them.

Standard practice when buying a condo is to have a condition in the purchase agreement that enables the buyer and/or their lawyer to review the status certificate - a document about the condo corporation's current "state of fiscal health" as well as any specific special charges that have been levied against that unit.

So a condo buyer would see that the seller is trying to dodge the special assessment and then the buyer has the option of negotiating that "discount" into the purchase price or walk away from transaction.

This is not an unusual tactic by the seller.
But the problem intensifies when more than a few unit owners try to sell for the same reason. All of a sudden you have a large number of units for sale on the market and that means they're competing against themselves for the few buyers. So they try to get around that by lowering their prices and find themselves in a spiral of falling property prices .

When you have a condo that's well run, it has a healthy reserve fund and a management board that is prudent in spending money to maintain the value of every unit-holder's investments, then everyone wins.
You get a well maintained building.
You get a building that's desirable to buyers.
You get a building where owners don't want to leave.
And the units are likely going up in value because of it.

So if you're thinking of buying a condominium, don't just look at the dollar amount of the maintenance fees. Have a close look at where they spend this money.
Are they spending enough? Too much?
How well is the reserve fund is managed?
What kinds of people are actually on the board making these decisions?
Remember, the board is just made up of other condo unit holders like yourself - ones who wanted to get involved. That doesn't necessarily mean that they have financial property management experience.

With condo ownership, it truly pays to get involved in the management of the corporation to help ensure that you protect your own investment in the property.

April market update

2011-05-11T14:23:00.000-04:00

With just over 9,000 homes sold in April across the GTA, sales were down 17% compared with last April. In the 416 area code, detached home sales were down 17% and in the 905 belt, they were down 15%. Semi-detached home sales were down 25% and 15% respectively.

According to TREB the number of new listings coming onto the market were “below expectations”, which resulted in an increase in the average-price by 9%. They predict that the increase in the average price will, in turn, result in more sellers listing their properties in the coming months resulting in more balance in the market.

I believe the weather also played a factor as the overly-long drawn out end to winter tends to deter buyers from hitting the streets to tour properties in search of their next home. So homes are sitting on the market longer and fewer buyers are touring the properties. However, the online statistics show me that high than average numbers of people are browsing listings on the web. So possibly higher gas prices are keeping some buyers from doing more touring in person.

In a piece of very welcome news, TREB has announced that coming July 5^th, Realtors will receive an enhanced search capability in our system – based on actual neighbourhoods!

In the past, the system was capable of searching only by TREB Districts, specific street names or map-grids (from the Map Art books). And the TREB District numbering was both archaic and, as it turns out, based on rather randomly drawn districts.

Currently, if you want a search done to compare sales in say, Moore Park, this year and last year, you couldn’t do it, unless you either entered all the specific streets (unlikely) or more crudely, base it on map grids.

Come July, you’ll be able to see what’s happening in specific, named, neighbourhoods.

So if you’re looking for a house specifically in Leaside or the Annex, or Bay Ridges etc., I’ll be able to do those searches for you. The system that we Realtors use for managing and searching properties on MLS is widely recognized as one of the top systems in all of North America. (Note: just to clarify, it’s not the same system that’s publicly accessible at www.Realtor.ca).

Would you like to receive a custom “area watch”?

I often receive requests from past clients, family and friends to keep an eye out for activity in a particular area or on a particular street. It usually takes me 10-15 minutes to set them up for you and you’ll automatically receive an email when there’s any listing activity occurring within your search criteria. So if there’s an area or specific street that you’d like to keep an eye on, just let me know.

Kudos to Osama's Realtor

2011-05-02T14:32:00.000-04:00

Maybe it's just me, or my lack of knowledge about Pakistan real estate and what buyers are willing to pay.
But that must have been quite the Realtor who sold Osama his place in Abbottabad.

According to CNN, the place was valued at a million dollars.
Hmmm - I must be missing something.
If I were listing this property, are these the "features" that I would have to put on the MLS listing?

*in* Pakistan
No outside facing windows
18 foot-high walls
surrounding roads are gravel
no view, to speak of - certainly not waterfront property
no telephone
no Internet
no trash pickup (apparently they burned all their own trash)
a half-day's drive to Afghanistan
100 km from the capital city of Pakistan

"Sun-drenched recently renovated multi-family, multi-storey dwelling in secluded neighbourhood. Dog-safe playground, featuring utmost privacy with 18 foot high walls, dual-entry gate, razor wire and inward-facing windows, this charming, rustic-style home welcomes your wives, family, closest friends and couriers. Bring your fussiest buyer - no need to remove shoes. Disclosure - was a former terrorist hideout. The red marks are not tomato."

In my book you'd have to be one helluva Realtor to sell that place for a million dollars.
I tip my cap to that agent.

TREB announces improved searching by neighbourhoods

2011-05-02T13:08:00.000-04:00

This feature is sooooo overdue it's impossible to understate it's value. TREB's Realtor system is finally getting the ability to search on a true neighbourhood basis rather than the ancient, arbitrary districts they had laid out in the dark ages.
So when a buyer wants to areas like West Shore, or Amberlea etc. we can do just that.
And when a seller wants a neighbourhood-specific CMA done, that's going to be much easier as well; or even across several neighbourhoods.
Here's the formal announcement from TREB........

Re-Districting TorontoMLS – Coming July 5

April 14, 2011 -- July 5, will see the fulfillment of a major objective: the replacement of our old MLS® districts with easier to understand community names.

Our 86 alpha-numeric districts are not only arbitrary, they’re out of date. Many of them were drawn when places like Markham and Vaughan were mostly rural and not the bustling communities that they are today.

Not only do the current district names not make sense to your clients, you can’t use them to accurately target what your clients want. It is almost impossible to target a search in our MLS® system to a specific neighbourhood which means that many of your search results are not what your client is after.
Re-Districting will solve these problems, replacing the code numbers with true geographic areas, giving your searches greater clarity and a tighter focus.

On July 5, community, or neighbourhood names, are replacing the districts. Their names and their boundaries were provided by government bodies with REALTOR® input. In this way, the names will make sense to the people who live in the area and REALTORS® who work in the field.

"Fine print"? I beg to differ

2011-04-12T13:39:00.000-04:00

There was an article recently in The Star, that talked about a couple who were looking to buy a cottage in the Muskoka area and signed a Buyer Representation agreement with an agent in order to see some properties.
(This is pretty much normal paperwork in the process of buying a property in Ontario.)

However, the buyers go on about how they feel shafted by the terms of the agreement.
How is "I didn't know what I was signing" a reasonable explanation?
Maybe for a 5-year-old, or an 85-year-old.

So I have several thoughts about this.
Background - among other things, the Buyer Representation agreement creates a confidentiality between the agent and the buyer. Without this agreement, the default situation is that all Realtors are working for the Seller. It also states that the Buyers are not currently working with another Realtor. Poaching clients is unacceptable. It also helps to ensure that the buyer-agent gets paid for their efforts in finding and showing properties to that buyer. Nothing wrong with wanting to be paid for your efforts, right?

Additionally, if they're already working with a agent, why would I want to get involved when I'm not going to get paid? (I've actually had buyers contact me to see a house and when I ask them if they're working with an agent, they said "yes, but he said he's busy so we'd like you to show it". Too busy for your own clients?)

But I digress.
I don't agree with some of the Realtor's methods. Since they just met, I disagree with signing the buyers up to a Muskoka-wide geography and for that long duration of time. Neither of those are fair or realistic terms given that the parties just met each.

When I just met a possible buyer and they would like to see a property, I'm going to ask them to sign a Buyer Representation agreement with me but
a) just for that specific property address and
b) for a period of only 2 weeks

And if they decline, I'll first try to determine the concerns and address them. And if they still decline, I'll suggest that they contact another Realtor. (And if they're already working with another Realtor, then *I'll* decline!)

I think it's fair that if you decide to buy that house in that time, that my time and efforts be compensated.
And if you don't like working with me - well, our obligation begins and ends at that specific house and for just two weeks, at that. The agreement does not bind us together beyond that specific house for that 2 weeks.

No tricks.

If you wanted to see the house right next door, you're not obligated to use me.
A short duration in the agreement gives the buyer a chance to become familiar with me and my work style, real estate knowledge and professional ethics and we can mutually decide if we want to work together going forward and sign a longer one. But if instead, you want to see another house with another Realtor, go ahead.

What kind of Realtor gets their own clients to sign legal papers without explaining what they're for and why they should sign them? If you have a Realtor that works that way, maybe you should re-think who you're working with.

If you don't trust your Realtor when signing a simple agreement to work together, how could you ever trust them when they advise you to buy or not buy a property?
Not all Realtors are the same.
You need to find a Realtor that you can trust.

I disagree with the article referring to the geography and duration as being "fine print".
Wow, it's front and centre in the middle of page 1 of the agreement!
It's right in the fill-in-the-blank portion.
It's not buried at the bottom of the page or on the third page of legalese!
How obvious can it get?

The buyers claimed they didn't know what they were signing.
So then why would they sign it?

Why would anyone sign *any* agreement without knowing what they're signing?

If they buy a house, are they going to try making the same claim to get out of that? After all, both agreements are written in the same font. No different than a credit card transaction.

"What? A million dollars? No one told us!" Come on.

Right above their signatures it says "This agreement has been read and fully understood by me". If you're signing something, don't you want to know if you're joining a swinger's club or AOL or Publisher's Clearing House or KKK or cheese-of-the-month club?

I think the Realtor could have handled things differently/better but that's just my opinion.
When you sign an agreement to work with me, it's because *YOU* want to, and *I* want to do so.
The last thing I'm looking for is to bind someone who doesn't want to work with me, or someone I don't want to work with, into an agreement to work together. There's no point. And it's no way to build a lasting reputation or a business.

Sometimes personalities don't mix and it doesn't work out. I accept and understand that. I have let buyers out of agreements in the past when hasn't been working out.

At some point in all of our lives, usually when we become "adults", we're supposed to become accountable for our actions....and especially our signatures.

If someone asks you to sign something - ask yourself WHY??
Read.
Ask questions.
Know what you're signing.
Otherwise, DON'T SIGN A THING!

I'm here to help.

Real Estate articles in the news

2011-03-22T09:04:00.000-04:00

Click on the links below for recent real estate articles in the media.

Selling your home - 10 tips

GTA Condo Market - Has it peaked?

Spring Housing Market - Is this the last big one?

Duct cleaning - Is it worth it?

TREB reports resale homes holding their own

10 ways to avoid buying the wrong house

Who's minding the mint?

2011-03-02T13:49:00.000-05:00

Here’s an interesting article that I just read, not specifically real-estate related, but if you're investing in real estate (or anything, for that matter), then this advice could apply to you too.

It amazes me that some people can be stupid or naive enough to think that there's such a thing as a risk-free investment. Even hiding your money in your mattress is an investment of sorts. And the risk of that investment is that if your mattress goes up in smoke....

Real estate has its own risks as well. Just different. But remember that house prices don't only go upwards.

As I go through life, I learn more and more to ask myself if something passes "the smell test".

Does it smell fishy?

First warning that an "investment opportunity" fails the test is when someone in that article says

“there was no possibility of him losing his money.”

that should make you scratch your head.

There’s really NO place you can invest your money that doesn’t have risk. It’s that the risk comes in varying degrees.

Can you lose your money if you invest in Canada Savings Bonds?

Yes! But the risk is very little because the government would have to collapse for something like that to happen.

Second warning – if you invest “off the beaten path”, I.e. with non-mainstream financial investors, you have to know your risk is going up – especially if it’s not even their primary job [laffin!!]

I mean in this article, these people were just plain greedy and their greed blinded them to sensibilities and normal suspicions. For example: How can some part-timer be having all this success when even the pros don’t have his success record? And if he’s so successful, how come he’s not doing it as a full-time job? And thirdly, if he is *so* successful, why does he even have/need a job????

I’m laughing at the investors in this article who are trying to blame the OSC for their own greed and stupidity. They're basically asking to be protected from themselves.

The author of a newsletter that I subscribe to says that no one can ever beat the market on a regular basis, like this clown, or like Bernie Madoff claimed to have done. Being able to do so, would imply that at some point you’re garnering more and more wealth and eventually ALL of it. And since no one has ever garnered all the wealth of the world and own all the stocks, or even just to a dominant position, you know it can’t happen.

I chuckled at this article because it refers to dentists getting swindled because it’s widely rumoured that dentists and doctors, more than any other professions, are the ones most often swindled.

And an interesting analogy to this article would be to ask you, if I told you that my friend does dentistry “on the side” – would you trust them enough to go yourself? Probably not. Yet these clowns invested HUGE amounts of savings with someone who still has a day job! How twisted is that? You trust your savings with someone who doesn't even do this investing as their REAL job????

It’s really important that you start putting some money away at an early age to make it work for you. But it’s even more important that you think twice about where you put it and never all in one basket.

BTW, I just bought this guy’s books after hearing him interviewed on local morning radio

http://www.chfi.com/2011/02/24/the-idiot-millionaire/

Never too old to learn a bit more.

Thinking of buying Florida real estate?

2011-01-19T16:07:00.001-05:00

With the Canadian dollar at or near par with the U.S. dollar, coupled with the cratered U.S. real estate market, now may be a good time to consider investing in U.S. properties such as Florida real estate.

However, you need to be aware of certain considerations. You're buying real estate in a foreign country and it's not done the same way as it is here in Ontario.
Consider the following:

Hurricane insurance is pretty much a requirement in some parts. Be aware of whether you're buying in a high-risk area
Condos - with vacancy rates on the increase, condo boards still have to cover their costs of looking after the property. If the costs used to be shared by 100% of a full condo, and now it's only 75% full, those fixed costs are now going to have to be shared by fewer people (I.e. higher maintenance fees). Could you still carry the costs if the vacancy rate dropped to 50%? Seems unthinkable "up here". But you're not buying "up here".
Inheritance - talk to a lawyer familiar with U.S. laws. A Canadian-only will may be insufficient for passing on your U.S.-owned property to your desired party upon your death.

These are just a few considerations. For more information, here's a helpful article.
http://www.thefinancialblogger.com/buy-a-condo-in-florida/

Or, to think about it a little differently, why not just rent?
The rental prices are bound to be very attractive and without the headaches of making a purchase in a foreign country. Another benefit of renting is that you're not tied to the same place time after time.

Or, consider the best of both worlds. Rent in the area that you're thinking of buying. It gives you a chance to spend time in that area and really become familiar enough with it to help you make an even more educated buying decision.

Mortgage changes in the works

2011-01-19T15:36:00.000-05:00

I'm surprised that I haven't posted anything in a month! Ok, Christmas vacation is over.
The federal government announced plans to change some mortgage rules in response to information that shows Canadians are accumulating too much debt.

In particular, they're changing, or rather putting more restrictions on which mortgages the government will insure. For example, they will no longer insure mortgages with extra-long amortizations (no more than 30 years now).

Previously, banks would not loan anyone a mortgage who had less than a 20% down payment, unless the government (via CMHC) was willing to insure that mortgage. So that allowed the banks to probably loan more than what was prudent, thinking that the government was insuring them, so their money was safe.

Also, the government will no longer insure Home Equity Lines of Credit (HELOC). That means the banks will be on the hook for the losses, should any HELOC loans go into default. Look for them to tighten up in this area, too.

From our own in-house mortgage broker, the result is that the lenders will still honour any of the longer 35-year amortizations even if they close after the effective date of the new changes, but on condition that they were approved before that date.

So if you're thinking of making a large real estate purchase that would require you to take a 35-year amortization, *and* require CMHC insurance on it, you have until March 18, 2011 to get it approved.

Tour the great Christmas Lights displays in Pickering

2010-12-18T13:40:00.001-05:00

See my previous blog (below) for pictures and details on these great efforts of Christmas lighting displays.
Here's a suggested route (in general). Keep it flexible and if something catches your eye down another street, check it out (and let me know, so I can share it!)

If you’re coming east on the 401, I suggest the following (with a map!)

· Exit at Whites Road south

· On Whites Road, turn left/east at the first lights onto Oklahoma

· Turn left at the first lights on Eyer and follow it past some nice displays

· At Hillcrest, turn right/south to Sanok and turn left/east

· Turn right/south on Greycoat to Vicki Drive – on the corner is a nice display all in blue

· On Vicki, at the corner of Victory, is a well-known, very large display

· Turn south on Victory and go across Oklahoma to see some more displays

· When you reach Park Cr, turn left/east and drive to West Shore to exit the area

· Turn left/north on West Shore and go all the way to Bayly

· Go right/east on Bayly

· Take Bayly a couple of km to Liverpool and turn right/south (there’s a Tim Horton’s on the corner)

· Go south on Liverpool to Ilona Park and turn left/west to go around the court and back to Liverpool

· You can’t miss the houses on Ilona – and be prepared for traffic and pedestrians

· Both houses are amazing.

· Then, time permitting, you go up Liverpool about 4-5 km to Rigby Drive and turn left/west to see the sound & light show. Tune your radio to FM 88.3

You can then take Liverpool south to get back on the 401 west to Toronto.

Enjoy!

Christmas Lights Worth Seeing - 2010

2010-12-17T16:21:00.037-05:00

I love trying to find homes around us that try to rival (or top) the Griswalds in the movie "Christmas Vacation".

Well in Pickering, we have the two contenders for top Christmas lights display at 1289 and 1285 Ilona Park. This is on the east side of Frenchman's Bay. They were recently covered in the Toronto Star.

We went for our annual drive to see what caught our eye and while we were there, Marg talked with one of the home owners this evening; his place has over 100,000 lights.

You really can't miss this display!!

The kids will love it. There's so much to see that you need to park your car and walk up to them to have a really good look. Marg says you should go up the driveway to see even more from the side, that you can't really see from the street.

The homeowners take real pride in their efforts so please share your appreciation with them, if they're out.

My pictures really don't do any justice to these efforts.

Here's a map where you can find them.
And the surrounding homes have done some very nice displays as well.

There's more!
Also in the area are some others that are worth seeing.

If you hop over to the west side of Frenchman's Bay, take a cruise along Vicki Drive and the surrounding streets, including Victory south of Oklahoma). From Vicki Drive, turn south on Victory, and south across Oklahoma.

Tune Your Car Radio to 88.3 FM for this show!
And from there, go back to Liverpool Road and take Liverpool Road north, across the 401, about 2km, up to Rigby Drive and you'll see a first-time display of about 10,000 LED lights on 48 controllers and synchronized to music, broadcast on 88.3 FM via your car radio. Shows run continuously from 6pm to 10 pm (11 pm Fri and Sat.)
This one is pretty cool because it's done in sync with the music. And therefore, really hard to photograph because it keeps changing.
Here are some teasers but again, they don't do it justice.

Here are some nice displays that we saw on Eyer Drive, too. (near Vicki Drive)

Please respect everyone's private property and please don't block other neighbours' driveways or walk on their properties.

If you have any other streets worth touring in the GTA, please share them with us here!

My next blog will have a route suggestion to tour these great, festive homes.
Enjoy!

Can you spot the former grow-op?

2010-12-03T16:02:00.000-05:00

What do you think?
Have a look at the following pics and decide which of them is a former grow-operation.

That was four different homes. Need more clues?
Ok, here are more pics from the same houses (in the same sequence of house, as the first lot).

If you picked house 1 - you were right!
If you picked house 2 - you were right!
If you picked house 3 - you were also right!
And if you picked house 4, yep, you were right. They were all former grow-ops!

Just by looking at the pictures, it's unlikely that you can tell.
And without the help of an experienced Realtor or professional home inspector, you the buyer might be unaware of what it is you're getting yourself into.

Now, the home may well indeed be completely re-mediated and back to a normal house, but wouldn't you want someone on your team who knows where and what to check to help address your concerns?

The above pics were from "declared" former grow-ops, where the listing Realtor declared it in the Broker's comments. By law, the listing Realtor is obligated to disclose this kind of information if it's shared with him/her. But what if the seller chose not to disclose this information to their own Realtor? That's why you really need a Realtor working on your behalf.

If you're the buyer and decide that you're going to deal directly with the seller's agent instead of getting your own agent to represent and protect your interests, thinking you're going to save a few bucks in a reduced commission, that decision could end up costing you far, far more in the long run.

Perils in the Current Real Estate Market

2010-11-30T14:29:00.000-05:00

The real estate market has been and currently is changing. A rising market can be a little more forgiving if you over-price your house. But that's not the market that we face today. And often times, a falling market is only visible/recognizable once the statistics roll in.

What is my home worth in today's market?

2010-11-23T16:26:00.000-05:00

One of the most frequently heard questions in real estate is home owners wondering what their home is worth in today's market.

Renovations that Matter?

2010-11-18T09:19:00.001-05:00

Just recently, I was asked about the possible improvement in resale value if the home owner replaced the windows. Actually, I was asked this very question twice in the last 3 months.

The bottom line is that you won't get your money back.

According to CMHC (Canada Mortgage and Housing), you can expect to recoup about 50-75% of the value of the windows through the sale of the property.
Do you want to see the expected returns on other various renovations? Here's the link.

Rarely does anything provide a better return on your investment when selling a home, than fresh paint and de-cluttering.While they may not translate directly to a bottom line improvement ($$), they will likely decrease the time your home spends sitting on the market. De-cluttering makes your house look larger (and cleaner and better kept). And new paint is fresh and inviting. (and *essential* if the seller was smoker!). Shampooing the broadloom would be next on the list.
Ditto for cleaning the windows.

Dirty windows draw your eyes to the windows.
Clean windows draw your eyes to the view.

Let's say you're living in an older home and several items could use updating.
You choose the windows. And upgrade them.
And then list the house.
I bring a buyer's offer that's less than you want.

You tell me the windows are new(er).
I point to the furnace.
You fix or upgrade the furnace.
I point to the roof.
You fix or upgrade the roof.
I point to the [fill in the blank]......get the idea?

Basically, working for the Buyer, I'm going to point at whatever you *haven't* renovated/upgraded as a justification of my offer price.

And if you tell me they're top-rated "xyz windows", I'll tell you my Buyer had a bad experience with that brand. And they prefer "brand uvwx"

If you tell me the shingles are 100-year shingles, I'll tell you that my Buyer isn't going to live that long and doesn't see the value. (by the way, unless you're planning to live there for the duration, anything more than the standard-life shingle is money you won't get back - unless of course, the rest of the neighbourhood is Marley-roof, then you'd be wise to do likewise.)

On other items that are tied to people's tastes and opinions
- you put in new broadloom, they want hardwood.
- you put in modern, above-counter sinks, they want traditional
- you put in gas fireplace, they prefer wood-burning.

Don't do upgrades that can narrow the types of buyers that look at your house. You want your house to appeal to the broadest range of buyers possible. What they do to it afterwards, is their business!

Like I said - Fresh paint and de-clutter (and clean windows)!

What you can get for $750,000 (in Durham Region)

2010-11-15T10:15:00.000-05:00

In comparison to the recent article in the Globe and Mail on what you can get in Toronto real estate for $750,000, here's what you can get for similar money in Durham Region.

For $739,900 on the edge of the Scarborough-Pickering border, you can get this 4+1 bedroom, 5-bathroom home on a 51x119 ft lot. With hardwood floors, potlights, granite in the kitchen, 8 appliances and a walk-out from the basement.

Or, for $759,900 in Oshawa, you can get this unique 1+2 bedroom bungalow on a sprawling 70x230 ft lot. With hardwood floors, a huge finished basement with walkout, 2 fireplaces, central air, sauna and inground sprinkler system.

In Pickering, $775,000 will get you this 4 bedroom, 6 bathroom home on a 50x120 ft lot. With finished basement, granite floors on the ground floor, granite kitchen counter, a 6-piece Ensuite, central air, crown mouldings and over 3,500 sq ft of space.

What do you get for $575,000 (in Durham Region)

2010-11-15T09:47:00.000-05:00

The Globe and Mail recently had an article on what you get for $575,000 in Toronto real estate.
So here's my comparison on what you get in Durham Regions for similar money.

$579,000 gets you this lovely 4 bedroom, 3 bathroom, 2-car-garage home in Ajax, on a 35x110 ft pie-shaped lot. With 9ft ceilings, pot lights, central air, hardwood floors and granite in the kitchen.

Or, in Pickering, you can get this large 3-bedroom, 2-bath bungalow on .72 acres. With 2 wood-burning fireplaces, granite in the kitchen, stainless-steel appliances.

Also for $579,000, you can get this 5-bedroom, 5-bathroom, home in Ajax on a 45 x 91ft lot. With over 3,800 sq ft of space, 4 full bathrooms, hardwood floors on the ground floor and second-floor laundry room.

Listing Photos - Not the "be all and end all" but darn CLOSE!

2010-10-30T14:30:00.000-04:00

In this day of inexpensive, yet good quality digital cameras, or, relatively inexpensive professional listing photographers, I have to say that I'm often appalled at the truly lousy listing photos I see with many listings.

Make no mistake. Listing photos do not SELL a house.

But they heavily influence whether buyers actually come to tour the house.
Listing photos should make buyers say "Gee, I'd like to see more of that house!"

When I choose photos for my listings, I ask myself "Would these photos get buyers out of their house and into this house?" and let that answer be my guide.

Lousy photos can often do more damage than good for a listing.
At least, the absence of photos creates the question "Hmmm, wonder what it looks like?"

But lousy photos already answer that question and the buyer and/or buyer-agent click to see the next listing.

What makes a lousy photo? It's not always the subject itself that's not photo worthy. (I.e. a kitchen shot with dirty dishes in the sink *is not* photo worthy). But additionally, if the camera is low-end and unable to get a wide enough look at the room, that in itself can backfire and make the room look awful. The other day, I saw a photo of basically two corner windows in a room, looking out at the yard. The camera lens and/or photographer was unable to capture anything further back than that, leading the viewer to ask "What the heck is that photo about?"

Another type of listing photo that grinds my shorts is where the photographer takes a picture of the room with a bright window, and the brighter-outside light fools the camera into thinking the exposure is correct. All that the photographer needed to do was turn on their flash and the photo would have been immeasurably better.

Even a little bit of Googling by the average Realtor could garner them some really useful photography tips. One of my favourite sites for real estate photography is http://photographyforrealestate.net/
Hopefully you find some interesting and useful tips there.
Enjoy!

Some "classics"

The Days of "Anything Goes" Are Over

2010-10-20T10:55:00.001-04:00

Unless you've been on Mars or abducted by aliens or marching in a "Leafs are going to win the Cup" parade, you're aware that the real estate market is changing, has been changing and looks to continue changing.

The monthly sales figure are trending downward and the sales-to-listing ratios clearly show the days of a Seller's market are pretty much a thing of the past. (these are very distinct, defined ranges in these ratios to give us the definition of a Seller's Market, Balanced Market and Buyer's Market - we don't just make these tags up and apply them whimsically).

In the heady past few years of selling homes, you could pretty much throw anything into the market and it would get gobbled up, often times, in a feeding frenzy of buyers. But now, Realtors are going to have to work a little bit harder in order to get their listings sold. There's more Seller competition for fewer Buyers.

As a result, I see us heading back towards the "polished apple" metaphor. When buyers come across two comparable properties, similarly priced, most often, they're going to choose the "most polished one".
It's been my experience that most Buyers buy up into the upper end of their mortgage bracket, leaving little money, if any (at least for the first several years) for major improvements. They're looking for homes that have all this stuff already done for them!

Note that even in the recent frenzied market, this was still the case, but wasn't that apparent because the plethora of buyers would have fewer homes to choose from and buy up the "less polished homes" right away, too!

Now, with more choices, Buyers can afford to take a bit more time and pick and choose through the selection.

And that brings me to the Realtor. In this new market, the Realtor has to roll up their sleeves and hopefully get more cooperation from the Seller in "polishing that apple".

Things like de-cluttering, cleaning, sprucing up and home staging are going to play more significant roles as differentiators in which houses sell first......or at all!

And the Realtors who are savvy enough to recognize this change, and work with their Sellers to apply some elbow grease to make it look like a "cut above" the competition, are the ones who are going to get top results.
Insist that your Realtor brings more to the table than just a "For Sale" sign for your lawn and a lockbox for your front door.

Avoid the "reverse bidding war"

2010-10-18T09:46:00.000-04:00

For over 5-6 months now, I've been watching a hugely over-priced listing in an area that I work in, to help me determine if it's as hugely over priced as I thought it was, or whether I was mis-reading either the market, the neighbourhood, that house or any of the above combination.

Thus far, this house has been *reduced* by over $300,000 in the time it's been on the market - all by the same Realtor, by the way. (that doesn't make it a bargain - it was never worth that much!)

What happens when a house like that first hits the market is that other homeowners, who feel they have a comparable home or live in a comparable area expect you to price their house in a CMA (Comparable Market Analysis) in the similar range. But as I have to remind homeowners, it's not what a house lists for, it's what it sells for that matters. I can list ANY house for one million dollars but that doesn't make it worth that much! Until a buyer agrees *and* pays that amount, it's wishful thinking.

So what happens when a Seller deliberately goes "fishing" to hugely over-price their home in the hopes that they find someone who hasn't done their homework on surrounding prices and makes them an offer?
The house sits on the market.
And sits.
And becomes known in the business as a "stale listing".
Even Realtors don't show it because it's not in line with local comparables.
So finally the Sellers agree to a price reduction. But relative to how wildly out of range it is, it's still not realistically priced.
So the Sellers have wasted all this time on the market (but not *in* the market) with an unrealistically priced house.
In the meantime, the market itself has been changing. It's been turning more to a Buyer's market.

And then the real kick-in-the-teeth occurs.

Another house in the immediate neighbourhood comes on the market in direct competition!

There are few things worse than that to happen to a Seller.
Unless of course, that competing Seller happens to be *very* motivated.

So the first Seller had all this time on the market, in a decent Seller's market and squandered it.
And now direct competition to their own listing has appeared.

Could it get worse?
Sure.
Suppose the second Sellers are really motivated - I.e. they're splitting up and want a quick sale to divest their assets? Or suppose it's an estate sale and the executor is looking for a quick sale to wrap up the estate?
Now they're going to be lowering their price in the hopes of landing one of the fewer Buyers currently on the market.

Now if the first Seller gets more serious about selling, they're going to reduce their price to compete.
And now the reverse bidding war is on.
Two Sellers, trying to out-lower the price on their house, to attract that elusive buyer.

And when a Buyer appears with a savvy Buyer-Agent, they're going to notice what's been going on with the prices of these houses. And out comes the dreaded low-ball offers to see which Seller is hungrier.

So now, the original Seller is likely looking at selling their place for considerably less money than if they had
a) listed it realistically in the first place months ago,
b) with no local competition and
c) in what was a stronger market.

No one can predict which neighbours are planning to list or when.
No one can predict the changes in a market.
One has to consider ALL of the variables that affect housing prices when they list and it's up to a responsible, informed Realtor to help provide that information to their Sellers to help them get the best price for their house.

Why going the "extra mile" matters

2010-09-16T11:55:00.000-04:00

Nowadays, it's become common practice in real estate transactions around the GTA (Greater Toronto Area) to simply fax an offer into the listing agent's office and wait for the results. I admit that on occasion, I've been guilty of doing that too. However, in the cases where the sellers request all offers by fax, you have no choice.

The other night, I was involved with a buyer, making an offer on a place and it required a good amount of driving. I could have saved a lot of time by faxing the offer to her, walking her through the signatures over the phone and then faxing it to the listing agent.

But here's why it can make a difference between winning and losing.
We were in competition with another offer, from another buyer-broker.
They chose to fax in their offer.

It turns out that both offers were very similar.
But we won! They chose us!
Why?
According to the seller's agent, since we presented in person, they chose to work with us and we hammered out the final few details and my client scored a gorgeous new home.
The deciding factor was that were there in person, and able to work out the final details then and there.

So driving those extra miles turned out to be the difference maker for my client.

Comparing Canadian vs. U.S. mortgage defaults

2010-09-13T20:06:00.000-04:00

From an article from the Toronto Real Estate Board......

Who benefits from a rising or falling market?

2010-08-29T15:39:00.000-04:00

There are 3 types of market in real estate - a seller's market, a buyer's market and a balanced market.
In a seller's market, demand exceed supply and often times buyers are willing to over-pay for a house, driving prices up.
In a buyer's market, supply exceeds demand and sellers compete for fewer buyers, driving prices down.
In a balanced market, supply and demand are roughly equal, and there's a healthy balance of buyers and sellers in the market place.

A seller's market is more advantageous to people who are buying down (price-wise) or people who are exiting the market (I.e. moving to another geography or seniors moving into a retirement home or rental housing etc.).

And conversely, a buyer's market is more advantageous to people who are buying up (price-wise) or people who are first time buyers.

Let me explain.

In a seller's market, a seller is often times going to get a better price than normal, for the sale of your house.
In the case of someone buying down (I.e. "empty-nesters"), they're looking for a smaller, less expensive place as their next place to live.

For the purposes of this example, let's say in a seller's market, all houses are selling at a 10% premium compared to a normal, "balanced" market.
The Smiths live in a nice 4 bedroom home, which in a balanced market, is worth $500,000.
So a $500,000 home sells for $550,000 in this seller's market.

The Smiths are empty-nesters and want something smaller so they are buying down to a house normally priced at $300,000, and in this seller's market, sells for $330,000.
So the Smiths made an extra $50,000 on the sale of their home and paid an extra $30,000 on their new home. The net difference is $50,000 minus $30,000 equals a gain-in-pocket of $20,000.

Let's look at the buyer's market.
For the sake of discussion, let says all homes are selling at a discount of 10%.
If the Smiths were buying up in this market, they would sell their $500,000 at $450,000.
If they're buying up to a house normally priced at $750,000, they purchase it at $675,000.
So by buying up in a buyer's market, although the Smiths "lost" $50,000 on the sale of their house, they far more than made up for it by saving $75,000 on their new house purchase!
The net difference is they saved $75,000 on their new house price, despite losing $50,000 on their current house price, making a net gain in their favour of $25,000!

And if you were a first time buyer coming into the market in a buyer's market, in this example, you bought your new house at a 10% discount, right off the bat!

So in this changing market, if the signs continue to indicate a buyers market, for those of you wanting a little bit more house, this is clearly this time to do it.

Why There's No "Team Steven"

2010-07-06T15:08:00.000-04:00

I've always known why I wasn't interested in developing a real estate team.

A colleague of mine recently shared this experience which pretty well sums it up.

Another Home Sale Botched up by the __________ Team. SOLD One Day on the Market!!

On Friday morning of the May Long weekend I was showing houses to a client. Our very first home we looked at was a beautiful home priced very well and this was the first day on the market (I was quick enough to catch it going on the system the evening before and booked the appointment for 930am).

We looked at a number of houses and she was on her way, really intrigued by the first house we saw that day. The listing agent had sent me an email requesting feedback, which I responded to saying that we were interested and please keep us posted if any offers come in. So far so good.

At 4:49pm the same day I get a message paged to me that there is an offer registered on the property and please call back if my client is interested. No problem, I called my client to let her know and she tells me that she would also like to put in an offer. Since we are competing with another offer we decide to go firm just over the asking price. Our call lasted about 10 minutes.

I called the agent back on the mobile number that was provided when they messaged me 30 minutes ago. They did not answer so I left a message of our intentions to submit an offer, and asked them to let me know what time the offer presentation was going to happen. I heard nothing back and I went about putting together the offer for my client.

About 6:20 I was done and had emailed the offer to my client in Niagara Falls which she was going to sign and fax back to me. I still hadn't heard anything from the agent so I called and left a second message again asking about the presentation time because we were going to submit an offer as well as a text message 6:28pm.

At about 6:45pm I get a call back from them saying how sorry they were that their phone was off, they didn't get the massage and that the property was sold with conditions to the other buyer. It was the long weekend and both the buyer and the seller were going away for the weekend and wanted to get it done quickly.

Now, one week later, the conditions have been removed, I know why the agent's phone was off. They were double ending the deal. The sale price was $5,500 less than our offer.

By not getting the message that we had an offer as well, that agent cost their client over $5,000 and the offer is conditional for 7 days holding everyone up while the buyer fulfils their conditions.

Had they waited till after the long weekend to present offers they may have had 5 offers, I wonder what it would have sold for then?

I am sure the seller still has no idea that our offer even existed.

Cost of using the BIG NAME Team $5,500.

Value of this story to me PRICELE$$!

Similarly, last year, I listed and sold a house that was previously listed by a "team".
It expired and the seller contacted me via a referral and shared a similar story. She listed with a Realtor "team" to discover that she only ever dealt with a junior agent who, ultimately, was unable to sell her house.

When you enlist me to help sell your house, you get *me*!
No one else. I'm accountable directly to you.

Recent articles in the media

2010-05-25T16:41:00.000-04:00

Handing down the family cottage - Not a simple case of inheritance. The government wants a piece.

Is a cottage a good investment? - Your best bet is to buy because *you* want to use it!

How about a cottage slice? - When a full exclusive cottage might be too much for you.

Parkwood Estate in Oshawa - Designed by the same group that designed the Royal Ontario Museum.

The Brickworks - Going forward

The bar has been raised - new rules put home ownership out of range of many

More listings = more choices - Good news for buyers!

Moving Mayhem!

2010-05-20T13:17:00.000-04:00

Interesting article in today's Star about a police bust of a family of movers who were ripping people off.
Just like pretty much everything else these days, if it sounds too good to be true, it likely is just that. I always suggest to my clients that one of the best ways to select a moving company is to a) ask your friends for a referral - they'll know from experience and b) check for complaints registered with the Better Business Bureau.
A move in itself is stressful enough. Having your furniture held for ransom is more than anyone needs.

A neighbourhood for every budget

2010-04-26T09:01:00.000-04:00

Yesterday, my wife Marg, and I went for a drive though some neighbourhoods in the west end for a change. Call it a hobby - we enjoy driving through different neighbourhoods as well as the open countryside.

Yesterday's destination was the Oakville area west of Ford Drive and south of Royal Windsor and the 403.
While browsing the TREB system for some noteworthy homes and areas, the following area caught my eye.
Why?

Because in that one area - denoted by the multiple push pins - there are 100 detached homes on the market, currently listed at $2 MILLION or higher!

I was pretty surprised to see that many homes in that price range on the market in one area.

That struck me as odd. But touring an area loaded with $2+ million dollar homes was still of interest so away we went. It was a perfect day for a drive - cloudy, with rain on and off, which made for light traffic.

When we got there, we drove up and down various streets, even parked and took a walk here and there on lake-front promenades to see the back sides of some of these gorgeous homes and their lake views.

Gorgeous homes. Gorgeous neighbourhoods.
So why do so many of them want out?
Well, only two reasons come to mind.
a) financial issues or
b) objection over the construction of the coming natural gas power plant which is slated to be built across from the Ford plant on Royal Windsor.

And from the large number of signs on resident lawns objecting to the gas power plant, I'm guessing that they're leaving because of the natural gas plant - although it's scheduled to be in operation less than 40% of the time because it's intended to provide additional power at times of peak demand only.

Just like the stock market, the best time to buy is when everyone else is selling.
And the best time to sell is when everyone else is buying.

So if you want to get a good deal on a house in the $2 million range, I'd be happy to show you any one of the 100+ homes for sale in that price range in eastern Oakville.

Apple "Mc-figures" it out!

2010-04-20T15:20:00.001-04:00

This isn't real estate related, per se, but just an observation du jour.

I just read in the (online) "paper" about how some schools in the U.S. are giving iPads to students instead of text books. Talk about a "green" solution! No paper wasted printing all those text books that have a limited usefulness. No aching backs making kids carry all that extra weight around. And publishing costs should go down considerably. (wishful thinking?)

So you have to give Apple credit for figuring out what McDonald's has known for years. Create customers at the earliest age and you keep them for life.

You put that Apple brand in front of school kids and they're going to come to rely on that brand. It becomes embedded in their minds from seeing it day after day in their text reader.
For what else? iPods, iPhones, laptops.......ebooks, downloading music, movies........

Just brilliant!

Buyers deserve the demographics

2010-04-14T09:13:00.000-04:00

I scratch my head these days when I hear stories of buyers purchasing a home and then being surprised at either the income level or the demographics; that it's "not what we were looking for".

How can that be?

As a Realtor working in the GTA and province of Ontario, we have access to some pretty informative and detailed information just like that. And since it's available to all Ontario Realtors, I can only surmise that this issue/question arises is because other Realtors either don't know about these tools or can't be bothered to use them.

Neither one is an acceptable excuse in my opinion.
As a professional, it's up to you to learn and understand all of the tools that are available to you in your business, whatever business that may be. How else can you call yourself a "professional"?

And if you can't be bothered to use these additional tools to understand things like the demographics of the area in which you're selling a house, then you're not servicing your clients to the best of your abilities and also leaving yourself open to a lawsuit.

When you buy a house from me, you're going to learn at least the following information about your area, as compared to the the larger postal area as compared to the city overall:

average income
proportions of white vs. grey. vs. blue collar workers
education breakdown
top ethnicities
top religions
top langauges
proportions of renters vs. owners

If you were buying an home and this information were readily available, wouldn't you want to be able to review it prior to making a purchase decision of this magnitude?

When choosing a Realtor to help you, dig a little deeper to find one that's willing to really roll up their sleeves to help you make a solid decision.

Q1 2010 was a record-breaker!

2010-04-06T15:29:00.000-04:00

So the numbers are in and they indicate that for the Toronto Real Estate Board, Q1 2010 was a record breaker for total sales. March sales hit 10,430 transactions to push the Q1 total to 22,418 sales. The average price of a home in the GTA in March was $434,696 but the increase is expected to slow over the remainder of the year as more listings come into the market, giving buyers more choices.

The sales were broken down across these major housing types

Detached homes: 47.6%
Condo apartments: 23.1%
Semi-detached: 11.9%
Condo townhouses: 8.0%
with the remaining 9.4% of sales accounting for sales of Links, Row-Houses, Detached Condos and Co-op apartments

The highest sale price for a detached home in March goes to 45 Bayview Ridge, which sold for $12,825,000 (6+1 bedrooms, 10 bathrooms, 235x666ft lot with annual taxes of $76,045)
And the bargoon of March for a detached home goes to a home in Gamebridge, ON (near Beaverton) which sold for $45,000 (1 bedroom, 1 bath house on a 66x144ft lot with annual taxes of $1,400)

And 10,428 other sales in between!

Condominiums - know what you're buying!

2010-03-31T14:31:00.001-04:00

There was an article in the papers recently that advised condo buyers to pay close attention to the condo rules of any particular condominium that they're interested in.

And it spurred me into this "there's even more to it" posting.

When you're buying a condo, you should be checking out that particular unit's location in the same way that you would a house's location. Where is the unit located within the building itself? Are you noise sensitive? Then you likely wouldn't want a unit that abuts the elevator shafts or the garbage chutes. You're going to hear those at all hours despite "house rules" on when people should use the garbage chute.

Take a walk through the underground parking garage and above ground lot, too. Take notice of what kinds of cars are parked there so you can get even a ballpark idea of the income levels of your neighbours.

If your unit is on the back side of the building, is it situated close to where the garbage truck will be coming to pick up the dumpster? If you works shifts or like sleeping in, that noise may be a concern for you.

Likewise, if you like sleeping in, if your bedroom is going to face the sunrise, maybe that's not right up your alley.

There's even more than this to consider, but I just wanted to put the bug in your ear.

It's important that when you're making a significant buying decision such as a real estate purchase, that you have a Realtor working in your corner and working towards YOUR best interests. We're not all the same.

Real estate topics in the news

2010-03-30T11:16:00.000-04:00

Here are some links from recent media sites on real estate-related topics.

Are we over-spending on our homes?
http://www.theglobeandmail.com/report-on-business/many-struggle-to-afford-their-homes/article1516948/

The rate hike(s) begin
http://www.theglobeandmail.com/report-on-business/mortgage-rate-boost-signals-rock-bottom-era-is-over/article1516497/

Balancing your debt
http://www.theglobeandmail.com/globe-investor/personal-finance/home-cents/how-to-avoid-taking-on-too-much-mortgage-debt/article1471079/

Worthwhile read on buying a condo - they're not all the same, with respect to the condo rules and regulations. Knowing what you can and cannot do before you make an offer will save you a lot of headaches and grief down the road.
http://www.nationalpost.com/homes/story.html?id=2730383

Interest Rate Rise Coming

2010-03-24T16:04:00.000-04:00

You can't really say that anyone who "predicted" the upcoming interest rate increase had foresight.
I mean, come on, they've been at historically record low levels for how long now? Did anyone really think they were going to go all they way to zero? They had only one direction in which to go! That's like someone "predicting" the stock market would drop while it was at record high levels. It's inevitable in both cases.

The historical average rate for interest has been around 7% so you can see that we've had it pretty darn good for quite awhile and now is the time to lock in your rates with a 5 year term.

In today's Star, they're calling for increases as needed to keep inflation in check.
Same thing in GlobeInvestorGold.

So, thinking of waiting? Got better things to do?
Thinking of putting off the purchase of your next house?

What's it going to cost you?
Per $100,000 of mortgage,

@ 3%, your monthly payment is about $473.25
@ 4%, your monthly payment is about $526.00
@ 7%, your monthly payment is about $700.42

Now granted, interest rates are highly unlikely to skyrocket over night, but it's definitely within reason to see rates rise to 7% within 5 years. So ask yourself, can your finances handle it if your mortgage payment almost doubles in 5 years?

Call me if you want to know of a few good mortgage brokers. Steven 905-831-9500
Lock in now and sleep well.

Restrictions for First-Time Buyers

2010-02-16T08:19:00.002-05:00

As mentioned several times previously, here in my blog, the media is saying that Canada's Finance Minister Jim Flaherty is set to table new rules today with restrictions on mortgage restrictions/qualifications for first-time buyers.
Most likely, we can expect to say goodbye to amortizations over 35 years and purchases with less than 5% down.
See this article in The Star.
Also, in the Globe and Mail.
And in the Financial Post.

Wednesday, February 17, 2010
More details From The Star
In the Financial Post, they're writing "Don't worry - the rules can still be bent" and that the "changes target reckless buyers"

Recent Real Estate in the News

2010-02-11T14:47:00.000-05:00

Some interesting reads in the area of real estate.......

Ottawa weighs stricter mortgage rules - Globe & Mail

The Wealthy Barber on carrying debt - Globe & Mail

Article on suggested mortgage restrictions/limits hints that the restrictions would be better off aimed at "who" rather than "what"

Riding the low interest rates - The Star

Where have the listings gone?

2010-02-10T17:08:00.001-05:00

While working on my regular mailings, I was providing a client with a comparison of the number of homes on the market this past January versus January 2009 and I was quite surprised by just how much of a difference exists between this year and last year. Here's an example:

In TREB district N03,
2009

232 homes on the market
25 sold
average price $600,000
average sale as a percent of list price: 94%

2010

93 homes on the market
36 sold
average price $639,500
average sale as a percent of list price: 100%

That means there were a whopping 60% fewer homes on the market in N03!
I know there's been an overall shortage of inventory across the GTA (on the order of 40% less, on average). So far, I have been unable to find any plausible reason to explain this, nor have I come across anything like that in TREB or in the media in general.

The smaller "inventory" means more buyer competition, hence the average house sold for LIST PRICE last month in N03!

Look at N06
2009

170 homes on the market
13 sold
average price $464,596
average sale as a percent of list price: 95%

2010

81 homes on the market - a 53% decrease in available inventory
21 sold
average price $649,929 - that's a whopping 40% increase in average price!
average sale as a percent of list price: 98%

Stay tuned

Advertising in a changing world

2010-01-26T16:51:00.000-05:00

As I twittered earlier today, it's a changing world with respect to TV ads. This link in the Toronto Star indicates that consumers are increasingly tuning out commercials.

Personally, I can attest to that because we often record our preferred shows and watch the recorded version so we can fast forward past the commercials. Some TV stations are just nuts with frequent commercials. Others string a seemingly huge number of them together. In an average hour-long TV show, 15-20 minutes is often credits & commercials. Zzzzzzzoom right past it all!

Which leads me to my next point on printed ads. It's been my experience over the last several years that they too, are dying a slow death, especially real estate ads. People just aren't looking at 1x2" photos of houses in newspapers anymore. Statistically, over 80% first start looking at houses online! It's no mystery why. Larger photos, more photos, more details and dimensions etc.

And since high-speed Internet is widely available *and* current, consumers are looking at properties almost as soon as they hit the market, not on a printed-media publishing/distribution schedule. If you look at what's hot and current - it's products and/or technologies that have instant contact - text messaging, email, cell phones, Twitter and the web in general.

As a Realtor, for far less than the cost of a single ad printed and distributed in a newspaper to a specific geographical market, I can create a dedicated website for that house with unlimited photos, details and global access *and* have it online for TWELVE MONTHS!

If you're selling your house, which kind of market penetration/coverage would you rather have? And that's just one of numerous things I do to market a house.

I find that many Realtors simply do what they've always done to sell a house (or what older Realtors have always done) - despite the fact that marketing and advertising media is changing in a big way. Some don't even believe in websites!

When you're thinking of hiring a Realtor to look after your best interests, be sure to ask them enough questions so you can determine that what they'll be doing to sell your house will help maximize buyer interest and return the best possible price to you.

2009 Christmas Lights - Houses worth seeing

2009-12-22T12:01:00.001-05:00

So Rosacea Court is not doing the Christmas lights mayhem this year - too bad - our loss.
Well, they still wrapped some trees with about 15,000 lights but there's no sound show and large scale extravaganza as in previous years. Here's their site.

So that means that the houses previously in second place, just got promoted. And having seen them just the other night, boy, they deserve it on their own merits!

Best Display!
Check out the houses on Ilona Park, in Pickering. Here's a map.
Here's what the Star says about them.
I have to go back with my DSLR and take some good pictures - it's worth the re-visit!

Also streets worth seeing nearby
Map: Eyer Drive
Map: Vicki Drive

Got any other locations worth seeing?
Post them here and I'd be happy to add them to the list.
Merry Christmas!

Why you should consider buying and/or selling early in 2010

2009-12-21T20:00:00.001-05:00

Often times, you'll heard Realtors say that "now is the best time to buy/sell real estate". And that's whether you asked them 5 years ago or 5 minutes ago.

But I believe that this time, I can make a stronger case for you, rather than just the age-old reason "because no one can predict the future and the market might be worse later than it is now". Who's got that crystal ball, right?

And now you're asking what makes me think that *this* time is any different?
Well, a number of reasons, actually. A recent new law bringing the HST into effect in mid 2010 plus some recent articles in the media have prompted me to advise my clients, past clients and prospects that this next 3-6 months would be worthwhile in terms of putting more money in their pockets.

Reason #1 - HST is definitely coming - There's no longer a chance that it will go away. Despite pressure against the government from a number of sources, including the real estate segment, it was just recently passed into law and comes into effect in mid-2010 (June?).

(Note: This is not a condemnation nor endorsement of the HST. It's an acknowledgement that it's now on the way and here's how you, the consumer, can benefit in the short term.)

How does it affect the real estate segment? Well, it means that in addition to GST, now PST will also be tacked on to real estate costs such as Realtor commissions, home inspections, legal fees, and all those other trades/skills that people use, either in a real estate transaction or before or after it, including cleaning services, painters, gardeners, moving companies, handymen services etc. - any of these kinds of services that you could have used either to spruce up your house before selling or just after buying - they're all going to cost you 8% more with HST.

Combined, it adds up to almost a couple thousand dollars just in the additional taxes coming out of your pocket.
Selling a $400,000 house is going to cost you about an extra $1,700 in PST charges alone!
Wouldn't you rather save that $1,700 and use it to hire a painter to paint your new house? You can get quite a nice patio set at Costco in that price range.

And you can, just by selling your house before that HST kicks in!

Reason #2 - the feds plan to tighten the money supply!

It was in today's media

The Star
The Globe (1) - observers warn of the risks
The National Pos t - Flaherty ready to deflate any bubble

The feds are pondering some changes to access to mortgage money as a means to try to reduce the amount of debt that Canadians have been getting themselves into. Previously they eliminated the no-money down financing and the 40-year amortizations. Now, they're talking about rescinding the 5%-down purchase option as well as eliminate the 35-year amortization.

"But Steve...", you start to say, "...we've got more than 5% down and don't need a 35-year amortization, so it doesn't really apply to us". Well, maybe not to you as a buyer - but if it's going to dry up or reduce the number of buyers out there competing to buy YOUR house, doesn't that matter to you?

Of course it does!

If the government were planning to stifle the buyers' market out there, and reduce the competition for your house (which could translate into you getting less money for your house), wouldn't you want to get the best bucks for your house and sell before the government steps in?

I know I sure would!

I want to help you get the best possible price for your house and that's exactly why I'm advising that listing it as soon as possible in the new year is in your best interests (rather than delaying it). It's more money in your pocket in several ways

Reducing the amount you pay in taxes by selling/buying before mid-2010 and
Selling before the government tightens or even kills the buyers' market through mortgage and interest changes
Capitalizing on the surge of available buyers, who themselves, are likely sellers and want to save a few bucks, too!

Real Estate articles

2009-12-09T19:58:00.000-05:00

Here are some links to recent real estate articles

3 bedroom condos - ha! About as rare as a Maple Leaf win

2 key factors to consider in your real estate purchase - future price of gas and rising interest rates

Reno mistakes - top 5 you can make....or not

Jump in, jump out....or jump up to something more?

What they got? Recent sales around the GTA

Disclosure - good for all parties!

Looking for value for your real estate dollar? It's in Pickering!

2009-11-13T09:30:00.000-05:00

A recent study by Coldwell Banker Terrequity suggests that Pickering offers the best bang for the buck in terms of GTA real estate value. It reports that a comparable 2,200 square foot home costs about 1/3 the price of what it does in central Toronto. For the full article in the Star, click here.

Beware the coming HST

2009-11-13T09:21:00.000-05:00

As TREB president Tom Lebour writes in his column in the Star, the forthcoming harmonization of PST and GST taxes into the HST is going to add significantly to cost of purchasing a home, beyond just the purchase price itself. Read the full article here.

That may (somewhat) help explain the higher than average number of sales as we heading into what has historically been the slow period of real estate sales (Christmas). That's likely a factor, along with historically low interest rates and a significantly lower than normal amount of homes on the market.

Market Update: Focus on Whitby

2009-11-09T14:27:00.000-05:00

From time to time, I plan to do a sale activity focus on a particular market segment and in this instance, I'll cover Whitby.

In October, 84 of 128 listed detached homes were sold (65%) at an average price of $342,137 [Note: 65% and higher indicates a Sellers' Market]
To compare, in October 2008, 60 of 312 homes were sold (19%) at an average price of $327,104 [Note: Less than 45% indicates a Buyer's Market]
The average Days On Market (DOM)

October 2008: 41
October 2009: 20

So several things immediately come to light

there are considerably fewer detached homes on the market this year, than last (almost 60% fewer!)
the actual number of homes sold is up 40% over last year
the average price is up, most likely influenced by the relative shortage of homes on the market

But it's not like that across the board in Whitby.
To compare, let look at condo townhomes.

In 2009, 11 of 19 (58%) sold for an average $206,355
In 2008, 15 of 31 (48%) sold for an average $206,477

So prices for condo townhomes in Whitby haven't risen much, if at all over last year even though there are almost 40% fewer on the market. Sales are actually down 27% over October last year too, which also helps account for the lack of change in average selling price.

In comparison, across the GTA, the average sale price was up 20% over last year, to $423,559 and the number of homes sold (all types) jumped 64% to 8,476 this year.

~~~

Know What You're Buying

2009-09-27T13:23:00.000-04:00

While the local real estate industry has made good strides over the years to improve how people buy and sell homes, there's still a "caveat emptor" (buyer beware) aspect to it.

For example, in the case of buying a power of sale home from a lender, were you aware that the previous home owner (the one in default on the mortgage) actually has up to and including the closing day to come up with funds to redeem their house? It's called "Right to Redeem".

So if you bought one of these houses with say, a 60 day close, then sell your house firm, you could find out in that time period that you're not going to get the house and since you've already sold yours, you have no place to live, come closing day.

Another example - If you buy a house that's listed in "as is" condition, were you aware that that could mean that it's not even legally inhabitable?

Don't rush into a home buying decision that might not be right for you. Make sure that you and your Realtor both do your homework to help ensure that you find the kind of home that's right for you.

Home Insurance - Look Closely!

2009-09-11T08:26:00.000-04:00

Here's a good article in TheStar.ca's "Your Home" section on the value of checking your insurance needs and coverage before/during an offer. People sometimes assume that every house is insurable and that it's a commodity. But insurance could also help you determine if there had been previous claims on that house that you might want to know about.
Read more here.

This Market Has Legs!

2009-09-03T08:31:00.004-04:00

Housing Market on Robust Rebound

The numbers are in for August, and like June and July before them, TREB is reporting that sales were up 27% over the previous August.

Despite the very dismal first few months of the year, year-to-date sales for the first 8 months of the year are now running at 2% HIGHER than 2008. That's quite the catch-up from the start of the year!

The average price is up less than 1/2% over last year, currently at $385,978

Interestingly, active listings are actually down 37% over last year - which, to me anyway, explains the rapid sales that are happening; more buyer competing for fewer homes.

An example of this is a house in Whitby, on Lofthouse. I had still had it on my watch-list from some previous buyers and it sat on the market for 73 days at the original price of $349,900 and then all of a sudden, there's a bidding war on it and it sells over asking price!

In Pickering, the hottest market segment is detached houses in South Pickering. Last month, 100% of the 17 detached homes were sold, 75% of the semi-detached were sold.

In terms of buyers or seller's market, here's the guideline

If less than 45% of available listings sell, it's a "Buyer's Market"
If 45-65% of available listings sell, it's "Balanced Market"
If over 65% of available listings sell, it's a "Seller's Market"

In E12 (South Pickering), for detached homes, it was 100%, for semis, it was 75%
In E13, for detached homes it was 48% and 100% respectively.

I've been showing some condos downtown recently, in C08 (south of Bloor, east of Yonge) and they've been flying out the door. Last month, 72% of listings sold for an average of 101% of list price!

A Word of Caution on Gift Cards
Finally, a word of warning when buying gift cards.
Especially if you pay cash.
It seems that some unscrupulous cashiers have not actually been putting the purchased amount ON the card and just pocket the cash.

When you buy a gift card with some money on it, ask the cashier to swipe the card and show you the money is there.

Recent Real Estate articles

2009-08-16T10:58:00.002-04:00

The Big Bucks are Back

Update on Condo development at 1 Bloor - Note that there's no guarantee that buyer deposits for this failed development will be returned in full, or even at all! Condo buyers of new, unbuilt units, should discuss the agreement with their lawyer *before* signing, to ensure that they can get their deposits back, without penalty, if the builder cannot develop the agreed upon condominium. Also, buyers should be aware of whether the builder has the option to sell the development to another builder without giving you the option to bail. Completion of a new development is not an automatic, foregone conclusion. Know your rights!

Market strength fools the experts - Even CMHC, which had forecast a down year in real estate this year was fooled by the strong surge - around mid-August, total sales YTD now exceeded the comparable YTD sales for last year. And that's despite sales in January and February being off 50% from last year!

July sales break another record!

2009-08-06T14:08:00.004-04:00

What a peculiar year it's been. At the start, in January and February, it looked like sales were going to drop right off the map, with transactions being down around 50% compared to the previous year.

But that was short-lived.

Following in record-breaking June's footsteps (up 26%), July has similarly set the all-time record for resales in July with 9.967 homes sold - up a whopping 28% over last July! The average price was up 6% to $395,414.

Homeowners are clearly feeling confident about the combination of an economic recovery and record-low interest rates to jump back into the real estate market with gusto.

Instead of the usual summer-slowdown in real estate sales, they've turned into the busiest months so far this year!

As a matter of fact, despite the steep drop-off in sales to start the year, total sales year-to-date are only down a mere 1.2% from last year!

Searching the GTA PLUS for you!

2009-07-26T18:05:00.002-04:00

On Tuesday, July 28th, members of TREB (Toronto Real Estate Board) will have beta access to a new system. Here's an excerpt of the announcement we received....

CONNECT is a joint venture of the Toronto Real Estate Board, REALTORS® Association of Hamilton-Burlington, the London and St. Thomas Association of REALTORS® and the Ottawa Real Estate Board. It offers all REALTOR® members, Unlicensed Assistants and Brokerage Administrators from participating boards the ability to search and view active listings and recent sales history of all other participating boards in their own local MLS® format.

CONNECT is not an MLS system – it provides access to more information in an efficient manner. Members will have the ability to search and view 2 years of Active, Sold, Conditional Sold and Pending Sold information for all listing classes except for Commercial, which will have 4 years of history.

What does this mean for you?

Well, now your TREB Realtor will have access to a much broader geography of real estate properties. Currently we can see listings (and history) as far west as Oakville - Highway 6 and the Oakville/Burlington Townline.

Going forward, we'll also have access to listings (and two years of history) in

Burlington,
Hamilton,
St. Thomas and
London in the west
and in the "far" east, Ottawa!

Note that this isn't an amalgation of systems or boards but rather a collaboration to share information.

How is this different from REALTOR.CA (formerly MLS.CA)?

Well, that system (REALTOR.CA) is a Canada-wide system aimed at the consumer, offered by the Canadian Real Estate Association (CREA). All member boards of CREA can upload their board-specific listing information into that national system for access by the broader public.

Since every board uses their own selected software and database, some have more and/or different information than others so only a common set of information appears on REALTOR.CA.

In addition, REALTOR.CA shows only current listings without any sold information.

With this new CONNECT system, your Realtor will also be able to access up to two years of historical information on properties in those areas as well.

Call your local Realtor (me?) for more information.

Protect your own interests, first!

2009-07-04T11:58:00.002-04:00

There's an interesting article in today's online "paper" that talks about someone lending their name to a real estate transaction over the lure of cheap & easy money. Read it here.

Per the old saying, if it sounds too good to be true, it probably is.
Your credit rating is extremely important to you and you should do everything that you can, to protect it. Who accesses your credit rating? Not just credit card companies. Insurance companies have hinted that they're trying (or are) connecting their insurance rates to your credit rating; that people with lousier credit tend to also be higher insurance risks. Also, I have heard (but don't know for sure) that some employers run credit checks on their prospective employees as part of a security check.

Pricing in a changing market

2009-06-15T08:39:00.002-04:00

It's always interesting to see how home sellers view the pricing of their homes.
Of course, most sellers believe their house is worth more than it actually is. Heck, I'm no different with my own house!

Often times sellers will want to list their house at a higher price than is realistic. The common logic behind this is the assumption that all offers occur at a fixed portion/percent of the asking price (I.e. 95% of the list price). So the rationale goes that "the higher I list, the higher I will sell for"

But that's not the case.
House prices are set by the market forces - what buyers and sellers *agree* that a house is worth. That's when a sale happens and that's when "market value" is established.

The further away a list price is from "market value", the lower the offer (if any) it will attract. Buyers and Realtors recognize over-priced homes and make offers accordingly.
All they have to do is see what comparable homes have been selling for recently, in the same area.

And when a seller reduces their list price to closer to market value, the offers that come in, start off closer to the asking price because buyers recognize the value.

Finally, when a seller lists their home *below* the market value, that's when multiple offers (bidding wars) occur.

Has anyone ever seen a bidding war start on an over-priced house?
Nope.

So as the list price comes down, the initial offer price comes up.
They meet around "market value" and then if they were to continue their respective paths, and the list price drops below market value, the offer price can actually move *above* market value! And that's often when you have multiple buyers wanting in on the "deal".

That's the effect of open market forces on the real estate market.

The new "safe haven"?

2009-05-12T11:36:00.003-04:00

Ok, so the stock market has tanked and the "average Joe's" retirement portfolio has lost over 40% of its value. Some large banks and investment houses as well as a few commercial "pillars of our economy", previously thought of as "unsinkable" have sunk or are in the process of sinking.

Banks and bonds are returning near-zero on investments.

For a lot of baby boomers, the maximum insured amount on bank balances doesn't cover all of their savings.

Where can you safely put your money *and* get some sort of return on it?

Have you considered real estate?

Look at it this way....

stocks prices can (and do) fall to zero or near-zero values
bonds are only as good as the viability of the issuing institution - I.e. if GM or Chrysler file for bankruptcy, what does that make their bonds worth?
banks? - they're no longer an infallible, safe haven. And what return do you get on your savings? Peanuts at best!
unlike stocks, when have real estate prices ever fallen to zero, or even dramatically at all? (not including real estate near Three Mile Island!)
the market in general has plumetted over 40% but local real estate prices have barely dropped 6% and the markets are already coming back!
You'd be hard pressed to get a bank to loan you 50% of the money to buy stocks (I.e. on margin) but with 20% down, you can still pretty easily borrow the remaining 80% to buy a house

Why? Because even the lenders recognize that real estate is virtually a "safe play". The biggest risk to lenders is not that the property becomes worthless. Their biggest risk is YOU - whether you'll continue making mortgage and tax payments.

So if you know you're a "safe bet" to make those payments, then the low-risk investment play of the day is obviously real estate.

Another option - buy a place and rent out either all or a portion of it and have someone else pay your mortgage!

Do your own due diligence on this thinking.
One book worth reading is "Real Estate Riches" by Dolf de Roos ($17 USD)
Check it out on Amazon.com

Real estate articles worth reading

2009-05-10T10:22:00.002-04:00

Here are some interesting articles that I've come across recently.

Real estate experts see silver lining
http://www.yourhome.ca/homes/article/630298

Simple home staging tips
http://www.yourhome.ca/homes/article/629975

Composite deck advantages
http://www.yourhome.ca/homes/article/630278

Cottage purchases need a special expertise - don't use a city realtor!
http://www.yourhome.ca/homes/article/630284

"White-box homes" - Are they coming?
http://www.yourhome.ca/homes/article/626564

More on cottages - keeping a cottage in the family? Get professional advice.
http://www.yourhome.ca/homes/article/619139

New Home Buyers Beware

2009-04-25T18:49:00.002-04:00

I always warn any of my buyer-clients who are considering a new home from a builder that they should insist that any offer they make should be conditional on them reviewing it with their lawyer.

I'm not saying that buying new is a bad thing - but buyers should remember that sales people working on behalf of a new home builder are not required to be licensed real estate agents so they have no governing body like RECO to oversee them and have no Code of Ethics to abide by.

This article in The Star is a perfect example of some of the things to be aware of.
(including a 39 page purchase offer!!!!)

http://www.yourhome.ca/homes/article/622890

Is your neighbourhood up or down recently?
http://beta.theglobeandmail.com/globe-investor/early-signs-of-a-rebound/article1061236/

Is the Spring market already starting to thaw? Click here.

Real Estate articles worth a look

2009-04-16T07:40:00.005-04:00

The Spring real estate market appears to be gaining steam once again.
Or, put another way, the previous market descent has slowed down and almost levelled off.

But either way you put it, I'm finding that both buyers and sellers have been finding their way back into the real estate market in the GTA. The fear mongerers are put off by this of course.
But when you compare how the lenders work in Canada vs. the U.S., you can see why their artificially created housing bubble never materialized here.

People will often say that we follow the U.S. economy, or we're in lockstep with them, or we lag behind whatever happens there, but if the business rules are different, or in this case, the lending rules, then what happens there isn't necessarily going to happen verbatim, up here.

In the U.S., pretty much anyone with a pulse could previously qualify for a mortgage. That hasn't been the case here.

So I suspect that in large part, our real estate market slowdown was created by fears of what happened in the U.S. - not by anything that actually *happened* here.
Are we feeling the economic slowdowns? Of course.
Is the real estate market getting or going to get pasted, like the U.S. one?
I don't think so.

Enjoy the following articles.

Buyers gain upper hand in real estate market
http://www.yourhome.ca/homes/article/618464

The provincial "green" legislation carries some scary powers - why?
http://www.yourhome.ca/homes/article/600663

Home tips
http://www.yourhome.ca/homes/article/429364

RBC says home ownership is more affordable
http://www.yourhome.ca/homes/article/619400

Spring housing market showing signs of life
http://www.yourhome.ca/homes/article/619146

New provincial real estate tax

2009-03-26T10:02:00.004-04:00

Across Ontario, when Joe Public sells his house, he is going to be paying an average of $1,500 in additional taxes to the provincial government when this PST/GST "Harmonization" takes effect.

Based on total home sales last year, and using the average sale price as a guide, it will mean over $100 million in additional revenue to the provincial government.
How is this "simpler", as they say, for the consumer?

At a time when the economy is struggling and the real estate market is still in a decline, a new tax is not going to help things.

More articles about it.......

Blended tax drives up costs for both new and resale home buyers in Ontario

Ontarians to receive $1,000 tax trade-offWhat the #!%* is sales tax harmonization?

Ontario in decline

Down but not out

2009-03-14T10:14:00.004-04:00

The February numbers are in and although the number of sales declined over the previous February, the amount of the decline was less than that in November-January.

Some interesting articles...

Royal LePage says the slump is at the half-way point already. Article

The Globe and Mail probably has the most comprehensive real estate section. Numerous articles worth perusing over your morning coffee. Click Here

Yourhome.ca writes how Spring is the usual barometer for the housing market economy. Article
But I hugely object to their statement that the bidding wars were "gleefully orchestrated by real estate agents". There are bad apples in every bushel. Were some "orchestrated"? I suspect so. Were all 28,000+ Realtors doing it? Not at all.

A bidding war can almost be created at any time, in any market simply by deliberately setting the list price below market value in a neighbourhood. With more than 75% of buyers first looking at houses online before hitting the streets, the Internet has brought these listings in almost everyone's home - even for casual reading. I know several friends who simply love browsing the homes currently on the market. So more people than ever before are looking at these listings and when an unusual bargain hits the market, the multiple offers appear.

As an example, just recently I was involved in a multiple offer situation on behalf of buyers for a nice home in Scarborough. Compared to what else was on the market in Scarborough in that price range, this house was quite the bargain. The result? Seven offers were registered on that house and on offer presentation night, there were over a dozen cars parked on the street with agents and their buyers scurrying back and forth between cars to consult. Nothing about that was "orchestrated by agents" whatsoever.

It's funny but often times, sellers believe that the higher they set their asking price, they'll received a correspondingly higher offer. Not so.

Buyers comparison shop.
The more out of whack the list price is with area comparables, the greater the likelihood that they'll attract low-ball offers or no offers at all.

As the list price moves closer to the real market value, so too, do the resulting offers. And the number of offers will often increase, too!

And when the list price moves *below* market value, that's usually when you're going to get multiple offers and offers that exceed the list price.

So more than ever, in a market with fewer buyers, I advise my sellers that setting a very realistic list price is key to getting the buyers in your door and offers on your table.

Interest is still in the market!

2009-03-06T08:33:00.002-05:00

As the Spring real estate market begins to open up, I see some conflicting signs about the health of local real estate.

On the one hand, on behalf of buyer clients, just the other evening, I was presenting an offer that was 5th of 7 registered on a Scarborough home. Interest was incredible as in the days preceding the offer presentation, people seemed to be swarming over it like ants on a doughnut. The listing agent told me that they had been averaging 8-10 showings per day since it went on the market!

I've heard some similar stories from colleagues; how interest in certain geographical pockets is as strong as ever, if not even more, as bargain hunters appear to be on the loose with record-low financing rates.

Yet, on the other hand, we have the latest TREB statistics released for February now, which indicates that home sales have fallen 33% over the previous February.
Here's a recent article from The Star's site. http://www.yourhome.ca/homes/article/597391.
The average selling price was down 5% from last year to $361,305.

With prices cooling off a bit and interest rates at record lows, it really is an amazingly good time to be shopping for a house.

First time buyers get a break on both the City of Toronto and provincial Land Transfer Taxes and sellers are much more willing to actually negotiate than in recent years.

And still, like always, the best homes at the best prices are going fast.
It's that old analogy from the grocery store.

If you're buying apples, you peruse what's available, pick through them and at that price, you pick the best looking, shiniest apples and skip the rest.
The following shoppers look over what's left and if there's nothing that interests them at that price, they pass and wait for either the produce manager to lower the price for the lower quality apples that remain, or they wait for new apples to hit the market and start picking through them all over again.

The housing market is no different.

Real Estate Articles in the News

2009-02-10T07:18:00.002-05:00

Here are some links to recent real estate articles in the media......

Loss of Confidence Swamps Housing Market

Condo Buyer Makes His a Double

A Burst of Action in an Idle Market

Four percent Tax Hike Expected for Toronto Homeowners

Home Prices to Fall by Eight Percent This Year

Second thoughts pre-listing spruce-up

2009-01-25T17:15:00.002-05:00

Have you been thinking of selling your house this year?
Have you also been thinking of doing some spruce up work around the house before you list it, to help you maximize your return?

Nothing wrong with that....mostly.

In the past, "up" market, sellers were usually advised to spruce-up their house before putting it on the market to help them net as much as possible on their home. And it also helps when competing against other homes.

However, we're in a market where prices are decreasing. Across the country, the average decline was 11% last year. So for this example, let's also say they're falling 1% per month.

Let's use fictitious Jack & Jill living in their $350,000 house in this example, too.

Jack & Jill are planning a spruce-up on their house before listing. They figure it'll take them one month to do that.
In that one month, the price of their house will decrease about $3,500.

So if their spruce-up efforts only add $3,500 to their selling price, they will have only broken even by doing it. They won't put any additional money in their pocket by doing it. The best they could hope for is that it makes the house look better than their competition and therefore helps it sell faster.

But there are more variables at work here.
Let's say that by waiting the extra month, they're now in the prime listing period of the calendar year (March-June) and now, additional homes have come onto the market in their area. That means more competition for fewer buyers.

It's not an automatic win anymore to hold off on listing to do some sprucing up. Give me a call to discuss your plans and I'll help you work through them.

Calculating the Toronto Land Transfer Tax

2008-12-31T14:33:00.003-05:00

Straight from TREB, here's several ways to calculate the Land Transfer taxes (both provincial and city of Toronto). While not identical calculations, they're pretty close.

Provincial Land Transfer Tax
(Applies to all Ontario properties, including Toronto)

0.5% on the first $55,000
plus 1.0% of the amount from $55,001 to $250,000
plus 1.5% of the amount in excess of $250,001 to $400,000
plus 2.0% of the amount in excess of $400,000

Toronto Land Transfer Tax
(Applies to Toronto properties only)

0.5% on the first $55,000
plus 1.0% of the amount from $55,001 to $400,000
plus 2.0% of the amount in excess of $400,000

Use the following formula:
(Provincial land transfer tax only)

Purchase Price	Calculation of LTT
0 - 55,000	.005 x Amount
55,001 - 250,000	(.01 x Amount) minus 275
250,001 - 400,000	(.015 x Amount) minus 1,525
400,000 +	(.02 x Amount) minus 3,525

If the purchase price falls within this range, then apply formula to purchase price

(e.g. on a $175,000 home (.01 X 175,000) minus 275=LTT)

4. LTT Reference Table

The following numbers are for reference only. Your individual land transfer tax calculation should be calculated and verified by your solicitor. The following chart is based on the Land Transfer Tax (LTT) levied by the Province of Ontario as at May 1996, and the City of Toronto land transfer tax, which takes effect on February 1, 2008. Please note that the provincial and Toronto land transfer taxes can be amended by the Province and Toronto City Council.

Purchase Price	Provincial LTT (Applies to all Ontario Properties, including Toronto)	Toronto LTT (Applies to Toronto Properties only)
$55,000	$275	$275
$60,000	$325	$325
$65,000	$375	$375
$70,000	$425	$425
$75,000	$475	$475
$80,000	$525	$525
$85,000	$575	$575
$90,000	$625	$625
$95,000	$675	$675
$100,000	$725	$725
$105,000	$775	$775
$110,000	$825	$825
$115,000	$875	$875
$120,000	$925	$925
$125,000	$975	$975
$130,000	$1,025	$1,025
$135,000	$1,075	$1,075
$140,000	$1,125	$1,125
$145,000	$1,175	$1,175
$150,000	$1,225	$1,225
$155,000	$1,275	$1,275
$160,000	$1,325	$1,325
$165,000	$1,375	$1,375
$170,000	$1,425	$1,425
$175,000	$1,475	$1,475
$180,000	$1,525	$1,525
$185,000	$1,575	$1,575
$190,000	$1,625	$1,625
$195,000	$1,675	$1,675
$200,000	$1,725	$1,725
$205,000	$1,775	$1,775
$210,000	$1,825	$1,825
$215,000	$1,875	$1,875
$220,000	$1,925	$1,925
$225,000	$1,975	$1,975
$230,000	$2,025	$2,025
$235,000	$2,075	$2,075
$240,000	$2,125	$2,125
$245,000	$2,175	$2,175
$250,000	$2,225	$2,225
$255,000	$2,300	$2,275
$260,000	$2,375	$2,325
$265,000	$2,450	$2,375
$270,000	$2,525	$2,425
$275,000	$2,600	$2,475
$280,000	$2,675	$2,525
$285,000	$2,750	$2,575
$290,000	$2,825	$2,625
$295,000	$2,900	$2,675
$300,000	$2,975	$2,725
$305,000	$3,050	$2,775
$310,000	$3,125	$2,825
$315,000	$3,200	$2,875
$320,000	$3,275	$2,925
$325,000	$3,350	$2,975
$330,000	$3,425	$3,025
$335,000	$3,500	$3,075
$340,000	$3,575	$3,125
$345,000	$3,650	$3,175
$350,000	$3,725	$3,225
$400,000	$4,475	$3,725
$450,000	$5,475	$4,725
$500,000	$6,475	$5,725
$550,000	$7,475	$6,625
$600,000	$8,475	$7,725
$650,000	$9,475	$8,725
$700,000	$10,475	$9,725
$750,000	$11,475	$10,725
$800,000	$12,475	$11,725
$850,000	$13,475	$12,725
$900,000	$14,475	$13,725
$950,000	$15,475	$14,725
$1,000,000	$16,475	$15,725
see calculation chart at top of page

For additional information please contact the Ontario Ministry of Finance at 905-433-6361 (for provincial land transfer tax questions) or the City of Toronto at 416-338-0338 (for Toronto land transfer tax questions). The Toronto Real Estate Board assumes no responsibility for the accuracy or completeness of the information set out in this section.

Christmas Lights 2008!

2008-12-22T09:16:00.003-05:00

Interested in checking out some exceptionally decorated Christmas homes in the GTA?

We are too!

Here are some of our favourite picks.
Please add your own streets that you feel are worth seeing - we'd love to check them out!

#1 Pick - 4 Rosea Court in Richmond Hill - over 50,000 lights this year! Visit http://www.lindsaylights.com/ for more info. It's actually a very active light show - tune your radio to 104.9 FM for the music. Clark Griswald, step aside. Here's a map.

Are you near South Pickering? Then check out several streets on each side of Frenchman's Bay. On the east side, there several well-done homes on Ilona Park Road. Here's a map. One house in particular here, was just covered in the Toronto Star - click here for the article.

And on the west side of the bay, several streets including Vicki Drive, make the trip worthwhile. Here's this map.

If you send me directions to any other gems, I'd be happy to post them here, too!

From a photography-interest side of things, if you've taken some good night pics of Christmas lights, I'd love to both see them and hear what settings you used to take the pics. I'm always interested in comparing photography notes.

Recent Real Estate Articles in the Media

2008-12-11T16:47:00.004-05:00

Here are some interesting real estate articles that I've come across this week....

On the importance of home staging in a down market - click here
And another one - click here
On dealing with a buyer's market - click here
Pros and cons of a back-split - click here
On how Mayor Miller's city of Toronto tax helped kill the market - click here
On falling home prices - click here
A good warning on the merits of a home inspection - click here - it also gives a great example of why you should turn off your water when you take a winter vacation!

Enjoy!

How to Not Sell Your House

2008-11-24T10:23:00.005-05:00

This note is a follow-up to my previous one on the advantages of Home Staging, but in a somewhat opposite manner.

Sometimes I come out of a listed house wondering "what were they thinking?". When people are trying to sell their house, you'd think that they would want as much money for it as possible. After all, it's a huge investment.
Especially now - there's more competition on the market for buyers to choose from.
In addition, one would think sellers want to sell as quickly as possible.

Yet I come across *all* kinds of crap out there. Yes, crap - such as people (adults) actually living in a unfinished basement crawl space - even WHILE buyers are coming through! White shag-rugs with a strange red stain so large that it looks like a scene from a CSI episode. Hideously, loud paint colours. Prominent tributes to deceased family, friends or relatives. Urns with cremated remains of a human and/or pet sitting on the mantle. Sometimes I wonder if people are actually trying to SELL their house or just scare the bejeepers out of all who visit.

So thinking back to some of the things that my buyers and I have seen, here are my "tips" for how to NOT sell your house.

Don't clean up. Thirty-three pairs of family shoes in the foyer - that's the most I've ever seen so far, and yes, I had to count. Dirty ashtrays, clothes on the floor, socks in the living room, uncleaned kitty-litter pans, old newspapers, empty beer bottles all strewn around - just begs for a offer-bidding war, doesn't it?
Don't de-clutter. All this does is tell buyers "Hmmm, there's not much space in this house. We need to look elsewhere".
Don't de-personalize. That picture of your charming niece is someone else's "Ugly Betty". Why distract buyers from the real reason they're there?
Don't re-paint - by far the most inexpensive way to get more money for your house. This isn't about being proud of your daughter's hot pink bedroom choice. It's about neutralizing the house so buyers can picture *themselves* living there.
Don't air it out - Cook something nasty, even just boil a cabbage - very little chases buyers out of a house faster than an odour.
Leave dirty dishes out everywhere. Dishes in the sink or dishwasher are understandable. People are very busy these days. But dirty dishes everywhere else just says "Animal House" - lowball offer! Maybe leave a bucket of fried chicken out for the guests!
Leave dirty laundry out. Imagine going into a room to see dirty clothes littering the floor or a g-string the size of Neptune hanging on a laundry string! A nice, open, fermenting bag of hockey equipment is a nice touch.
Don't clean the windows. Just another implication that the house hasn't been cared for and therefore is worth considerably less than you want to receive.
Don't turn on the lights. Sure. You want to sell a house worth hundreds of thousands of dollars and at the same time save 50 cents by not leaving the lights on for an hour!
Don't open the drapes. Great - if you're selling a cave!
Don't clean the yard. Nothing sells a house like an old bath tub or car growing in the yard or having the buyers trip over something or step in dog-doo-doo.
Leave Uncle George's ashes on the mantle. You can't imagine how fast this can spook home buyers right out of the house.
Leave unfriendly pets in the house. Nothing says "Buy me" like a crazed dog threatening to tear down a door to gnosh on your leg. It's a great way to appeal to the buyers who don't like animals.
Don't shovel the walk/mow the lawn - imply how unkempt the rest of the house is - a great way to say "Don't come in!"
Use compact fluorescent bulbs and/or under-wattage bulbs. Sure, CFLs save money but the bluish tint they cast in your home isn't the most pleasing. For the duration you have the house on the market, make it look warm and inviting - use incandescent bulbs *and* brightly light everything. Pack those CFL bad boys in your moving cartons to take with you. Heck, I'll even pay for the bulbs!
Don't replace burnt out bulbs. Just let buyers guess what your place looks like!
Don't clean sticky/dirty floors/carpets. In one house, I had my stock almost pulled off my foot because it got stuck to something nasty-sticky on a hardwood floor - yum!
Don't use a Realtor. In large part, getting the best price comes from the having your house receive the widest exposure possible. The only ones looking at sell-it-yourself sites are bargain hunters - in effect, you're targetting the cheapie buyers who are likely going to offer you even less!
Stay home during a tour. Showing them what *you* want them to see, rather than let them see what *they* want to see. Yeah, that's smart. Your presence also inhibits their own open conversation and their need to open cabinets and closets. And it makes them feel like you're hiding something, by trying to control the tour.
Leave your choice of music playing. Not everyone appreciate rap or even classical music. You're not selling them on your big-azz stereo or musical tastes. Let buyers talk about the house in peace.
Leave your family pictures on display - I had a client who *loved* one condo but abruptly and absolutely refused to make an offer once he saw a picture of the current owners. "Our type of people hate their type of people" he said - "But they don't come with the house!", I explained. No use. Never have I seen an about-turn faster than that.
Post lousy pictures with your listing. And some people wonder why no one is touring the house? Have a look below at some pics I've seen with real listings.
Smoke like a chimney inside - Next to a bad cooking-related odour, I would say that the smell of embedded old/stale cigarette smoke drives buyers out of a house (especially non-smokers), unbelievably fast.

I'm always willing to offer suggestions on how to sell your house for the best possible price, in the shortest period of time. Sometimes, it may require a little extra work on the sellers' part to get there, but time and again, I've seen that it's worth it to them.

Stage it!

2008-11-23T14:27:00.002-05:00

I was pleased to read an column from the TREB President, Maureen O'Neill on the merits of home staging.

Why? I've been providing FREE professional Home Staging to my clients for the past 5 years!
Want to see a great example?
Check out www.32Leamington.com

Many other realtors will either dismiss it or suggest someone to you so *you* can pay for it, or they'll claim they can do it themselves.

Your house is likely one of the biggest investments in your life! Isn't it worth it to try and put a little extra money in your pocket by having a professional do it?

Currently there are over 26,000 properties listed on the TREB system - a whopping increase of 26% over this time last year! And this is at a time when listings typically DECREASE because many sellers know that there are fewer buyers at this time of year *and* they don't want people traipsing through their house around Christmas.

If you're selling your house, don't you want to
a) sell it as quickly as possible and
b) try to get as much money for as possible?

The average "days on market" (DOM) has increased from 31 days at this time last year to 37 days!

There are fewer buyers out there today. I'm doing my best to snag one them for your house!

If you would like to receive a free copy of that Home Staging column, just send me an email and I'll get it to you ASAP.

Retirement and Real Estate

2008-10-30T11:13:00.002-04:00

In my previous entry, I lightly touched on the retirement and real estate connection and voila, here's an article on thestar.com that covers it a bit more in depth.

Something to keep in mind when you're thinking about a retirement home in some other area.
As we age, our medical/specialist needs are likely to increase, too. So when you're thinking "Gee, that place way out in the country would be a great, inexpensive place to retire", make sure that you also give some thought to

how far is the medical treatment I might need?
is that kind of specialty even available in that area?

We have friends who moved out to the countryside, but still have to drive into town to get regular medical treatments. Likewise, we also have some friends who are contemplating a retirement move out into the country but their current medical-specialist requirements are keeping them here, where these services are available, nearby.

On another consideration, while I could easily see us eventually retiring into something smaller in the country or "near-country", I could never give up high-speed Internet - that's a big factor on our own list.

So while considering your real estate-related retirement options, take a step back and look at the larger picture per your personal needs. There's more to it than just the house.

Real Estate Articles of interest

2008-10-28T16:25:00.003-04:00

Here are some links to interesting articles and their points of view.

In GlobeInvestorGold.com, this article says "....As of August, there were more condos under construction in both Toronto and Vancouver separately than there were in all Canadian cities combined a decade ago..." and makes a connection between what's currently happening in the Canadian real estate market and the U.S. market of two years ago, in effect, a 2 year lag.

The National Post has an article that, among other things, touched having the vision of knowing when to buy and sell real estate - not wanting to sell at the bottom etc.

But guess what, if you're upsizing, you're also BUYING at the bottom - so while you may be getting less for your own house than you had hoped, you're also likely going to make a decent score on that house you're buying up into.

It's no different than buying stocks. The only reason to sell at the bottom is because you want to buy something else that's down, that has a great chance of rising higher and faster than the stock you're selling.

Otherwise, to paraphrase what one noted stock watcher says, "if you're holding a good stock, it should be a good stock at both the bottom and the top of the market - that you should only sell a stock when the company itself is no longer doing well, regardless of what the overall market is doing...good companies and their stocks will often rebound earlier and possibly higher than the rest".

And likewise, a good home in a good neighbourhood will increase in value higher and faster than homes in lesser areas.

But ultimately, if you're thinking of making a move, make it for your own reasons - because you need the upsize (or downsize), not because of what the market as a whole is doing.

Doing the math:
You're selling your $400,000 house in a market that's down 5%.
A $400,000 house is down $20,000

But you're buying a $700,000 that's also down 5% or $35,000
Well you just saved $15,000 off your new mortgage!
And when the market comes back, that's now your equity!

And if you're in a good house, with no reason to upsize or downsize, then, unless you're retiring in the next couple of years and getting out of real estate entirely, what do you care what the real estate market is doing today? It'll be higher down the road anyways. Just ride it out.

Ouch -Here it comes!

2008-10-18T10:12:00.004-04:00

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?

Our real estate market will be affected by the U.S. economy

2008-09-15T19:14:00.003-04:00

There's no doubt about it - the GTA real estate market is going to feel the effects of the woes in the U.S. financial sector (if it's not already starting to feel the efffects!)

In extremely simplistic terms, you could use today's plunge in the stock market as an example scenario (one of many)

Two very large U.S. banks collapsed today. One went bankrupt and the other was bought by Bank of America. So the stock markets, including the Toronto TSX went into a tailspin, losing over 500 points
A lot of money was lost in the stock markets as a result
Stockholders lose money, some of it was borrowed
Some of it can't be repaid to the lenders
The lenders tighten their credit criteria or even raise rates to compensate
It now becomes tougher to get financing or even increased financing for that newer, bigger home you wanted to buy
That means fewer home buyers in the real estate market
Less buyers means more seller-competition for those buyers
Highly motivated sellers (I.e. those who lost big money in the stock market) will aggressively reduce the price of their home to get it sold to those fewer buyers
House prices stop rising, level off, and could even start declining

and so it goes.

So while the exact same thing might not happen here, we're still going to feel the effects.

Easy Home Automation!

2008-08-19T19:49:00.002-04:00

For well over 20 years, since before I got married, I've been using X-10 home automation devices to control lights and other devices in my home.

I first started using it in my one bedroom apartment, while I was single. I bought just a couple of pieces at the now defunct Eaton's department store and my use has grown from there.

My system controls lights, pool heater and pump, door chime, motion detectors, garage door openers, fans, heaters and more.

I'm able to vary what I control and when, throughout the year, depending on my needs at the time. Ay Christmas, I control my outside and inside Christmas lights. During the winter, I also control the ice-melting heater on the roof, around the eaves. On vacation, I have more lights under automated control. And in summer, I control the pool, deck lighting and several fans around the house.

All in all, it allows us to save money on electricity by using it more effectively (especially on the pool pump) and to also give us increased peace of mind when we're away from the house.

If you're considering the use of individual timers here and there around your home, I would suggest that you look into a home automation product that can grow/adjust with your needs instead. Being able to manage them all from a single location is considerably easier than having to go around the house adjusting individual timers etc.

For a supplier local to the GTA, you should check out www.aartech.ca or www.baranharper.com
Both offer good prices and timely service.

Mark your valuables

2008-07-20T12:35:00.004-04:00

I was reading in the media this past week about the police nabbing some suspects involved in a large-scale bike theft operation. Apparently they recovered hundreds of bikes and are in the process of returning them to their owners. But without being able to prove ownership, it makes the process that much more difficult.

Police recommend that you use an engraving tool to mark your valuables. Two recommended options are to mark your SIN or your license plate number on them. One problem with the SIN suggestion is that police can't locate you via your SIN - that's private information. Whereas your license plate is a different story - very easy to find you.

Want an easy trick to be able to prove the bike is yours, roll up and stuff your business card down the seat post. Then it should be relatively easy to fish it out down the road, should the need arise.

But on a larger scale, many of us just can't make the time to go through such a seemingly laborious and time-consuming process. Is there an alternative? I think so - courtesy of the digital age.

Take digital pictures of your valuables.
Shoot photos like crazy.
And even include yourself in some pics, to prove a personal connection between you and that item. (I.e. just because I photograph a Ferrari doesn't mean it's mine). Being in the photo with your valued possession doesn't automatically prove that it's yours either, but it makes the case for it that much more compelling.

When you buy a house and you're also purchasing certain chattels with it, such as a fridge, stove, dishwasher, select light fixtures etc., make your to ask your realtor to include a clause in your offer that gives you permission to photograph those specific chattels. (do not photograph without the seller's permission and especially do not photograph items that are not part of the offer - how would you feel if it was happening in your house?)

By taking photos of chattels at the time of the offer, you can set an expectation of what you should be getting on closing date, plus the condition they're in as well. In rare instances, unethical sellers have tried to swap out appliances after the sale, but before closing. Having pictures, plus having a clause in your offer that tells the sellers that you are likely to have these pictures is a strong deterrent to problems on your closing date.

I would rather take the extra steps up front to try to prevent problems down the road, than having to deal with them after the fact.

They can't be serious?

2008-07-16T18:54:00.004-04:00

In an article in today's Toronto Star, a BMO economist makes reference to the change in the real estate market and says
"There is no debating that there is now a serious chill in Canada's housing market after a six-year boom," observed Doug Porter, BMO Capital Markets deputy chief economist.

A "serious chill"?
The same article says the average price declined across the country by 0.4% and yet they rose in the GTA by 4%.

If that's a "serious chill", what the heck would they call anything more than that?

Sales are off their peak, that is true. But even the stock market never stays at the peak. They're both *markets* - they rise and fall.

It seems the media fluctuates between market that's burning up or melting down - because anything in the middle would be, well, normal, and therefore not really newsworthy.

So I guess they feel that "serious chill" sounds more media-worthy than something like "normalizing" or "settling" etc.

As you can probably tell from my blog, I'm a cup-half-full kind of person and while I agree the market is off it's peak, I just can't quite swallow that "serious chill" thing.

Sheesh!

Feds revamp mortgage lending rules

2008-07-09T19:21:00.005-04:00

The Globe & Mail online site reports today that the federal government has announced plans to change the mortgage lending rules to pre-empt a housing bubble similar to what happened in the U.S.

Both the Finance Minister and Governor of the Bank of Canada had expressed concern in the surge of 40-year amortizations; feeling that they were contributing to a bubble situation.

CMHC mortgage insurance will no longer be available on amortizations over 35 years in length and buyers will also require a minimum 5% down payment. The intent is to prevent people from over-leveraging themselves into houses that they realistically can't afford and would most likely lose at the slightest upswing in mortgage interest rates.

In addition, buyers will require a minimum credit score of 620 along with stronger "documentary evidence" that buyers can pay their loans.

What does this mean to the buyers?
On a $200,000 mortgage at 6% interest, the reduction from 40 years to a 35 year amortization will mean an additional $41.00 on the monthly payment and will save them over $49,000 in additional interest charges.

The new rules come into effect on October 15, 2008.

P.S. The feds report that mortgage defaults are at 0.27 percent - near the lowest levels since 1990!

New FINTRAC Legislation begins today!

2008-06-23T09:11:00.003-04:00

As mentioned here previously, today, June 23 is the day that the new laws take effect with regards to tracking suspected anti-terrorist financing and money laundering.

Here's an article in today's CANOE.CA that mentions the same expected backlash that I've felt would be forthcoming from home buyers and sellers.

In short, they're going to have to provide some significant, additional personal information in order to conduct a real estate transaction, such as

date of birth and
occupation,
plus ID such as a driver's licence or passport.

It's not something mandated by the real estate business - it's bigger than that - it's federal legislation.
So when we ask you for this information, please don't feel offended at us - we're only adhering to the laws.

I wish the government or even the real estate organizations at the provincial or federal level had done a much better job of informing the public that this is the "new world", rather than let us break the news to our clients and customers seemingly out of the blue. I mean, I haven't seen or heard a single ad about this on TV or radio to let the public know this was coming. Maybe that's their intention - that they don't want the criminals to know.

And interestingly, if people either refuse to provide the information or we feel there is something suspicious about the transaction, we're obligated to not only file a report with FINTRAC but we're also obligated to *not* tell you that we're doing it.

By the way, this is no different from how the banks, stock brokerages, casinos and other business must also act now under this legislation. Read one of my following blog posts if you want the link to FINTRAC or to read more about this.

Big brother is watching....(well, at least more than yesterday!)

MLS.CA changing to REALTOR.CA

2008-06-09T13:12:00.002-04:00

On June 30, 2008, the Canadian Real Estate Association (CREA) is going to be replacing the existing www.mls.ca website with an new 'n improved version which will also be rebranded as www.realtor.ca

One of the reasons for the change in URLs is to help reinforce public understanding that these property listings and services are being brought to you by realtors across the country.

The new website will also feature a new, interactive mapping systems for listings.

The old and new sites will be run in parallel for awhile and then at some point, CREA plans to shutdown the old mls.ca site and just redirect everyone to realtor.ca.

New FINTRAC Legislation - June 2008

2008-05-21T20:29:00.002-04:00

I think this is going to cause a bit of a shudder throughout the real estate biz. Not just from the Realtors, but especially from the buyers and sellers.

Effective June 23, 2008, there's new federal legislation coming into effect that has broad ramifications. I'm only covering it as it pertains to real estate transactions.

The legislation is called The Proceeds of Crime and Terrorist Financing Act. It's intended to help in the fight against money laundering and terrorist financing, in part, through greater disclosures.

I already attended a seminar on this and samples that they provided to us demonstrated that these actions have become quite sophisticated and interconnected and it's up to the FINTRAC analysts to track these kinds of transactions and "connect the dots". And believe me, to the average Joe, these are otherwise normal looking transactions. Often times, it's not even evident at the individual-transaction-level. It's only when several, seemingly unrelated activities are connected that the bigger picture becomes clear.

What does it mean in real estate transactions?
Basically, it means more detailed identification of buyers and sellers is going to be required (including any third parties, too). It's now going to require

photo ID,
date of birth and
primary career/occupation (and "self-employed" won't cut it).

It will also require some mandatory reporting on our part if we even suspect that a participant in a real estate transaction may be involved in these illegal activities. It's a one-way process. We file the reports with them but they tell us nothing in return. And obviously, we're prohibited from disclosing the fact that we even filed a report.
There's going to be a lot of shake-out on this as the ramifications and obligations get digested and the individual brokerages map out how they plan to deal with it all.
As usual, working with an informed Realtor is your best bet.

You can obtain a copy of the FINTRAC brochure from my website.

Or, you can always visit the FINTRAC website directly to learn more about their mandate as well as this legislation in particular. Just browsing their homepage will give you an idea of their scope - casinos, life insurance, securities dealers, accountants, large cash transactions, electronic funds transfers and much more.

And, importantly, this legislation supersedes the PIPEDA legislation (Personal Information Protection and Electronic Documents Act) and your right to privacy.

Resale Housing Market stats

2008-05-14T13:30:00.003-04:00

Here are some of the most recent stats on the resale housing market in the GTA.
Prices continue to rise at a steady pace although sales numbers are slightly lower than the previous record level.

Selling a new home that you didn't occupy?

2008-04-24T14:12:00.003-04:00

If you're one of those "investors" who buys a new home and then re-sells it without even having occupied it yourself, be aware that you're on the hook for some additional obligations related to the Tarion New Home Warranty Program.

A notice from the Toronto Real Estate Board to Realtors today says:

"Tarion also advises those who buy new housing units and re-sell without first occupying them are required to submit an Application for Registration as a ‘Vendor’ to Tarion Warranty Corporation, meeting specific terms and conditions.

They are responsible for the Deposit Protection, Delayed Closing and any material changes made after purchase from the builder. They are further required to provide Tarion with written confirmation that the builder will provide necessary warranty service or alternatively, specify how they will provide it.

In addition, Tarion points out that the warranty start date is the date of possession of the owner who occupies the unit. The new owner should be provided with the ‘Homeowner Information Package’ outlining the warranty coverage.

For more information visit www.tarion.com"

Note that they state that either the builder will provide the necessary warranty service or YOU will, which seems to imply that if the builder declines to provide warranty service in this kind of situation, then you're on the hook to do so.

This is just a reminder that when you're getting involved in real estate transactions, you're talking about big money and potentially big obligations. Make sure that the Realtor (and/or lawyer) representing your interests knows how to deal with, and cover you in these situations as best as possible. Not all Realtors know all of the intimate details equally well in every specific type of transaction. Interview your Realtor to make sure that you've got the best one representing your interests that particular situation.

And before you invest your hard-earned money in a specific area, whether it's stocks, bonds, real estate, mutual funds etc. do your own homework, too. The Internet (and Google) makes it a lot easier to learn how to protect yourself. There's a difference between "risk" and "reckless".

Yes, it's true - the market is down

2008-04-18T14:32:00.003-04:00

When you've been in a market that's been peaking for so long, it's only inevitable that at some point the numbers are going to be lower than the year before and finally this appears to be it.

An article on thestar.com discusses it and also fairly points out that sales are still high, based on historic numbers, just off the record ones from the past couple of years.

We're still tracking to significantly exceed the sales numbers of even 2004-2005.

But the printed media seems to love anything that has a "doom & gloom" aspect to it so a number of sites are reporting on it. One column is even called "Housing Gloom"!! Oh give me a break.
It's like there's no middle ground. We're either in record territory or "gloom"???
So much for balanced reporting.

Comparing your property taxes

2008-03-30T10:31:00.002-04:00

In today's Toronto Star online, there's an easy-to-use calculator that allows you to compare how your property taxes stack up against many other municipalities in the GTA.

If you think they're mostly the same, think again.

The average home is now worth about $400,000, so let's use that to compare taxes.
For a home assessed at this amount, here's what you would pay in 2008 in:

Oshawa $6,047.22
Whitby $4,713.31
Ajax $4,637.34
Pickering $4,494.60
Toronto $2,443.70
Mississauga $3,076.69
Oakville $3,090.68
Vaughan $3,123.32

As you can see, Oshawa is the runaway leader in high property taxes and the City of Toronto has, by far, the lowest property taxes. Kind of makes you wonder why they seem to fuss so often about their taxes.

Longer mortgage amortizations? Nothing new.

2008-03-29T11:06:00.002-04:00

I've heard from a few people recently who seem a little shocked at the appearance of 35 and 40-year mortgage amortizations. When in fact, this kind of thing isn't new at all. People were saying the same kinds of things when amortization periods increased from 7 years (yes, 7!) to 10 and then 15 years before hitting 25, where they've been for quite awhile.

But the reality is that this is how homes remain affordable while prices keep going up - not just home prices, but the prices of everything.

Back in 1962, my parents bought their first home for under $20,000 and amortized over 7 years. And in 1967, Dad bought a brand new Chevrolet Impala for $3,300!

Can you imagine getting a *mortgage* for only $15,000? It seems ridiculous by today's standards - heck, many people carry a balance like that on their credit cards today. Today, that might be considered for a car loan, and you'd have a hard time getting a loan period (amortization) for longer than 3-4 years!

If you had a mortgage of $420,000, simply by changing from a 25 to a 40 year amortization, that reduces your monthly payment by $335/month! That's a significant reduction on your monthly bills and still allows you to live in your dream house.

Granted there are pros and cons to longer vs. shorter amortizations but whether we're talking 25-40 year or 10-25 year, it's a debate that's been going on for many, many years. There's no right answer - but rather, which is right for *you*.

In Japan, because their house prices are far higher than ours, mortgage amortizations of 100 years are commonplace there. But they weren't always that long.
It's just part of the continuing changes to keep things like real estate and cars affordable.

At our office, we have an in-house mortgage broker, SGH Mortgages Inc. You can talk with either Steve King or Rob Mason and quickly determine both what you can afford and what kind of mortgage is right for you. They're great guys and very helpful. 1-905-619-9500.

Living for Free? Nothing is FREE!

2008-02-27T11:08:00.002-05:00

It's odd how often I come across prospective sellers who have lived in their house without doing almost any upgrades (other than the those that are pretty much mandatory) and then want to list their house for close to the same price as the competitors who *have* not only put maintenance money into their home, but kept upgrading it as well.

For an example, I've been in a number of homes where the owner bought new from the builder and lived in it for several years without even freshening up the paint over the builder's bland default paint colours, or where they haven't even upgraded even the most prominent light fixtures from what the builder installed (usually very cheap).

Home buyers and sellers should keep in mind that spending a little money on a continual basis to keep the house up to date is often times a lot cheaper than finding out down the road that no one wants to buy the house for even close to market rates because "it's dated" and they would need to spend a lot of money on top of the purchase price, to bring it up to date.

Imagine yourself going to the fruit market to buy apples - which ones do you pick?
The cleanest, shiniest apple that's in the best shape, right?
It's no different with a house.

The typical rule of thumb is that you should plan *on average*, to spend 1% of the value of your house, on maintaining your house every year. Now, some years you might not spend anything but that's just going to catch up on you at some point.

And if you try to sell without having spent the money, well, it will catch up on you in the form of lower than expected offers for your home.

To paraphrase the the old TV commercial for Fram oil filters
"You can pay now or you can pay later"

Is the Subprime Fiasco Coming Here?

2008-02-04T14:53:00.000-05:00

If I had that crystal ball, I would be answering that from a beach in Fiji.

Is it likely coming here? Nope. And I'll tell you why.
At it's peak (2004-2006), in the U.S., subprime loans accounted for over 30% of all American mortgages.
In Canada, subprime exposure is less than 5%.

Why the difference?
Canada has a much more conservative approach to lending as much of it is controlled by the big banks whereas in the U.S., lenders are a dime-a-dozen and therefore competing heavily for business, which caused them to loosen their criteria and end up loaning money to otherwise un-credit worthy people.

In addition, many of these subprime mortgages had "teaser" interest rates that many buyers failed to pay attention to. The rate was typcially a "low" 8% or so in the first year jumping to 11% in year 2. On a monthly basis, that's an increase of almost $600 in payments, which many buyers were unable to absorb.

How's the market doing this year?

In the first half of January, sales were up 11% over the same period in 2007.
Bowmanville is up 65%.
Richmond Hill is up 59%.
The average days on market (DOM) is down 13% from the same period last year.
The hands-down winner for affordability is Oshawa, with an average price of $231,000
Interest rates in Canada are expected to go down again shortly and, interestingly, they're predicting that they will not rise this year.

So if you're thinking of selling your home, get it on the market for the Spring peak to catch most buyers and when you buy your next home, lock in that low interest rate. It can't go a heckuva lot lower, but it can certainly go higher.

Now, back to polishing my crystal ball........

Lots new for the New Year!

2008-01-09T11:17:00.000-05:00

Happy New Year!

There are a number of items worth mentioning at this point. I'll list them and then explain a little more

GST reduced to 5%
New record set in 2007 for resale homes
40 year mortgages have arrived
Ontario Land Transfer Tax rebate for first time buyers

As mentioned in a previous post or two, as of January 1, the G.S.T. has been reduced to 5% across the board so be sure to check all of your receipts. Rumour has it that some merchants have been "slow" to implement the change.

From the Toronto Real Estate Board, a new record was set in 2007 for the total number of resale home transactions. There were 93,193 homes sold in the calendar year, up 12% over last year and up 11% over the previous record year 2005 (84,145 sales). On a year-over-year basis, the average price rose 7% to $376,236. So unlike the real estate market in the U.S., the Toronto market (and the Canadian market in general) is still going strong.

According to an article in today's Star by Ellen Roseman, you can now get a mortgage amortized over 40 years. Unfortunately, you can't lock in the interest rates for this length of time (max. 10 years) but you can certainly lower your monthly payments, if you wish. HAving said this, let me also say that you'll pay far more in interest payments with this amortization.

Here's an example. Let's say that you borrow $300,000 at 7% interest.

Amortized over 25 years, you'll pay $330,376 in interest payments, on top of the original $300,000.
Amortized over 40 years, you'll pay $584,429 in interest payments, on top of the original $300,000 loan. That's an additional $254,053 in interest just for the extra 15 years.

All that just to reduce your monthly payment by $258.

And finally, the provincial government has agreed to extend the rebate on the provincial Land Transfer Tax to include first-time-buyers of resale homes. Previously, the rebate was only for first-time-buyers and *new* homes. Talk to your lawyer for more details about it.

GST Reduction is Here!

2008-01-02T14:04:00.000-05:00

If you're planning to buy or sell a home in 2008, then congratulations!
You're going to save some money!

Thanks to the federal government, as of January 1, 2008, the GST has been reduced to 5%.
So if you buy a new home, you'll save on the purchase price (because GST is payable on new home purchases)
If you're planning to sell your home, then you'll save where GST is collected such as agent's commission, closing costs (I.e. lawyer's fees), movers etc.
And if you're planning to buy a home, then you'll save a little extra where GST is charged (I.e. closing costs, home inspection, appraisal etc.)

Some Great Christmas Lights!

2007-12-15T12:33:00.004-05:00

Interested in checking out some exceptionally decorated homes in the GTA?
We are too!
Here are some of our favourite picks.
Please add your own streets that you feel are worth seeing - we'd love to check them out!

#1 Pick 2007- 4 Rosea Court in Richmond HIll - over 70,000 lights! Visit http://www.lindsaylights.com/ for more info. It's actually a very active light show - tune your radio to 104.9 FM for the music. Clark Griswald, step aside. Here's a map.

Are you near South Pickering? Then check out several streets on each side of Frenchman's Bay. On the east side, there several well-done homes on Ilona Park Road. Here's a map.

And on the west side of the bay, several streets including Vicki Drive, make the trip worthwhile. Here's this map.

If you send me directions to any other gems, I'd be happy to post them here, too!

2010 Update - Check out my latest/current update on great displays here

Province Expands Land Transfer Tax Rebate!

2007-12-15T12:07:00.000-05:00

From the Toronto Real Estate Board.....

December 13, 2007 -- The provincial government has announced that it is expanding the PROVINCIAL land transfer tax rebate for first-time buyers to include re-sale housing, something which REALTORS® have lobbied for.

Details

First-time buyers of BOTH re-sale, and newly constructed homes, will be eligible for a rebate of the provincial land transfer tax of up to $2,000.
Effective for first-time buyers who enter into Agreements of Purchase and Sale AFTER December 13, 2007.
This change is being implemented by provincial legislation introduced on December 13, 2007. The Ministry of Finance has indicated that, until the legislation is passed, first-time buyers of re-sale properties eligible for the rebate can submit their applications for the refund and they will be processed once the legislation has passed. It is not known when the legislation will be passed. Buyers can consult with their lawyers if they have concerns.
The provincial land transfer tax rebate applies in all Ontario municipalities. In Toronto, the provincial rebate is in addition to City rebates of the Toronto Land Transfer Tax.

More Information

Further information is available by calling:

Ministry of Finance
Land Transfer Tax Section
905-433-6361

Ministry of Finance
General Inquiry
1-800-263-7965

Latest GST Reduction and Real Estate

2007-12-03T09:52:00.000-05:00

The GST has recently been reduced again (announced October 30, 2007) and going from 6% down to 5%. As before, GST only applies to sales of newly constructed homes and substantially renovated homes. GST does not apply to the purchase price of resale homes (in general), but it still applies to Realtor commissions.
The new, reduced rate becomes effective January 1, 2008.
Please review this with your lawyer and/or tax adviser for full details, because as usual, there's always "fine print".

Improvements - Getting Bang for Your Buck

2007-11-30T17:44:00.000-05:00

I often get asked about which home improvements would bring the best improvement in a home's resale value and I always go to the best place in Canada for their opinion. Canada's national housing agency, Canada Mortgage and Housing Corporation (CMHC) has a website loaded with great information on things like this. In particular, this link, will take you to their page showing you what you can expect for a return on your renovation dollar. (FYI - bathrooms and kitchens are still #1!)

Thinking of a Furnace Maintenance Contract? Think again!

2007-11-11T10:39:00.001-05:00

So you bought a house with an older furnace, and just to be on the safe side, you get a service/maintenance contract for peace of mind. Eventually you buy a new furnace and it comes with it's own warranties etc. and therefore, no longer need that maintenance agreement. Did you realize that you might not be able to get out of that agreement?

There's another worthwhile column by Ellen Roseman in today's Toronto Star that's definitely made me think twice about ever considering a service contract for my furnace. Or, at the very least, I would be very careful about who it's with *and* the specific criteria.

In some cases, even moving to another home isn't enough to void the agreement.
I'm not suggesting that we don't need regular/preventative maintenance on things like a furnace - warranties often indicate that it's required to keep the warranty in effect. But I'm able to manage the reminders etc. myself in my calendar - I don't need them to call me and I'd rather pay the fee for the actual service calls than continually shell out "insurance" money.

As my Dad always use to remind me "Money-in-pocket will always be in style".

Thinking about a reverse mortgage?

2007-11-07T10:05:00.001-05:00

There was an interesting article in today's Toronto Sun about reverse mortgage. Click here to read the complete article.

They've been around for a long time in several other countries including England and are just now starting to raise their profile here.

My thoughts on them? At this point, I would consider one only as a last resort. There are high set-up fees and the interest rates are higher than mortgage rates. I would talk to my lender *and* my lawyer for other possible alternatives before going down this path.

Details on Toronto's New Land Transfer Tax

2007-10-31T13:35:00.001-04:00

I've had a number of clients already asking me for more details about the recently approved Land Transfer Tax for Toronto residents. Here are the details, courtesy for the City of Toronto's website.

The summary points:

takes effect February 1, 2008
If your agreement is prior to December 31, 2007, you receive a full rebate, regardless of closing date
If you purchase after December 31, 2007 and close before February 1, 2008, you receive a full rebate
If you purchase after December 31, 2007 and close on or after February 1, 2008, you pay the full tax.
A rebate of up to $3,725 will apply to first-time purchasers for new and existing homes under $400,000.

Interestingly, I read in the paper recently that the City of Hamilton was also looking to implement something similar but it turns out that these extra taxing powers were only given to Toronto in the "City of Toronto Act" by the province.

So, at this time, it doesn't look like the surrounding municipalities or regions will be implementing anything like this anytime soon. I originally surmised that it wouldn't take long for the surrounding area governments to level the playing field and make their own similar tax grabs but it doesn't appear as though they have the power to do so at this time. And I haven't read so much as a tiny hint that that's about to change anytime soon.

How will it affect the real estate market?

That's anyone's guess. So I'll take a stab at it, too.
In the short term, I think that we'll see a flurry of home sales through the end of this year within the Toronto area. Then, in January, we'll see Toronto buyers looking for short closings to dodge the tax.

Then, in the longer term, that's a tougher call. Toronto has lower property taxes than most, if not all of its immediate neighbours. Toronto homes along the border may take a little longer to sell than homes just outside the border because of this tax. But since it's a one-time tax at the point of purchase, I don't think it's going to be a decision-breaker for many buyers.

I think it will be similar to the GST on new homes. Certain buyers prefer a *new* home and are willing to pay the GST in order to have it. I think the same thing will apply for Toronto homes. Ultimately buyers will be willing to take that extra tax-hit to live in Toronto.

New Land Transfer Tax - coming to you!

2007-10-23T11:28:00.000-04:00

Well the spend-a-holics at Toronto City Hall have voted in the new, additional Land Transfer Tax that will (initially) double the amount of Land Transfer Tax that you currently pay to buy a home in the city. Why I say "initially" is because getting it implemented is far more difficult to do than getting an increase in subsequent years. And as house prices go up every year, so will their revenue.

This is the thin edge of the wedge.

I also think it's just a matter of time before other local regions decide to implement a similar tax since "big brother" has paved the way. They can do it feeling that they're simply levelling the playing field.

While I'm not opposed to raising taxes when it's truly needed (and with the federal and provincial governments currently rolling in cash, I don't think it is), I'm more opposed to a tax which targets a specific industry/vertical such as real estate transactions.

And it's not going to help them when the real estate market cools down and transactions decrease, which will lower their revenue, too. It's a short-sighted, partial solution.

Housing Crash Coming?

2007-08-17T09:41:00.001-04:00

As the U.S. housing market continues to decline and the related, U.S. subprime lending scenario continues to unravel, an increasing number of my clients and customers have been asking me if we can expect to see the same thing happen here; convinced that since we're neighbours, it's inevitable. And the recent drops in the stock market have only served to further the doom and gloom aspects (and media hype).

Do I believe it? Not really. Why?
Well, this article in today's Toronto Star can explain it much better than I can and I pretty much agree with everything he says.

In short, Canadian subprime lending did not occur on anywhere near a level (proportionally speaking) that it did south of the border. In addition, the housing market here never exploded the way it did down there. Sure it's been a very strong market here but nowhere near what happened in the U.S.

From the signs I've been seeing around the GTA and within my own business, I think the Fall real estate market is going to show a continuing strength and balanced supply and demand.