Power back in Toronto buyers' hands

Dig through the clutter of statistics — of sales declines, project launches, economic growth forecasts, volatile investment markets — and the future for Toronto condominium sales does not look bad at all. In fact, according to a number of industry experts, we are probably heading into a buyers' market.

"I think we are getting back to the days when sales people in new condo projects can't just be order-takers," says Barry Lyon of N. Barry Lyon Consulting Ltd.. "Buyers are no longer going to be numbers on a chart. Developers are going to have to be a lot more innovative and offer incentives to make sales.

"I can see the next six months as being a great opportunity for new condo buyers."

See full story in the Toronto Globe and Mail »

November 14, 2008 in Buying Toronto Real Estate | Permalink | Comments (2) | TrackBack

Untouchable Toronto Neighbourhoods

With a slowing economy and a tanking stock market, everyone’s looking for a little security -- in real estate?

Toronto Life magazine has identified some if the city's most crash-resistant neighbourhoods. The most important consideration in buying crash-proof real estate, they say, is the overall vitality of a neighbourhood. Look for areas with thriving local businesses and well-maintained homes that are accessible by TTC. Districts with a diverse mix (detached, semis, towns, apartments and condos) at a variety of price points means you won’t run the risk of living in a bust area if, say, townhouses go out of fashion (ultra-high-end condos, which tend to attract foreign investment, are the exception).

Flexibility is another key they identify; properties that are easily converted between single-family and rental units will ensure against a property value–lowering fire sale if your neighbour is desperate to sell and can’t hold out for a decent price. Regions populated by those who work in IT, advertising, design and media will fare better through a downturn than nabes with high-flying financiers or auto workers.

Areas with artsy professionals often have a high proportion of cafés, galleries, boutiques and other value-maintaining amenities. Having a permanent attraction such as a museum, park or waterfront, and residents with fixed incomes (such as students and seniors) provides a steady support system for local businesses. Emerging areas with undervalued properties are money-makers when gentrification hits.

Here is the list of crash-resistant neighbourhoods:

October 8, 2008 in Buying Toronto Real Estate | Permalink | Comments (1) | TrackBack

Luxury home sales holding steady

While housing sales in the Toronto area have slowed considerably from last year’s hectic pace, the top end of the market remains relatively strong.

The RE/MAX Upper-End Report, which highlights trends and developments in 15 housing markets across the country for the first seven months of 2008 found Vancouver, Victoria, Regina, Saskatoon, Winnipeg, London, Kitchener-Waterloo, Ottawa, Halifax-Dartmouth, and St. John’s all experienced an upswing in sales activity, while declines were noted in Kelowna, Calgary, Edmonton, Hamilton-Burlington, and Toronto. Also significant is in all but two markets, percentage increases in sales were greatest in the upper-end when compared to the overall residential marketplace in 2008.

“Given the transition occurring in most residential real estate markets, upper-end sales remain exceptionally strong,” says Michael Polzler, Executive Vice President and Regional Director, RE/MAX Ontario-Atlantic Canada.  “The market for luxury homes is usually the first to show pressure cracks, but the reverse is actually true this year, with pent-up demand (due to trade-up activity), less speculation, and job transfers all factors contributing to stability in this segment.  That being said, we feel uncertainty in financial markets both here and abroad will give purchasers cause for concern in the immediate future.”

Although the top-end of the market represents less than five per cent of total sales, activity is generally a gauge of overall market conditions.  Leading the country in terms of percentage increase in luxury home sales are Regina (up 306 per cent); Winnipeg (up 89 per cent); St. John’s ( up 78 per cent); Saskatoon (up 72 per cent); Kitchener-Waterloo (up 47 per cent); Ottawa (up 36 per cent); Halifax-Dartmouth (up 20 per cent); London (up 14 per cent); Greater Vancouver (up five per cent); and Victoria (up four per cent). Solid performance is likely a result of consumer confidence, particularly in provinces like Saskatchewan, Manitoba, Newfoundland, Nova Scotia, and parts of Ontario where solid economic fundamentals helped to bolster the number of homes sold in the upper-end. 

“In two-thirds of the markets we surveyed, demand for upscale homes surpassed peak levels reported last year,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada.  “However, with supply edging higher in most major centres and few markets reporting tight inventory levels, we are seeing a return to more balanced conditions.  This situation is expected to have an impact on high-end values in coming months, especially in areas that have experienced consistent double-digit growth.”

The RE/MAX Upper-End Report also notes serious appreciation in housing values in recent years has pushed upper-end price points to new levels.  This is especially so in Western Canada where $2 million is now merely a starting price in Greater Vancouver, while in the tony Westside, that figure is closer to $4 million. Calgary is steady at $1 million this year, but is pushing closer to the $1.5 million benchmark.  In Ottawa, where the upper-end price point is currently pegged at $750,000, sales are increasingly occurring over the $1 million mark.

Other highlights include:

See the full report »

September 28, 2008 in Buying Toronto Real Estate | Permalink | Comments (1) | TrackBack

Yorkville condo to list near $30m

Global financial markets are in turmoil and the Canadian economy is slowing, but that hasn't put a damper on the promotional effort touting an as-yet-to-be-built condo unit at Toronto's Four Seasons Hotel and Private Residences as "Canada's most expensive penthouse!"

The posh condo in Toronto's Yorkville neighbourhood is expected to list in the $30-million range, but the price won't be revealed until after virtual tours for the media take place Thursday with developer Alan Menkes and designer Brian Gluckstein.

But the 9,000-square-foot penthouse, complete with four fireplaces, staff accommodations and galleria, will be listed for more than the previous record sale price of $25-million, public relations representative Beth Merrick said.

See the full story:

September 17, 2008 in Buying Toronto Real Estate | Permalink | Comments (1) | TrackBack

Home Buyers Seek Sleepovers

In most markets, home buyers have the upper hand these days. That often means they have greater negotiating power when it comes to price or the ability to squeeze out extra perks from sellers. But on occasion, they will ask a seller for even more, a request that will help get to know the home better. They will ask to sleep over.

As reality programs such as TLC's "Date My House" and HGTV's "Sleep On It" show buyers spending a considerable amount of time -- and sometimes an entire night -- in homes they are considering, some buyers in the real world are getting the chance to do the same.

It isn't something being agreed to by droves of sellers, but it is a new tactic that some are considering, said Pat Skiffington of Keller Williams Classic Realty in Orlando, Fla. He is arranging for a prospective buyer to stay overnight in a downtown Orlando condo.

See story in The Wall Street Journal »

July 15, 2008 in Buying Toronto Real Estate | Permalink | Comments (3) | TrackBack

Toronto Real Estate: Hot or Not?

Ever wondered how houses have stood up as an investment?

Crunching forty years of stats from the Toronto Real Estate Board reveal a few surprises:

1,250%

Average resale house prices have increased a whopping 1,250 per cent since 1969 – about the same performance as the stock market, where the TSX composite index rose 1,244 per cent.

2.5x

Both house prices and the TSX outstripped inflation – which stands at 484 per cent over the last 40 years – by 2.5 times.

Drop

Since the last price peak of $280,676 in 1989, the average price across Toronto fell 31 per cent, to a low of $192,406 in February 1996.

Lag

Since that peak, some areas have enjoyed gains of more than 100 per cent, but in 40 of 85 areas tracked by the Toronto Real Estate Board, prices have not kept pace with inflation.

Buy

Smart buyers head out in January when prices are usually lower, and have been consistently the lowest for the year in the last decade. Often, they're rewarded with prices lower than the previous December.

Sell

May is the highest month for house prices, followed by December. One notable exception was 1989; prices peaked in October.

Hot

Top 40-year gains: Bridle Path, Forest Hill, Annex/Yorkville
Top 20-year gains: Clarkson (Mississauga), the Beach, Riverdale
Top 10-year gains: South Riverdale, East York, the Beach

Source: Toronto Star

July 13, 2008 in Buying Toronto Real Estate | Permalink | Comments (2) | TrackBack

Preparing for your Home Search

Your Needs and Wants

A good place to start your search for a new home is to prepare a detailed 'wish list' -- and then make a comparison of your wants or wishes and your needs or what you must have. For example:

Needs
Wants

Include the type of housing - detached home or condominium, bungalow or two-story, and size - which best suits your needs. Consider location, transportation or commuting time, and new or resale.If you are handy with tools or a paint brush, you might consider a home with a great floor plan even though it’s in need of some repairs or updating. Otherwise, a home in a newer community might be more suitable.Make it a family decision—include the children and your spouse. Or, if you're buying on your own, talk to friends about their home buying experience.

Make the list

Record a list of your needs and wants. Do you need an extra bathroom, a garage, a fenced backyard, or lower utility bills? Do you want a fireplace, a short drive to work, or maybe minimal yard work? Once your list is complete, review it and decide what is most important to your lifestyle. Decide which items are “musts” and which you are willing to give up.

Location

Deciding where you want to live may be the single most important factor in choosing a home. Location affects your day-to-day living and is one of the most significant influences on value. Your choice of location may be limited somewhat by the price you can afford. Even so, make sure you consider such things as:

Type of home and lot

A single-family detached home is attractive to many people because it typically provides more living space and land area than other types of living units. Typically the detached structure permits you greater freedom (less restrictions) on remodeling, expanding, painting, and altering the appearances of the structure. On the other hand, a condominium may be a more appropriate choice for you, with an emphasis on maintenance-free living.

Size and style

Consider size and style. You may already have in mind a contemporary home with a sun deck or a two-storey Victorian-style with a cozy study. Or maybe you won't know what you want or like until you see it. Whatever the case, your realtor should listen to your preferences and help find the right home for you.

May 13, 2008 in Buying Toronto Real Estate | Permalink | Comments (3) | TrackBack

First-time buyers remain challenged

While higher housing values and tight inventory levels have hampered home-buying activity so far this year, longer amortization periods and alternative housing types have offset the impact on most major Canadian markets, according to a report released by RE/MAX.

Despite a higher degree of frustration in the marketplace than in previous years, the RE/MAX Affordability Report found that first-time buyers, in particular, remain steadfast in their determination to purchase a home. In fact, entry-level purchasers are adjusting their expectations by sacrificing size, location, and even long-term financial freedom, to overcome challenges such as rising prices and serious supply issues. Innovative financing has become key to homeownership in today’s environment – with longer amortization periods gaining favour in 62 per cent of the major centres surveyed. Low or no down payments were popular with first-time buyers in 38 per cent of markets.

“Doom and gloom reports coming from south of the border have yet to hinder overall momentum,” says Michael Polzler, Executive Vice President and Regional Director, RE/MAX Ontario-Atlantic Canada. “First-time buyers are still leading the charge, taking advantage of every resource available to achieve homeownership. They’re determined to get into the market sooner rather than later. If suburban locations, smaller condominiums and town homes, or a little sweat equity is what it takes to get into the market, these purchasers are game.” Inventory levels, however, remain one of the foremost concerns facing purchasers across the country. A shortage of available entry-level product was identified as a major obstacle impeding buyer intentions in three-quarters of markets surveyed in the report, including St. John’s, Moncton, Fredericton, Halifax-Dartmouth, Ottawa, Greater Toronto Area, Hamilton-Burlington, Niagara Falls, Winnipeg, Regina, Saskatoon, Greater Vancouver, Victoria and Kelowna. “First-time purchasers continue to play a pivotal role at both a local and national level,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “The impact they have on the housing market is significant, as they are the impetus for sales in the mid-to-upper price ranges. As long as this segment of the market remains healthy, the real estate outlook will continue to be favourable.”

Although average price is the barometer for housing values in most major centres, first-time buyers looking to achieve homeownership consider starting prices a more meaningful gauge of affordability. Starting prices can be substantially lower than the market average. For example, average price now approaches $400,000 in the Greater Toronto Area, while the starting price for a detached home can be as low as $300,000 in areas east and west of the city.

The best value for the dollar continues to be found in the suburbs. For those unwilling to sacrifice on location, small condominium units in new developments and condominium conversions of rental buildings offer up the next best alternative. Condominium conversions in some of the country’s major centres can be picked up as low as $150,000 to $175,000.

See the RE/MAX Affordability Report

April 24, 2008 in Buying Toronto Real Estate | Permalink | Comments (8) | TrackBack

Tips for First-time Toronto buyers

If you’ve ever thought about owning your own home, now may be the time to take action. Lower interest rates combined with a growing inventory of homes for sale in the Toronto market may translate into a good opportunity for buyers in negotiating the terms of a sale with a seller.

The home buying process may seem daunting to someone who has never purchased a home before. But, through home buying educational seminars offered in your community, and with the assistance of an experienced loan officer, a first-time home buyer can obtain a better understanding of their financing options, leading to a more positive home buying experience.

Whether you’ve been dreaming of owning a home for years or you’ve just decided it would be a smart financial move to make, your first home buying experience will be a memorable one. It’s important to learn about your financing options in order to find the mortgage that’s right for you.

Here are some suggestions for first-time home buyers:

1. Educate Yourself About the Mortgage Process – By taking the initiative and learning about the mortgage process, you can be more confident in the financial decisions you are making. It’s important to learn about different types of mortgages, how much you can afford, how your credit impacts your interest rate, and the benefits of home ownership.

2. Save Just a Little Bit More – It’s not only important to save money for the down payment and closing costs, but it’s important to factor in some of the other costs of home ownership such as decorating, repairs and maintenance. Many mortgage lenders recommend that first-time home buyers have at least three to six months of additional savings in their possession in anticipation of these additional expenses.

3. Check Your Credit – An individual’s credit score will have a significant impact on his or her mortgage loan approval and interest rate. A good first step in financing a home purchase is to check your credit history. You can request a credit report from credit reporting bureaus such as Equifax. Carefully review your report and contact the credit reporting bureaus to correct any inaccuracies.

4. Shop Around for a Mortgage Lender – As you start thinking and preparing for the home buying process, start shopping for the mortgage lender from whom you would like to obtain a mortgage for your new home. Because this process is new, it's easy to go with the first lender, loan officer or mortgage broker you meet. Instead, take your time and shop around. Start by asking friends, co-workers and family members for recommendations. When you’ve identified two or three loan officers or mortgage brokers, ask for references. In addition to pricing (interest rate and closing costs), focus on customer service as well as other services and tools that a mortgage lender may be able to offer you.

5. Get Pre-approved – Before you start working with a real estate agent, consider contacting a mortgage lender to obtain a pre-approval credit decision. A loan officer will review your financial status, including your income, cash flow and credit score, to help you determine the maximum monthly housing payment for which you may be able to qualify, and, if qualified, "pre-approve" your mortgage before you've found a home. Armed with a mortgage pre-approval, you can start searching for homes with a much better idea of your price range, and in turn save time as you will know the right homes to focus on. Obtaining a pre-approval may offer more confidence and certainty to home sellers in your ability to purchase the home.

6. Don’t Be Afraid to Ask Questions – Once you’ve found your new home, the mortgage lender will help you through the details of the loan process. From application to closing, your loan officer will work through the financing process with you, just as your real estate professional should do in the home buying process. Throughout the process, read all loan documents carefully, and involve an attorney, if necessary.

7. Inspect – Before you commit to purchasing a home, don't forget to hire a professional home inspector to conduct a thorough assessment of the property. An inspector can alert you to any major problems with the home, and/or help you understand potential short-term and long-term home maintenance issues.

May your journey on the road to home ownership be a happy and successful one.

March 24, 2008 in Buying Toronto Real Estate | Permalink | Comments (1) | TrackBack

Is your home inspector qualified?

Anyone can say he or she is a home inspector, but consumers have the option of hiring one who has been trained and tested.

Alan Carson says, "We believe you need a good, diverse broad background to be a home inspector." Carson is vice-president of Carson Dunlop Inspections. "It's like a doctor who's a general practitioner. You have to know all about the body. And when you see a problem you recommend a specialist. In home inspection, if someone works in one trade how will they know about others?"

Carson has written home inspection books for people who want to learn about the nuts and bolts of a house. He has also helped develop the home inspector course at Seneca College of Applied Arts and Technology that's also offered at 15 other Ontario Community Colleges.

Guy Battaglini, co-ordinator of Humber College's home inspectors course, says within the past 10 years a lot of people have discovered they have purchased homes based on unqualified people calling themselves home inspectors. He adds that they likely had no formal education or training to understand the different systems that comprise a home.

"In some cases, it might have resulted in buyers being upset because it cost them an additional $20,000 or $30,000 in further repairs," he says.

Many people get inspections done when they buy older homes, but having new homes inspected is increasingly common. Another growing trend among sellers is having an inspection done before putting the house on the market.

"We've seen that trend over the past five years and roughly 25 per cent of our inspection work is for sellers," Carson says. "We call them pre-listing inspections."

There are many advantages to this, he adds, for the buyer and the seller.

See story in the Toronto Star »

March 8, 2008 in Buying Toronto Real Estate | Permalink | Comments (3) | TrackBack

 

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