Archive for the ‘Ajax Real Estate’ Category
Real Estate Market at Boiling Point
Orit Alon – Shalom Life
Active listings are down in 81 per cent of real markets in January with interest rates remarkably low. Every good listing is getting full attention from variety of buyers.
Guy Scheiner, a Mortgage Broker and a Real Estate Agent with Sutton Group, describes the real estate arena as a sellers market. “From my perspective from all parts of the real estate arena, I see that the prices are very high, the demand for properties is bigger than the supply, people that were hurt form the recession don’t want to move, they postpone the sell to better times. The prices have gone up as a consequence of this market condition along with encouraging interest rates that you can block today to five years and enjoy the low expense.”
RE/MAX Market Trends Report 2010, published this week, examined real estate trends and developments in 16 markets across the country. It found that unusually strong activity during one of the traditionally quietest months of the year has led to a sharp decline in active listings in 81 per cent of markets surveyed. The threat of higher interest rates, tighter lending criteria, and in British Columbia and Ontario, the introduction of the new Harmonized Sales Tax (HST) have clearly served to kick-start real estate activity from coast-to-coast, prompting an unprecedented influx of purchasers. As a result, 87.5 per cent of markets posted an increase in sales in January, with average price appreciated in 81 per cent of markets surveyed.
Markets experiencing the tightest inventory levels include Toronto (- 41 per cent); Kitchener-Waterloo (-33 per cent); Ottawa (- 30 per cent); Victoria (- 30 per cent); Greater Vancouver (- 27 per cent); Halifax-Dartmouth (- 19 per cent); London-St. Thomas (- 18 per cent); Regina (- 16 per cent); and Winnipeg (- 13 per cent). Conditions were still balanced, but starting to tighten in Calgary, Edmonton and Saskatoon, particularly in the single-family detached category.
The highest year-over-year sales gains were reported in Greater Vancouver (152 per cent), Kelowna (121 per cent), Greater Toronto (87 per cent), Victoria (69 per cent), Hamilton-Burlington (58 per cent), London-St. Thomas (55 per cent) and Calgary (47 per cent). Western Canadian cities dominated the list of centres with the highest increases in price appreciation. These included Victoria at 25.5 per cent, Kelowna at 22 per cent, Greater Vancouver at 19.5 per cent, and Winnipeg at 17 per cent. St. John’s (23 per cent) and Toronto (19 per cent) were also among the frontrunners for price growth.
“In few months the situation will be different” explained Scheiner. “The interest rate will be higher for mortgages as the Bank of Canada promised to raise at the second mid. of this year. The new program to tighten the down payment will effect buyers and lower the pressure on real estate deals. Other then that, the new HST will add (additional) percentage to the price. All these factors can combine to the boiling market. Though, we need to remember that Canada is a land of immigrants and as new comers keep coming, the pressure to find a place to live will effect the local real estate market.”
While buyers are taking advantage of favourable conditions, sellers too are reaping the rewards. Competing bids are a factor in the marketplace once again, with well-priced listings-especially at the entry-level price point-experiencing multiple offers. Properties priced at fair-market value will likely sell quickly for top dollar. The overall pressure on sales and price is significant across the board – and it’s not likely to subside unless more inventory comes on-stream.
Recent revisions to lending criteria will add fuel to the fire in the short term. Buyers considering a variable rate mortgage will step up their plans for homeownership in the next month or so just to get in under the wire. In the longer term, buyers will adjust, but move forward. Compromise has long been a reality-particularly in the larger centres. This simply means they may go smaller or further in their pursuits.
“From a buyers point of view, I advise to do a good search in the market for a good opportunity with your agent, only if you find one for a reasonable price, though it is a seller’s market, get the deal, from the sellers side- more then yesterday this is your game,” Scheiner advised.
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Contact the Jeffrey Team for more information - 416-388-1960
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Some encouraging news and numbers
Tom Lebour
No matter where your travels take you throughout the Greater Toronto Area, you’ll find that real estate is on many people’s minds.
From office lobbies to restaurants to subway trains, snippets of conversations about the market can be heard. This is a reflection of how our city’s real estate market affects all of us. Indeed, the quick rebound in the real estate market (GTA and Canadian) contributed greatly to the recovery experienced in the economy to date.
The Canadian Real Estate Association estimates that each resale home transaction in Canada results in more than $46,000 in additional spending across many different sectors of the economy. Obviously, this spending also helps with keeping people employed and creating new jobs as we continue to recover from the recession.
Regardless of whether you’re planning a move in the near future, it’s important to keep up-to-date on the GTA real estate market as it has such a tremendous impact on the broader economy.
In January, 4,986 homes changed hands throughout the Greater Toronto Area. This figure far exceeds last January’s 2,670 sales, which took place in the depths of our short-lived recession.
Most significantly, it is comparable to 5,075 transactions in January 2008 and the 5,173 sales that took place in January 2007, the latter of which was the strongest year on record. Breaking down the numbers, there were 1,973 sales in the 416 area and 3,013 transactions in the 905 region last month.
Condominium apartments comprised 47 per cent of all sales in the 416 and nearly 13 per cent of all 905 transactions last month. By contrast, at this time a year ago, condominiums comprised 43 per cent of 416 sales and 11 per cent of 905 transactions, despite the fact that in last year’s struggling economy, a condominium purchase may have been a more affordable option for many homebuyers. Condominium living is becoming an increasingly popular option for a broader array of households in the GTA.
With respect to prices, there is more encouraging news. Currently, the average price of a home in the GTA is $409,058, which represents a 19 per cent increase over the January 2009 average price of $343,632. The increase was even more significant in the 905, where last January’s average price of $328,935 rose more than 20 per cent to $396,556 last month. In the 416, the average price rose 17 per cent from $364,416 a year ago to $428,151 in January.
There are 12,052 resale homes available for sale throughout the GTA as compared to 20,450 a year ago. As we move toward the spring market, we can expect more listings as homeowners react favourably to recent months’ activity. The average home price will continue to grow in the GTA, but at a more moderate pace.
To find out more about market conditions in your specific neighbourhood, talk to a Greater Toronto realtor. They can advise you on recent sales in the area so that you can make informed decisions when planning your next move. At www.torontorealestateboard.com you will find GTA listings, plain language explanations of common real estate forms, information on government programs and much more.
Tom Lebour is president of the Toronto Real Estate Board, a professional association that represents 29,000 realtors in the GTA. The views expressed here are those of the president. For more information, go to www.TorontoRealEstateBoard.com.
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Contact the Jeffrey Team for more information - 416-388-1960
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January home sales slip from previous month
‘We do think the lull will be brief,’ TD strategist says
Garry Marr, Financial Post
Existing home sales declined on a monthly basis for the first time in more than a year but it may only be a temporary decline as new government regulations are expected to boost the spring market.
The Canadian Real Estate Association said yesterday January sales nationally were down 2.8% on a seasonally adjusted basis from December, the first time activity has fallen in 13 months. Despite the decline, January 2010 sales were 58% higher than a year earlier.
“January results suggest that the national resale housing market may be past the recent peak,” said Gregory Klump, chief economist with CREA.
“One car doesn’t make a parade, so a few more months of results showing a cooling trend will be required before talk of a Canadian housing bubble begins to fade. It could take until the second half of the year before a cooling trend becomes evident since home buying activity may continue to be accelerated in the first half of 2010 by expected interest rate increases, and by the introduction of the [Harmonized Sales Tax] in Ontario and British Columbia on Canada Day.”
Prices across the country continue to climb: Year-over-year gains are more impressive because of the dismal housing market a year ago.
CREA said the average sale price last month was $328,537, a 19.6% increase from a year ago. However, January 2009 prices were almost at a three-year low.
Supply across the country continues to be constrained. CREA said there were 179,199 homes listed for sale on the Multiple Listing Service at the end of January, an 18% decline from the same month a year ago.
CREA said there was only 4.4 months of inventory in the system based on the present paces of sales. That’s up from 4.2 months in December.
Some economists and observers are predicting the market will get even hotter in coming months ahead of new government regulations designed to make it harder for a home-buyer to borrow.
The federal government is introducing new rules that will force homebuyers to qualify for mortgages based on the five-year fixed rate, as opposed to the variable rate.
The gap between the two is expected to mean buyers will have to show more income to get a loan. The government is also only going to allow homeowners to refinance their homes for 90% of their value.
A third measure, demanding investors seeking government-backed mortgage default insurance have 20% of their down payment before they purchase an investment property, is expected to have more of an impact on the new-home market and condominiums.
Millan Mulraine, an economics strategist with TD Securities, sees the decline in sales in January as an exception.
“We do think the lull will be brief considering the regulatory changes. Homebuyers affected by this are going to jump in while the going is good,” said Mr. Mulraine.
By the second half the year, most commentators predict a more balanced market as the combination of higher interest rates, the new HST and regulatory changes kick in.
The realtors association is calling for sales to drop by 7.1% in 2011 and prices to fall by 1.5%.
“All signs suggest that the market will start to simmer down later this year, although likely only after another burst of activity this spring,” said Doug Porter, an economist with Bank of Montreal who agrees the market should slow in the second half of 2010.
“By then, the bubble chatter should fade,” Mr. Porter said.
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Contact the Jeffrey Team for more information - 416-388-1960
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