Archive for the ‘Ajax Real Estate’ Category
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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Real estate set for rise ahead of new rules
But a buying frenzy may be around the corner as new borrowing rules and tax regimes re-energize sales
Steve Ladurantaye – Globe and Mail
A rush of home buyers trying to beat higher taxes and tighter mortgage regulations could pump up the real estate market just as it’s showing signs of cooling.
The real estate market pulled back slightly in January after its record run, although both sales and prices were up sharply from the depressed levels of a year ago.
Economists believe, however, that home buyers will push to beat new regulations, unveiled this week by Finance Minister Jim Flaherty, which come into effect April 19.
They also think that there will be a rush to beat the new harmonized sales tax in Ontario and British Columbia later this year.
That could lead to a spike in sales in the spring, followed by a sharp pullback and lower prices in the second half the year, but nothing that would crater the market.
An increase in supply as owners were enticed to list their homes by high prices, and a slight ebbing of demand as consumers realized things were getting a little too pricey, led to a decrease in month-over-month sales in January for the first time since December, 2008.
The 2.8% decline was small, but comes as market watchers anxiously track the market in search of an asset bubble.
The federal government moved this week to curtail speculation in what has been a red-hot market.
It also made it more difficult for home buyers to qualify for mortgages unless they can meet more stringent criteria such as down payments.
The Canadian Real Estate Association said Wednesday that while “one car doesn’t make a parade,” the market may have peaked in December as consumers took advantage of low rates and buyers who stayed out of the market during the depths of the recession finally closed deals on new homes.
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Contact the Jeffrey Team for more information - 416-388-1960
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Beware of promises that sound too good
Mark Weisleder – Toronto Star
“List with me and I guarantee to sell your home in 60 days or I will buy it myself.”
How many times have you seen advertisements like this from real estate salespeople? I have often been asked whether these guarantees are in fact legitimate. As with most advertising claims regarding guarantees, there are always terms and conditions that the guarantee is subject to, and these conditions must be immediately brought to the attention of any consumer at the time any inquiry is made about the guarantee.
In addition, the terms and conditions cannot contradict the main point in the advertising.
In a discipline case decided in March of 2008 by the Real Estate Council of Ontario, a real estate broker made a guarantee that if a buyer bought a home through the broker, then the broker would sell their home in 120 days or he would buy it himself. The buyer found a home to buy with this broker and then listed their home with the same broker. The home did not sell and then the broker refused to buy the seller’s home.
The reason given was that although the buyer did buy a home using the broker as a buyer representative, the buyer did not buy a home that was actually listed with this same broker. The broker was fined $10,000 for this misleading advertising.
Some terms and conditions may state that the salesperson will only pay 80 to 95% of the appraised value. But many other points are left vague. Is the real estate commission included or excluded? When is the appraisal to take place? Who conducts the appraisal? What if the property needs repairs? Who pays for this?
If you intend to rely on any guarantee, be sure to get all these terms and conditions in advance in writing, before signing anything.
Selling a home or condominium is complicated. There is a lot of money involved and potential liability if you are not honest with any buyer about the condition of your home.
That’s why it’s important sellers receive the highest quality of representation, to both make sure they obtain the best price for their property, but also to avoid any risk of being involved in any kind of legal proceedings.
In my opinion, you do not need any guarantee; you need the right salesperson to represent you.
To make sure you find the right real estate salesperson to sell your home, remember the following:Ask your friends, relatives and colleagues for references;
Drive around your area and look for signs that say “sold” on them;
Check the information on the salesperson’s website; the more helpful the information, the better;
Review examples of their marketing materials to see how professional they look;
Carefully review the salesperson’s sales history. Ask how many homes they listed last year and how many sold, as well as how long on average it took for each of their homes to sell as compared to the average on your local market.
The salesperson will prepare a comparative market analysis giving you an idea as to what your own home should sell for. Review this carefully.
Read the testimonials of previous clients of the salesperson and call them yourself to verify the information.
By doing your homework in advance of finding the right salesperson to sell your home, the greater your chances of being satisfied.
It is not about catchy advertising slogans or guarantees, it is about results.
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Contact the Jeffrey Team for more information - 416-388-1960
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