Tag Archive for greater toronto area

Laurin Jeffrey | January 13, 2012
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Home sales market hot in December

DurhamRegion.com

More homes might have sold in December if more had been on the market.

The Greater Toronto Realtors reported just over 4,700 transactions through the MLS system in December. The December totals capped off the second best year on record under the current Toronto Real Estate Board boundaries, which includes Durham Region. In 2011, total sales amounted to 89,347, a four-per cent increase over 2010.

“Low borrowing costs kept buyers confident in their ability to comfortably cover their mortgage payments along with other major housing costs,” said TREB president Richard Silver. “If buyers had not been constrained by a shortage of listings over the past 12 months, we would have been flirting with a new sales record in the Greater Toronto Area.”

The average selling price in December was $451,436 — up from the $433,523 in December 2010. For all of 2011, the average selling price was $465,412, an increase of eight per cent in comparison to the average of $431,276 in 2010.

“Months of inventory remained below the pre-recession norm in 2011. Very tight market conditions meant substantial competition between buyers and strong upward pressure on selling prices,” said Jason Mercer, TREB’s senior manager of market analysis.

“TREB’s baseline forecast for 2012 is for an average price of $485,000, representing a more moderate four per cent annual rate of price growth. This baseline view is subject to a heightened degree of risk given the uncertain global economic outlook,” Mr. Mercer added.

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Contact the Jeffrey Team for more information – 416-388-1960

Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
They did not write these articles, they just reproduce them here for people
who are interested in Toronto real estate. They do not work for any builders.
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Category: Ajax Real Estate, Buying Real Estate, Oshawa Real Estate, Pickering Real Estate, Selling Real Estate, Whitby Real Estate | Tags: , , , , , , , ,
Laurin Jeffrey | March 4, 2011
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Expect homes to remain affordable

Bill Johnston – Toronto Sun

I have written recently that the Toronto Real Estate Board (TREB) expects to see the average existing home price in the GTA grow by approximately three to five per cent per year over the next two years.

Much has been made of some recent analyses forecasting double-digit declines in Canadian home prices. Some analysts have given a specific time frame whereas others have simply argued that the Canadian homes are currently overvalued and their values should decline over time.

Geography is another issue. Talking about the Canadian housing market as a whole is problematic. Market conditions are not uniform across all Canadian provinces and cities. The drivers of economic growth in the Greater Toronto Area (GTA) are different from the drivers of growth in the Vancouver area which are different again compared to St. John’s. The same is true for the sources of population growth. These regional differences confirm that it is difficult to paint resale housing with one brush country-wide.

I talked to Jason Mercer, TREB’s Senior Manager of Market Analysis. He explained that many of the analyses pointing toward double-digit price declines in Canada have relied on the calculation of Canadian home price to income ratios.

“It has been argued that because this ratio is currently high from a historic perspective, the average resale home price in Canada must fall in order for the ratio to move back in line with the long-term average.

Unfortunately, this argument doesn’t account for borrowing costs, which is problematic given that most home buyers purchase a home using a mortgage,” said Mercer.

“A better way of determining if the current average home price level is justified is to consider what percentage of average household income is going toward mortgage payments associated with the purchase of an average priced home.

The current percentage is lower than the long term averages for Canada and the GTA. This means that there is still room for moderate price growth, even after taking into account the consensus view that mortgage rates will increase in 2011 and 2012,” continued Mercer.

To me, as a practicing REALTOR® and President of TREB, Mr. Mercer’s comments make sense. One of the most common topics of conversation amongst REALTORS® and home buyers is where mortgage rates are headed.

People are concerned about what their mortgage payments will be relative to their income and other expenses. What I do not hear people talking about is what their home price to income ratio is going to be after they purchase a home.

The bottom line is that when most people think about housing affordability, they are thinking about how much of their income is going toward their mortgage payments. Affordability has been an issue in the past. In the early 1990s, mortgage rates were substantially higher than today’s levels, the unemployment rate had spiked and income growth had stalled. The result was falling prices.

While we will likely see higher borrowing costs this year and next, income growth is also expected to accelerate. This suggests that home ownership will remain affordable and moderate price growth will be justified over the next two years.

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Contact the Jeffrey Team for more information  -  416-388-1960

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Category: Ajax Real Estate, Buying Real Estate, General Real Estate, Pickering Real Estate, Selling Real Estate | Tags: , , , , , , , , , , , , ,
Laurin Jeffrey | February 24, 2011
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Taking steps towards homeownership

Bill Johnston – Toronto Star

If you are considering the purchase of your first home you’re probably aware that like many of life’s milestones, there are many things you must consider.

Understanding conditions in the real estate market is a good first step. Current conditions in the Greater Toronto Area resale market remain quite favourable for people looking to take the first step onto the property ladder.

A total of 4,337 homes changed hands throughout the GTA in January, representing a 13% decrease compared to a year earlier. At the same time, however, the average selling price grew by more than four% in comparison to January 2010, coming in at $427,037. While sales are down in comparison to last January’s record pace, the level of transactions remains high enough relative to listings to promote price growth.

The housing market in the GTA continues to be supported by improving economic conditions which have led to sustained job creation, a lower unemployment rate and accelerating income growth. Financing remains affordable as well. The average interest rate for a five-year fixed rate mortgage is very low from a historic perspective.

While it’s important to consider these fundamentals, it is also crucial to closely examine your individual circumstances, especially when determining what you can afford. Financial institutions will help you determine what you can afford by calculating your Gross Debt Service (GDS) ratio, an amount that includes monthly mortgage, tax, and utilities payments and a portion of condominium fees (if applicable).

Your GDS ratio normally should not exceed 32% of your gross monthly income. A lender will also look at your total debt picture by calculating your Total Debt Service (TDS) ratio, taking into account all obligations such as your monthly mortgage, car loan, line of credit and credit card obligations. As a rule of thumb, your TDS ratio should not exceed 40% of your gross monthly income. Be sure to explore of the financing options available through different financial institutions.

When determining a price range it’s important to realistically consider miscellaneous monthly expenses, and to account for costs associated with the transaction including home inspection, survey and legal fees.

Once you’re ready to begin your search, enlist a REALTOR® who will commit to representing your interests in writing using a Buyer Representation Agreement. More information on this important document can be found at www.BRAFirst.com.

To find a home suited to your lifestyle, be sure to explore a number of different housing types and neighbourhoods with your REALTOR® before narrowing your search. REALTORS® have access to information on market conditions in individual neighbourhoods, on future development plans and on a range of local amenities.

Your REALTOR® may also provide information on a number of available government programs to help make your purchase more affordable like the Five% Down Payment Program, the RRSP Homebuyers’ Plan, the First Time Home Buyers’ Credit, Land Transfer Tax rebates and more.

Once you have found the right fit, your REALTOR® can use their expert negotiation skills to help you achieve a favourable agreement.

Specialized skills and knowledge make your REALTOR® an invaluable resource, buoying your efforts as you navigate through one of life’s most important decisions.

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Contact the Jeffrey Team for more information  -  416-388-1960

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