New listing: 510-1 Cole St, offered at $354,900

OneCole is part of the massive redevelopment of Regent Park. Set right on the edge of downtown Toronto, the exterior of the building is a modern blend of brick and glass. The interior finishes are fantastic – both the public spaces, and the interior of the unit.

Floor-to-ceiling windows allow plenty of sunlight into the unit. The finishes are well above average, including high-quality engineered wood flooring, granite counters,  stainless steel appliances, and a full-sized washer-dryer set. The master bedroom has a 4-piece Ensuite bath and double closet; the den offers plenty of options (office, spare room, library, etc.).  No detail has been missed – even the light fixtures will catch your eye!

Unit 510 is high enough to offer a complex city view. As you look westward, the foreground captures the rooftops of the hundred-year-old streetscape below. Just beyond that you’ll see the trees in the local park. Further in the distance the downtown seems to rise from the leafy treetops. It’s quite a sight!

One of the most amazing features at OneCole is the third floor common area, which includes a large lounge (with TVs, a fireplace, Foosball and more) and a large, impressive outdoor space (with BBQs!). The gym includes cardio and floor equipment, free weights and has wall-to-wall, floor-to-ceiling windows looking out onto the park-like gardens.

With parking and a locker included, this is a great value. There’s a brand new grocery store downstairs, a coffee shop, local parks, TTC at your door, and downtown just a short walk away. If you are in the market for a condo, you owe it to yourself to see this one. Call me today to book a private viewing!

Balancing motivations

The topic of commissions garners a lot of attention in the real estate world. Real estate is a brutally competitive industry (not that you’d know it from what you hear in the media – or from the Competition Bureau). Most obviously, the big brands compete (e.g. RE/MAX vs. The Rest); in every neighbourhood agents at the various offices and branches compete with each other for local business; within each office, individual agents are competing with each other, too. It takes a Realtor many years to build a proper real estate business, and to accumulate the experience and wisdom needed to weave one’s way through the infinite number of ways a transaction can play out.

Naturally, with all that competition we sometimes see commission cutting – because when somebody can’t sell their value, they have to cut their price, right? And it’s not only due to pressure inside the industry. We often see ‘advice’ from professionals in other industries (e.g. lawyers, bloggers, ‘financial advisers’) telling folks to negotiate the commission. I think that’s terrible advice, and here’s why: it completely misses the point.

The most important factor for most sellers is maximizing the proceeds from the sale of their home – and rightly so. That’s why it’s so important to put your best foot forward, and to have a winning marketing plan, but here’s what I mean about balancing motivations: keep your eye on the net proceeds of the sale, not the commission rate. If you are focussed on the commission you are looking at the trees, but not seeing the forest. You want (and perhaps need) the absolute maximum from the sale of your property or condo. You don’t get that by obsessing over half a percentage point. You get it by hiring the right agent, at the right brokerage, with the right plan for you and your home. Ultimately, the point of the marketing is to generate an offer on the listing. That’s when I earn my money, and that’s where you, the seller, make yours, too – at the negotiating table. Depending upon the circumstances, we could be talking about tens of thousands of dollars – enough to make that half point insignificant.

I’ll give an example of why I think it’s a mistake to choose your agent based on the commission. Last month I did a market valuation for a local couple. I figured that their four bedroom house was worth something in the range of $579k to $599k. I thought that, with some hard work and a bit of luck (timing is often so important) they might crest $600k. About a week before they were due to come on the market I had a chat with one of them, and the question of my commission was raised. They wanted a ‘deal’. I don’t do ‘deals’. What I *do* is work hard for my clients, with the best of intentions – and I produce results. In short, I’m here to help, and as so many of my past clients can attest, I do that quite well. Because this is how I provide for my family of six, I get paid the market rate - and everybody goes home happy.

After that conversation, it didn’t surprise me when the listing appeared on the MLS with an out-of-area agent at a lower rate of commission. What did surprise me was the price – it was $30,000 below the bottom of my projected range. Now, given that the agent was from the 905 region I suppose I shouldn’t have been so surprised, but the gap was so huge that I could hardly believe my eyes.

The next surprise was a phone call from the seller – a pleasant surprise, of course. (Most folks don’t bother with the follow-up call; I pointed that out and thanked him for the courtesy.) He admitted that they went with the out-of-area agent in large part for the commission savings. When I asked about the price he responded that they ‘didn’t have to accept’ an offer if they didn’t like it…. (That’s technically true, but I feel quite strongly that it’s not fair to buyers to play games like that.) I thought he meant that they were counting on competition to bid the price up to market value, but a week later the house sold for just a touch over the asking price – and *that* was a real shocker.

So, let’s do some math now. I’m just going to guess that the commission savings amounted to half a point – which, on my estimate of close to $600,000 is about $3000, naturally less if the house sold for less. To achieve the supposed ‘savings’ of $3000 all the seller had to do was drop their selling price by $30,000-$50,000. Does that make any sense? It seems to me that they left about $40,000 on the table! I’m still shaking my head….

Like I said, real estate is competitive. It’s a tough business, but I (like most of my colleagues) work hard to provide value and earn my keep. However, if you focus on the commission you’ll end up sitting across the table from an agent who’s thinking about the commission, too. In my opinion, the guy cutting his commission up front is there for the deal, not for you. Is that what you want?

As I always say, I’m here to help. I work for my clients, we get the job done, and a few months down the road, when the transaction closes, I get paid. I don’t, however, try to buy anybody’s business – and I urge you to think twice about somebody who does.

New Listing: 124 Glenmore Rd – offered at $599,000 – SOLD!!

I love Glenmore Rd! It’s got such a great look and feel to it. The homes are mostly brick and well-built; many have parking, while street parking is readily available. The tree canopy is still fairly mature (although it’s thinning throughout the east end), so there’s decent shade during the hot summer. With parks and schools close by, Glenmore Rd is a great family-friendly street. The Gerrard streetcar or Woodbine bus (to either the subway or Queen streetcar) give commuters options to get downtown.

My new listing at #124 is classic Glenmore. It’s a three bedroom semi with a finished basement and one car parking – that right there covers a lot of bases, doesn’t it? The home has been well cared-for and thoroughly improved in the ten years that the sellers have lived there. The roof, furnace, A/C, windows, and wiring have all been upgraded. The entire main floor was renovated in 2009 (including a new kitchen and powder room), while the second floor got new lighting, ceilings and broadloom in 2011. All of the appliances have been replaced, and a gas line run to the back yard – the existing natural gas BBQ is included with the house. (Contact me for a copy of the list of features and improvements.)

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About the New MLS Home Price Index

Hi folks,

I don’t normally do this, but today I’m going to re-post a press release from TREB regarding the new MLS Home Price Index. The Index is meant to provide a more informative and valuable analysis of market movement by breaking down the average sale price by property type and location, and providing a base reference (2005) – rather like the Consumer Price Index. With time, as more data is accumulated, home owners and buyers will be able to tell how the price of their type of home in their neighbourhood has changed. During a period in which we have seen significant price appreciation, this should help us all keep some perspective on things.

Here’s the release (my closing comments appear below):

“TORONTO, February 6, 2012 – The Toronto Real Estate Board (TREB), Canadian Real Estate Association (CREA) and four other major real estate boards across Canada have developed a new system to measure and provide clarity on home prices and home price growth: the MLS® Home Price Index (MLS® HPI).

The MLS® HPI is calculated using a sophisticated statistical model that is a hybrid of both the repeat sales and hedonic price approaches. The MLS® HPI takes into account a home’s quantitative attributes (e.g. the number of rooms it has; square footage etc.) and qualitative attributes (e.g., whether it has a finished basement, a view etc.).
The MLS® HPI approach provides a less volatile measure of price than averages and medians, which can swing dramatically in response to changes in the mix of home sales from one time period to the next (see Chart 1 on Page 2 of this release for a visual comparison).

Each month, there will be two key outputs published using the MLS® HPI:

1. A series of price indices – The MLS® HPI price indices work in a similar fashion to the Consumer Price Index (Canada’s measure of consumer price inflation). The indices have a base month/year of January 2005, where the indices are equal to 100. In January 2012 TREB’s composite HPI was 143.6. This means that the composite price index grew by 43.6 per cent between January 2005 and January 2012. On a month-over-month basis, TREB’s composite HPI was up by 0.28 per cent compared to December 2011 and also up by 7.6 per cent year-over-year in comparison to January 2011.

2. A series of benchmark home prices – The MLS® HPI has also been used to establish benchmark homes down to TREB’s Community level of geography for major home types including single family (detached and attached), townhouses and apartments. A benchmark home is composed of a set of attributes typical of homes in the area where it is located, and remains constant over time. This allows for an apples-to-apples comparison of price over time.
In the coming months, TREB will publish an increasing amount of data and analysis based on the MLS® HPI in its monthly Market Watch publication in a new section called “Focus on the MLS® Home Price Index”. Eventually, the MLS® HPI will become TREB’s headline price number for release and reporting. However, traditional average and median calculations will continue to be published in the Market Watch.

“The Toronto Real Estate Board is extremely excited to be launching the MLS® HPI. This new approach will provide clarity for the consumer and prove to be a major improvement over any other method to measure home prices and home price change available in the marketplace today. I look forward to discussing the many benefits and uses of the MLS® HPI in the coming months,” said TREB President Richard Silver.

More information about the MLS® HPI can be found in the TREB-specific tables and charts on Page 2 of this release, the Backgrounder beginning on Page 3 of this release and at www.homepriceindex.ca.”

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I think this is great. The recent recession provides a great ‘case-study’ for how important this information is. Back in late ’08 when the Toronto real estate market experienced a brief period of downward pressure I wrote this blog in which I pointed out the impact high-end sales can have on average prices – especially when those sales dry up. Averages are helpful, but don’t tell the whole story. The new HPI will provide more, and clearer, data.

By the way, on the topic of averages, the average sale price in Toronto for the month of March was up 10% over 2011 (to $501,614), while the number of sales was up 8% (to 9,690). As long as demand continues to out-strip supply, this trend will continue. That said, I listed two houses in the last month that sold for under $500k, and sold a condo in the West End for under $300k. That average sale price includes plenty of high-end houses, so remember to look past that. Going forward, the HPI will help!

Renovated Beach Townhouse: 3-16 Balmy Ave, SOLD!!

This gorgeous, fully renovated townhouse is south of Queen St E, just a two minute stroll to the boardwalk! Set in a development of only six units, the home features three bedrooms, two luxurious baths, hardwood floors, an amazing kitchen, and direct access to the unit from the parking garage. If you are looking for peace and quiet – and exclusive privacy – you have to consider this one as an option – call me today to book a private viewing!

New Listing: 57 Drayton Ave, offered at $379,900 – SOLD!!

This lovely detached bungalow is bigger than it seems from the street, and would make a fantastic starter or condo alternative. The home features two bedrooms (one with a sunny office/den attached), a bright living room with vaulted ceilings and four skylights, and a modern kitchen with an adjacent breakfast/dining room with sliding glass doors to the back deck and yard. The large loft space offers plenty of storage or kids’ play space, while the basement has a brand new four-piece bathroom, a laundry room and a huge open, carpeted rec room.

The rear walk-out opens to a great back yard with a deck, gardens and a shed (included). The sunny front yard is planted with a perennial garden. Just steps to the Danforth and all its shops and services, this home is also just a short walk to the Coxwell subway station, East Lynn Park, Monarch Park, a Toronto Public Library branch, great schools and more! As a ironic bonus, the original antenna now offers free over-the-air HD TV – just hook up your digital TV and start watching!

Don’t forget to ‘Like’ my Facebook Fan Page at http://www.facebook.com/RealEstateSimon and follow me on Twitter (I’m @RealEstateSimon) to keep up-to-date on the latest happenings in the Toronto Real Estate Market!

New listing: 162 Bastedo Ave, offered at $439,900 – SOLD!!

This cute two bedroom semi is a fantastic house in a fantastic neighbourhood! Freshly painted throughout, the home features hardwood floors, a kitchen addition (making it a huge eat-in), and a gorgeous landscaped back yard. Two skylights (including in the bathroom) make the upstairs sunny and bright, and the balcony off the back of the house is a great additional outdoor, private space. This one is truly in ‘move-in’ condition!

Located just steps from the Danforth and all it has to offer, it’s also close to parks (e.g. East Lynn, Monarch Park), the Danforth/Coxwell Toronto Public Library branch, and is only a 5 minute walk to the Coxwell subway station. Local schools are Earl Haig Jr. PS, Monarch Park CI; and St Brigid elementary, St Patrick HS Catholic.

I’ll be hosting public Open Houses on Saturday, March 24th and Sunday, March 25th. Please feel free to drop by to see the house, or call me to arrange a private viewing.

By the way, follow me on Twitter to keep up-to-date on the latest happenings in the Toronto Real Estate Market. I’m @RealEstateSimon!