Toronto Real Estate Market Continues Strong Growth

TREB released its monthly Market Watch for January 2012 last week. It came as no surprise that the Toronto real estate market was once again up in price (by almost 9% on average). It was also up in volume (the number of sales was up 8.8%), a reflection of a little boost in the number of new listings and continued strong demand by buyers.

The biggest challenge we have faced in the Toronto market post-recession has been a lack of listings. Rising prices were supposed to encourage more homeowners to put their properties on the market, but we haven’t seen that, yet. So, any increase in the number of new listings is good news.  However, as I reported in December, the demand is still greater than the supply. Thus, although there were more new listings posted in January 2012 than in January 2011, the total number of listings available went down.  Also, reflecting the torrid pace set by buyers, the average number of days on market declined from 36 to 32.  So, in addition to selling for more money than last year, homes are also selling faster (which makes sense).

So, why is the media reporting today that the “Canadian real estate market’ (whatever that means) is “cooling“?  Maybe it has to do with the weighting of cities like Vancouver, but it’s certainly not a reflection of what is happening in Toronto. It does seem to have something to do with CREA’s comparison of January 2012 to December 2011 (for a month-over-month analysis). Go to their news page for more info. You’ll see this handy quote: “Actual (not seasonally adjusted) activity came in 4.0% above levels in January, 2011 and stood even with the 5 and 10 year averages for January sales.”  To me, that is a more relevant comment – up, not down; normal, not abnormal.

The Toronto real estate market moves in cycles within each year: busy spring, slower summer, busy fall, slower winter. These ups-and-downs should not be confused with over-all, year-over-year trends. The cycle is a reflection of peoples’ lives – for example, of wanting to buy or sell in time to close at the beginning or end of the school year, or not wanting to be on the market over the Christmas-New Year holidays.  Month-to-month variations occur, but are rather well understood.

This morning I attended a weekly meeting with a group of RE/MAX Hallmark agents. We all have buyers eagerly looking for homes to buy, which is a sign of a strong market for this year. However, we are also wary of prices spiking too much, which could negatively affect buyers’ ability to close on purchases. The market is ‘hot’, and will stay that way for the foreseeable future. That said, it’s important that you not get caught up in the moment. I’m not worried about a ‘bubble’. (I thought that we were past all of that mis-placed speculation!) I’m more concerned about the immediate impact on buyers, and the market, of lenders refusing to validate some of the prices we are seeing (when they appraise it for a mortgage). Know your valuations (I provide the background on that for each house on which my buyers want to offer) and the market; also, know your budget, and work within the boundaries. It may mean looking in a different neighbourhood, so keep an open mind!  ;)

Contact me for a copy of the latest Market Watch report from the Toronto Real Estate Board.  It included numerous breakdowns – by location, type, size, etc.

Fantastic Opportunity for RE/MAX Hallmark Clients to Learn about the Canadian Economy!

Wow – this is great! RE/MAX Hallmark is partnering with TD Canada Trust to bring our clients an Exclusive Economic Outlook event with Craig Alexander, Senior Vice-President and Chief Economist, TD Canada Trust. Mr. Alexander is one of the foremost authorities on the Canadian economy, and is a fantastic speaker.  (I saw him at the RE/MAX annual convention a couple of weeks ago.)

The event will be held February 23rd, 2012 from 6:30pm to 8:00pm, and is available exclusively to RE/MAX Hallmark Clients. Whether you are buying or selling, starting your career or retiring, saving, investing, or simply trying to learn more about our economy and how it impacts your personal finance, this is an excellent opportunity to get an inside perspective.

Space is limited! If you would like to attend please contact me ASAP to make the arrangements.

Buying in a Sellers’ Market

So, you want to buy a house or condo in today’s sellers’ market?  With interest rates at record lows, and set to stay low for the next few years, the number of active buyers is going to stay high for some time.  In fact, I believe that a number of factors are setting the stage for an extremely busy real estate market in Toronto for 2012 and 2013: ongoing, if modest, economic growth (and yes, blips will appear); a slowly improving job market; those low rates; and – perhaps most importantly – receding fears of a major price correction.

Regular readers will know that I have always believed in the Toronto market.  It is completely different from other markets in Canada, so declines in the ‘national average price’ (whatever that is) mean next to nothing here.  Even during the recession, I urged buyers to act quickly to take advantage of the very brief lull.  Since the recovery, I have argued against the ‘bubble theory’.  Now, BMO has issued a report re-framing their minor concerns as a ‘balloon’ that may deflate slightly over time.  While caution is always warranted, I think that ‘head for the hills’ fear is behind us.  That is going to draw more buyers into the market.

For you first-time buyers (and those of you who haven’t done this in a while), there’s lots that you need to know – not just about the market, but about the process.  I provide all of my buyers with a comprehensive, custom Home Buyer Guide.  We’re not talking rocket science here, but almost every purchase or sale has something unique about it.  Knowing the basics will help you to prepare yourself for your experience.  The following is by no means a comprehensive list; rather, it’s sort of a “Top 5″ – or better yet, a “First 5″ things you should know (updated from a previous post):

· Be an educated Buyer. Learn as much as you can about the market before you buy.  I’m happy to take out all of my clients to start looking at houses early on in the process.  If you seriously want to buy, it’s never too soon to start getting educated about market conditions, what your money will get you, neighbourhood characteristics, etc.  On that note, be honest and open with your Realtor®!  I work for you and can best help you if I have a good understanding of your needs.  Once I know what you are looking for, my job is to be the objective guide in the process to ensure your needs and interests are met and protected.  (I.e. I’ll be better able to show you  houses that interest you.)

· Get pre-approved for your mortgage as soon as possible.  This helps you to determine your budget, and locks in today’s best rate for you.  I will help you connect with a mortgage professional if necessary.

· Act quickly!  If you want to see a listing call me right away and book an appointment.  Most well-marketed houses and condos will sell within a week or two, so there most often won’t be time to dilly-dally.

· Accept that it’s a ‘seller’s market’ and act accordingly.  That means be prepared to make an offer on Offer Day (financing lined up, home inspection report in hand).  Chances are there will be competition on most well priced, well prepared listings this year.  We’ll look at comparable sales and determine a reasonable valuation for the house/condo.  The rest is left somewhat to ‘fate’, and will depend upon your desires vis-a-vis other bidders, but if you do your best you have a decent chance of success.  (This is a complicated topic, and we will spend plenty of time talking about it throughout your search.)

· Plan to stay in your home a minimum of two years to ‘break even’, five years to build a decent amount of equity.  This may require sitting down with a partner to plot out a viable plan – just to make sure that the move makes sense.  The bottom line is that you shouldn’t expect to make money in less than two years.

There you have it: five basic principles to get you started on your new home search.  Be sure to re-visit my blog for more tips – and please do contact me if you want more help!  Call me any time.

RE/MAX Hallmark Realty Ltd Announces New Leslieville Office!

RE/MAX Hallmark Realty Ltd is expanding into the heart of Leslieville!  With the recent purchase of 785 Queen St East, Hallmark will be building upon our already significant market presence in one of Toronto’s most interesting and exciting neighbourhoods.  The new office, which is scheduled to open in May, 2012, will serve the growth of the company, Realtors already in the organization and the needs of our many clients in and around the area.

For those of you who have followed my own recent journey away from, and then back to, RE/MAX Hallmark, this will make sense: Hallmark just has so much to offer – both to me and to my clients.  The new office will give us a physical base in Leslieville from which to operate – just as we have had with Hallmark’s many other offices around the city (including Riverdale, Don Mills, Mt Pleasant, College St, etc).  Plus, it will draw more buyers and sellers to the brokerage, adding to the pool of opportunities for all involved.

All in all, this is just another great reason to work with RE/MAX Hallmark.  Call me if you have any questions or comments, and let’s get to work on your real estate goals!

 

Thank you for your support!

Wow!  It has been a busy couple of weeks since I announced my move back to RE/MAX Hallmark.  In that time, I have been absolutely inundated with excited and supportive calls and emails from my clients, colleagues, friends and family.  The message is overwhelming: great move!  Honestly, I thought that a few people would be at least a bit skeptical, but not one person has indicated any doubts (quite the contrary).  All the positive feedback has been great.  I want to thank all of you for your support.  As you know, I am very excited, and it’s really great to see that so many of you are, too!

The reaction at RE/MAX Hallmark has been fantastic, too.  From Broker/Owners Debra Bain and Ken Mclachlan right through the whole organization, it has been a warm ‘welcome home!’  It’s great to be back.  With seven locations around Toronto (plus two more in Cottage Country), RE/MAX Hallmark has a market presence all across the city, which allows me to better represent and serve my clients.  I couldn’t be happier!

I expect 2012 to be another busy year in the Toronto real estate market.  (I’ll blog more on that in the coming weeks.)  If you are planning to buy or sell, call me today and let’s start laying the groundwork.

Have a great holiday season!

I’m back at RE/MAX Hallmark Realty Ltd!

A few months ago, the team I was working with broke away from RE/MAX Hallmark Realty to become an independent Brokerage.  They are such great people, and it was an exciting time, so I happily accompanied them.  However, now that the dust has settled I have realized that I can much better represent my clients – both buyers and sellers – with the RE/MAX brand behind us.  Although there are some advantages to working with a highly localized boutique brokerage, I don’t feel that it’s the best way to represent a wide range of people in a city as large and diverse as Toronto.  That’s why I have decided to go ‘home’ to Hallmark!

The RE/MAX brand is world famous, but more importantly it is the king of the market in Toronto.  I’m really looking forward to re-connecting with many of my former colleagues, and to getting plugged back in to one of the biggest (and best!) real estate networks available to buyers and sellers – not just in Toronto, but Canada-wide and, when necessary, world wide.

This time around I’ll be returning to my roots as a solo agent – no more teams for me!  This will give me the independence to cultivate marketing strategies that are right for my sellers, while leaving me with the time and flexibility to better service buyers.  Having seen and experienced the trials and miscommunications of team selling, I’m very relieved to be getting back to dealing directly – and singly – with all of my clients.

If we have done business in the past, I’ll be getting in touch with you over the next while to further discuss the change, and to re-connect with you personally.  If we haven’t yet done business, please don’t hesitate to contact me any time.  I’m here to help!

Toronto Real Estate Market Stayed Strong Through November

The Toronto (i.e. GTA) real estate market had another strong month in November.  Sales volume was up 11% to 7,092 units sold, and new listings for the month were up 14% to 9,786.  However, that latter number masks an over-all decline in the number of active listings (15,551, down from 18,305 last year).  Although the market did provide more supply relative to the same month last year, the general supply challenge remains in place.

Not surprisingly, the average sale price was also up. It is now $480,421, an increase of almost 10 per cent over the average in November 2010 of $437,494.  The ever-rising price of houses in the GTA is a reflection of high demand and attractive interest rates.  I’ll point out that I don’t credit everything to low interest rates; if Toronto wasn’t a great place to live, we wouldn’t have so many eager buyers, no matter how low interest rates went.

Understandably, the question of affordability comes up in conversation from time to time.  Although I don’t usually quote directly from the TREB Market Watch report (which is the key source of my numbers), I found this comment to be particularly relevant, given how often we hear about ‘affordability’:

“Despite strong price growth this year, the housing market remains affordable in the GTA,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.  “The correct method of assessing affordability is to consider the share of the average household’s income that is dedicated to mortgage principal and interest, property taxes and utilities.  Currently, this share remains in line with generally accepted lending guidelines.  Given this positive affordability picture, average price growth is forecast to continue in 2012, albeit at a more moderate pace.”

So, prices are rising, but they remain affordable for the majority of people.  Of course, some people ‘blame’ Realtors for rising prices.  That’s reminiscent of the old ‘shoot the messenger’ folly, but since we are active participants in the market, I suppose that comes with the territory.  Realtors don’t set the market; like water, it finds its own level.  We certainly work to fulfill our obligation to get our sellers the most money possible for their homes; that’s the job.  On the buyers’ side, we work within their budgets, and strive to follow their instructions and find them a great new home.  Again, that’s the job – to sell houses.  Ultimately, a rising market only helps Realtors as long as it remains rational, which I think it still is.

I’ll finish with a reminder that there are properties out there at every price level.  As with everything else, you get what you pay for.  However, if you are willing to make a trade-off regarding location, parking or size, you might be pleasantly surprised at the compromise.  Feel free to get in touch with me at any time to review your options.

Beautiful loft conversion: 201-326 Carlaw Ave, $499,000

This authentic loft conversion is move-in ready.  At approximately 1180 square feet, it features newly laid hardwood floors, granite counters, all new appliances, plenty of windows (unique to the end units) and a roof-top deck!  (Parking is available for purchase separately.)

If you are in the market for a loft, don’t miss this one!  Call me today to book an appointment to see it.

-Simon

October 2011 sales volume up 17.5%

Sales activity in the Toronto real estate market continues to impress.  The number of sales (7,642) increased 17.5% over October 2010 (6,504), which is in part thanks to new listings being up 18.1%.  Overall, however, the increase in sales caused a slight dip (-2.8%) in the number of available listings.  Thanks to supply and demand, it remains a seller’s market.

The healthy sales pace is a reflection of the on-going demand for housing in Toronto, a topic that I have discussed more than once before.  I’ll just take a moment to remind readers that, as usual, sellers need to properly prepare their home for sale (de-clutter, clean, paint as necessary, etc.) and list at a fair price.  A ‘hot’ market does not mean that somebody will over-pay for your house.  For their part, buyers must be prepared with a mortgage pre-approval, a ready deposit (accessible within 24 hours to meet TREB guidelines), and a willingness to move quickly on an attractive property.  There are lots of other buyers out there – they are your competition!

Despite the apparent resilience of the Toronto market, I still hear people say that they want to wait for a recession before they buy.  It’s worth noting that, although a very small number of folks made great buys during the last dip (as I encouraged my buyers to do), not many people can pull that off.  TREB statistics for the GTA show that in the year before the recession (2006-2007) the average sale price increased by about 6.9%.  Recession fears hit Canada in early-mid 2008, and by late-2008 the real estate market was hitting its funk.  Nonetheless, from 2007 to 2008 the average price managed a 0.8% increase.  Then, as the recovery took hold in early 2009 we saw a year-over-year increase of 4.2%, which stretched to a 9% increase 2009-2010.  So far this  year, we are around that +8% range.

As I noted at the time, aside from a brief (maybe 4 to 6 months) period in very late 2008 through about early spring 2009, there wasn’t much of a buying opportunity in the Toronto real estate market.  If we are going to see another recession (fears seem to ebb and flow from one day to the next) it’s not going to be as bad as the relatively modest one Canada experienced a couple of years ago.  While I’m sure some smart and lucky folks will pull off a great buy or two, I really don’t believe that many folks will be able to time their purchase to precisely the right moment.  That’s why I say (as I did recently via my Twitter account): Don’t wait to buy real estate.  Buy real estate and wait.

Probably the best way to buy real estate is to get out there and start looking for a good fit.  When you find it, buy it.  No tricks, no games, no luck, just smart buying.  Call or email me when you are ready to get active in the Toronto real estate market!

New Listing – 164 Neville Park Blvd now SOLD!!

This beautiful three storey home sits on one of the Beach’s nicest streets – a rare cul-de-sac.  Backing on to a reverse ravine, this home oozes character and charm.  Gleaming hardwood floors, beautiful wood trim, a fireplace and coffered ceilings contribute to that ‘Beach’ feeling.  With 4+1 bedrooms, a family room, a walk-out to the back deck and parking, this home offers size and flexibility for any family.  Call me to book an appointment to see it before it sells!