Real Talk!

Economist Adrienne Warne expects Canadian housing prices to flatten for the rest of 2010. New housing prices in June rose 0.1 per cent according to Statistics Canada, following a 0.3 per cent increase in May.

But July's housing starts slipped to 189,200, led mostly by a decline in new single-unit homes, according to numbers released Tuesday by Canada Mortgage and Housing Corp. The Canadian Real Estate Association said Monday a total of 31,536 homes were sold in July, compared with 33,836 in June. The average price of homes sold in July was $330,351, edging up one per cent from the same month last year. But that was down considerably from the average of $342,662 in June.

Year-to-date transactions are up 5.6 per cent, compared with the first seven months of last year. However, activity rose sharply over the second half of last year and experts aren’t convinced that is going to happen this year.

New supply continued to adjust to lower demand. The seasonally adjusted number of new residential listings declined by 7.2 per cent in July 2010, compared with June.

“While the average home sale price was higher in July than one year ago, prices will inevitably fall in response to a large oversupply of homes on the market," says Queen’s University professor John Andrew.

“It looks like anyone who wanted to buy a house this year in Canada got their shopping done early," said Doug Porter at BMO Capital Markets.

The Canadian Real Estate Association predicts a fall in the supply of homes in Canada coming onto the market is expected to spearhead a rise in Canadian property prices, but also lead to a decline in sales transactions. However, Phil Soper, president and CEO of Royal LePage Real Estate Services, says "An expected increase in the supply of homes on the market will now bring stabilization in prices and in some cities, we will see both prices and unit sales decline towards the end of the year. This should not be interpreted as a severe correction, but rather a natural reaction to the market having peaked quite early this year."

Georges Pahud, CREA president, said: “The Bank of Canada recognizes that inflation remains well contained and that economic growth will soften, so interest rates will rise slowly and at a measured pace, which will keep home financing within reach for many homebuyers.

Queen’s University real-estate expert John Andrew thinks the typical seasonal slowdown in late October and November will be even sharper this year. He says those months could prove the best time for a buyer to strike a deal.

Opportunists who were looking to take advantage of fire-sale prices and desperation sales in the spring have given up and generally, once Labour Day is out of the way, serious buyers who put their plans on hold during the summer will begin to move forward. Still, with fewer buyers around, the market tends to be more balanced and fair. Fall has always been a busy time in this area.

Statistics from the Canadian Real Estate Association (CREA) say the average house price has climbed 110% over the past 10 years. During the same period, the S&P/TSX composite index had a total return of about 40% AND there are now 100,000 realtors in Canada compared with 63,950 a decade ago.

Fake real estate agent gets 15 months in jail

BARRIE - An Alliston man will be spending the next 15 months in jail for trading in real estate without being registered and for defrauding potential investors of $90,000.

Terry Graham, previously of Oro-Medonte, pleaded guilty in April to eight counts of trading in real estate while unregistered and eight counts of failing to deposit trust money.

Graham was also wanted on a bench warrant after failing to appear on two similar charges in Mississauga last week.

He was sentenced in Barrie Tuesday for breaching the Real Estate and Business Brokers Act (REBA).
His case began in October 2008, when he was charged with six offences. The Real Estate Council of Ontario – which is responsible for administering the REBA – issued an advisory shortly after, and public response led to additional complaints and charges.

“I think it’s important that consumers were not able to recover their deposits, because Mr. Graham was not registered (to practice real estate),” said the real estate council’s lawyer Tim Snell.
All registered real estate professionals in Ontario must complete an educational program and take updated courses, as well as participate in RECO’s insurance program, which offers protection for consumers’ deposits in the event of fraud, insolvency or misappropriation.

Because Graham was not registered, he was not insured.

Consumers affected by him, therefore, could not claim losses, though the court has ordered he pay restitution.

The real estate council has a search feature on its website (www.reco.on.ca), so consumers can check whether or not a person is a registered real estate professional, meets educational criteria and is covered by insurance.

Snell asked the court to sentence Graham to 18 to 20 months in jail, which is almost the maximum allowed under the Real Estate and Business Brokers Act. Graham must also serve two years probation after his release.

Sentencing relating to the Mississauga charges is pending