No Cooling Off for the HOT Real Estate Market

April 11th, 2017

While there are concerted attempts to cool the real estate markets, things aren't really slowing down. Mortgage lenders are being more cautious, appraisers are being conservative and Realtors are guarded but still, Buyers want to buy and Sellers are happy to sell.

The Toronto and Vancouver markets are expected to see a very slight lull in the wake of government attempts to cool their markets but it is not really deterring foreign Buyers who are prepared to do what they must to secure property in those areas. The net effect seems to be that properties aren't selling quite as quickly but they are still garnering high prices and the volumes are still higher than last year.

This is driving people to the suburbs... and even the suburban prices are climbing and more new home construction is taking place. Nationwide, there has been a 5.6 per cent increase in the number of private dwellings. Population growth in Canada has been slow but it reached 35.2 million in 2016, an increase of 1.7 million (about 5%) over 2011. Two-thirds of the new people coming from immigration- the strongest growth of all the G7 countries. So, not only are people moving to Canada, they want to own their own home.

The uncontrolled growth of our cities is known as urban sprawl. It creates bedroom communities of commuters who rely upon cars to transport them to work in urban centres. As the suburbs expand, growth pushes out into the rural landscape. Remote communities are becoming the target for developers and this can't really be a total surprise. While newcomers are accustomed to higher density living, many long-term city dwellers are uncomfortable with the crowding, not to mention the escalation in prices.

It was bound to happen. Smaller commercial centres are welcoming and familiar to those who have grown accustomed to the healthy, vibrant, thriving, liveable communities that afford community health and individual well-being. This is good news for rural communities who haven't had the population to support the investment in widespread communication towers and other important infrastructure improvements.

The nature of life is change and we do adapt. It's just time to get on with it.

Choosing the Right Property

March 24th, 2017

Generally speaking, real estate is not a get-rich-quick scheme but if you review Canadian Real Estate history, property in a good area doubles in value about every fifteen years. Some neighbourhoods evaluate more quickly than others but seldom to you hear about anyone losing money in real estate, over the long term- especially if they've taken the time to choose the right investment.

Assuming you've spoken to a lender and you've gotten pre-approved and know your price range and how much you need for the down payment and you've factored-in a little buffer for unexpected repairs or incidentals- AND regardless of whether you plan to live in the property or rent all or part of it to tenants, the top three considerations when you contemplate a real estate purchase are location, location, location.

Sure, you've heard it a million times, but have you really thought about it?

There's more to location than scoping out the schools and hospital, it's wise to visit the property at different times of the day and night, on both sunny and rainy days. Talk to the neighbours, ask about drainage, snow removal, school buses and garbage pick up or disposal sites.

Purchasing real estate should always be thought of as an investment and it can be financially rewarding but if you have to sell suddenly, you're going to better off with a property that checks off all the boxes and is located in a good, stable community.

Buyers and Sellers Deserve Skilled, Experienced, Professional Service

March 14th, 2017

Last November, CBC’s current affairs program Marketplace ran a program about unscrupulous real estate sales people... more recently, there's been a lot of press about the underhanded tactics of Buyers and Sellers, too. There's no question that a hot market can tempt some people into being a little fast and loose- even though it's unethical and certainly not the sort of behaviour in which any intelligent person would engage.

Real Estate transactions usually involve a great deal of money and frequently, people's homes... their roots, their security, often their largest asset... so it's both a financial and emotional consideration. Real estate is one of those things that most people have either had experience with, or know someone who has. The problem is that a little experience can be a very dangerous thing... a lot of it depends on the particular sort of experience one has... but generally speaking, people approach real estate with a reasonable amount of anxiety. A hot market may appear to favour Sellers, but it can actually work against them, too. Whether buying or selling, everyone wants to get the best deal they can... and that's exactly what they should expect and exactly what skilled, experienced, professional Realtors strive to achieve.

Contrary to popular belief, most Buyers in a "Seller's Market" won't just settle for anything decent that fits into their price range. They won't overlook housekeeping, maintenance and repair issues. Homes that are clean, well-lit, and de-cluttered are always perceived as having better value. In fact, in a hot market, Buyers tend to become a little more cautious.

Sometimes, Sellers think it's clever to underprice a property in a hot market, to bring a frenzy of buyers... but lots of Buyers assume a low priced home, even in a hot market, is a sign that of problems. This is made worse because some Buyers worry that, in a hot market especially, Sellers will be tempted to hide important details about the property's history or fail to disclose flaws. A competent Realtor knows that you can never skip over the facts.

Many Buyers start out by making it very clear that they don't want to get into "bidding wars"... even though most of them haven't ever been in one, they've just heard that bidding wars are a bad thing. In twenty-something years, I've yet to meet anyone who has been tricked into paying too much for a property because of a bidding war- usually the worst part of multiple offer situations is that someone is going to be disappointed when their offer isn't accepted- but that can happen in a normal offer situation, too.

Sometimes, in bidding war, there are Buyers who try to pressure Sellers (or the Sellers' representatives) into giving them some sort of opportunity to beat the highest bid- but that is totally unprofessional and against all the rules. In a hot market. sometimes Sellers are accused of being greedy- and perhaps some are. In fact, being unrealistic about the value of their property is one of the most common mistakes that Sellers make and there's been study upon study to prove that, even in a booming market, a property that is over-priced will not sell. A competent Realtor will guide Sellers to list their property at the best price for the existing market conditions.

Practicing real estate today requires deep knowledge of the industry and its approaches. Competent Realtors have a sophisticated understanding of not only the legislative framework and the layers of regulation involved, but of the cycles of the industry, current trends, pending issues, and potential concerns. They also have a terrific understanding of people and marketing and a host of other talents. Some of us have been through many diverse cycles in the industry and provide the skilled, experienced, professional service that Buyers and Sellers not only deserve but really need, especially in a booming market.

Why Do Some Properties Fail to Sell in Such a Hot Market?

March 8th, 2017

In spite of the busy market with some local listings selling the day they're listed and others selling for well-over-asking price... others fail to sell and the listings expire or keep being renewed. Usually, the reason is quite obvious- the price is too high, the property is in disrepair, the location is a problem, nobody will insure or mortgage it or there is some stigma attached to the property.

Pricing too high is usually the result of a Seller having unreasonable expectations and Realtors who are willing to take the listing, regardless. There are a number of reasons that some Realtors will take an overpriced listing. Some are just happy to have a sign location to self-advertise- their name and phone number on the lawn will generate calls from ready buyers and they can sell other homes to them. Others are looking for the opportunity to have a high priced listing that they can advertise in print, fielding calls from buyers and selling them other properties that are worth the higher prices. More often, the Realtor hopes to use feedback from the market to convince the Seller to reduce the price.

Location, location, location. A good Realtor factors location into pricing and doesn't try to hide the fact that the property is next door to an auto-wrecker or doesn't have road access... keeping that detail for a surprise during the showing is usually a great deterrent to prospective Buyers who wonder what else you might be hiding. The same goes for properties that exaggerate their condition and disappoint Buyers who are unprepared or unable to invest in necessary repairs.

Stigmas include any non-physical, intangible attribute of a property that may elicit a psychological or emotional response on the part of a potential Buyer- for instance, a previous owner was a criminal, the property was a grow-op or meth lab, there was a murder in the home or on the property, the property was used as a brothel or chop-shop, there was a suicide at the property, it was formerly a funeral home or waste disposal site, there's a decommissioned mine on the property, the house was previously infested with pests or allegedly haunted... and the list goes on.

A competent Realtor does their homework and discloses the challenges that exist on or about the property. It's the law.

Foreign Investors in the Toronto Market

March 4th, 2017

I recently blogged about the foreign investment issue that's driving house prices up in the Toronto Area. I had read a lot of articles relating the situation to what went on in Vancouver and, I have to admit, I found it all a little discouraging. While I've happily made my home in cottage country since 1992, I am a Toronto girl... and just yesterday I was thinking how you can take the girl out of Toronto but you can't really take the Toronto out of the girl.

While the cityscape has changed dramatically over the past twenty-five years and I don't often get there, Toronto is still my city and I've always seen it as the mosaic in which most Canadians take great pride. Toronto has always made space for new Canadians and while some find it easier to integrate than others, on the whole it's really a very friendly place, where people warmly make new friends. I've been chatting to some of my colleagues in the city... and they reminded me of this bright side to the Toronto market situation.

Apparently, there is a great deal of interest in the secondary school and post-secondary education available in Canadian schools- both the private and highly-rated public schools. In Canada, graduates are allowed work-visas for a period after their studies and this means that at least part of the family can move to our cities for several years- and, of course, they need accommodations. Purchasing a home is a smart investment and what better place than a beautiful city where you are bound to find others who know your first language fluently?