This week, Inside the Real Estate Market, I want to discuss social media in real estate. Not how to do it, there are plenty of trainers and programs for that, but why? If we want to be recognized as a top agent, we must engage in social media. There is more information on real estate than any other industry on social media, from listings, to agent promotion. After all, we are the mobile generation. That's how we get our information and that's how we communicate with each other, on Facebook, Twitter, Linkedin and Instagram. With real estate agents, no one is more mobile than they are. Realtors are never in the office, they're always in the car, on appointments and they even learned how to do the majority of their business by smart phone. So how can one be informed as an agent in today's real estate market if you ...
Dont' Be A Secret Agent: Why Social Media is Important in Real Estate
September 25, 2015
Market Report September-October 2015
September 17, 2015
Sales Summary August sales on the Toronto Real Estate Board continued the strong summer market. Sales were 5.7% higher than in August of last year. But at 8,000 sales, this was 19% lower than July. Both the market and real estate agents were taking a break! Historically, both September and October sales numbers should be higher than August, but lower than July’s. That would suggest sales in the 9500 range per month which would be well ahead of last year and tracking for 100,000 units for year end which would be an all time record. So how do we explain the strong demand for real estate? Certainly the population growth in Toronto is a factor. We are about one million more people than when the all-time record was established in 2007. However, also important is that many people have lost faith in stock markets. Volatility and the feeling that one ...
September 11, 2015
What you sign for is what you get In a strong real estate market there can be situations with multiple offers and pressures for both parties to respond quickly. While verbal agreements can be binding to parties in most industries, they are not valid or legally binding in real estate. That means the seller can verbally agree to take the first offer, then when they receive a second, they can decide to accept that instead and sign it. That can lead to unhappy people who think they have a deal and then they have none. The phrase, my word is my bond, does not apply to real estate, unfortunately. However, I try to conduct my business that way. I am also aware that the other side is not bound by that code in real estate. So govern yourself accordingly and remember in real estate, what you sign for is what ...
Real Estate Deposits
September 3, 2015
When writing or accepting an offer, one thing that can often go unnoticed is the deposit, more specifically, when the deposit is due. In the offer the deposit is required either ‘herewith” or ‘upon acceptance’. Herewith means attached to the offer. Upon acceptance means what it says, when you have a deal. That is what most agents put in their offers. However, below the deposit payment it explains that the deposit must be paid within 24hrs. If you don’t’ the agent is subject to discipline, but that’s it. The offer is not dead, because the deposit is not a condition. In our brokerage, we have a separate clause that says ‘if the deposit is not received within 48 hours, the seller, at their option, may cancel the deal’ using that clause, the deal is definitely dead. So why are we focusing on deposit deadlines? More and more deposits are coming ...
How Are Low Mortgage Rates Affecting Buyers?
August 25, 2015
As you know mortgage rates have fallen as low as 0.5 per cent. As lending rates have decreased, lending criteria and documentation has become tougher from our lenders. Our take is that government regulations are setting tougher standards for the lenders because they are worried about high real estate prices. Lenders want to even lower their losses. That’s funny, because mortgage arrears, as a percentage of all mortgages in Ontario, now sit at just .16%. That means out of 2000 mortgages only 3 are behind in payments. Incidentally, that number is the lowest since 1990. Remember the US problems in 2008? Their peak mortgage arrears number was 44 times bigger than the number we are at in Ontario today. However, today lenders no longer do stated income for self-employed mortgages and they want to see NOA’s (Notice of Assessment) only. Not only that they require a certificate of incorporation, three ...
Rental Market Report-July 2015
August 20, 2015
What was the average rental price in Toronto for July? July is the month where tenants are looking for September 1st occupancy. While the downtown condo market recorded 625 sales in July, it also produced 1440 rentals! Of that amount, 900 were in the one bedroom segment and the most popular was the one bedroom without parking. The studio/bachelor market averaged $1400/mo. but the most frequent price was at $1500. In the one bedroom market, the starting point remained at $1600. A one bedroom with parking averages just over $1800. The implication is that parking is now worth $200/mo. With parking spaces being sold at $25,000 - $50,000, depending on the building; the return to an owner after condo fees and property taxes is still only in the range of 2.5 -4%. The two bedroom market continues to be the strongest in terms of rental prices. The entry point ...
Record Sales Month for July 2015
August 17, 2015
Market Report August-September 2015 Sales Summary Sales in July on the Toronto Real Estate Board were a record for the month at 9900 units – up 8% from July of last year. These numbers were achieved with the Pan Am Games occupying two of the weeks, which is even more remarkable. But before we get too carried away, we need to remember that these sales numbers were down by 17% from June; a clear indication that this business is seasonal. August numbers are usually lower than July’s before we experience a pick up for September and October. That is our expectation for the balance of what will be a record sales year. Turning to the condo market, sales across the GTA were ahead by 14% over July of last year because of more product being available. Looking at the downtown condo market, sales were up by 23%! But the number ...
GDP numbers and the Real Estate Market
August 11, 2015
This week I want to veer slightly off Real Estate and talk about the relevance of government statistics and how it should not impact our real estate decisions. Right now everyone is asking if we’re in a recession. A recession is 2 quarters of negative growth. However, we won’t know the June GDP numbers until September and by that time they will probably revise the first quarter numbers as well; Just like they did in the U.S. The information we get is way too late and way too general for people to make decisions. So what do I do? I talk to business owners about their sales. Are they up, down and why? I could have told you in February that the first quarter was weak. No one was in the stores because of the cold weather. Certainty low oil prices are affecting our economy, but the lower Canadian dollar ...
What is Form 801?
July 23, 2015
Starting July 1st, Real estate agents are required to keep all offers on properties they list for sale for a period of one year, that’s Bill 55. Next the Ontario Real Estate Association decided to introduce the form 801 to make things easier for all agents. The form captures all the information from the offer, meaning less paperwork to store. This form is not mandatory, just a way to reduce paper. Now, some enterprising listing agents are asking the cooperating agent to supply the form with their offer. In essence they are trying to pass off their duties under this new legislation. They try to tell agents it is mandatory when this form is not. Why would a cooperating agent and a buyer put down all the information from their offer again? What happens if they make a mistake? Simply put, it is up to the Listing Agent to keep ...
Rental Market Report July/August 2015
July 22, 2015
This chart plots the average rental price by unit type with the previous year's second quarter for comparison What's the rental market in Toronto like this summer? We are now in the peak season for rentals. The studio unit now averages $1400 per month and around University of Toronto, the number approaches $1500. The biggest market is for one bedroom units. The entry point remains at $1600 without parking. The most popular unit is the one plus den with parking at $1900 per month. More and more renters are trying to convert the den into a second bedroom to reduce costs. The two bedroom market continues to be most in demand. The entry level without parking is now $2300 per month. The most popular unit, with parking but no den, averages almost $2500. Adding a den will push the average price to almost $2800 per month. The three bedroom market ...