Many Realtors incorrectly advise their clients that a condition can be used as an escape clause. For example, there is a conditional offer on Financing between a Buyer and a Seller. The Buyer wants out of the deal. The Realtor had advised the Buyer that it shouldn’t be a problem because the clause wording states: "This Offer is conditional upon the Buyer arranging, [..]a new […]Mortgage satisfactory to the Buyer in the Buyer's sole and absolute discretion.[…]" In this scenario, the Buyer’s Realtor communicates with the Seller’s Realtor that financing fell through and submits a mutual release. On the surface, it appears that a reason is not required. However, the Seller can then take legal action if they suspect that foul play is at hand. The guiding principle in contract law is good faith. Meaning, that both parties have to reasonably make good effort to fulfill their contractual obligations. Should ...
Backing out of a Deal: Conditions Are Not Escape Clauses
August 31, 2016
Renting in Toronto: A Word of Advice
August 23, 2016
It's rental season in Toronto so it seems fitting to bring it up in this weeks video. 15 years ago leasing was just a small part of the overall market. Today, the market for renting condos is two times bigger than for condo sales. Now, that is good for young people who want to live downtown, but it 's bad for our industry when it is only inexperienced or new agents who represent tenants. In the past week for example, we have had two REALTORS drop off deposits on a rental condo before the offer was even accepted. So what do we do with a cheque that we receive? We deposit it of course, because we are responsible for the money. 24 hours later, when the offer isn't accepted, the potential tenant or the newbie agent wants the cheque back, but guess what, there is a five day hold. That's ...
Toronto Market Report August-September 2016
August 22, 2016
Sales Commentary July sales on the Toronto Real Estate Board were just under 10,000 units, which was 2% higher than July of last year. However, these sale numbers were 22% lower than for June and about the same as in March of this year. This suggests a slowing market due to seasonality and also a market taking a breather. But the real drag to the market continues to be a lack of listings. ‘Active’ listings are 31% lower than in July of last year and ‘new’ listings in July were down by 7% over July of last year which just continues the problem. In terms of the condo market, the same trends are evident. Downtown condos showed a sales increase of 19% over July of 2015 but a decrease of 17% from June of this year. In Humber Bay Shores, sales were the same as last year for July ...
Buying a Condo: The Three Biggest Questions to Consider.
August 17, 2016
Buying a condo, or any property, is a big decision. Especially if you are a first-time buyer about to make the plunge into the real estate world. Yes, there are plenty of things to consider before you even make the decision to buy, but when you're ready to go out and choose your new home, here are the three questions you should make sure to ask yourself first. Space How Much Space Do You Need? In the Toronto market you can get a giant detached home, or an itty bitty condo. Before you start looking make sure you have an idea of what you're looking for. How many bedrooms to you need? Do you require a certain amount of square footage? Your budget may have a big influence on the amount of space you can get but the last thing you want is to purchase a small space when ...
Big Problems with the Foreign Buyers Tax
August 15, 2016
A few weeks ago, we talked about the 15% sales tax on non-residents buying property in B.C. We said it would not have much of an impact on the property market but it was a great P.R. move. However, just the opposite is happening. Bad P.R. And real estate deals falling through. The B.C. Government announced this policy change on July 25th, effective August 2nd. This was probably not the smartest move. They made the changes effective closings when it should have been effective on the offer date. What is happening now is that you have residents, those are B.C. Voters who sold their house in July, closing in August to a non-resident and the deal will fall through because the deposit is less than the 15% tax. In this situation, it is just cheaper to walk away from the deal. Not only that, you have landed immigrants working in ...
The Best Condo Reno's for Increasing Property Value
August 12, 2016
In our last blog post we discussed the real cost of flipping a property. We mainly focused on the costs that most Flippers tend to overlook, such as closing costs, land transfer costs and commission. Today, we thought we would take a look at what home improvements will have the biggest impact, if any, on your selling price down the road. Not all projects will give you a 100% return on your investment (in fact, very few do). However, upgrades can always help sell your property faster and give your property that "love it, have to have it" quality that can help your home stand out. What renovations stand out the most to Buyers? According to the REALTORS® surveyed, a new kitchen, bathroom or wood floors make the biggest impact. We put together a handy chart that compares a project's estimated cost with the estimated cost recovered when it's time ...
The Cost of Flipping Properties
August 5, 2016
Flipping properties is becoming a hobby for more and more people and that is a scary thought. So what do we mean by flipping? You buy a property, do some minor or major renovations and sell it 6-12 months later. Sounds simple enough, but here is the reality, flipping properties only works in a rising real estate market. When prices cease to increase by 10% per year, it will end and fail badly for the inexperienced. Here is why; A flipper has to buy first, there are legal and land transfer costs. Next, they have to carry a property at a cost of 1% per month. Then, when they sell it at the end, they have more closing costs and commissions. Now let's say you spent $50,000 in renovations. Do you really think someone is going to pay you $100,000 for the same renovations? No! You would be happy ...
How Will Vancouver's New Foreign Home-Buyers Tax Affect the Real Estate Market?
July 29, 2016
The BC Government has announced a 15% tax on buying properties for non-residents in Vancouver effective August 1st. The big question is, will this new tax curb property prices in Vancouver? No. The problem is still a lack of supply and non-residents represent only a small minority of buyers. Here is what it will do! First, it's a tax grab for the BC Government that will not offend voters. Secondly, it's a public relations win. It looks like the government is doing something even if it is doing nothing. Will this new tax come to Ontario? They are already studying it and my guess is 'yes'. Just because it's an easy tax grab that won't affect voters and it looks like they are being proactive. What the Ontario Liberals need to do is to encourage more housing to be built. Now that takes some planning. Want to stay up to date ...
July-August 2016 Market Report
July 19, 2016
Sales Commentary June sales mark the halfway point of the calendar year but in terms of sales on the Toronto Real Estate Board, it usually represents 54% of the year’s sales. That means we will hit 111,000 sales in 2016 versus 101,000 in 2015 which was the previous record. If you recall, all of the bank economists were calling for lower sales this year while our Brokerage was forecasting another record year in 2016! But to keep everything in perspective, sales per 100,000 people are lower today than in 2007. In other words, the increase in sales has been caused by population growth and not by people selling (read flipping) properties. In terms of the condo market, sales figures are more balanced throughout the year. Usually 51% of the year’s sales occur in the first six months of the year. That is because this market is dominated by one and ...
What You Should Know about Witnessing a Signature
June 29, 2016
Witnessing a signature can sometimes be a problem with newer agents and first time buyers who don't understand the significance. Every contract and amendment provides for a witness signature. What happens if there is no witness? Only a person present to see the signing can witness. You cannot witness after the fact. Does not having a witness invalidate a contract? No, it is still valid. If you have no witness a signee may argue that they never signed a document, this is rare and usually someone will compare all the signatures. So don't worry about a witness signature. It is nice to have but not necessary. Just think about electronic signatures, the wave of the future. There is no witness there, just computer proof through an IP address. Want to stay up to date on our monthly market reports? Subscribe