Sales Commentary August sales on the Toronto Real Estate Board were up by 23% over August of last year. But to make an even bigger statement, August sales were only 1% lower than July. Last year the August to July drop was 19%! Also August sales in 2016 are higher than for sales in any Fall month for 2015. However, there is a double edge sword. Active Listings in August were 37% lower than for the same month last year, and new listings for August were down by 1%. This can only mean continued rising prices in the short term; and if things don’t change, then for a considerably longer period. With prices for low rise housing in Toronto becoming unaffordable for many, the shift to more affordable condo housing, which we have predicted for the last two years, is now starting to snow ball! In the downtown condo market ...
Market Report September-October 2016
September 20, 2016
Elements of Negotiations
September 9, 2016
Most of you have heard the phrase, “The one who speaks first loses.” Does this mean an equally matched negotiation results in two salespeople locked in a room staring at each other for hours on end? There is truth to silence as an ally but there is more to consider than this alone. So, what is the most important factor in negotiations? Communication can either be verbal or nonverbal. There has to be a statement of terms in any negotiation. Choice of words, pace, tone, medium and non-verbal clues such as body language all help deliver those terms. It’s important to focus on what you want to communicate and stay focused on objectives. Start by discovering, understanding and differentiating between your client’s needs versus their wants. If you are going to use technology to communicate, you must understand how to use it. Can the receiving party accommodate your method of ...
Time Saving Tips: Which Signatures are Required to Bind a Mutual Release?
September 9, 2016
It is a common misunderstanding that a Mutual Release must be signed by the Broker Manager or Broker of Record to have a binding Mutual Release and to release held funds. For a Mutual Release to be binding it only requires the signature of both the buying and selling parties. The standard OREA Form 122 confusingly has a signature section for the Broker Manager or Broker of Record which is preceded by the following preprint: "The Brokerage hereby releases all parties from any claim that the Brokerage may have had for commission or other remuneration in the above transaction, except as may be hereinbefore specifically provided." In the eyes of RECO, the transaction is between the Buyer and the Seller. Therefore, the Brokerage is obligated to release the funds should both parties mutual want out. What this means is that if you are negotiating a Mutual Release at 11:00pm, you ...
Backing out of a Deal: Conditions Are Not Escape Clauses
August 31, 2016
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 ...
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 ...