Housing market prognosticators say next year will be marked by bursts of growth in certain hot regional markets throughout the country combined with a cooling trend in other areas, namely that of robust markets such as Toronto.
Look for mixed market signals in Canadian real estate as a market theme in 2012 as cities like Halifax and Edmonton and Calgary will begin to feel a marked increase in demand for real estate purchases, with average price increases beginning late in the year, according to says Vancouver real estate consultant Don Campbell. Toronto’s hot market will start to ease off next year, although its condo real estate market will remain stable.
“Sophisticated homeowners and investors will have to dig a little deeper, especially in 2012 and 2013, to find out how their region is performing because Canada is really going to be a tale of regions over the next few years,” says Campbell, a real estate investor and author. “Where one region is booming, the next may be underperforming.”
Expect price moderation in Toronto in the neighbourhood of five to 10 per cent, says Todd Hirsch, a senior economist with ATB Financial in Calgary. “There could be a little more worry of a small bubble (bursting) in Toronto,” says Hirsch, “because the Ontario economy in 2012 will likely cool off a bit, not tremendously, though. You won’t see a recession.”If you’re thinking the same for Vancouver, think again, advises Hirsch. Given that Vancouver is the destination of choice for Asian investors, prices there will remain far higher than what they are in Calgary and Toronto. This will likely continue into 2012, predicts Hirsch, who expects the Chinese economy will moderate next year although not enough to prevent its citizens from wanting to invest in Canada’s west coast real estate market.
But the markets in Toronto and especially Vancouver, which comprise approximately 40 per cent of Canadian real estate, should be eyed carefully by home buyers or investors. According to Campbell, time lines should run short at 12 to 18 months or long at five years or more as statistics show signs of market turmoil in the medium term (19 months to four years) as interest rates begin to edge up, inventory outstrips population demand. That’s when speculators will try to dump properties and market confidence will be lower. In Calgary and Edmonton expect stable prices, says Hirsch.
Saskatchewan is where you’ll find the best real estate deals in the country with the average house price in Saskatoon running at $320,000. That province also has the lowest unemployment figures in Canada with unemployment pegged at three per cent in Regina.
Halifax and St. John’s are stand alone in Atlantic Canada as those two cities experience an unrivalled economic boom right now. House prices in those cities could actually gain a little in 2012.
As for the rest of Atlantic Canada, notes Hirsch, much of it is a depressed economy in which its rural areas are being hollowed out as residents leave the countryside for jobs in urban areas. Quebec City’s economy is faring not too badly these days as its house prices are undervalued at about one third below the national average.
Still, growth in Quebec will be a bit sluggish in 2012 with no real strong real estate gains. While its economy will be sluggish, keep in mind the province’s housing prices are not as overvalued as in Toronto so you won’t see as much deflationary pressure as in Toronto. While the province is not looking at a recession in 2012, the year will be economically softer.
Strong real estate markets will be in Canadian regions where job growth continues, low unemployment rates continue to drop and where there’s a migration of people with jobs (as opposed to retirees), says Campbell, who cites Halifax, Kitchener/Waterloo/Cambridge, Hamilton, Saskatoon, Edmonton, Calgary, St. John, Dawson Creek and Surrey as having the most stable markets.“Many Canadians will be fooled into thinking that their home value is either increasing or decreasing because of reports that are released discussing the ‘Average Price in Canada,’ “ he says, “producing either a false sense of confidence or a false sense of doom, depending on the report of the month.”
According to CREA, the national housing market is edging closer to being a seller’s market.“The Canadian housing market is proving resilient in the face of ongoing global economic and financial uncertainty, to the benefit of Canadian economic growth,” said Gary Morse, CREA’s president. “That said, some housing markets are picking up, while others are holding steady or consolidating.”
A quarterly economic forecast by TD Economics economist Francis Fong indicates that the low interest rate environment coupled with slowing jobs and income growth, especially in the first six months of 2012, will hold back resurgence in housing activity. Expect a slight pullback in homes sales and prices to the tune of one to two per cent. “Looking ahead, 2012 will likely be a much more subdued year for the housing market,” wrote Fong in her report released this week.
What are your predictions for 2012? Do you think your market will stay the course, grow or drop off? What sense are you getting from clients? Tell us what you’re thinking.
Rick Moran, AMP, OMB # M08001997
Showing posts with label real estate. Show all posts
Showing posts with label real estate. Show all posts
Tuesday, December 20, 2011
Saturday, November 19, 2011
Real Estate Industry Myths Debunked
As human beings, we often form ill-conceived notions about people based on our education, our upbringing, our experience. These notions, many of which on the surface appear to pose little threat, eventually stick to the signposts of our society becoming a sort of common knowledge.
Think about the used-car salesperson. What image did you conjure? Was it favourable? Likely not. The same applies to the real estate profession.
For a multitude of reasons, there are a number of ill-conceived ideas shared by the public about the industry and those in it and that’s what we plan to examine today. “We’re rank slightly below lawyers and slightly above used car salesman,” says Laurin Jeffrey, a sales rep at Century 21 Regal Realty in Toronto. “A lot of people fit us in there.”
The reason, he surmises, has to do with the fact that clients think they are paying Realtor®s too much for the service they provide. There’s a saying in journalism that to get to the bottom of a story, you should follow the money. That saying could well be applied to our first misconception about Realtor®s. It’s the one that prescribes to the notion that real estate agents make a great deal of money doing very little for their clients.
“What they don’t understand is we’re responsible for everything,” Jeffrey points out. “I pay taxes, do my advertising, marketing, printing of business cards and signs, insurance and extra insurance to drive people around. I have no medical benefits. There’s a lot of risk that goes into that.”
In addition, the industry has had a history of “less-than-ethical” characters, says Jeffrey, an image that it is starting to shed thanks to higher fees and tougher professional regulations. “It’s a lot more cutthroat now,” says Jeffrey. “Before the Internet, the only way you could get information on a property was through that slimy guy down the street. They knew that and they had you.”
Steven Fudge laughs at the prospect that people think a career in real estate is easy money. Even in a hot market such as the one he currently works in in Toronto, his clients are typically bidding on six to 12 properties before they can secure one. That’s a lot of showings, home inspections, writing of offers in addition to a lot of heartbreak and disappointment to deal with.
A sales rep for Bosley Real Estate Ltd., Fudge recently received a one-year anniversary gift from clients. When he looked somewhat perplexed by the gift, his clients sweetly reminded him that, yes, it’s been a full 12 months that they’ve been on the hunt for a home.
In addition to the behind-the-scenes amounts of work Realtor®s put in, there is also the little-publicized fact that Realtor®s have to work while everyone else is having fun, says Fudge.
Evenings, weekends and holidays are common as is working until 8 or 9 each evening. Fitting in a 70-hour work week is the norm for Fudge. By the same token, the career makes for great flexibility so Fudge allows time for daily work-outs with a trainer and late lunches with good friends. Still, the immediacy of technology in combination with a hot market means he must fly when called. “Often I have to drop what I’m doing so that by dinnertime, it doesn’t matter if I’m hosting a party, attending a recital...whatever,” says Fudge. “You do not have complete control of your time if you’re committed to being in complete control over your clients. I have missed my own birthday party.”
The perception that Realtor®s don’t have to work hard for their money is what has fuelled the For-Sale-By-Owner industry, but as Mississauga sale rep Marjorie Canales points out, that myth is seeing its own backlash. “That’s why most end up listing with traditional real estate,” says Canales. “They think they will put up a sign and maybe put up a little website for the property and so many things can go wrong. That’s why 90 per cent or more of homes are sold through a Realtor®.”
Another related misconception about real estate is the belief that Realtor®s have oodles of freedom and spare time. “That is actually not the case,” she says. “You get out, what you put in and it’s very unstructured so you have to be disciplined with your time. It’s easy to derail and slack off. I wouldn’t call it easy money at all.”
Furthermore, adds Canales, Realtor®s are one of the few professions that work on contingency and aren’t paid a dime till well after the property sells. “We’re taking a bigger risk from the get-go. Immediately, I have to go into my pocket and pay for marketing and if the house doesn’t sell, I don’t get paid.’
While OREA president Barb Sukkau agrees that the profession is the target of unfair criticism, she feels more can be done to put public thought back on the right track. “We don’t do a good enough job at telling consumers how valuable our service is,” Sukkau says. “There are a lot of misconceptions about Realtor®s and it comes from consumers that don’t appreciate the level of expertise we have and the knowledge we have.”
“People don’t realize we are bound to be ethical honest and we have certain obligations under the act that we have to follow and there are certain repercussions if we don’t.”
In addition, there is the continuing education that agents are required to complete in order to keep their license current.
Real estate associations large and small are embarking on campaigns to help deliver the message to media and consumers about the value services Realtor®s provide, she says, referring to the www.howRealtor®shelp.ca website.
In St. John’s, Bill Dilny often hears rumblings from people who believe that house prices are set by Realtor®s because it’s to their advantage to sell higher-priced homes. While Dilny doesn’t dispute that it is beneficial to some extent, the misconception that agents set prices is laughable. “But you don’t increase the price by 20 per cent because you’ll make more money,” says the Remax agent. “That’s ludicrous. It’s the market that drives prices.”
One fact about Realtor®s that Edmonton Realtor® Craig Pilgrim would like more people to know about is their high level of community mindedness. Despite mythical assertions that the profession embraces greed in its formula for making easy money, the high level of community involvement and payback would suggest there’s something more altruistic at play than simply mercenary means. “It is commonplace for Realtor®s to attend pretty much every social good function and fundraising event and to spend and donate both in terms of money, in kind donations, work and effort,” Pilgrim says. “Realtor®s are really committed to their communities and it does show.”
The Realtor®s’ Community Foundation in Edmonton, of which Pilgrim volunteers his time, is celebrating its 25th anniversary this year. Since its inception, the organization has returned in excess of $3-million to more than 100 Edmonton-based charities.
“The vast majority of Realtor®s just do these things -- they serve on boards and local charities and that’s typical and below the radar and that’s just done,” Pilgrim says. “I think the reason it’s so significant in our industry has to do with the flexibility in our industry. People are drawn to this profession because you’re seeing and touching so many people, their lives, their passions, their personal causes. It’s because of the connectedness of the industry.”
What myths about the profession would you like to shatter? Ever heard a real doozy? Let’s hear it.
Rick Moran, AMP, OMB # M08001997
Think about the used-car salesperson. What image did you conjure? Was it favourable? Likely not. The same applies to the real estate profession.
For a multitude of reasons, there are a number of ill-conceived ideas shared by the public about the industry and those in it and that’s what we plan to examine today. “We’re rank slightly below lawyers and slightly above used car salesman,” says Laurin Jeffrey, a sales rep at Century 21 Regal Realty in Toronto. “A lot of people fit us in there.”
The reason, he surmises, has to do with the fact that clients think they are paying Realtor®s too much for the service they provide. There’s a saying in journalism that to get to the bottom of a story, you should follow the money. That saying could well be applied to our first misconception about Realtor®s. It’s the one that prescribes to the notion that real estate agents make a great deal of money doing very little for their clients.
“What they don’t understand is we’re responsible for everything,” Jeffrey points out. “I pay taxes, do my advertising, marketing, printing of business cards and signs, insurance and extra insurance to drive people around. I have no medical benefits. There’s a lot of risk that goes into that.”
In addition, the industry has had a history of “less-than-ethical” characters, says Jeffrey, an image that it is starting to shed thanks to higher fees and tougher professional regulations. “It’s a lot more cutthroat now,” says Jeffrey. “Before the Internet, the only way you could get information on a property was through that slimy guy down the street. They knew that and they had you.”
Steven Fudge laughs at the prospect that people think a career in real estate is easy money. Even in a hot market such as the one he currently works in in Toronto, his clients are typically bidding on six to 12 properties before they can secure one. That’s a lot of showings, home inspections, writing of offers in addition to a lot of heartbreak and disappointment to deal with.
A sales rep for Bosley Real Estate Ltd., Fudge recently received a one-year anniversary gift from clients. When he looked somewhat perplexed by the gift, his clients sweetly reminded him that, yes, it’s been a full 12 months that they’ve been on the hunt for a home.
In addition to the behind-the-scenes amounts of work Realtor®s put in, there is also the little-publicized fact that Realtor®s have to work while everyone else is having fun, says Fudge.
Evenings, weekends and holidays are common as is working until 8 or 9 each evening. Fitting in a 70-hour work week is the norm for Fudge. By the same token, the career makes for great flexibility so Fudge allows time for daily work-outs with a trainer and late lunches with good friends. Still, the immediacy of technology in combination with a hot market means he must fly when called. “Often I have to drop what I’m doing so that by dinnertime, it doesn’t matter if I’m hosting a party, attending a recital...whatever,” says Fudge. “You do not have complete control of your time if you’re committed to being in complete control over your clients. I have missed my own birthday party.”
The perception that Realtor®s don’t have to work hard for their money is what has fuelled the For-Sale-By-Owner industry, but as Mississauga sale rep Marjorie Canales points out, that myth is seeing its own backlash. “That’s why most end up listing with traditional real estate,” says Canales. “They think they will put up a sign and maybe put up a little website for the property and so many things can go wrong. That’s why 90 per cent or more of homes are sold through a Realtor®.”
Another related misconception about real estate is the belief that Realtor®s have oodles of freedom and spare time. “That is actually not the case,” she says. “You get out, what you put in and it’s very unstructured so you have to be disciplined with your time. It’s easy to derail and slack off. I wouldn’t call it easy money at all.”
Furthermore, adds Canales, Realtor®s are one of the few professions that work on contingency and aren’t paid a dime till well after the property sells. “We’re taking a bigger risk from the get-go. Immediately, I have to go into my pocket and pay for marketing and if the house doesn’t sell, I don’t get paid.’
While OREA president Barb Sukkau agrees that the profession is the target of unfair criticism, she feels more can be done to put public thought back on the right track. “We don’t do a good enough job at telling consumers how valuable our service is,” Sukkau says. “There are a lot of misconceptions about Realtor®s and it comes from consumers that don’t appreciate the level of expertise we have and the knowledge we have.”
“People don’t realize we are bound to be ethical honest and we have certain obligations under the act that we have to follow and there are certain repercussions if we don’t.”
In addition, there is the continuing education that agents are required to complete in order to keep their license current.
Real estate associations large and small are embarking on campaigns to help deliver the message to media and consumers about the value services Realtor®s provide, she says, referring to the www.howRealtor®shelp.ca website.
In St. John’s, Bill Dilny often hears rumblings from people who believe that house prices are set by Realtor®s because it’s to their advantage to sell higher-priced homes. While Dilny doesn’t dispute that it is beneficial to some extent, the misconception that agents set prices is laughable. “But you don’t increase the price by 20 per cent because you’ll make more money,” says the Remax agent. “That’s ludicrous. It’s the market that drives prices.”
One fact about Realtor®s that Edmonton Realtor® Craig Pilgrim would like more people to know about is their high level of community mindedness. Despite mythical assertions that the profession embraces greed in its formula for making easy money, the high level of community involvement and payback would suggest there’s something more altruistic at play than simply mercenary means. “It is commonplace for Realtor®s to attend pretty much every social good function and fundraising event and to spend and donate both in terms of money, in kind donations, work and effort,” Pilgrim says. “Realtor®s are really committed to their communities and it does show.”
The Realtor®s’ Community Foundation in Edmonton, of which Pilgrim volunteers his time, is celebrating its 25th anniversary this year. Since its inception, the organization has returned in excess of $3-million to more than 100 Edmonton-based charities.
“The vast majority of Realtor®s just do these things -- they serve on boards and local charities and that’s typical and below the radar and that’s just done,” Pilgrim says. “I think the reason it’s so significant in our industry has to do with the flexibility in our industry. People are drawn to this profession because you’re seeing and touching so many people, their lives, their passions, their personal causes. It’s because of the connectedness of the industry.”
What myths about the profession would you like to shatter? Ever heard a real doozy? Let’s hear it.
Rick Moran, AMP, OMB # M08001997
Tuesday, November 8, 2011
Real Estate Sales Continue to Climb: TREB
The market in Toronto seemingly only knows one direction- up.
According new data released by TREB, sales for October climbed an impressive 17.5%, year-over-year.
“The pace of October resale home transactions remained brisk in the GTA. This bodes well for a strong finish to 2011,” said Toronto Real Estate Board President Richard Silver. “Home buyers who found it difficult to make a deal in the spring and summer due to a shortage of listings have benefitted from increased supply in the fall.”
As Steven Fudge, Sales Representative, Bosley R.E. Ltd told Propertywire.ca, although there are plenty of signs that indicate that 2011 will close out with similar, robust activity, there are elements at play that do pose the possibility of influence: “The general consensus is that the fundamentals for Toronto real estate are sound, but the erratic stock market and headline news of other world economies may be causing a reason for pause. If the market slows before the end of the year, these will be the big factors influencing a decline in sales.”
And it wasn’t just sales activity that continued to climb through October; average prices in this hotbed continue their ascent as well, up 8% year-over-year, resting in at $478,137.
And as Fudge points out, these intense conditions, while support consistent upward trends, begin to take their toll on consumers after awhile. “In the City of Toronto, sales of freehold properties will remain strong for the balance of the year, as demand continues to outstrip supply, though purchasers are displaying signs of fatigue and are weary of the bidding wars. Many are refusing to go head to head in competition, which is causing some homes to stay on the market longer than expected “
“Sellers’ market conditions remain in place in many parts of the GTA. The result has been above-average annual rates of price growth for most home types,” said Jason Mercer, the Toronto Real Estate Board’s Senior Manager of Market Analysis. “Thanks to low interest rates, strong price growth has not substantially changed the positive affordability picture in the City of Toronto and surrounding regions.”
Fudge sees the condo market as a possible driver towards balanced territory in Toronto: “The City of Toronto, which has a significantly larger supply of condominiums for sale, is not as robust as the freehold market segment. Unless aggressively priced, condominiums will be for sale longer before trading, which signals a more balanced market. Hopefully this indicates a soft landing, rather than a crash.”
According new data released by TREB, sales for October climbed an impressive 17.5%, year-over-year.
“The pace of October resale home transactions remained brisk in the GTA. This bodes well for a strong finish to 2011,” said Toronto Real Estate Board President Richard Silver. “Home buyers who found it difficult to make a deal in the spring and summer due to a shortage of listings have benefitted from increased supply in the fall.”
As Steven Fudge, Sales Representative, Bosley R.E. Ltd told Propertywire.ca, although there are plenty of signs that indicate that 2011 will close out with similar, robust activity, there are elements at play that do pose the possibility of influence: “The general consensus is that the fundamentals for Toronto real estate are sound, but the erratic stock market and headline news of other world economies may be causing a reason for pause. If the market slows before the end of the year, these will be the big factors influencing a decline in sales.”
And it wasn’t just sales activity that continued to climb through October; average prices in this hotbed continue their ascent as well, up 8% year-over-year, resting in at $478,137.
And as Fudge points out, these intense conditions, while support consistent upward trends, begin to take their toll on consumers after awhile. “In the City of Toronto, sales of freehold properties will remain strong for the balance of the year, as demand continues to outstrip supply, though purchasers are displaying signs of fatigue and are weary of the bidding wars. Many are refusing to go head to head in competition, which is causing some homes to stay on the market longer than expected “
“Sellers’ market conditions remain in place in many parts of the GTA. The result has been above-average annual rates of price growth for most home types,” said Jason Mercer, the Toronto Real Estate Board’s Senior Manager of Market Analysis. “Thanks to low interest rates, strong price growth has not substantially changed the positive affordability picture in the City of Toronto and surrounding regions.”
Fudge sees the condo market as a possible driver towards balanced territory in Toronto: “The City of Toronto, which has a significantly larger supply of condominiums for sale, is not as robust as the freehold market segment. Unless aggressively priced, condominiums will be for sale longer before trading, which signals a more balanced market. Hopefully this indicates a soft landing, rather than a crash.”
Thursday, November 25, 2010
REAL ESTATE MARKET INFORMATION FOR FIRST TIME BUYERS
Research done by a major Canadian Chartered Bank indicates that almost half of the first time homeowners in Canada believe it is now time to buy a home. The report went on to say that prices are expected to rise by 8% in the next year slowing to about 1.5% later in the frame.
Interest rates remain at record lows, with 5 year money available: fixed 3.59% (Nov 23/10) and variable 2.25% (Nov 23/10). These interest rates should be available from your reputable mortgage consultant without any brokerage fees.
Consultation and proper planning with your mortgage broker professional makes home ownership a real possibility for 2011. Discuss budgets, carrying costs and closing costs ensuring that you are completely comfortable about the entire process. This is the most important responsibility of the mortgage broker that you deal with. Always remember that your mortgage broker has access to over 40 Institutions in Canada – make use of them.
Rick Moran, AMP, OMB#M08001997
Interest rates remain at record lows, with 5 year money available: fixed 3.59% (Nov 23/10) and variable 2.25% (Nov 23/10). These interest rates should be available from your reputable mortgage consultant without any brokerage fees.
Consultation and proper planning with your mortgage broker professional makes home ownership a real possibility for 2011. Discuss budgets, carrying costs and closing costs ensuring that you are completely comfortable about the entire process. This is the most important responsibility of the mortgage broker that you deal with. Always remember that your mortgage broker has access to over 40 Institutions in Canada – make use of them.
Rick Moran, AMP, OMB#M08001997
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