TORONTO, February 3, 2012 — Greater Toronto REALTORS® reported 4,567 sales
through the TorontoMLS® system in January 2012. This number was 8.8 per cent
higher than the 4,199 sales reported in January 2011. Sales growth was
strongest for low-rise home types in the regions surrounding the City of
“A favourable affordability picture bolstered by very low posted fixed
mortgage rates has kept home buyers confident in their ability to achieve
the Canadian goal of home ownership,” said Toronto Real Estate Board
President Richard Silver.
“The buyer pool remains diverse in the GTA with strong interest in home
types across the pricing spectrum,” continued Silver.
The average selling price for January 2012 transactions was $463,534 – up by
almost nine per cent compared to January 2011.
“Low inventory levels have kept competition between buyers strong,
resulting in robust annual rates of price growth over the last year. Strong
price growth is expected to attract more listings. A better supplied market
should result in a
slower rate of price growth, especially in the second half of 2012,” said
Jason Mercer, the Toronto Real Estate Board’s Senior Manager of Market
January 2012 Toronto Real Estate Market Watch
2012 Housing Forcast for Ontario
December 2010 Toronto Real Estate Board Market Watch
November 2010 Toronto Real Estate Market Watch 2010
October 2010 Toronto Real Estate Market Watch 2010
August 2010 Toronto Real Estate
August 2010 Toronto Real Estate Market Charts
July 2010 Toronto Real Estate Market Report
Greater Toronto REALTORS® reported 10,898 sales through the
Multiple Listing Service® (MLS®) in April, representing a 34 per cent
increase compared to April 2009. There were also 20,683 new listings in
April – a 59 per cent annual increase. Both the sales and new listings
results amounted to new records for the month of April under the current
Toronto Real Estate Board (TREB) boundaries.
“The GTA resale market is functioning properly. Sales were high as
buyers continued to take advantage of affordable home ownership
opportunities. Listings grew as home owners reacted to strong sales and
price growth,” said Toronto Real Estate Board President Tom Lebour.
“More balanced market conditions will result in sustainable rates of
annual price growth in the second half of 2010.”
The average price for April transactions was $437,600 – up 13 per
cent compared to the average of $385,641 recorded in April 2009.
"Home sales continue to be driven by many different segments of the
market, with sales growth for all major home types in both the City of
Toronto and surrounding 905 regions," said Jason Mercer, TREB's Senior
Manager of Market Analysis. "Home sales will remain strong in the second
half of 2010, but will slip from the current record pace as borrowing
Toronto Real Estate Market showes a 48% increase in listings.
The Multiple Listing Service® (MLS®) during the first two
weeks of April. This represented a 25 per cent increase compared to the
3,681 sales recorded during the same period in 2009. New listings
increased by 48 per cent annually to 9,512. “The fact that annual growth
in new listings outstripped growth in sales suggests that the GTA
existing home market is becoming better supplied,” said Toronto Real
Estate Board President Tom Lebour.
"Home owners are reacting to strong sales and price growth by listing
their homes in greater numbers. They are confident they will receive
offers in line with their asking price."
The average price for April mid-month transactions was $430,271 – up
12 per cent compared to the average of $383,361 recorded during the
first 14 days of April 2009. "The average annual rate of price increase
has declined and we are shortly going to see a return to sustainable
single-digit rates of growth," said Jason Mercer, TREB's Senior Manager
of Market Analysis.
"As home buyers experience more choice in the marketplace, there will
be less upward pressure on the average selling price in the GTA.”
This looks like April will mark the turning point for Toronto's Real
Estate Market. For the first time in years we saw new listings increase
at a faster rate than sales.
Toronto's real estate market has suffered from a shortage of new
listings ever since the market rebounded a year ago.
Canadian Realtors report busy spring
Resale market sees nearly 100,000 homes listed for
sale in March. Seasonally adjusted sales scaled new heights in Toronto
Homebuyers have more choice heading into the busy spring
buying season, with new supply in Canada's resale housing market setting
a record for the month of March. While resale housing demand remains
strong, rising numbers of new listings are resulting in a more balanced
national resale housing market. According to statistics released by The
Canadian Real Estate Association (CREA), some 97,663 residential
properties were listed for sale on the Multiple Listing Service® (MLSvSystems
of Canadian real estate Boards in March 2010. This is an increase of 20
per cent from the previous March record set in 2008. A total of 233,402
new listings have come on stream since the beginning of the year, more
than in any other first quarter period on record.
"Negotiations still favour sellers during the home buying process in
a number of major Canadian housing markets," said CREA President Georges
Pahud. "The rise in new listings means that buyers may shop around more
before making an offer."
Demand remains very strong, but has edged lower compared to the
record levels posted at the end of 2009. Seasonally adjusted national
home sales totalled 130,072 units in the first three months of 2010.
This represents the fourth highest quarterly level on record, down 3.4
per cent from the quarterly peak in the fourth quarter of last year.
Sales activity in Ontario, Quebec, and Newfoundland & Labrador rose to
new records in the first quarter. Higher activity in these provinces was
offset by a decline in activity in British Columbia (-17.8 per cent) and
Alberta (-9.7 per cent).
Actual (not seasonally adjusted) sales numbered 111,110 units in the
first quarter of 2010. This is the third highest level ever for the
first quarter period.
A total of 43,621 homes traded hands through Boards' MLS(R) Systems
on a seasonally adjusted basis in March 2010. This is an increase of 1.4
per cent from February, as further gains in Toronto more than offset a
decline in activity in Vancouver.
Unadjusted national sales activity numbered 49,256 units in March.
This marks the second highest level on record for the month of March. On
a year-over-year basis, sales were up 40.8 per cent, smaller than those
of the previous five months. Since a year will soon have elapsed
following the recessionary decline and subsequent rebound for the
Canadian resale market, year-over-year comparisons are expected to
continue shrinking in the months ahead.
The national average price of homes sold via Canadian MLS® Systems in
March was $340,920. This is the second highest national average price on
record, just $300 below the peak reached last October. Compared to March
2009, the national average home price was up 17.6 per cent. As with
sales activity, the increase was smaller than those recorded over the
past five months, and year-over-year gains are expected to become
further subdued as the year progresses.
The price trend is similar but less dramatic for the national
weighted average price, which compensates for changes in provincial
sales activity by taking into account provincial proportions of
privately owned housing stock. It climbed 16 per cent on a
year-over-year basis in March 2010.
The residential average price in Canada's major markets climbed 19
per cent year-over-year to $373,835 in March. As with the national
counterpart, the price trend is similar but less dramatic for the major
market weighted average price, which rose 17 per cent from levels
reported in March 2009.
There were 214,312 homes listed for sale on Boards' MLS® Systems in
Canada at the end of March 2010, a decline of nine per cent compared to
the elevated levels of one year ago. This is the smallest year-over-year
decline in active listings since June 2009.
The actual (not seasonally adjusted) number of months of inventory in
March 2010 stood at 4.4 months. While well below where it stood one year
ago (6.7 months), and down slightly from March 2008 (five months),
months of inventory are higher compared to March from 2004 through 2007.
The number of months of inventory is the number of months it would take
to sell current inventories at the current rate of sales activity.
On a seasonally adjusted basis, months of inventory stood at 4.6
months in March. This was little changed from February, but stands above
levels reported in the previous four months.
"The erosion of housing affordability is crimping activity in some of
Canada's priciest markets in the lower mainland of British Columbia,"
said CREA Chief Economist Gregory Klump. "Higher mortgage interest rates
and the rise in new listings may also soon reduce some of the urgency to
purchase in Toronto. Sales activity in British Columbia and Ontario is
expected to ease over the second half of 2010 once the HST comes into
effect, pulling national activity lower. Rising supply and lower
activity will take the steam out of the pricing environment following
upbeat home sales this spring."
CREA cautions that average price information can be useful in
establishing trends over time, but does not indicate actual prices in
centres comprised of widely divergent neighborhoods or account for price
differential between geographic areas. Statistical information contained
in this report includes all housing types.
GTA Realtors report on the March Resale Home Market.
Greater Toronto Realtors reported 10,430 sales through the
Multiple Listing Service® (MLS®) in March, pushing total first quarter
2010 sales to 22,418 – the best result on record under the current
Toronto Real Estate Board (TREB) boundaries. The average price for March
transactions was $434,696. The average price for the first quarter was
"The strong rebound in the existing home market was one of the
initial drivers of economic recovery," said TREB President Tom Lebour.
"While we don't expect to see the same rates growth moving forward, GTA
households will remain confident in ownership housing as a quality
long-term investment, especially as economic recovery expands across all
The annual rate of growth for new listings continued to accelerate in
March. The number of new listings grew by 42 per cent compared to March
of 2008. "The average home price in the GTA will continue to grow this
year, but the pace will slow as we move through the spring," said Jason
Mercer, TREB's Senior Manager of Market Analysis. "As growth in new
listings starts to outstrip growth in sales, buyers will experience more
choice, resulting in more sustainable single digit rates of average
Forest Hill and Bridle Path are the hottest spots
for real estate worth $1 million-plus as February sales and prices soar.
Aheated Toronto real estate market is
lifting sales of luxury homes as the economy starts to improve and
move-up buyers regain confidence, says a report by Coldwell Banker
Terrequity Realty released Wednesday.
The top-performing area with sale prices in excess of $1 million in
2009 was Forest Hill, where 280 homes changed hands at an average price
of $1.42 million.
The Bridle Path area was in second place, with 221 sales and an
average price of $2.1 million.
Oakville, west of Toronto, came in third with 174 properties sold
with an average value of $1.67 million.
GTA residential real estate market continues to soar.
Toronto area realtors reported 7,291
sales through the Multiple Listing Service® (MLS®) in February,
representing a 77 per cent increase over February 2009. The average
price for these transactions was up 19 per cent year-over-year to
$431,509. Sales and average price increases represent both increased
demand for ownership housing and the base year effect, which involves a
comparison of economic recovery this year to a period of economic
decline last year.
“Increases in existing home sales and average price were noted across
the GTA in low-rise and high-rise home types. Similar rates of growth
were experienced in the City of Toronto and surrounding 905 regions,”
said TREB President Tom Lebour. “This suggests that first time, move-up
and down sizing buyers are all active in the existing home marketplace.”
New listings also increased in February, climbing 24 per cent
compared to the same month last year. “Annual growth in new listings is
expected to continue. New listings growth will start to outstrip sales
growth as we move through 2010,” said Jason Mercer, TREB’s Senior
Manager of Market Analysis. “As the market becomes better supplied, we
will see more sustainable single-digit rates of price growth.”
Low inventory heating Spring market
Lack of inventory will be the greatest challenge
facing housing markets across the country this Spring, according to a
report released today by RE/MAX.
The RE/MAX Market Trends Report 2010,
which examined real estate trends and developments in 16 markets across
the country, found that unusually strong activity during one of the
traditionally quietest months of the year has led to a sharp decline in
active listings in 81 per cent of markets surveyed. The threat of higher
interest rates, tighter lending criteria, and in British Columbia and
Ontario, the introduction of the new Harmonized Sales Tax (HST) have
clearly served to kick-start real estate activity from coast-to-coast,
prompting an unprecedented influx of purchasers. As a result, 87.5 per
cent of markets posted an increase in sales in January. Average price
appreciated in 81 per cent of markets surveyed.
“There have never been so many motivating factors in play at once,”
says Michael Polzler, Executive Vice President, RE/MAX Ontario-Atlantic
Canada. “We’re in for a heated Spring market that will, in all
probability, spill over into the summer months, as the window of
opportunity draws to a close. The supply of homes listed for sale has
been drastically reduced, housing values are once again on the upswing,
and banks and governments are moving in unison toward stricter lending
Markets experiencing the tightest inventory levels include Toronto (-
41 per cent); Kitchener-Waterloo (-33 per cent); Ottawa (- 30 per cent);
Victoria (- 30 per cent); Greater Vancouver (- 27 per cent);
Halifax-Dartmouth (- 19 per cent); London-St. Thomas (- 18 per cent);
Regina (- 16 per cent); and Winnipeg (- 13 per cent). Conditions were
still balanced, but starting to tighten in Calgary, Edmonton and
Saskatoon, particularly in the single-family detached category.
The highest year-over-year sales gains were reported in Greater
Vancouver (152 per cent), Kelowna (121 per cent), Greater Toronto (87
per cent), Victoria (69 per cent), Hamilton-Burlington (58 per cent),
London-St. Thomas (55 per cent) and Calgary (47 per cent). Western
Canadian cities dominated the list of centres with the highest increases
in price appreciation. These included Victoria at 25.5 per cent, Kelowna
at 22 per cent, Greater Vancouver at 19.5 per cent, and Winnipeg at 17
per cent. St. John’s (23 per cent) and Toronto (19 per cent) were also
among the frontrunners for price growth.
“Affordability is the catalyst for the vast majority of purchasers in
today’s housing market,” says Elton Ash, Regional Executive Vice
President, RE/MAX of Western Canada. “While homeownership is still
within reach in many major centres, levels are slipping. There is a
growing sense, on both sides of the fence, that the time to act is now.”
While buyers are taking advantage of favourable conditions, sellers
too are reaping the rewards. Competing bids are a factor in the
marketplace once again, with well-priced listings—especially at the
entry-level price point—experiencing multiple offers. Properties priced
at fair-market value will likely sell quickly for top dollar. The
overall pressure on sales and price is significant across the board –
and it’s not likely to subside unless more inventory comes on-stream.
“The level of frustration is growing, as pent-up demand builds,” says
Polzler. “For every successful offer, there are those that will walk
away empty-handed. They’re thrust back into the buyer pool and the
process starts all over again. Some buyers are upping the ante, while
others are considering alternate housing options. Still, purchasers
remain cautious in their bids, with most careful not to max out debt
Recent revisions to lending criteria will add fuel to the fire in the
short term. Buyers considering a variable rate mortgage will step up
their plans for homeownership in the next month or so just to get in
under the wire. In the longer term, buyers will adjust, but move
forward. Compromise has long been a reality—particularly in the larger
centres. This simply means they may go smaller or further in their
“It’s been a 180 degree turnaround from this time last year,” says
Ash. “It’s clear that real estate from coast to coast has roared back to
life and markets are once again firing on all cylinders. The vast
majority of markets are now recovered and fully-evolved, with all
segments working in tandem. At the luxury price point, activity was
brisk in 73% of centres surveyed, with momentum ramping up in the
remainder. Opportunity exists in some areas, but the question is for how
much longer? ”
levels set stage for heated Spring market
major Canadian centres, says RE/MAX
Active listings down in 81 per cent of markets in
Lack of inventory will be the
greatest challenge facing housing markets across the country this
Spring, according to a report released by RE/MAX.
The RE/MAX Market Trends Report
2010, which examined real estate trends and developments in 16 markets
across the country, found that unusually strong activity during one of
the traditionally quietest months of the year has led to a sharp decline
in active listings in 81 per cent of markets surveyed.The threat of higher interest rates, tighter lending criteria,
and in British Columbia and Ontario, the introduction of the new
Harmonized Sales Tax (HST) have clearly served to kick-start real estate
activity from coast-to-coast, prompting an unprecedented influx of
purchasers. As a result, 87.5 per cent of markets posted an increase in
sales in January. Average price appreciated in 81 per cent of markets
There have never been so many
motivating factors in play at once.We’re in for a
heated Spring market that will, in all probability, spill over into the
summer months, as the window of opportunity draws to a close. The supply
of homes listed for sale has been drastically reduced, housing values
are once again on the upswing, and banks and governments are moving in
unison toward stricter lending policies.
Markets experiencing the
tightest inventory levels include Toronto (- 41 per cent);
(-33 per cent); Ottawa (- 30 per
cent); Victoria (- 30 per cent); Greater Vancouver (- 27 per cent);
Halifax-Dartmouth (- 19 per cent); London-St. Thomas (- 18 per cent);
Regina (- 16 per cent); and Winnipeg (- 13 per cent).
Conditions were still balanced, but starting to tighten in Calgary,
Edmonton and Saskatoon, particularly in the single-family detached
The highest year-over-year sales
gains were reported in Greater Vancouver (152 per cent), Kelowna (121
per cent), Greater Toronto (87 per cent), Victoria (69 per cent),
Hamilton-Burlington (58 per cent), London-St. Thomas (55 per cent) and
Calgary (47 per cent). Western Canadian cities dominated the list of
centres with the highest increases in price appreciation.These included Victoria at 25.5 per cent, Kelowna at 22 per cent,
Greater Vancouver at 19.5 per cent, and Winnipeg at 17 per cent.St. John’s (23 per cent) and Toronto (19 per cent) were also
among the frontrunners for price growth.
Affordability is the catalyst
for the vast majority of purchasers in today’s housing market.While homeownership is still within reach in many major centres,
levels are slipping.There is a growing sense, on
both sides of the fence, that the time to act is now.
While buyers are taking
advantage of favourable conditions, sellers too are reaping the rewards.Competing bids are a factor in the marketplace once again, with
well-priced listings—especially at the entry-level price
point—experiencing multiple offers.Properties priced
at fair-market value will likely sell quickly for top dollar.The overall pressure on sales and price is significant across the
board – and it’s not likely to subside unless more inventory comes
The level of frustration is
growing, as pent-up demand builds.For every
successful offer, there are those that will walk away empty-handed.They’re thrust back into the buyer pool and the process starts
all over again.Some buyers are upping the ante,
while others are considering alternate housing options.Still, purchasers remain cautious in their bids, with most
careful not to max out debt service ratios.
Recent revisions to lending
criteria will add fuel to the fire in the short term.
Buyers considering a variable rate mortgage will step up their plans for
homeownership in the next month or so just to get in under the wire.In the longer term, buyers will adjust, but move forward.Compromise has long been a reality—particularly in the larger
centres.This simply means they may go smaller or
further in their pursuits.
It’s been a 180 degree
turnaround from this time last year.It’s clear that
real estate from coast to coast has roared back to life and markets are
once again firing on all cylinders.The vast majority
of markets are now recovered and fully-evolved, with all segments
working in tandem.At the luxury price point,
activity was brisk in seventy-three per cent of centres surveyed, with
momentum ramping up in the remainder.Opportunity
exists in some areas, but the question is for how much longer?
Greater Toronto realtors reported
3,555 sales through the Multiple Listing Service during the first two
weeks of February. This represented a 74 per cent increase compared to
the 2,044 sales recorded during the same period in 2009 when resale
transactions had dipped due to the recession. The February mid-month
sales total was also 7.7 per cent above the previous high set in 2006.
"Home ownership demand remains strong in the GTA, as households
remain confident that economic recovery is at hand and that ownership
housing will continue to be a quality long-term investment," said
Toronto Real Estate Board President Tom Lebour.
The average price for February mid-month transactions was $429,997 -
an 18 per cent increase over 2009. New Listings within the Toronto Real
Estate Board boundaries were up 15 per cent to 6,212.
"Double-digit price increases will persist through the first quarter
of the year," said Jason Mercer, TREB's Senior Manager of Market
Analysis. "However, as new listings continue to increase creating a
better supplied market, we will see the annual rate of price growth
moderate into the single digits."
Government of Canada
Takes Action to Strengthen Housing Financing
The Honourable Jim Flaherty, Minister of Finance,
today announced a number of measured steps to support the long-term
stability of Canada's
housing market and continue to encourage home ownership for Canadians.
housing market is healthy, stable and supported by our country's solid
economic fundamentals," said Minister Flaherty. "However, a key lesson
of the global financial crisis is that early policy action can help
prevent negative trends from developing."
The Government will therefore adjust the rules for
government-backed insured mortgages as follows:
Require that all borrowers meet the standards for a five-year fixed rate
mortgage even if they choose a mortgage with a lower interest rate and
shorter term. This initiative will help Canadians prepare for higher
interest rates in the future.
Lower the maximum amount Canadians can withdraw in refinancing their
mortgages to 90 per cent from 95 per cent of the value of their homes.
This will help ensure home ownership is a more effective way to save.
Require a minimum down payment of 20 per cent for government-backed
mortgage insurance on non-owner-occupied properties purchased for
"There's no clear evidence of a housing bubble, but
we're taking proactive, prudent and cautious steps today to help prevent
one. Our Government is acting to help prevent Canadian households from
getting overextended, and acting to help prevent some lenders from
facilitating it," said Minister Flaherty. "If some lenders aren't
willing to act themselves, we will act. These measures demonstrate the
Government is committed to taking action when necessary to support the
long-term stability of a sector that is so vital to our economy and the
financial well-being of Canadian families."
These adjustments to the mortgage insurance guarantee
framework are intended to come into force on April 19, 2010. See link
So what does this mean to you??? Well, if you're an
existing homeowner that holds a Variable Rate mortgage, it means very
little, just enjoy your low rate mortgage. The above changes doesn't
mean rates are on the rise, but rather the government is using other
means to slow down a hot real estate market. With unemployment currently
at 8.50%, a strong Canadian dollar sitting at 95 cents and core
inflation at 2%, means that there is not a huge panic for the Bank of
Canada to raise rates aggressively for now.
Of course, this could all change as certain key
indicators and new data come to the market.
Still a seller's real estate market
but it's not a bubble economists say
Canada's housing market is on the
rebound after a decline in 2009 with resales expected to set a new
annual record this year and home building is off to a strong start,
according to two reports Monday. There in't a bubble because of a lack
of speculation in the real estate market, said Scotiabank senior
economist Adrienne Warren.
Prices are being driven by more buyers than sellers, not unexpected
with a tight supply, and buyers may be overpaying a little in some
markets, she said. "We don't think there's a bubble," she said from
The Canadian Real Estate Association is forecasting resales for homes
will set a record in 2010, largely driven by activity in the first six
months of this year.
The resale housing market is expected to reach 527,300 units this
year, up 13.3 per cent from 2009. This would be a new annual record, up
1.2 per cent above the previous peak in 2007, CREA said Monday.
"You are not hearing about a lot of speculative buying," Greg Klump,
the national real estate organization's chief economist, said from
Ottawa. "Nor is there a lot of speculative building."
Low interest rates and buyers wishing to avoid the harmonized sales
tax before it comes into effect in Ontario and British Columbia will
help fuel resales in the first half of this year, he said. In the second
half of 2010, sales are expected to be lower as interest rates are
expected to increase marginally, Klump said.
New housing starts have also gone up, according to figures Monday by
Canada Mortgage and Housing Corp. The seasonally adjusted annual rate of
housing starts reached 186,300 in January, up 5.8 per cent from 176,100
in December. CMHC reported actual housing starts for 2009 totalled
149,081 units, with activity improving as the year progressed.
TD Bank economist Pascal Gauthier said there's talk of a bubble
because of how strong housing markets have rebounded after the economic
downturn. "Our expectation is that it will not be sustained. The market
will cool off. You could only really have a bubble if that was to
continue," Gauthier said. Gauthier said he expects housing starts to
cool off by mid-year.
The CMHC said urban starts increased 4.4 per cent to 165,200 in
January. Urban multiple starts rose 5.7 per cent to 76,300, while single
urban starts increased 3.3 per cent to 88,900.
The improving market comes as the federal Competition Bureau said
Monday it's challenging rules imposed by the Canadian Real Estate
Association, a body that represents nearly 100,000 real-estate brokers,
agents and salespeople.
The federal agency says the CREA rules limit choices for consumers
and force them to pay for services they don't want, also stifling
innovation in the market for residential real estate services.
Toronto HST Tax
.. next year may be too late. The new 13% harmonized sales tax comes
into effect in Ontario on July 1, 2010, and it will likely hit the whole
housing market hard. If you haven't sold by July 1, you may well be out
of luck. And if you haven't bought by then, well, maybe you'll want to
change your mind. And the funny thing is, hardly anyone seems to realize
"There are going to be a lot of very surprised people on July 1,"
says Jim Flood, director of government relations for the Ontario Real
Estate Association. "It's a massive tax increase."
So here's the bad news: Although resale houses will not be taxed,
everything to do with the sale will be -- the house inspection, the
agent's commission, the moving costs and legal fees.
There will even be tax on the home energy audit all sellers are now
compelled to carry out thanks to the Green Energy Act the McGuinty
government passed in May. And speaking of the home energy audit, why
isn't anyone concerned about that?
Altogether, that means the extra tax on a resale house priced at
$369,000 will come in at roughly $2,000 (largely the tax on the agent's
commission) and double that and more on many ordinary houses in Toronto,
before you even remember you have to pay Toronto's onerous land-transfer
It's enough to make you wonder exactly why you're thinking of moving.
Or to get you packing your bags and calling the mover today.
But it's worse news for new home buyers, although not as bad as it
was originally expected to be. Under pressure from groups like the
Ontario Home Builders Association, the province has decided not to levy
the tax on the first $400,000 of any new home purchase. (GST has been
payable for a number of years but builders tend to hide it in the house
So on a $500,000 house, the extra HST hit will be $6,000 instead of
$30,000 (builders get a 2% tax credit that lowers the overall tax hit
from 8% to 6%). Without that change, the loss of a potential 21,200 jobs
in the GTA alone looked probable. That's enough to scare off first-time
home buyers and potentially many other people struggling to make ends
Easy, according to the OREA's Flood: "There's a lot of ignorance. I
don't think the average consumer is even aware of the tax." The HST will
impact many things you haven't even thought of yet -- but the
housing-related taxes are killers.
How new tax adds to cost of a sale:
Realtor Commission $1,100- $1,700
Mortgage insurance $470
Legal costs $80 *
Home Inspection $32
Title Insurance $15
Total $1,747 -$2,297
(Estimates based on house less than $400,000, from Ontario Real
Toronto finds itself in a surprising situation: The economy stalled,
but house prices didn't.
hat happens if you had a recession and housing prices
didn't really go down? That's the scenario Toronto could be in by the
end of 2009, as economists scramble to revise this year's real estate
Toronto housing economist Will Dunning is forecasting that the
average price of an existing home in the Greater Toronto Area will be
$378,700 by the end of this year. His previous forecast was for prices
to decline to $358,100, or about 5.6 per cent from 2008. That's in line
with the estimates of about a 5 per cent decline from most major housing
"The forecast has been raised substantially," Dunning says. "For the
past three months, resale activity has been much stronger than I had
A $378,700 price is spitting distance of the $379,347 average price
recorded at the end of 2008. Dunning says this year's average price
could surpass last year's.
Five must-haves for flipping houses
Many people assume that they can simply 1) buy a house, 2)
apply a fresh coat of paint, 3) trim some bushes, and then 4) resell the
home at a profit. Unfortunately, this process, called "flipping" is not
that easy. After all, if it were, everyone would be doing it. There are
several skills and people that every potential investor/flipper should
have in place before even considering entering into a real estate
transaction of this nature. Here are the top five "must-haves" you'll
need to succeed in this endeavour.
1. A Group of ExpertsWhile a house flipper can certainly go it alone, it will certainly
help to retain individuals that are familiar with the legal, accounting
and construction ramifications of flipping houses.Flippers typically work against the clock, so they must renovate a
home on budget and then turn it around and sell it before the financing
costs eat up their profits. In any case, a bevy of experts including a
real estate agent, a lawyer, a contractor or renovator, an accountant, a
home inspector and an insurance agent can ensure that the work is
completed in a timely and efficient manner.
2. A Handyman or Knack for Home ImprovementThe house flippers that make the most money buying and selling homes
tend to be handy people. That is, they have the ability to step in and
lend a helping hand when time or money constraints kick in. Most
flippers can do things like change a sink, install a countertop, do
basic electrical or plumbing work, and/or shingle a roof.Why is being handy so important?The obvious answer is that if you can do the work yourself, you won't
have to pay someone to come in and do it. However, there are other
advantages to being handy as well. For example, there are times when it
will be impossible to get an electrician to install an attic fan on
short notice. There are also times when a job must be completed without
warning at the last second in order to obtain a certificate of
occupancy. In these instances, having the ability to navigate your way
around a tool box is very valuable.
3. A Good Lay of the LandThe buyer should know about the area in which they are buying
property. A buyer should know, for example, what characteristics
(acreage, number of rooms, type of home, etc) are the most desirable in
the area in which they are looking to buy. Equally important is knowing
what houses in the general vicinity have sold for and if there is likely
to be any future development in the community (such as a new school,
condominium or shopping center) as this could affect supply and demand.
4. A Good EstimatorBy definition, house flippers attempt to buy a property and then
resell it at a profit in relatively short order. In order to do this,
however, the flipper must typically make some structural and/or cosmetic
changes to make the property more appealing to the next buyer.If the flipper underestimates the costs associated with the
refurbishment he or she may be exposed to large monetary losses.
Therefore, a flipper should be familiar with construction materials
(their use and their cost), as well as local construction codes, the
cost of local labor and the time it should take to do a given job.This is no small feat. In fact, it takes even the most seasoned
construction professional many years before he or she is aware of all
the nuances that exist. In any case, before becoming involved in
"flipping", be certain of your abilities to estimate a job in terms of
both cost and time.
5. A Dose of PatienceOne of the biggest obstacles to making money in the real estate
market is that buyers tend to overpay for a given property.Why do buyers overpay?Typically, buyers become emotionally attached to a property or
develop some other bond with it, which in turn forces them to enter into
a contract on less than favorable terms.However, savvy flippers have the ability to avoid emotional
purchases, and the desire to find diamonds in the rough and properties
on the cheap. They also understand that if they aren't buying a property
at a favorable price and with favorable terms, it makes sense to simply
move on to greener pastures.The bad news is that patience is a difficult virtue to teach and
hone. In general, either you have it or you'll lose a lot of money
trying to learn it. The Bottom LineWhile quitting your job and becoming a full-time house flipper may
sound like an attractive proposition, be sure that you have these five
"musts" before investing in a real estate project.