Home (Less)

I've spent the better part of 2010 preoccupied with the GTA housing market (perhaps justifiably so being a realtor). I've tried through my website TheSmithsBuyAHouse.com and this blog forum to educate propsective homeowners about the ins and outs of making offers; calculating market value for yourself; how to best your chances for getting a mortgage (often by pitting competitors against each other); keeping you informed about new developments that impact the purchase of a house from HST to more stringent mortgage requirements to land transfer tax and any rebates that were once available.

I've tried to use my economic background to look into trends and educate you on how mortgages work and how banks do their business so you get a glimpse of what's going on behind the scenes.

It's been a year of many developments and I've enjoyed making this blog into a sort of resource for those of you who visit.

I am struck though with how fortunate we (as a collective) are. Perhaps it was an article I read in the Star this morning about a Harvard graduate who followed a homeless man around the streets of Toronto and has been blogging using the words of the homeless man to tell his stories and life. "Homeless Man Blogs" by Phillip Stern.

Perhaps it was the outing with my family on the downtown streets of Toronto checking out the festive lights while explaining to my 4 yr old son that the people sleeping in doorways with skimpy blankets are not likely to become potential homebuyers or client's. These people are without a home...I explained to my son. It's a very confusing lesson and dialogue for a kid whose spent each winter wrapped in his cozy bed with the heat blasting.

Today, I'm not interested in reviewing the housing market. I'm interested in the number of homeless people on our streets ranging in age; skin color and histories. I'm inspired to do something.

I remember a post by an old friend on facebook where he was collecting sleeping bags for some homeless people. At the time I read it, I smiled and then had an offer presentation for a client. I commend DG for his efforts and to all of you who have done their part.

We're fortunate to concern ourselves with interest rates and downpayments and taxes as we plot our paths towards home ownership! Multiple offers suck. But homelesssness sucks way more (would be my guess).

So after being so consumed with working in the housing industry and blogging about it religiously, I wanted my last post of 2010 in the spirit of the holiday season to put some responsibility on my plate to assist those who won't likely read these blogs but can use our collective help.

The best of the New Year

Condo Owners vs Freehold Owners-oh...they are different!

Can you compare these owners?
These owners may be different because of many lifestyle; budget; locational needs; transportation sources, etc.

But...make no mistake. At any stage a condo owner is different then a freehold dweller.

1. A condo owner is like the knowlegable investor. They typically have a RIP (not rest in peace but Regular Investment Plan). They pay monthly fees that for the most part don't change w/o a major reason that's voted on by the board. A freehold dweller often can't figure out how often they pay heat or hydro or better yet don't have a clue what company or what phone number to dial should they require service. So....they call me to find out!

2. A condo owner who wants to do upgrades, typically has most of what they need readily available. Floorplans, square footage, layout. A resale homeowner (freehold) hasn't a clue often enough how many sq ft are on their main living space when they buy the house and hence need it measured so they can calculate how much laying hardwood flooring for example will cost.

3. If a condo owner is short on cash and something happens...say a leak in the main lobby...the condo will go to the pool of monies (much like a mutual fund) and pull out the required amount to fix the problem. If the reserve fund is ample...the condo owner may not feel any pinch at all. "May not".

4. The condo owner never asks their agent..."How the hell do I read this survey"?!

5. A condo owner typically doesnt worry about where his/her parents will park when they come for a visit.

6. A condo owner can break down to the penny what a sq ftg of space costs. Not so in many older resale freehold properties. You start doing that kind of math and you're gonna get some funky numbers when you valuate property.

7. Condo owners may have to plan their entries and exits with savvy to avoid certain neighbors. Not as easy as looking out your front window of your detached house to see if their car is in the lot.

8. Condo owners know the city...I find. They don't have much greenspace so they go searching for it.

So much more. But just a few points when a freehold owner looks over at the condo owner and shakes their head.

Wishing you the best of the holiday season. Peace and Prosperity. Most importantly...good health.

Be in touch in 2011.

Michael Gruuenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
mgruenstein@trebnet.com

Year End Note on Housing Market/Prices in and around Toronto

The year began with emergency rate interest rates. The year will end at low levels.
After a bounce back of approx 20 percent from Jan 09-2010 Jan...the remainder of the year was a bit of a bumpy ride. We grew and peaked in April in many areas and sputtered in most areas into the summer months.

We didn't put as many of our homes on the market after the summer and saw a decent fall but really a Seller's market with lowered inventory and hence heightened prices.

Midway thru the year the government worried some that we were creating a bubble in the housing market with these extraordinary low rates and consumer debt was reaching all time highs. So...the government in a round about way tried to put the brakes on the level of purchasing by making the qualifications for first time buyers more difficult and taking away tax advantages for renos. Most banks shortened their ammortizations and first time buyers needed to qualify based on the 5 yr posted rate.
Did this take any steam out of the market?

Overall...not really. Canadians had seen enough of the foreclosure woes in the U.S. that banks and buyers wanted for the most part to afford their mortgages.

We saw a boom in condo purchases especially outside the city in areas like Mississauga and Richmond Hill. Areas that no doubt are more enticing with one land transfer tax as oppose to Toronto's 2.

So heres the picture moving into 2011:

1. Rates are low. Bank of Canada did not raise last week
2. Supply is lowered. Bodes well for Seller's but Buyer's may argue they feel good as rates are low
3. People will continue to need homes
4. On a world scale, Toronto is not terribly expensive and we continue to have demand from immmigrant populations looking to begin their lives here
5. Now the Bank is actually saying that consumers in Canada are being more dilligent and cleaning up their balance sheets

But...anything can happen. Just ask Bernake!
We'll no doubt take our cues from the U.S. as they stage their recovery
There's been some healthy data but unemployment numbers are awful

In areas I frequent here are some year end examples of pricing:

Aveneue and Lawrence:
we saw 3 homes on the same street east of aveneue all sell well into 800ks-mid 900ks. All 3 bdrm homes, on 25 ft lots with mutual driveways and some front pad parks. The homes did show well overall.

Upper Forest Hill Village:

50 ft lots with tired homes but good layouts for renovators were hitting 1.2 approx---depending on street, location on street, timing, exposure, number of bedrooms, etc.

Thornhill Woods:

Homes on 40 ft lots typically by 80-90 with 4 bdrm 4 washrooms were all over the map. 600k-870k. Depending on builder, upgrades, when built, finished basement

Semis/Thomes-
450k-575k

Armour Heights:

We saw 2 storey 3 bdrm 2 bath on periphery streets (just outside of main area nearing bathurst) approach 700k

Of course the core streets saw homes sail into mid 1 millions and certainly higher on ravine lots.

With that....if you have any specific questions---don't hesitate to ask.
Wishing you a happy and healthy New Year!

Please call or email if I can be of any assistance to you or your family.

Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
mgruenstein@trebnet.com

Wth..is that going to ultimately affect my mortgage payment. How do mortagages work?

Okay, so this isn't the sexiest dialogue...but I still seem to get a ton of questions about interest rates and mortgage rates. I figured in my shortest blog entry I would oversimplify the explanation:
______________________________________________________
VARIABLE RATES:

We have short term rates and long term rates.
Bank of Canada decides on the discount rate (prevailing interest rates)
This rate is determined by risk of inflation vs growth prospects vs strength of dollar amongst other things
When B of C increases interest rates, chartered banks may lift their "prime rates".
Banks offer variable rate mortgages which use prime rate

So lets suppose B of C is worried about containing inflation then they may raise the
discount rate.
Then banks may lift prime rate
Then variable/floating rate mortgages may rise (prime rate plus a premium)
If you have a variable rate mortgage and rates go up..this will offset the amount of your payment that goes towards principal vs interest. Of course, your interest is for as much of you payment to go towards principal so you like low rates.

FIXED RATES:

Conversely, fixed mortage rates like the 5 year fixed rate that guarantees a specicif rate for 5 years is subject to change as well due to many factors.

Suppose, investors believe that the economy is going to start clipping along. Their appetitie for safety falls. Bond holders holding 10 year notes and collecting interest may decide to sell their bonds and move that money into the stock market. In doing so because their bonds may suffer from a lowered interest rate, the bondholder needs to sweeten the deal. How? They offer a discount on their bond which kicks up the yield for a new investor to grab hold of.

Now when yields go up in the long term bond market...this isn't great for banks who loan money out (mortgages). Now the banks borrowing costs when they sell bonds has gone up. To match and ensure that they make money on their loan portfolio, an increase in borrowing rates will ultimately lead to an increase in rates the bank will offer on mortgages.

SO variable rates are subject to change and fixed rates are subject to change.

What changes either is different.

Again, I'm not an economist. I am a realtor. If your economist says I'm a lousy make believe economist....I'm comfortable with my abilities to move real estate, so no worries.

Hope this clarifies.

Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

Buying or Selling in Late November/December...know this!!

Keep these tips in mind:

Banks and lawyers vacation too. Make sure if your lawyer is to preform a title search or close out the transaction in late Dec that he or another lawyer are physically available. Make these arrangements early. You may need to go a week or 2 early to sign some of the documentation.

Make sure as a Seller that you give as much notice as you can to utility providers to come do final readings for adjustment purposes. These large companies get stacked to towards the end of the year and doing these readings timely will help streamline the adjustments for closing purposes.

Call moving companies as early as you can. You will being paying a premium likely to do a late Dec or early Jan move. So more then any other time, price shop and ask for referals.

If you're a Seller leaving town after listing in December, be sure to have access to a dedicated phone line/fax line to deal with any offers and make sure someone is looking after your house. Awful time for a water pipe to burst. It won't happen...but be prepared for anything.

Shovel Sellers. It's already a pain in the butt when buyers arrive and the streets aren't plowed so they circle around for 10 minutes just to find a spot to come view your house. If you didn't shovel your driveway and front steps...you're going to leave a negative taste in the buyer's mouth...assuming they don't fall and eat snow.

Make certain that you leave lights on at all times. The days get grey and so do homes inside, no matter how many windows or the perfect exposure. Also, turn the heat on. Take it off the program while you're at work for the few weeks the house is being marketed. Yes, your bills will temp go up but the selling price should easily take care of those bills.

Buyers-open all the blinds and look for the condensation. It's there!! Home inspection will determine the need for replacing windows or simple sealing jobs.

Humidifiers should be on. Many older homes have mold in basement and do have an odor. Putting moisture in the basement air and opening up windows from time to time can only help.

There are many more things to know when purchasing into the winter season. If you have any further questions around this or the market...don't hesitate to ask me.

Michael Gruenstein MBA CSC
mgruenstein@trebnet.com
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGta.ca

Let's pretend to be Economists for a sec...

A few weeks ago it was announced that October saw a solid rise in condo purchases, most falling in mississauga and richmond hill. Land getting more expensive, condo units get smaller. The smaller units have to attract end users by offering up good amenities and clever sleek designs. Apparently, we have an appetite for low rates still and don't mind living in close quarters to get out of our parents basements and build equity. I thinks that's a good move.

Other data saw September's TO market drop almost 2% in prices. Of course, this should be further identified by looking into specific areas as trendy blocks with little supply are hitting homeruns on sales prices.

Now, if the world is playing games with currency interventions to keep their exports fuelled and say buying up CDN dollars serving to strengthen the loonie while at home inflation remains beneath the target rate...basically you get a Cdn economy losing its power with a high currency as an exporter while still tempting home buyers into the market with low rates. When these rates go up the arguement is that is when the "bubble bursts". It's not imminent from what I understand. But that seems to be where were at.

Currency intervention by developed countries; low domestic rates; an appetite to own homes and a strong loonie create a challenging landscape. At least we're not choking off growth and playing austerity games that will almost undeniably slow growth elsewhere.

The biggest concern by most economists around housing is the sheer level of indebtness that personal households are holding and the future of employment.

The market for homes in TO is getting closer to balanced but prices albeit some small drops of late still take us above pre recession levels by about 3% (National Post source).

So its not cheap out there. There are good opportunities though and for those who are prudent....get in the market and leverage these low rates. Just don't blow your brains out!!

Michael Gruenstein MBA CSC
mgruenstein@trebnet.com
Re/Max Realtron Realty

Random pieces of knowledge about homes and the market. Just throwing out some ideas. Easy read. You'll learn something!

Here's a random blog. Just some ideas that I've come across in a decade of buying and selling real estate that may be of interest (or not) to you. Let's do this:

1. For tepid sellers....there is a way of attempting a multiple offer scenario. The seller rather than asking for a clear date to review offers...asks for a 24-48 hr irrevocable (time to review the offer). During this period a good listing agent will attempt to draw in further business and have competing offers. Note, when this strategy is used..usually the ask price won't be on low end, like the more "bullish" seller who has underpriced with a pre inspection and an offer date.

2. Homes work in 20 year cycles. If you're lucky enough to purchase a resale house that has just undergone the correct maintenance you may be fortunate in that the sellers are taking goood care of their home and recently updated windows, roof, furnace, etc. If not, you may be looking at a healthy first and second year budget on top of your "welcome to" land transfer cost and closing costs in year 0.

3. Buying homes that are less then 7 years of age and Tarion warrantied...the warranty is transferrable. Though towards the last year or two of the warranty, the new owner has lost a lot of the warranty. At this stage, youre basically safe guarded should the house crumble if its demonstrated that its the fault of the poor construction. So don't take too much comfort in a warranty nearing the end.

4. When buying brand new...make sure in your offer you have a condition for a final inspection of the property. A walk thru with the builder to compile a deficiency list is important. By close or shortly thereafter its the hope of the buyer that the builder makes good on the list. Otherwise, Tarion may act as an arbitrator to ensure fairness in process.

5. Most asbestos tiles in older homes containe traces of asbestos as do water/boiler run furnaces. Removal of furnaces or tiles should be done by experts. It isn't a problem until its mishandled and then it becomes quite costly. This is not for the most part an insurance issue like knob and tube but it can become a saftety issue.

6. When caught in a multiple offer scenario, therte are strategies that may assist you. One such strategy works off the law of averages and determines for a like neighborhood and the number of offers in play, a percentage premium per offer that you'd tack on to the ask price to figure out where the house may sell at the end of the night. This is a crude benchmark, used in conjuction with adjusting comps and the ability of your agent to leverage relations with the listing agent (best to use an agent familiar with fellow agents in an area that they work). Timing of the presentation of your offer may also have a distinct advantage.

7. When going out to look at homes, namely a townhome or a semi..do not purchase until you've gone for a "dinner time" showing. Wait til the kids next door or dog are home. Then judge the level of noise. The listing agent will most of the time represent the house as very quiet and well constructed but best to learn on your own and go for a peak hour showing. Also when looking at a house, don't be shy to ask the neighbours. They're a wealth of info. You may find some who are very happy and others who aren't. Are the happy ones closer to your demographic and those not as happy perhaps older and liked the good ol' quiet days pre construction.

8. Canadian banks have recently raised draft fixed rates. With investors abroad seeking higher yields then those in other developed nations, the cost of borrowing has increased for our banks and in turn lending rates have had to go up on fixed mortages. Yesterday we had higher inflation data then expected. It's not clear when rates may work their way up. Tho Canada is looking relatively okay, Europe debt issues, US unemployment and potential deflation and emerging market bubbles may keep rates down domestically for some time. That said, locking in rates for a period if you're planning on hitting the pavement in the spring...is probably a good idea.

9. Many older homes have knob and tube wiring. A crude estimate of the cost to replace may be 1000 dollars a room. A room may be defined as a hallways as well. Some insurers will allow for a home to contain total k and t while other may ask for a percentage reduction and still others won't put up with any. You need to shop around and weigh insurance premiums relative to cost of doing work right off the bat.

10. Where can you save money and still live in a "trendy area". Here are some ideaas:
a) a townhouse or a semi will save you some money
b) if you have one vehicle and don't mind parking on street--typically these homes have less buyers in line
c) often corner properties are devalued
d) a house that shows poorly and has an unfinished basement (factoring in "over time") what needs to be done---it may represent a good opp for you
e) a smaller lot. yes, its a skinnier house for certain, but if its got an open layout and gets you into the school district and has a deep enough lot for further build out--this may be a good option
f) some estate sales or foreclosures
g)exclusive listings-if you're agent is tapped into the market, he/she may be aware of these kinds of opportunities. With fewer buyers and a seller not looking to "play the game", you may locate a house at fair market value and not be suckered into paying more and getting less.

This is a cross section of ideas. If you're getting into the market; have questions or want to learn more--please email or call. Also one of my sites...http://www.TheSmithsBuyAHouse.com is a great reference guide and may offer further insights.

Appreciate your time in reviewing the above.

Michael Gruenstein MBA CSC
416-271-2066
mgruenstein@trebnet.com

What the heck is "market value" on a home? Any basis for pricing these days??

Seeing that we realtors can't pinpoint an exact price on a house, (in fairness we don't know whose out shopping, how many parties may bid on house and we work for the sellers and sometimes are convinced for a period of time that they're price is "correct"---we default to "market value/range of value".

At the end of the day, the goal is to keep that range as tight as possible, unless we've priced at 999k and get lucky and sell for 1.3 million.

You should know that a few things make the calculation and arrival at market value more meaningful in most cases.

1. what have recent comps sold for?

2. how can you time adjust and adjust differences from one house to the next to make sense of a house asking price?

3. how long did it take this house to sell in similar environment over last many years?

4. Is this house being marketed after a recent termination?

5. whats the supply like of homes in the surrounding community. If low and in this interest rate environment...we'll market value is going to move upwards for sure (if house is priced okay and shows well)

6. what side of the street is the house located on? there is often a premium when backyard has southern exposure.

7. what renos/additions have been done? when were they completed. Even if they look great...you may need to depreciate the cost some to arrive at today's value?

8. Has there been a recent land sale on street. Trace back what a builder spent to put up new house when he purchased the land. Now tie in land value vs the full ask price of the house you're looking at. This should serve some basis

9. what are the mechanics like; electrical; plumbing; insurance premiums if any...take these into consideration relative to comps

10. don't discount the knowledge of a neighbour. some won't talk to you. others will tell you stuff that may actually make or break your decision to buy.

Theres so much more. I never saw this as ....person sees house. person likes house. person offers timely on house. person moves in.

But many do!

Michael Gruenstein MBA CSC
ReMax Realtron
mgruenstein@trebnet.com
http://www.TheSmithsBuyAHouse.com

Condo In your near Future? Do you know what you're getting into?

A condo can be a great purchase. Why? Typically not because it offers wonderful upside potential relative to a detached home, but its the ease of lifestyle. For those who want to be pampered and have underground parking, lawns maitained, windows repaired and like amenities that require nothing but a change of clothes and an elevator to arrive at....condos are great.

When you go condo shopping, go armed with some knowledge of questions to ask:

1. How long on avg do units take to sell? If the cheaper units are taking some time, that's typically not a great sign.

2. How long has the building been standing? This will point to the reserve funds strenght. A newer building is gonna need to play catch up to get an ample reserve fund built?

3. What are the plans for the building over the next yr? Do they intend to create more amenties, redo the lobby, etc.? That's going to require you as a unitholder of common elements to beef up your monthly fees for some time. Be prepared

4. Are the heating/cooling mechanisms owned? When are they serviced? How old are they? Is it your borne cost to replace? Are the rented? Are the part of service contract and monthly fees?

5. If building is approaching say 20 years plus...it may be time to replace windows for example. How long will you have to live with drafty windows before they get to your unit?

6. What's going to be built around the condo if vacant land exists. If you're buying for that south west view of the lake..will you enjoy that for long? how will a new structure effect the resale value if you lose part/all of the view?

7. Whats the split between investors vs owners who reside in the condo. Remember, tenants have less of a vested interest to upkeep the units as well as the common elements. Also, in an older building, renos by multiple units will increase the value of the units. Tenants tend to not put any money into their units. Why would they? In a perfect world you'd like something like a 75% plus owner occuppied building.

8. How's the visitor parking?

9. What's the turnover? If it's high....why?

10. Final piece of advice (in this article..) interview anyone you bump into at the building during a showing from the doorman to the guy in the elevator to the girl walking her dog outside. They have more knowledge on the day to day then the agent and you combined.

Michael Gruenstein MBA CSC
Re/Max Realtron Realty
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

Call or email with questions anytime @ mgruenstein@trebnet.com

blurred picture for residential market and pricing herein. what's going on?

First, we have the talk of the new commission structure. Most agents don't seem very concerned in the least. They look to the U.S. where homeowners have been offered discount brokerage/menju options for years now. It penetrated approx 3% of that market and this is before the housing crisis.
I've had top realtors in the city tell me that for an experiment they've spiced things up in their farm area and offered terribly low commissions and the phone calls and interest changed little.
Much as the public doesn't like paying the commission, its a sunk cost that sellers build into the pricing of their home and its equitable in that when they go to purchase a house they watch the sellers this time pay the commission out. It's an itch that gets scratched. Perhaps, like watching the Leafs no matter how awful a season its now turned into.

New home construction readings fell today. So the arguement may go that now there are fewere homes and some who would have looked at new construction will focus on the inventory of resale properties. Thus, the supply of homes will decrease and hence as the demand side goes..prices should stabilize if not rise.

This of course may be squashed by increasing rates tho with a dollar as high as it sits today and little inflation worries, it seems apparent that the rates may sit low for some time, helpping to prop up the prices of homes yet again.

What may disrupt the upward movement in prices may be the desire for Canadians with ever high household debt to become net savers and pay down theirt balance sheets making do with their current residence, though Canadians are comfortable with having mortages.

Klump from the CREA sounds like hes counting on a slower inventory year in 2011.

I suppose we have some news to sort thru in the US, commodity prices, deflation vs inflation and consumer confidence will all work their way into the housing market.

For the time being, inventory is low so in good areas we're seeing prices remaining quite high.

Best advice: get a strong agent, stay on top of the market and lock in rates with a preapproval.

If you have any questions I can help you with, don't hesitate to call or email. I still believe the site I've pieced together should be a great starting point for newcomers and those who haven't been in the game for some time.

But I'm always available.

Best,

Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

Waiting for the spring market to sell?

Folks,

wait for Gadot. don't wait to sell.

Here's why:

1. For the past many hot spring markets there have been "winners" and "losers". But you only hear of the winners!
A spring market works as follows: Everyone waits for springtime to sell. The obvious advantage is that the weather is nicer, the house shows better, buyers come out of their caves. The flaw is that there are more homes on the market. There are schools of investors that believe that when everyone wants to buy into the stock market, that's the exact time to sell and when people are saying its a bad time...buy.
My point is that in the spring market, you better have the prettiest house on the block if you want to get top buck. Buyers are slower to make an offer as they need to weed through all the inventory. The first guy who sells may sell at a price lower then you hoped he would and now your chances of selling for your buck are minimal.

In a market like today's there is not an abundance of inventory. That's typically great for a seller. Interest rates are low for the buyer so they feel pretty good. With banks still permitting 30 year ammortizations on top of low interest rates, buyers payments become more affordable.

Canada in general is seeing some of the highest debt levels per household ever. The theory goes that households will have to clean up their balance sheets and in doing so will become net savers. That doesn't necessarily point to a great market for sellers.

Some are predicting a correction of up to 15 percent in 2011 in some pockets. Who knows? We've been calling for a correction since I walked into real estate in 2002. Time will tell.

What I am certain about is homes are seeing similar prices that the heights of the spring market brought. In some cases --higher. Just supply and demand without the supply.

So if you're thinking about the spring market, the month of November just might be a heck of an opportunity for you to sell.

You can always look for a long closing to insulate some time to locate a great house. Ya, you might be a buyer in the spring market and pay a bit of a premium..but there should be more inventory if the house you want isn't here sooner.

It just may be better to be a buyer this spring market then a seller after all!

Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
mgruenstein.blogspot.com

"Offer Time" for Smith's...lets see how it goes

They locate a great house. It's even priced at market value. Closing date looks good. Heck, this is straight forward...make an offer and buy the damn house.

Can this not be so straight forward? Might there be some key issues here?

There just might be. Here's some things that the Smiths in all their excitement may not have cleared up and may affect their enjoyment and hence the resale value of the property of interest.

1. There's a major city easement that runs through the backyard. it actually chews off 10 ft of the rear property. So this 40 ft lot is contained to 30 feet on the westerly side for potential development. if they wanted to build a pool or a deck of plant a garden...they may have serious issues.

2. The family room addition is great space. It's hard to say if it was built legally. Current sellers bought it "as is". Better do some investigating and insuring

3. Property has some knob and tube wiring. There are some insurers. Some will ask you to cut the amount of knob and tube, others may request a complete update and inspection by third party. On top of land transfer and closing costs, this may be a sizable cost. So do they keep it "as is" and pay premium for year OR change immediately. Is one insurer more accomodating then the next?

4. The inspection revealed some moisture and active water coming from roof of house. Conditions run out tmrw for them to move forward or walk away. What's best course of action? Is their a way to try to get an abatement but still have capacity to move forward if sellers dispute?

5. Parking spot infront of the house isn't legal. But it's been in operation for a while. Do you ask the city or keep your mouth shut and assume it "as is" and hope for best.

6. Smiths need a second spot. No problem right? This area/street has street parking. Careful here if youre moving forward and not doing homework on this issue.

7. The taxes on the property seem low. That's great news for the Smiths? Does the city know about the 2 additions and 2 new washrooms added on to the top off of the existing bungalow? This property may be up for reassesment any time now and the property taxes may be artifically low so make sure you have an eye on that.

8. During negotiations a second offer pops up. How do you handle this now strategically. You were the first ones in. Does this give you an advantage. Is there a way to treat signbacks of offers for some added protection.

We found ourselves for years in an environment where if you had an average agent and lost a house then inventory was plentiful. So you hurt for a few days until you found the next one. Inventory is not as plentiful so the arguement is some buyers are feeling rushed to pull the trigger. Some agents love the hurry-up offense.

My arguement is that you can still be quick to the plate and cover yourself properly.

We're not trying to get you to the moon here. We'd like to get you into a great house and there are strategies and concerns that trained realtors can assist with.

I hate those realtors can help commercials. It oversimplifies the issues. It's a legal document with clauses that too often are breezed over which can have ramifications on the purchase of your greatest asset.

Cheers,

Michael Gruenstein MBA CSC
ReMax Realtron
mgruenstein@trebnet.com
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

do it yourselfer meets realtor--round 1. freindly sparring

sure sell/buy your house alone---good luck my friend.
let's start from the beginning:

1. Seller is asking 849k
fair price?
diy--do you have comps? don't want to overpay. may find out banks appraisal differs from yours and banks are getting tighter with these debt levels. sucks when you find out 2 weeks before close at time of appraisal that theres a disagreement.
i'd think those comps would be important\

realtor-i got the comps. i also have the land registry for private sales. oh..i also have the knowledge that theres ways of disecting a listing to come to market value (with some room for subjective value). i'm gonna ask some questions to give my client the upper leg. here's some:
1. what side of the street is house on?
2. when did it last sell? how long did it take?
3. what are semis selling for relative to detached?
4. in the area what's the premium for a private drive or mutual drive
5. cost of redoing the kitchen, wiring, plumbing --how will that factor into "market value"

DIY: house asking 849K. bypasses agent. goes to listing agent and offers 825k. DIY did it! good work. got the reduction. It's just that the house was so overpriced that 810k would have been a win/win for all. hey, what's an extra 15k savings, especially when its coming out of sellers pocket??


DIY: this guy is glued to the paper and mls.ca--the papers advertise typically 3-4 days after it hits mls.com where agents have taken their top clients to the front door and house could have sold. mls.ca---48hr delay. then call the listing agent who has 3 buyers in mind and likely will invite you to the open house on Sunday or struggle to return your call. Agent--takes you in on day 1 as inventory is tight and gives you time to make a decision. It's like the DIY arrives 2 days late for the flight to Miami. The agent boarded the flight and gates are closed.

I don't want make this blog too long and beat up on the DIY. I have friends who are DIY's. They're still friends. Just tough to watch them navigate the system of buying a home. It's just money and a house so let them be happy I say!

Gotta go show some homes. They just came out ande 2 are exclusive. DIY's can't possibly know about them. 9 years of cultivating relationships with other agent's got my clients the "early bird special" to see these places.

My best---

http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
http://www.mgruenstein.blogspot.com

You do it yourselfer you. Ity

October Market..inside scoop

Here it is: issues for October

1. If you're wondering what's going on in terms of pricing in GTA...think "big".
Why? Lack of supply and low rates continue to prop up prices. I'd argue were above in many districts where we saw prices in this past hot spring market.

We just witnessed 23 offers in Allenby on a semi this past week. So are their buyers still out there? Indeed. Is their supply? Not enough. Do the math!

This may be the kind of market where you need an agent who is creative and hard working and has established a steady network with fellow agents. They're not competitors of one another. We actually can work quite well together and secure the interests of our 2 parties.

2. As for flat fee sellers leveraging the MLS system---no real concern. This has been around in the US fore many years and less then 3 percent of the entire market went this way. Bottom line is....I'd still trust a dentist over a welder to fix my teeth. Sellers don't have exposure to negotiating homes. And always valuate their homes well above market value
3. I just sold a house that involved using my network. We located a great property that wasn't listed on mls. A truly great way for a buyer to buy and a great way to stand out amongst the other agents. A win/win if you will. So there are still ways to locate homes in a low inventory area, but it takes time and work!
4. Household debt is huge in Canada these days. With these teaser rates, buyers continue to leverage the rates and may be buying more then they should. So, don't "overbuy". Buy but be prudent! But get into the market.

If you have any questions about the market or just want a second opinion...please get in touch!

Best

http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

All the best-

Michael Gruenstein MBA CSC Sales Representative Re/Max Realtron http://www.TheSmithsBuyAHouse.com http://www.Propertiesinthegta.ca Blog:mgruenstein.blogspot.com O:416.782.8882 C:416.271.2066 mgruenstein@trebnet.com

POST TURKEY DINNER SHOWING

Mental note to myself. Next year don't show properties the day after a turkey dinner. We arrived at a beautiful house to do our showing. The instructions were that the owners of the house would be home and they'd open the door for us. No problem. Always prefer when vendors are our so we can have freedom for open dialogue and run around the place at our pace. But, no worries. The owner, a man in his 40's decided to be a "tour guid". I did at the onset mention that the showings I've done with buyers typically run smoother when the seller makes as though he's not home and let's us do our thing. This guy wouldn't have it. Proud of his upgrades and pie shaped lot and pot lites and new cobblestone yards, he'd captain this visit right to the bitter end.

Okay, off we go. We follow him as though we're in grade school. Our teacher in the lead and we don't break rank or single file. My luck, I'm a foot behind this gentleman who makes mention that he really overdid it between the scotch and turkey the night before. "Never been so full" he whispers, as though we're old friends. A moment later a gastly smell attaches to me. Trying to remain professional, I look at my buyers and it seems they're totally immune to our tour guide's missles. Now it's a matter of holding my breath as long as I could. My crappy lungs are losing this damn battle. I try to make room between us but each step upstairs is a potential land mine for me with this man 2 steps in the lead. 10 minutes into the tour and trying my hardest not to run out of the house, my buyers are now part of the experience. Their more visual then me putting their hands around their necks and making crazy faces.

When the owner showed us the walk out in the basement, it was a mad dash to get outdoors for air. I've never spent more time looking at a non landscaped 25ft bu 110ft backyard in my career. I suggested that we'd walk around to the front and not bother to walk back thru the house.

We left. I caught up with my buyers some hours later and they decided for many reasons not least of which was the awful experience during the showing, to keep looking.

As for myself, I've made it a rule that I will not work the day after Thanksgiving dinner.

http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

con't from last post...

Here's the state of the market:

1. Listings are not plentiful but depending on area, you can find a solid home

2. Buyer's need to be on top of the inventory as good listings are selling quickly

3. There is talk of further government controls to cool the market

4. In many areas, pricing is feeling on par with March/April 2010

5. Muliple offers are pretty common so know your strategies and do your homework so you're ready, armed and not bumped out

6. Try to get your financing taken care of so that you may proceed w/o a finance clause to strengthen your offer where possible

7.The new rules for homeowners listing their property on MLS and dealing with the cooperating broker direct, may cause some headaches but if the results are anything like what we've seen while this has been taking place in the U.S., an overwhelming number of sellers still put their trust in a brokerage to represent the sale of their biggest assets. Problems in the sale of a house aren't typically in the thousands. THEY ARE MAMMOTH. They can lead to the carrying of 2 homes (if your bank will assist) or the non closure by the buyer of the house you just sold.

8. Because supply isn't abundant in most pockets, be prepared to have a conditional period of no more then 2 business days following acceptance and get your best/biggest deposit to the seller. Seller's are increasingly worrying that the Buyer will walk. It's just the feel out there.

9.Stop waiting for MLS.ca to spit out a listing. Sold another house this week and 5 angry callers working w/o an agent were upset that I sold the house before the 48 hr lag until they got to see it on mls. During that period we had an offer and 15 showings.

10. Don't pay too much attention to the paper. Everything sounds just a little scary right about now. Find an agent who knows what they're doing, let them catch you up to speed; go see homes; learn about values; discuss strategies and try to have fun.

http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

First week of October. What's up with market asks the Buyers?

Fall Buyer Seminar for GTA buyers/Sign Up and get dates. Don't miss out.

It's been years since I've conducted one of these.
It's hard to find the time to plan and schedule.
But, it's time. The more Buyers I speak...the more I feel this is a "must"

****There's been enough changes over the last 6 months that seem to have blanketed today's buyers with a lot of confusion.

The Internet is an incredible resource for those looking to purchase a home. It falls short if you're trying to be on top of the market and simply can't answer your questions the way a live body can.
-----------------------------------------------------------------------------------
Here are some topics that will be included: (if you know the answers don't waste your time with this seminar):
******
1. How do you analyze market value in an economy that went down 15%, back up 20%, settled back down in the first month of 2010 and then went flat. Where are sellers coming up with fair market value?

2. How do property taxes work? Are they assessed in cycles? Can they go up or be reassessed once I buy?

3. What's Title Insurance? Why get it? The house has insurance on it.

4. Is a variable rate mortgage still the best option for getting the best rates? How do you qualify for a mortgage? Is it good to shop around or a danger?

5. What strategies should help increase your chances of winning in multiple offers? Yes..they're back!!

6. Economically speaking, where are prices headed? Do I buy now or wait?

7. What are closing costs these days? Title Insurance? Land transfer tax? Property tax? Moving costs?

8. When do I supply a deposit? What conditions can I have in an offer these days? How can I strengthen my offer while still being completely protected?

9. Are banks still doing drive-by appraisals or are they being more invasive?

10. Why use a buyer agent? How much will that cost me ultimately? Don't I get a better deal if I cut out the middleman (boy...do I have stories to tell here).

Let's look at some scenarios:(if you know how to handle these scenarios, don't waste your time here either)

CONDITIONAL OFFERS:


1. You present an offer that is conditionally accepted. Your inspection reveals some issues. You have a few hrs to present the waiver to seal the deal. You can also try to amend the agreement and ask for an abatement (money off). Which do you do? What are the risks here? Can you do both?

ADDITIONS:

2. You purchase a house and it has a family room addition on it or a small built out kitchen. The owners bought it that way. Could you find yourself in hot water should an inspector from the city come by? What should you do?

MULTIPLE OFFERS:

3. Your told there's 4 offers on a property. Is that the case? Is there a better time to present your offer? Can a particular agent actually better your odds of winning?

CONDOS AND RESERVES:

4. The condo you are interested in has a shortfall in its reserve fund and a special assessment is about to be levied. You love the condo...would it make sense to move forward? Under what circumstance might you?

PARKING ISSUES:

5. You locate a house that you have intense interest in. The house has a pad park. The owners have been using it for years and so did the prior owners in this 100 year old house. Does it now "run with the land" and become legal on title OR do you have some homework to do around this? What if you require street parking. Is that automatic because you have a deed to a residence on the street?

INSPECTIONS AND INSURANCE:

6. Your home inspector beleives that the house has a few key issues...knob and tube and galvanized steel plumbing. Also there are large trees around the premise that may affect the drainage system and could lead to roots blocking the flow of water and hence a back up. Firstly, what can you do? Secondly, how does insurance work on both these issues?

I'm going to work in some dates in the month(s) to come. This will be informal. This will include other partners involved in the home buying process. This will not cost you anything. This will prove to be hands down the most educational and informative seminar/meeting of the year.

Sign up thru http://www.TheSmithsBuyAHouse.com (copy and paste). On the home page there's an area for your information. Make mention of your interest in the fall/winter seminar and I will keep you in the loop.

Best---

good news/bad news of toronto real estate market

With September nearing a close, here's the good news and bad news if you're a Buyer;

Good news:

Interest rates remain at historic lows and don't look poised to move up soon based on many recent economic indicators

More supply is hitting the market in most areas

Prices have slowed in growth from what we got used to seeing a year ago

Low inflation will keep rates low for a while yet




Bad news:

Multiple offers are creeping up in some areas

Days on market is lowering again. Though some stuff is sitting...if priced well, a lot of listings are selling quickly. Some before even hitting mls.ca and many before the open house

Prices are not really moving down. In many areas they're moving upwards. Often a result of a lack of supply.

Still a good time to begin your shopping and always a good time to get educated.

Always happy to speak further,

Michael---

http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

Toronto market offers many new listings in first week of September...or does it??

There's been quite a few listings over the last week to pop up on MLS. Were you in the market over the last few months? Most weren't given the statistics. Well...I was. It wasn't my favorite market...but I was there. Sometimes just being there is helpful. I'm a lot better then the guy who just shows up. But this is a case where just showing up would certainly be a major step!

Why? Simple. Many of the listings aren't new to MLS. They didnt sell in their 90 day mandate that begun in June and now they're back (some with different photos, some with different agents...all with different MLS #s).

Why care? Well...the arguement is that the inventory may not be new. So statistically speaking, this is important as they're not truly "new" listings and it's also important b/c some have responded to the new market structure while others may have increased their prices. I'd think you'd like to know as a buyer coming to market this September.

The history of the exact listing is important for obvious reasons. The history of what's going on on the street is also important and the "feel" for what's happening on the ground is also crucial.

Again, this is stage 1. There's obviously much more to this. Just thought I'd offer up some free advice.

Call me this fall or email with any questions. Look forward to speaking with you.

Best,

Michael

http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

Welcome Back Buyers in GTA. Predictions for a September Housing Market

As you make your way back to work today...you've likely indulged in headlines all summer about the housing market. Rates are going up this week for sure has been the most popular arguement. Canada is growing and it needs to be slowed. Interestingly enough, the last bout of increased rates still had Canadians scrambling for treasuries/safety and yields moved downward causing mortgage rates to fall (fixed term).

Gone are the days of multiple offers read the headlines. Yet from where I sit, the lack of supply often resulted in homes in certain pockets selling above with a few offers on the table.

There is a housing bubble and prices will crash others argue. I've been hearing about this for the better part of the last few years. I haven't seen it. The economists are worried about the increasing debt loads of Canadians and how home owners are going to start saving more and hence the economy will falter and housing prices will fall. Though, they put into place some stricter guidelines already that apparently have had some effect on eroding the bubble.

Anyhow, nobody has a crystal ball. Certainly the U.S. didn't!!

I'm betting that we see an increase in listings this month and while traditionally the stock market doesn't fare well in September, home buyers make their way out of the wood work and purchases go up from an inactive summer.

In any event, rates remain low, product can only increase from where we've been over the last few months and people always need to have a roof over their heads. People like having equity and there's no faster way for most to make their asset column look stronger then purchasing a home.

As I've argued for years, the seller pays the commission and its embedded in price you pay as a buyer. A strong agent will not only make sure your offer is one sided to your advantage where possible but should be able in this market to negotiate the best price and terms on your behalf.

I'd be happy to speak to you should you have any questions at all and see my website http://www.TheSmithsBuyAHouse.com (great resource).

Happy September---

What the hell is going on in the housing market in Toronto?

Here are my observations from the front line:

1. Supply is lower

2. Prices are coming off but they're overall up above 10% year to date. It's just of late in many pockets we've seen a downward movement

3. Homes in certain pockets; Leaside, Forest Hill are still seeing multiple offers and selling above as recent as yesterday. Why? Supply is low and people need to purchase ahead of the school year.

4. The market prices don't look like they're going to show a sizable drop in the near future

5. Interest rates aren't much of a threat. The U.S. is dealing with deflation and Canada is seeing treasury yields fall as people park their money in safe havens. As such banks are reducing their closed mortgage rates....so the rates are still looking great for the next while

6. HST is an issue, but understand it doesn't affect resale home prices. Some periphery services will increase a bit

7. It was presumed that HST would have led to a heightened inflation index. It didn't for the most part.

8. People always need to buy and sell. Households get larger or smaller. People want a certain school district and new condos need occupants. So there is a market. We should see an increase in inventory in September and its important to note that August is tradtionally the slowest month of the year for real estate.

So...hopefully you've enjoyed your summer vacation, saved up your downpayment and are getting excited about the purchase of your new home this fall or winter.

If you have any questions; would like more detailed information on a certain pocket; gain access to listings with no strings attached or are interviewing agent(s)...please contact me anytime.

My best---
www.TheSmithsBuyAHouse.com

Toronto Mortgages in a Buyer Market. Deflation and Rates?

Its looking like there's reason for the B of C to gradually increase the overnight lending rates (short terms). These affect variable rates mortgages indirectly as they're tied to the prime rate. So barring some seriously corrupt news from the US, this would be my guess.

That said, we find ourselves in an environment where fixed rates with the likes of the 5 yr rate going down. Royal Bank just dropped their posted rate.

Why? In short, the US is worried about deflation as oppose to inflation. There's talk of the FEDS injected money back into the economy by way of buying up long terms bonds, thus creating the demand to keep rates low and flushing banks with more money to lend and not hoard.

This money in theory should go to writing mortgages and stimulating the economy. But US households are on a savings kick and unemployment should inch up.]

Put all that together and fixed bonds yields should fall. The more who run into the bonds for safety lessen the yield that needs to be paid. People are happy with low yields these days as long as they're not losing money.

B/c Canada is linked to US the bond market rally continues here and as a result fixed rates are temporarily going down, while prices have certainly gone up year over year, a more balanced market should keep prices flat.

So, once again BUYER's go get preapproved, start looking at homes and for god sakes find a good agent.

visit http://www.TheSmithsBuyAHouse.com

Cheers-

Mortgage Basics when buying a house as of today

In short and not from an economists mouth....here's what buyers are faced with.
Do you lock in or do you stay with variable rate mortgages with tempting low prime rates.

Over the last many years emergency rates have made variable products much more attractive and even with the heighetned risk attached to variable products, historically holders of these mortgages have fared better then their fixed counterparts.

There are arguements that this may change moving forward. Its pretty certain the the government is going to be increasing short terms rates which affect variable products. Interestingly in the wake of these prime rate increases, the banks borrowing rates have been falling likely due to the avialbility of credit and the desire for Canadian banks to lend money as oppose to a few years ago. With that, though prime rates are increasing, some variable rate mortgages are still priced below prime.

On the other end, fixed rates are being pushed down according to the yield curve. Why? Likely, consumer confidence and difficulites in the U.S. and the flocking of many investors to safe havens of government bonds even with low yields.

Investors puchars mortgage securities to get returns. These vehicles carry greater default risk the a similar comparable 5 year bond. So if 5 year bonds are offering low yields, there is room for fixed 5 yr mortgages to stay low for a period and potentially move lower so long as investors in these products get a premium return relative to the spread theyd see on an investment in a 5 years fixed gvt bond.

So right about now, you and your mortgage holder may want to discuss what option suits you best. Theyll want too review your risk appetitie, time horizon for any other investments coming due or the chances that you'll have excessive cash coming to you soon to pay down a closed vs open mortgage (both carry diff weightings). If your advisor believes a double dip is inevtiable then they may feel that deflation is a concern and variable rates have further to dip.

Anyway, I like venturing out of my comfort zone every now and then. I'm pretty confident the above is sound but if you know better, write me and teach me. I'm just a realtor....with an MBA.

The inventory is low. We're 20% off sales volumes from last June. It's a slow summer but september tratditionally ramps up. So if you're contemplating getting into the market---the balanced market is always a "fair" time to shop.

If you don't have an agent and wish to learn more--pick my brain and let's chat anytime.

My best

http://www.TheSmithsBuyAHouse.com

MLS disclosure and buyer's chief complaints in Toronto

Over the years the following seem to create frustration for buyers when they're focussed on listing information readily available before they see a property:

1. Central Air Conditioning-"yes". Older homes with boilers (water heated) often have a wall mounted a/c unit in the house (or 2). This often get ticked off as "central air conditioning" though it's not really a central air conditioner. FYI...a house with a water boiler cannot run a central air conditioner. If the owners have upgraded and spent a good amount of money, there may be what is known as a "space pac" which is an air conditioning method that begins in the attic and runs thru piping from room to room.

2. Mutual driveway listing with 1 detached garage. Note, in most older homes, the mutual drives are so tight that most of today's autos won't fit. So the garage is nothing more then a storage facility---which is fine so long as you go in knowing that it's not going to house your car.

3. Pad parking spots-MLS rules are becoming stricter around agent's disclosing that the parking spot in front of the house is "not" legal. Often there will be a badge displayed on site that shows that the spot is registered with the city.

4. Transferance of pad parking--this requires the new Buyer to actually reapply for the pad park. Another means for the city to form revenue. Note, this must be done.

5. Number of bedrooms--a house is noted as a 3 plus 1. Often this means that there are 3 bedrooms on the upper floor(s) of the home and an additional room in the basement. Sometimes the room in the basement has neither a window nor a closet. It's a glorified closet.

6. Partly finished basement--most of the time you can assume this means an unfinished basement and budget to do the whole basement. Sometimes the basement is completely unfinished and in the back there is a laundry area or maybe a couch with an ikea rug on top of the poured concrete (we see this in newer homes quite a bit as the owners wait the year plus for the foundation to level before finishing).

7. No mention of asbestos. Asbestos is no where near as scary as it has been made out to be. It's often used above boilers to wrap the piping to insulate the water and keep it warmed. So long as the asbestos is not disturbed or "encapsulated" (looks like a white bandage around pipe). Sellers to date do not have to disclose the existance of asbestos. As a prospective home buyer it's of use for you to know that it exists, espectially if you were planning major renos, you'd want certified people to handle the matter.

8. Property Tax quoted on MLS. It may seem low. If the house has had a recent addition done the city may not be aware of it and is assessing house off the existing structure from 2008 assessment date. Be sure to know. Also taxes are increasing until 2012 each year by the difference of the 2008 assessed value and the prior one.

9. Pets permitted in condos---you'll want to make sure if you have a pet that you get your agent to do some digging here for sure. Some agents will say "yes" under the condo listing and it may turn out to be a "no" OR the corporation of the condo may have restrictions as to what size pets permitted. Also, be sure to verify what is included under the monthly maintenance fee. Some times agent's tick off the wrong boxes and this will most certainly affect your monthly budgeting (especially first time buyers).

10. GST/HST when buying a new home. The agreement should always read that GST/HST is in addition to the purchase price. But, often the HST will be buried in the price you pay. You'll want to know for potential rebate purposes. I will defer to the accountants and lawyers here. Just bringing up the issue.

There are countless other areas of confusion for Buyers. As I continually say in these blogs...stay informed and hire someone who truly has your best interests covered.

Thanks-

http://www.TheSmithsBuyAHouse.com

Offer Strategy before you waive condition in Toronto

Here's a scenario...

John and Jill have conditionally purchased a house. Their amazing agent Michael negotiated great terms and the offer is conditional upon the results of a home inspection to the sole and absolute discretion of the buyers.

Let's suppose that the inspection revealed that there was some active water in the basement and upper ceiling in a bedroom due to some minor roof mishap (perhaps the flashing around chimney has come undone).

John and Jill are willing to take the house in "as is condition" based on the inspector advising the couple that the matter isn't a big deal, will likely not worsen in the next 60 days prior to closing and the house has to be transferred in like condition to the way they purchased it.

John and Jill were going to paint anyway. So now they have a little roof work and some ceiling work. All said and done the rest of the house proved to be in good condition. With that they budget aloted for the fixups was approx 1k. This is a very manageable amount for a 0-2 year time frame post inspection.

If the final waiver is to be submitted by 8pm tonite (the waiver removing the final condition) and making this a binding agreement....John and Jill have 3 options.
1. The home inspection is to their sold and abolute discrtion so they can walk
2. The couple may just waive the condition and accept the minor defect and move on
3. The couple's agent can submit an amendment, changing the initial agreement and putting the onus on the seller to repair the roof by closing at sellers expense and offering up all documentation to show it was repaird. The Sellers then can walk from the amendmnet (not agree) or agree to it.

Here's the thing...make the amendment due by 7pm and not the 8pm that the original agreement dies at (the time the waiver is due). Here if the sellers don't agree to play ball and the buyer decides to move forward, after 7pm the deal defaults for the final hour back to the original contract ---the very one that gives the buyuers until 8pm to "waive" the condition and own the house.

This is a small tip but a good one to know. I've got plenty of these tips for you. It's all about staying on top of the game!

http://www.TheSmithsBuyAHouse.com

Cheers-

Buyers Market still depends on basics of supply and demand

There's no denying that there's a shift going on out there in the market.

So what does this mean?

It means no matter what we always fall back to the basic economics of supply and demand.

Yes, some buyers have had their dreams dashed for a period as they failed to qualify with stricter terms on mortgage.

But, others are noticing that the market has lost some of its competitiveness. Has it though?

Some things to be cognizant of:

1. When there's little supply in a demanded pocket---even in a so called "buyers market", you can still find multiple bids. See http://www.TheSmithsBuyAHouse.com. Look under mutliple bids and strategies.
I've run into a few circumstances of late where the price of homes were still bid up and competition exists. Not April competition, but competition.

2.June to June prices have increased. A buyers market does not neccesitate falling prices. It would be nice

3. New building permits are down, so if there are enough buyers in market then stock of resale (supply) will dictate the competition and interest.

4. Rates are still very low. The big banks all dropped rates last week on closed mortgages.
5.With the recent job #s, it looks pretty certain that the BofC will raise rates. More workers should translate into more demand for assets. If supply is plentiful, the buyer market continues.

6. Know the neighborhoods you're searching in and look at those stats to better understand what a "shift" means for you.

Deposit, Mortgage, Downpayment, Adjustments, Interest--Tracing your Buyer Money Thru the process of buying a home.

Tracing your $$$ as a buyer

When you locate the house you decide to make an offer on, this is what will transpire:

1. If after negotiating an offer is accepted (conditionally or firm), the buyer has 24 hrs to certify a deposit to "hold" the house until closing.
As a benchmark we use 5 percent of the purchase price. In unsteady economies the seller may request more.
Note: if the buyer does not close/make good down the road on bringing the money...the sellers doesn't automatically get the deposit money. It typically would go to court where the seller will sue fore deposit money, plus interest plus damages plus legal fees.
This can also be taken care of outside of court.

The deposit money given at this stage by the buyer sits in an interest bearing account typically with the listing brokerage where it will earn a laughable amount of interest in most cases depending on brokerage.

The deposit money is part of the downpayment--all monies calculated by buyer (outside of land transfer taxes, moving costs, legal fees, adjustments and net of mortgage buyer is taking).

On closing, there may be adjustments. Ex: seller has paid taxes for the month or quarter and buyer owes back some money. These adjustments are taken care of at closing. Also, a buyer may opt for title insurance approx 300-400 dollars as a one time fee.

On the date of closing, the bank will forward the mortgage to the buyers solicitor and the buyer will forward all other monies needed to pay seller.

The buyers solicitor will pay out the sellers solicitor and in return the buyer will earn the keys to their new home.

Commissions are stripped out from purchase price and seller is issued cheque net of all borne expenses.

Hopefully this clarifies when and how your money is spent.

Of course depending on where your downpayment is coming from ie RSPs, there are a few further complexities that you're mortgagor will catch you up to speed on.

Today, it was announced that sales in Toronto in June were off nearly 10 percent from last year. The average price of a detached is approx 435k and that the second half of the year we will see a slowdown. Prices may stabilize if new construction stays soft, reducing supply to mostly the resale market.

Cheers-

Michael Gruenstein MBA CSC Sales Representative Re/Max Realtron http://www.TheSmithsBuyAHouse.com http://www.Propertiesinthegta.ca Blog:mgruenstein.blogspot.com O:416.782.8882 C:416.271.2066 mgruenstein@trebnet.com

GTA Housing Market 2015

I'm curious how the housing market will shape up in say 5 years from today?

We've enacted the HST and made some stringent qualifications for first time buyers.
That group used to walk into the bank, apply at a variable rate based off prime rate (very low as a percentage), ammortize the heck out of the mortgage, put 5 percent down and go house shopping.

Now, we have the same group qualifying at the 5 year posted rate as of April. This distinction has surely dropped many buyers first time buyers out of the market.

One could argue that that's not a bad thing. After all, with emergency rate loans and giving these guys mortgages...it could set up for a tough run when rates go up during their 5 year term (most popular term). And unless their incomes go up, it takes a bigger bite of household debt (which is already at all time highs here in Canada).

My concern is that I've always seen the first time buyer as the foundation of the pyramid. Less then 1 percent own 1 million plus homes. The bread and butter or sweet spot is 200-450k (just under and just above the average price for a detached in the GTA). In the past, we've seen first time buyers enter the market and begin the process of leveraging and increasing their networth. They get the keys to their basic semi that they paid 400k for. They do some renos; follow the rule of location and in an up market they see the value of the larger detached in area increase year over year by double digits thus pulling the value of their smaller home up by leaps and bounds. 5 years down the road, their semi has gone from 400k to 650k. Welcome to Avenue and Lawrence and Leaside folks. Now they paid down some of their mortgage and saved a little and their ready to upsize. So the guy sitting with the detached a few doors down is waiting for the semi owner to buy his house.

Taking more buyers out of the market shrinks the size of the buyer pool down the road for the second and third level homes. True, it only takes 1 buyer and theyll be enough one-off buyers out there but we've loved having 16 buyers bid up a house for the better part of the decade. Will the market not be so interesting then? So much damn fun for buyers (I really mean sellers).

Anyway, just a thought. I agree it's important to make sure a buyer can afford a house. So I'm not anti the new regulations. Just, every action seems to have a reaction. With that, buyers who train hard and do their work will be as okay as ever.

Enjoy the heat?

http://www.TheSmithsBuyAHouse.com

HST and GTA homes...now what!!

Well we've anxiously awaited this date. It's only a few away on the calendar. Interesting it coincides with Canada day and celebrations. Okay, it's not to be celebrated....but is it to be feared? Will HST change the landscape of the residential market here in the GTA as we know it.

Not much. Most argue. The main concern is when your purchasing a new home. But...its so difficult these days to calculate costs per sq ftg from one builder to the other and one neighbhourhood to the next so builders will bury much of the cost in the sticker tag of the house. I don't think they're going to piss the buyer off and dangle the HST as an extra all the time. Without getting into the tax consequences of how this gets done, as I'm not a lawyer or an accountant (sorry mom)..it'll get done...above board...or underground...it'll get done.

When Tarion warranties came out, for less thenm 1,000 on a 1 million dollar house, builders and buyers would fight over who pays the enrolment feet. We're here to scrap over everything and then feel like someone one or lost. So we'll scrap it out.

Interest rates are still low today and thats a saving grace for the builders selling new homes as buyers can leverage these rates and justify the costs (somewhat). This wouldn't be taking place now nor work out if the interest rates were double digits! I suppose this would all be different in that event.

On that note, rates are going up. There doesn't seem to be much arguement there. Some economists argue 1.5% prime rate (currently at .5%) by year end and above 3% by next year. Enough to get current mortgage holders to think twice about their debt levels both inside and out of thier home expenses.

In the meantime, the residential real estate market got a jolt in April when they made it more difficult for first time buyers to get into the market. This is more of an issue I'd think. I've always seen the first time buyer as the lifeline of our economy. Once they`re in, they increase their net worth overnight, own a major asset and begin the lovely process of leverage. In a few years they become our crop of 700-1million buyers (mostly on the increase in the house values) not their amazing savings abilities!!

If you`re out their buying now, the timing is pretty good. Demand is lower and supply is quite low, hence a more balanced market in most areas. And interest rates are still really low. The HST in the resale market will have little effect so don`t be scared off and listen to the doomsayers. Go get yourself a house.

If you have questions along the way---ask me!

BTW, I`m leaning towards starting a home buyer seminar over the hazy days of July. It`ll be free, informative and as fun as this can get. It would be a good first step if you`re looking towards the market for the first time or havent been in the market for a decade. A lot has changed.

If you`re interested, send me an email or call my office " 416.782.8882 and have me paged.

TheSmithsBuyAHouse.com..you can email me inside the site.

FIFA and Canada's Housing Market

FIFA is everywhere.
FIFA is a smorgus board of countries around the world with varying issues.
Some like Greece come to South Africa with unprecedented debt problems and lowered credit ratings.
Spain is the next pot brewing up a massive debtload.
Germany is angry at its lazy Euro peers.
U.S. is feeling a bit of relief and even considering raising rates.

Canada didn't make the cut. But it's banks have won the tournament on a global scale for being in the best shape of its peers.

While the U.S. contends for a position in the finals in the World Cup against maybe Greece or England (another balooning deficit country)...Canada will use the time to show the rest of the world not glued into the World Cup, how to lead a strong economy and banking system.

Though, this system has put some hardships on first time buyers here at home, it is probably saving these buyers from a world of hurt when interest rates start working there way up.

Remember, banks will work with you if they see a "future" with you. But be prudent. Don't get excited b/c the bank will throw a large mortgage your way. You have potentially 2 land transfer taxes, the potential for an upped property tax bill and the arguement that some areas are caught in a bubble.

I do believe that we're seeing a balanced market with lowered demand and lowered supply. If you're a buyer, keep both feet on the pavement because listings in July and August usually are priced well as the sellers need to sell. So don't despair at the low volume, rather make your agent work to find the product and seek out those that need to sell.

Go Argentina?

Cheers-

Residential Propety Taxes in Toronto and HST: expenses for you.

You knew there would be…..HST is coming to town
GST- Is the property a resale or new construction. Resale properties are not subject to GST. New construction is. The GST can be included in purchase price OR in addition to.

You’ve probably heard in the media about the much dreaded “HST”. Were just beginning to learn about how this will work. Here’s what we’ve learned to date as far as the housing market is concerned:

HST-this is new and will increase taxes to 13%. This will apply to new homes being purchased after July 1st 2010.
On a purchase of 500k, additional tax is 40k. Builders will apply for 2 percent tax credit on supplies-10k. Now 30k owing. There is going to be a max 24k rebate on a 400k plus purchase. So effectively you will owe 6k more in taxes. Doesn’t sound that high right? Well, most new homes in this city are above 400k. Let’s look at a 1Miliion dollar home purchase with the new HST. You can go ahead and add another 36k on sticker price!!

HST on resale puts a small dent in your pocket in increased tax on legal fees, moving costs, etc.


The concerns some have with the HST include:
How will it affect builder’s quality as they try to keep asking prices lowered
How will this affect interest of buyers of new homes


Red Flag: Property Taxes. MLS will point out property tax bill. You want to pay attention here.

In 2005, MPAC valuated properties in the city. These valuations became the basis for applying the tax rate to. In Jan 2008, MPAC reassessed most properties in the city and in most cases the valuations went up with the market. The 2008 valuation difference above the 2005 valuation is then split in 4 equal amounts and from 2009-2012 inclusive the equal amounts will be placed on top of the 2005 valuation amount to gradually increase taxes owing according to tax rate. In 2009, if seller is posting a tax amount on MLS, it may be according to a 2005 valuation. This is important to note as it will up your annual tax bill for property. Again, stay ahead of your competition with your knowledge!


It's being debated that with Canada looking to reduce its budget deficit per GDP, governments will cut spending and look to increase revenues. HST is one source, but a further hike in property taxes is certainly a means to get more money in the governments accounts.

http://www.TheSmithsBuyAHouse.com

What a Buyer Needs to know in Toronto Housing Market before offering.

Initial Homework with your Agent:

Sample of Questions I’d think you would want to know some answers too.

What have comps sold for in area?
Is this a typical or atypical house for the area?
Has this house been marketed before?
What is the lot size relative to comps?
Is their new construction in the area and with that can we gage what portion of price is going to “lot value”?
What is maximum built out permitted by city on this house should you decide to renovate down the road?
How many days has house been marketed and hence motivation of Seller?
How many days was this house on the market the last time it sold?
Have the Sellers completed a pre home inspection? What company did it? What were the results?
From a layman perspective, are there any blatant defects to note? Windows in rough repair, ceiling cracks beyond settling cracks, is there water gathered/pooled in the yard and not in neighbors?
What’s the age of the house? If mechanics are new…who did them? Was it the owner or a certified electrician?
What’s the parking situation? (more to come on parking. There’s actually a bit to know on this topic).


Here’s an interesting story: Don’t try to be too smart!
I had a client who decided to go their own way and buy through the listing agent b/c it was day 1 of the listing and the Buyer thought they’d get a great deal doing this fast and with the one agent. They bought the house. Only thing is….this was the 5th listing in a row over a few years and the market price didn’t reflect 2 very important elements 1) market value in current market and 2) insider knowledge many agent’s had that Sellers were uncomfortable dropping list price as they didn’t want to appear desperate, but that they were “very flexible” on the price. My old Buyers paid close to full pop and did very poorly. Again, know the market and be clear what the “best deal” really means!

My estimation is that I would have saved them in excess of 50k on this purchase if they had let me negotiate it. Story sound extreme?

It doesn’t happen every day but agents in the field often have similar stories to share!!

http://www.TheSmithsBuyAHouse.com

House Hunting and how to get ahead!

Shopping Time: Go have some fun BUT be “Strategic” here.


This should begin with a “wish list”. Often the wish lists get more realistic with time. But it’s needed as a benchmark and a starting point. Often the house you finally locate from the initial “wish list” is pretty darn close to what you went searching for only you included a few wishes that you didn’t really need.

How to Suffer in this Market

Some buyers get the idea that Sat/Sun Open Houses are where it’s at. WRONG. Homes trade hands Mon thru Fri and often waiting until the weekend can put you at a serious disadvantage should preparation be needed to advance to an offer, especially if there’s more than one competing offer. You should be out there hitting the pavement timely, especially in this immediate market with lessened supply and strong demand (in most pockets of the GTA). This is real easy. Let your agent help you narrow down some homes to see and let them make the plan and orchestrate the outing. To be fair, if you have a weak agent, this could play out like a really bad date. Some homes sell the first day on market. Just last week I listed a property in the central core and entertained 16 phone calls on Wed (property was listed on Monday). We had a few offers in play on Wed. All the callers who located the property some 48 hrs after it was listed (working off MLS.ca) were told it was too late. A shame…it was a great house in an area where there’s little supply. So if a Buyer (or in this case at least 16) have been watching this area and are ready to buy…why would they be sitting at home waiting for it to pop up on MLS.ca with a lag while competing Buyers knew of it days in advance. I will let you guess which Buyer is expecting delivery of the keys in a month!

How would you see a house before it came out so that day 1 you’d have a chance?
Simple…make sure you have a strong Agent! I’ve made sure to build relationships with my competitors/fellow agents. In turn, I can put myself on a short list for homes coming out in certain areas I work. I get a heads up. What an advantage for my Buyer!

If your strategy is to utilize MLS.ca as your main lead generator, you’re doomed. I know few guys who succeeded at sitting at the bar and waiting for the girl to give out her number. You have to be proactive. This is reactive work and it simply won’t work in this GTA housing market.

MLS.ca lags the official MLS system by up to 48 hours, so you’ve already missed some supply that your competition is aware of and may have seen and even bought.

MLS is one means of locating a home. Some Sellers for personal reasons (don’t want nosey neighbors, estate sale, don’t want sign on their lawn) entrust a sole brokerage to market their property on the hush either within the walls of the brokerage or within the network of the brokerage. So having an agent who is plugged in to the process also puts you in an advantageous position relative to most of your competition. Ask your agent about their firm’s supply and success of housing inventory off MLS.

Let your agent see homes through your eyes and get a solid feel for your needs, so that while you’re busy working, your agent is busy working on finding you a good house. Some Agents first send their Buyer to an Open House and wait to get reported back to. In many cases, the Agent has yet to see the house, so they’re really interested in your report!! Perhaps the Agent is too busy with prior commitments?

In the Real World
Depending on your price point and areas of interest, there may be fewer homes then you’d like out there. Now more than ever, you need to see homes timely and you need to be made aware of any and all opportunities outside of MLS. Make sure you’re working with an agent who will provide this…or “say hi while you’re out there on the Open House circuit”!!

ADVANTAGE: Buyer working with solid Agent.

Mind the Language of the Listing Agent's for Clues....

As discussed here and in the media...there is a shift going on in the marketplace.
It's almost tangible. More listings are popping up in most neighborhoods and multiple offers aren't happening as frequently.

The language listing agents are using of late is important to note...

3 months ago...this would have been typical in the brokers notes in the MLS:
"Offer(s) if any, to be reviewed March 25th @ 8pm, register by 6pm."
There was a decent chance that a "bully offer" may have sparked an earlier offer date.

Today...this is more common language in the MLS:(I've come across it countless times in the last few days in many ranges and areas I represent buyers).

"Please provide 48 hr irrevocable on all offers per vendors"

This is often a less aggressive/less confident way of trying to collect offers. Here, the sellers are hoping that if their agent collects an offer and the house is priced to market, that they buy time to connect with all other agents who showed the property and voila....we're back in "multiple offers" (if all works out for the sellers). The only thing that changed is the "softer tone".

The good news is, there are fewer multiple offers and with more supply to hit, rates increasing and many arguing that the bubble is bursting---the market is infact looking like a brighter place for buyers to be!

http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca

Hiring a guitar teacher costs more then hiring a realtor to buy a house!

We need to be clear. Very clear. I'm having discussions with clients and friends about where the market is at and the talks are footnoted by stats people are reading.

A few things to pay attention to when you interpret the data:

1. National averages and market movement tells us little about our immediate market

2. Toronto statistics tell us little about the market as well. Its best to divide the market into either small geographic districs OR price points. This data is the most helpful and immediate for comps and predicting future movements of supply and demand.

3. When discussing the average price in Toronto (which as I just pointed out means little for you) read carefully what the time constraints are. Is the data pointing to an increase in sales/volume year to date which would consist of no recession OR is the data looking at this years #s ie; 2010. The 2010 data is skewed b/c most would argue that many buyers forwarded their purchases to beat HST, April mortgage deadlines and grab a hold of the emergency rates.

Its been a real interesting period to follow the market. In some price pts and areas, weeks in timing have led to sellers missing seeing more then one offer on the table and taken first time buyers out of the game altogether.

Its my belief that the first time buyer, not the top 1 percent, drive the ultimate direction of the market. For the most part, it looks healthy out there but it really depends where you're looking.

My suggesstion, study and study the area of interest. Learn the pricing of those that sold off mls and on mls. Become an expert. If you have the resources and time do this as a full time gig. If you have your own full time gig..get help!

I recently picked up the guitar. I used to play a bit. I'm stagnating a little. I can keep going at this alone or I can get a professional and learn inside tips. And my investment in hiring a guitar coach is greater out of pocket then yours in hiring a real estate professional whose costs are covered by the seller!

Cheers-

Michael Gruenstein MBA CSC Sales Representative Re/Max Realtron http://www.TheSmithsBuyAHouse.com http://www.Propertiesinthegta.ca Blog:mgruenstein.blogspot.com O:416.782.8882 C:416.271.2066 mgruenstein@trebnet.com

Market Timing and Buying your home!

There was a solid article in the Financial Post today that talked about owning a home as a long term investment. Some have been succesful no doubt at timing the market, most aren't. You see most people around this time in the cycle think that ahead of further interest rate hikes and before more supply hits and demand falls off further as it has been in certain ranges due to interest rates; hst; general economy and european debt, high undemployment, etc., that its the time to cash in and sell. Looking for a longer closing date, insulating themselves with time for the market to drop off a little bit. Then like a stock they can buy into the market at a rosier time---a buyers market. Some economists will argue that the lowered prices from increased supply may be offset by the interest rate hikes increasing the monthlies you pay. It really depends on your financial picture and specifically the home you buy and sell...but timing the market isn't so easy.

We have seen a drop in building permits across the nation and from the ground I'm feeling the shift in momentum away from the sellers market towards a buyers market.

Of course market variables and supply have been changing so fast and furiously where we see interest rates on fixed mortgage go up and then down in a few weeks. This isn't a straight forward market.

Keep doing your homework and learn the market as best you can. Most importantly dont overextend and buy a home in an area with upside potential..preferably one with more then just the natural inflation of the market as those heady gains are behind us for some time now.

Cheers-

The times they are changing!

Today's GDP numbers for Canada; the emergency level rates in the economy; the housing market valuations; decent manufacturing and employment numbers (all relative) and the loonie flying under par.....it seems pretty certain that tomorrow we'll witness our first rate hike in years. Hey, that's not a bad thing for prospective buyers. Yup, mortgages become more expensive (marginal...for now anyway) but housing prices should cool. Not from a one time hike tomorrow but over time.

I'd argue it's a great time to get that preapproval and get in the game if you've been on the sidelines.

Summer listings are not as plentiful as spring or fall for that matter, but the quality can be great and the competition can fall off some.

And...if you don't like what you see this summer, then use the summer along with your agent to learn the market so you can spring into action in the fall market.

In short, take advantage either way of the late spring/early summer market buyers!

http://www.TheSmithsBuyAHouse.com
http://www.Propertiesinthegta.ca

Stay cool!

Market Update and Commentary

CIBC found the market to be about 14 percent overvalued (residential market). Benjamin Tal would argue that a 5-10% correction is in store for the housing market. Between heightened rates and more money going to pay off mortgages from household income, the arguement is it needs to cool.

The stock markets have cooled and by definition we find ourselves in "correction mode".

Just a few weeks ago it seemed a no brainer that rates were headed up on June 1. The world picture has made that a tad more confusing. A retreat in commodities and a falling Canadian dollar as well as increased supply in the housing market for buyers to choose from has made for a confusing picture.

After a few small and quick interest rate hikes while ppl were leaving the safety of the US dollar heading into the recovering markets and now we find yields and mortgage rates falling again.

Some signs show pessimism around a recovery. Banks aren't lending to each other at bare bone rates again so a little bit of a squeeze on credit. China's market is down 25 percent since April heights. Treasury yields continue to fall and we've found our way under a few 200 day moving averages.

With all that...supply in the housing market is looking good. So if the above did little more then serve as an opportunity for me to demonstrate a tiny bit of knowledge---that's good enough for me.

And what's good enough for you....the market is a friendlier place to shop now and should continue. So get your game on!

Cheers-

3 Quick and "Clever" Games to understand Buying Property

Let's play some games today.

GAME 1:
Let's play>>>>

"Darts". I give you 3 darts and I take 20. You shoot first. I shoot second. Not fair? Of course not. I have more chances to increase my score.
In real world: Buyers going to open houses see maybe 10% of inventory available. Many don't open house.
Buyer's working thru mls.ca miss first 2 days of marketing of property-theres a lag buyers working w agents don't have.
Good agents have networks for "exclusive/non mls/no sign on property listings.
Advantage--guy with more darts and guy with Agent gets more chances to throw darts!

GAME 2:
"MARBLES"

One red marble and 10 white marbles get dropped on floor. Red marble is asking price of homes in this market that you're looking at.
White marbles are recent solds and recent asks and history of house you're interested in.
As a Buyer, you need to know the comps inside out. Have the others been reno'd? What are the reno's worth? What's the lot size? School district? What's history of house being marketed? How many times has it been marketed? How long did it take the first time around to sell? Were comps sold is similar market and how to adjust for smaller lot, mutual drives, south side of street, easements...etc.
Advantage--guy who has all his marbles together!

GAME 3:

"You're the Agent"!
Let's make up a scenario. Here it is:
House for sale. Ask 699k. Easement in back. Pool inground. Reno's done namely a family room addition. Mutual drive with pad park.
Do your best negotiating. My hunch is you're thinking price and closing date and deposit and you're gonna work you're magic to get a deal.Assuming it's not multiples (where other strategies come in)!
Hey...were you concerned at all about saving your ass here?
Did you consider the easement and the pool? Is it legal to have pool over easement?
Is family room addition legal?
Survey illustrate that?
Was the pad park legal?
So on top of the price, deposit and closing date...this scenario would call for quite a few clauses to protect you on closing or it could get costly.
Btw...if the house was assessed pre renos/additions...MPAC will msot certainly reassess and taxes will go up. But you knew that! There may be a need for a holdback here folks!!

My point...these are 3 quick games. In our world of buying and selling, there's a lot more. A dedicated and knowledgable buyer agent is a must and commission is priced into the house regardless--sunk cost so you might as well get the help you likely need!!

cheers----

Keep your head up...in hockey and in buying a house!

We've all heard the cliche..keep your head up. The translation seems to mean that by looking up you stay positive and open yourself up to better experiences and expand your horizon to grab this fortune.

I've had a few experiences in the last day or so that for more logistical reasons have had me thinking again about keeping my head up.

Watching hockey over the last few weeks, Ive seen some ugly open ice hits. A guy trying to do too much with the puck gets absolutely run over in a clean hit (albeit a painful as shit looking one). What could this player have done different? "Keep your head up" so you can see the hit coming and make a move. Making a move can have a domino effect as the puck gets brought down the ice---maybe even leading to a goal?

My second experience was this morning when I went out to my yard to see the landscaping coming to bloom. I'm fixated on the grass. We get patches of funny looking weeds maybe on the periphery of the lawn in an otherwise handsome looking lawn.

My wife thinks I'm nuts (as she should) cuz when she sits and sips her coffee from the patio she admires the green carpet with nice trees. I on the other hand have a compulsion that requires me to drink my coffee too quickly and seek out these pesky weeds. Hey...if I modelled my wife's behavior and sat and enjoyed the coffee and the backyard for what it is (our little muskoka in the city)...I'd actually be keeping my head up!

So, I'm going to work on keeping my head up.

Now, bringing this home to real estate. Many buyers have been feeling down about the market and multiple offers and inventory and the new rules, etc. Here's an idea. While your competition is getting roughed up (like an open ice hit they didn't see coming)...why don't you just keep your head up and keep going! (with the help of the right Agent)!!

Enjoy a much deserved nice day out there.

Cheers-

Hard to get a Pulse right now on Toronto Residential Market

Look, I'd be lying to you if I said that this market in central Toronto is pretty easy to follow rigth about now. It's not. Too many factors happening at the same time. I've blogged about them but maybe a recap and summation in of value to some of you.

1. On April 19th mortgage qualification grew more stringent. Now first time buyers had to be qualified at the heightened posted 5 year fixed rate and not the low low variable rate. That took some buyers out of the market

2. HST is coming to town July 1st. Not such a big affair for resale properties but a big deal for buyers of new construction as their price point goes up.

3. Mortgage rates have steadily risen on the fixed end. The pullback in government stimulus and the need for the private sector to step in has created an environment where the private sectors demand higher returns then the gvt did at the emergency levels. Hence we saw the 10 year Treasury yield rise.

4. As rates are increasing, so too is the inventory of homes available. The two may counteract each other.

5. Some homes are missing offers. Others are selling 300k above in multiples the same night. Really depends on home and inventory surrounding that home. We just saw a house in the upper village go last night for approx 300k with a bully offer above list price

6. The Canadian economy is showing some signs of strength in terms of GDP growth and employment which may serve to keep housing prices at current levels

7. Conversely, many Canadians are heavily indebted through their mortgages picked up at emergency loan levels. Decent increases in these rates and the upcoming increases to follow in the variable market may push some homeowners into foreclosure. It is a concern that economists are looking into. Though we've had a strong track record of banking in Canada, theres no doubt that when rates rise systematically some will be pushed to the brink. This may serve to stop the escalation of housing prices depending on the volume of this occurence.

8. With the US dollar again the safety currency and people buying it up, yields are falling and hence mortgage rates may fall for a period. Still a great time to go qualify and lock in.

9. Building permits are up so there is confidence in the marketplace.

10. Many Buyers are out shopping and taking the added value steps that a strong Buyer Agent can offer. Don't be fooled into getting a deal by avoiding a Buyer agent. Unless you do this for a living and know all the "games" that get played...get some help!!

I'd be an idiot, if I didnt end off saying to call me for such help!

Cheers-