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Toronto Reviews

Searching by neighbourhood for reviews. Go here and read mine first thanks.

February 2010 Mid Month Market Report

There have been 3655 sales reported for the Greater Toronto area in the first 2 weeks of February. In the City of Toronto (416 area code) there have been 1430 sales in the first 2 weeks and the balance of 2125 have been in the 905 districts. There have been 6212 homes on the market in the Toronto Real Estate boards boundaries as of the 15th of the month.

This is a 74% increase compared to the 2044 sales during the same period in 2009. There was a big dip in resales due to the recession.

The average price for mid February transactions was $429,997.00 an overall 18 % increase over 2009.
Keep in mind this is not a true 18 % increase as prices did dip roughly 13-14% at the end of 2008 to mid 2009 before they regained what had been lost and then added a few more percentage points. This was due to returned confidence in the economic conditions of our country.

The real estate market is important to job creation in Canada. It is estimated that every home sold generates on average an additional $46,000. in spending across many different sectors of the economy. This keeps many people employed in many real estate related fields including lawyers, home inspectors, retail stores such as home depot and contractors helping with renovation projects.

In January 4986 homes changed hands throughout the GTA. 1973 of these sales were in the 416 area and the balance in the 905 region.

Condo apartments made up 47% of all sales in the 416 area code in January.

This is in part because the largest segment of the market is the first time home buyer and they are generally purchasing under the $400,000. Mark. They can purchase a condo with a small downpayment and move in without requiring cash for renovations.

The 905 districts are becoming increasingly more desirable as the average price is about $40,000 lower than the 416 allowing first time home buyers to purchase homes rather than condos in many cases. These are often being bought direct from builders who are often helping with financing and many extras. For instance I was able to help my son purchase a home from a builder with a 3 year interest free loan. This allows them to pay of an extra $45,000 of principal in the first 3 years of ownership.

There are a couple of items that are driving price at the moment.

1/ is the interest rates which are threatening to go higher later in the year.
2/ is the lack of product on the market. Throughout all of the GTA in January there were just over 12,000 homes available in January. A year ago there was over 20,000 homes available.
3/ The coming of the rather onerous HST which kicks into place on July the 1st 2010. New Residences costing less than $400,000. Will effectively be exempt from the HST and there will be partial rebates on homes less than $500,000.

The immediate impact is that consumers will be paying more for a lot of items not previously taxed such as utilities and maintenance contracts imbedded in condo fees, legal fees and realtor commissions. This, together with any increase in mortgage interest rates, will reduce the number of buyers who can qualify in the second half of the year. Our forecast for is that 2010 will be the reverse of 2009 – strong first half, and lower second half!

In the downtown condo market, the sale-to-list ratio was 44% in January, down from over 80% at the end of last year and the number of new listings in February is accelerating. While multiple offers are common on well priced units in the popular price range ($300-450,000), more and more listings that are not priced right will sit in this market.

We also know that time is running out for sellers. The HST, coming July 1st, does not apply to resale housing but it will impact new sales coming after that date.

I believe we currently have the lowest inventory I have ever seen on the market during my real estate career.

We are looking forward to a climbing inventory in the spring as many folks are getting ready to put their homes on the market. This will help to stabilize prices and keep affordability in check. This is very important to sustaining a good healthy market. When the prices get way out of whack and affordability is gone the market slumps despite a healthy economy.

Rental Market
Rental prices are also holding steady with studios going for $1250, and one-bedroom units ranging from $1450 with no parking to $1650 for parking and a den. Two-bedroom units ranged from $2000 to $2500 for parking and a den. Three-bedroom units averaged $4500. Units are leasing for 100% of list price, on average and there has been the occasional ‘multiple offer’ situation as the vacancy rate for rental condos is still under 1%.

As always let me know how I can help. I can be reached at 416-462-1650.
If you have friends or business associates thinking of buying or selling I would much appreciate the referral.
Here is the link to our February online newsletter Newsletter
As always there are some excellent articles on renovation, Habitat for Humanity, banishing the winter blues and a couple of videos that you may find useful.

Best Wishes
Aeriol.

Riverdale Totally Renovated Duplex

Fantastic Renovated Three storey duplex with 2 multi-level apartments. Three car private parking ( private drive). Excellent income from the lower level. The upper unit is owner occupied. Good sized yard. Walking distance to Withrow Park. Steps to schools, East side Chinatown, transportation.

Green Stewardship with a Resuable Bag

If you are working towards a completely Green kitchen and lifestyle then here’s the next step. Reusable mesh bags made from cotton-mesh. These are a great alternative to all those disposable plastic bags that you stash the broccoli mushrooms and apples into the refrigerator that get trashed right after. These bags are made of 100% organic cotton, come in two sizes and allow your food to breathe. You can find them at StewardBags. They runabout about $3.75 for the large and $3.25 for the small, but a good long term investment. They can also be found at the Healthy Butcher.

Currently plastic bags constitute about 10% of debris on U.S. shorelines and China will save 37 million barrels of oil a year by banning fee plastic bags. Plastic bags also have a big impact on wildlife… there are some facts on their website. Buy 5 or 6 for your friends or clients for a gift instead of that big bottle of wine.

Government Moves To Slow The Toronto Housing Market

In an effort to slow down our very zippy local housing market the government has proposed some changes to how we buy or finance property here in Ontario.

As of mid April they are proposing the following:

1/ If you are a first time home buyer you will have to qualify for your first loan based on a 5 year fixed term rate. Currently mortgage companies qualify buyers on a 3 year fixed term. Once qualified you can then generally choose the term of your choice. Since there is not a huge difference between 3 and 5 year rates at this particular moment that will not be terribly painful for most folks. This is a very good thing. When rates rise it will help to ensure that more people will be able to handle a larger mortgage payment.

2/ For sellers doing take-out mortgages on their homes they will only be able to max out on a loan up to 90% of their home’s value. Very smart idea.

3/ The government is proposing a way to slow down speculators by requiring them to put down 20% on properties. They are apparently targeting the condo flipping market. This is the same group that got into trouble back in the 80’s when thousands of condo deals didn’t close when the gov’t came down with a speculation tax. This had a radical effect on the Toronto market. Most builders look for 20% down to hold a unit for the 2 to 3 years it takes to get a building up so this should only affect those with fairly dicey deals anyway.

They are stating that this will not affect actual investors who buy multi unit properties to invest in and hold. In other words professional landlords rather than speculativ flippers.

So it will be interesting to see how this shapes up in the next few weeks. Check back again soon for an update.

Queen West Village Victorian Charmer

Just Listed. Victorian 1880’s 2 storey home with many updates.

Sitting just south of Queen St. in Queen West Village this home started out as a Fort York officers home.

The original charm of 12″ baseboards, high ceilings, warm pine floors and banisters has been retained. The home has been opened up on the main level to add to the floor space. The upper level has been converted from a 3 bedroom to 2 bedroom home with spacious bath and built-in laundry room.

There is an atrium addition to the fabulous kitchen with big skylight, and an adjacent main floor family room.

This home is bright and charming.

The garden is well developed and full of perennials. However should you require parking there is a rear access lane and part of the garden could be converted to parking .

the basement is unfinished.

The seller has done a number of upgrades. They are new furnace in 2008, 2010 new 100 amp electrical service, 3/4 ” water line providing excellent water pressure, roof in 1998 and mainly modern wooden windows.

Summer In The Garden At 31 Whitaker

Inside 31 Whitaker Ave.

Details Are Important

January Resale Housing Market Figures

TORONTO, February 3, 2010 — Greater Toronto REALTORS® reported 4,986 transactions
through the Multiple Listing Service (MLS®) in January 2010. This result represented a large
increase over the 2,670 sales in January 2009 when the home sales were in a recessionary
trough. Last month’s sales were slightly higher than the January average in the five years
preceding 2009.

“The GTA housing market has rebounded well from the lows in sales experienced at the
beginning of 2009. Sales climbed back to healthy levels across the GTA because the cost of
home ownership remained affordable in the Toronto area,” said TREB President Tom Lebour.
“Increasingly confident consumers moved to take advantage of affordable home ownership.”
The average home selling price in January 2010 climbed 19 per cent to $409,058, compared to
343,632 in the same month last year.

“Expect strong annual growth rates for existing home sales and average price through the first
quarter as we continue to make comparisons to the weak market conditions at the beginning of
2009,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “The rate of sales and
price growth will be lower in the second half of 2010.”

Summary Of January Sales And Average Price

          January
                                                   2010                                    2009
                                                  Sales      AveragePrice    Sales            Average Price
City of Toronto(“416″)     1,973       $428,151          1,106           $364,416
Rest of GTA (“905″)         3,013       $396,556          1,564           $328,935
GTA                                      4,986       $409,058          2,670           $343,632

Source: Toronto Real Estate Board

Canadian House Prices What’s Real and What’s Not

Newspaper editorials have been overflowing lately with speculation on how rising rates may lead to a surge in mortgage defaults. In response to this issue, CIBC Economist Benjamin Tal released a report that took a closer look at the facts and determined history doesn’t support this premise. Below is a summary of Tal’s report.

House Prices – Some Overshooting
Over the past two years, the degree of volatility observed in the Canadian housing market has been unprecedented. Within this short timeframe, house prices fell by almost 13%, only to rebound by an impressive 21%.

Meanwhile, resale activity is now rising by close to 67% on a year-over-year basis after falling by close to 40% in 2008. Housing starts are presently 33% higher than in April 2009 despite dropping by more than 50% earlier in the recession.

In fact, no other segment of the economy has rebounded as fast as the housing market, making it one of the real surprises of this recession. This rapid uptick in housing activity, in the face of recessionary conditions elsewhere in the economy, raises concerns about its sustainability, and is causing some to wonder whether house prices are, in fact, rising too quickly given current economic fundamentals.

Tal estimates that the Canadian housing market as a whole is indeed beginning to overshoot its “fair value”. At just under $350,000, the current average price of a home is estimated to be roughly 7% over what would be consistent with current housing market fundamentals such as interest rates, income growth, rents and demographics.

But this modest overshooting is, far from uniform across the country. Those figures are skewed to western Canada, which has seen the most dramatic swings in house prices over the past 24 months. That market now appears to be overvalued by roughly 10-15%, suggesting that the imbalance in the rest of the country is much more modest.

Note, however, that overvaluation does not necessarily mean a bubble or a dramatic price correction.

Given that the current overvaluation is occurring in a context of historically low interest rates, what we are most likely witnessing is a temporary period of exuberance that is “borrowing” activity from the future, as households take advantage of lower rates and accelerate their borrowing and home purchasing activities.

To the extent that current activity is simply a redistribution of sales from the future to the present, the housing market of tomorrow may be in store for a more muted level of activity. Housing starts will also catch up with the sudden spurt in demand, with the increase in supply helping to moderate price trends. Rather than plunging, house prices are more likely to stagnate in coming years (or fall modestly in the most overheated markets) as fundamentals catch up with a market that has gotten ahead of itself.

Tax Tips For 2010

With the rush of the holiday season and New Year’s celebrations now over, many Canadians are turning their attentions to their taxes. Following are some useful tips to help simplify your 2009 tax filing process and get the most out of future returns.

While the 2009 tax filing deadline is months away, January is often the best time of year for
Canadians to evaluate their overall tax strategies, especially as time will run out to realize a variety of tax-saving opportunities early this year.

Advice for homeowners and prospective homebuyers

In 2009, significant tax changes were introduced in the federal budget to benefit homeowners, prospective homeowners and even homeowners who renovated their home, cottage or condo. These include: changes made to the RRSP Home Buyers’ Plan; eligibility for the new non-refundable First-Time Home Buyer’s Tax Credit; and the Home Renovation Tax Credit (HRTC).

A $5,000 increase to the RRSP Home Buyers’ Plan means that first-time homebuyers can now withdraw up to $25,000 from their RRSPs for a down payment – tax- and interest-free.

The First-Time Home Buyer’s Tax Credit includes a $750 tax credit for first-time homebuyers to help with closing costs, such as legal fees, disbursements and land transfer taxes.

And if you’ve been thinking about doing some home renovations, keep in mind that the 15% HRTC of up to $1,350 only applies to eligible home renovation expenses undertaken before February 1st, 2010.

RRSP Contributions

A Registered Retirement Savings Plan (RRSP) continues to be one of the best tax shelters available to the average taxpayer.

Eligible RRSP contributions are deducted directly from income reported on your tax return.
This means that you save taxes at your marginal rate, which may be up to 50%, depending on your income level and province of residence. In addition to the initial tax savings when the contributions are deducted, all income earned inside the RRSP accumulates tax-free until the money is withdrawn.

Remember that you have 60 days after the calendar year to make a contribution that qualifies for a tax deduction for that year.

RESP Contributions

Registered Education Savings Plans (RRSPs) allow people to save for the post-secondary education of children or grandchildren on a tax sheltered basis while reducing taxable income. There are, of course, other advantages to RESPs. With an RESP contribution of $2,500 per child, the federal government will contribute $500 in the form of the Canada Education Savings Grant to the RESP. If a client has prior non-contributory years, the annual grant can be as much as $1,000 in respect of a $5,000 contribution.

Do You Have a TFSA?
With the introduction of Tax-Free Savings Accounts (TFSAs) on January 1st, 2009, 26 million Canadians aged 18 and older received $5,000 in tax-free contribution room from the federal government. On January 1st, 2010, an additional $5,000 in tax-free contribution room was added to each account. Now is an excellent time to discuss your options for making the most of this new contribution room.

Remember that it’s important to review your overall tax-planning strategy with a professional to ensure you’re making the most of any opportunities available to you, especially as a result of new savings and investment vehicles, credits and policy changes that came into effect for the first time in 2009.

HOMEOWNER TIPS – Humidifier Maintenance

Whether you have a power humidifier or just a simple pan-type model, you will have to clean your humidifier on a regular basis to ensure proper operation. As water evaporates, it leaves behind mineral deposits that clog the mechanisms in the humidifier, eventually causing it to stop working. You will be able to tell when cleaning is appropriate as the mineral deposits will be noticeable to the eye and to the touch. The sponge drum in a power humidifier will be crusty and stiff instead of soft and pliable. Check at least twice a year and more often in the winter when your humidifier is likely to be working harder.

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