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Land transfer tax changes need to go farther
Posted on Thu, 16 Feb 2017, 10:20:00 AM  in My services
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blog  Earlier this year, in response to the City of Toronto’s Budget Committee announcement that they were considering possible hikes to the Land Transfer Tax, TREB launched a campaign to stop another obstacle to home ownership in Toronto.

You responded and that, combined with TREB efforts, resulted in protection for first time home buyers. I’m happy to report that there has been some success in the campaign, with the Mayor’s Executive Committee opting to take proposals to hike the Land Transfer Tax for first-time buyers off the table by increasing the first time buyer LTT rebate from $3,725 to $4,475. We believe that Mayor Tory understands the importance of keeping Toronto affordable for everyone, especially first-time buyers, and we applaud his leadership in this regard While taking the proposal to hike Toronto’s LTT on first-time buyers off the table was a great first step, we at TREB believe that City Council still needs to go further.

Currently, first-time buyers are allowed a rebate of the Land Transfer Tax that is payable on a purchase price of up to $400,000, which was the average price when the tax was implemented in 2008. The average price in 2016 was over $700,000, which means that first-time buyers have lost substantial ground on the rebate. The provincial government recently recognized this concern by doubling the provincial Land Transfer Tax rebate. TREB is calling for City Council to make similar adjustments to the City Land Transfer Tax rebate to account for increases in housing prices. In it’s recent budget, City Council decided to hike the Land Transfer Tax by $750, or seven per cent, for all repeat buyers.

Given that City Hall’s take from this tax on the average priced home has increased by 200 per cent since 2008, from $3,725 to over $11,000, you’d think they’d be satisfied with how much they’ve already taken from buyers. The fact that they’re still looking for more is a cash grab.

 

Source: Toronto Sun

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Toronto Real Estate Rises Over 5 Percent In January 2017
Posted on Mon, 06 Feb 2017, 10:10:00 AM  in Home buying tips,  Home selling tips, etc.
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blog   Toronto real estate added another record month to the stats. According to the latest release from the Toronto Real Estate Board (TREB), the benchmark prices rose once again. The price increases are being attributed to an increase in sales, and a decrease in inventory.

Prices Increasing Unsustainably Fast

The price of a home in Toronto once again got more expensive in January. The average price across the GTA in January rose 5.5% from the month before to $770,745. This represents a 22.3% from the same time last year. The average priced sale in the actual city of Toronto was just under that number at $727,928. A 5.5% increase might sound like good news, but it is unsustainably high. For instance Vancouver, Canada’s hottest real estate market, increased by only 20% over all of 2016.

Everyone across the GTA isn’t purchasing pricey castles however. The median price was only $539,000 in the city of Toronto proper, and $631,000 across the TREB region. The most popular price bracket for a sale was the $500k – $599k range. Not exactly the dizzying high prices we’re hearing in the news.

Toronto Sales Increased

Sales across the GTA are increasing, with the City of Toronto leading the growth. TREB logged 5,188 sales, an increase of 11.8% from last year. The 416 experienced larger growth due to the number of condo units, and represented 1,904 of the sales. This represented 12% year over year growth, slightly faster than the GTA average.

Inventory Was Smaller Than Last Year

The number of listings in the GTA continued to dwindle. January saw 7,338 new listings, a 17.6% decrease from the same time last year. The month ended with 5,034 active listings – a decline of 49.5%. TREB believes the decline in inventory is the reason that prices are rising so rapidly.

Better Dwelling

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Toronto condo sales push to records as buyers get squeezed out of the low-rise market: report
Posted on Thu, 02 Feb 2017, 12:35:00 PM  in Home buying tips,  Home selling tips, etc.
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blog     Priced out of detached houses and other low-rise products, Toronto buyers poured into condominiums units last year to create a 10-year low in inventory, according to a report out Wednesday.

Urbanation Inc., which has been following the high-rise market in the Greater Toronto Area since 1981, said unsold inventory in the market at the end of 2016 was 9,932 units, a 47 per cent decline from 2015. Based on the present pace of sales, that equates to about 4.4 months of supply — well below the 10 months of supply needed for a balanced market.

The research firm said 27,217 new condo apartment units sold across the GTA in 2016, a 34 per cent increase from 2015 and enough to break the record set in 2011. Urbanation said the record was set with fewer new pre-construction launches — there were 18,466 in 2016 versus 28,204 in 2011 — but the lack of new buildings and strength of demand helped push the unsold inventory levels down.

Urbanation is now predicting the lack of inventory in the high-rise market will lead to a slowdown in sales and is forecasting only 23,000 new condo apartment sales in 2017. The firm expects developers will respond to market conditions by launching more projects in 2017.

“The new condo market is experiencing broad-based demand that will carry forward in 2017,” said Shaun Hildebrand, senior vice-president of Urbanation. “Buyers, priced out of the low-rise segment, a surge in rental demand and increased attention from investors are placing downward pressure on condo inventories which will support strong price growth this year.”

 

The Urbanation report comes on the heels of statistics released from the Toronto Real Estate Board Tuesday which showed active listings for all existing homes at the end of 2016 were below 5,000, a 16-year low.

Matthew Boukall, senior director of residential products with Altus Data solutions, told a group of realtors at TREB’s annual economic outlook that his company’s statistics show new home sales in the condo sector hit a record in 2016. Just over 29,000 of the 47,200 new home sales were condo sales.

“We are seeing in the entire GTA a substantial shift into the new home market and consumers looking for an apartment unit,” he said, noting the average $537,000 price was a record. Altus data has also shown first-time buyers are about half of the buyers while one of out every two buyers are immigrants.

Boukall noted there has been almost a complete flip from low-rise units to condo units. A decade ago sales were 70 per cent low rise to 30 per cent condo and now those numbers are reversed.

“It’s an important shift,” said Boukall, noting consumers are still chasing detached homes. “We know consumer demand is stronger for low-rise product, we just don’t have the supply. We do see some consumers shifting into townhouses but I would argue that is not happening because of choice.”

Condo affordability has driven consumer demand and with it a shift back into two-bedroom condo units. About five years ago, one bedroom units sales accounted for 60 per cent of sales activity but that number is declining.

“We are seeing young couples, families and consumers of all streams getting into a two-bedroom product because of affordability,” Boukall said.

Urbanation’s overall index price for sold units in active development jumped three per cent in the fourth quarter from a year ago to $586 per square foot. In the former city of Toronto, the average selling price within projects launched in 2016 jumped 14 per cent compared to projects in 2015 to an average of $746 per square foot. At the end of 2016, the average remaining inventory in the old city of Toronto was $795 per square foot.

Garry Marr

 

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Toronto real estate heading for another hot year: TREB
Posted on Tue, 31 Jan 2017, 10:40:00 AM  in Home buying tips,  Home selling tips, etc.
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blog  Toronto real estate will get a lot more expensive in 2017, according to the Toronto Real Estate Board, which is forecasting the average price of a home to climb over $800,000 this year.

The board is predicting another year of double digit growth in Toronto real estate prices, with the average selling price rising between 10 and 16 per cent.

More than 100,000 home sales are forecast for the third straight year.

The average sale price for a Toronto home is predicted to hit $825,000, according to TREB's market year in review and outlook report 2017, to be released Tuesday afternoon.

While the board predicts that some buyers will be hindered by new federal mortgage rules that limit their borrowing power, it says the biggest roadblock will be lack of inventory.

According to TREB data, active listings at the end of 2016 were at their lowest point since 2000. 

"It's unlikely that the shortage of listings will improve to any great degree over the course of the year," Jason Mercer, TREB director of Market Analysis, said in a statement.

Foreign buyer tax would be 'misguided'

TREB's report acknowledges the rapid growth in Toronto real estate is putting home ownership out of reach for many residents.

But the board says a tax on foreign buyers would "misguided" as a potential solution.

In survey of its members, TREB found that just 4.9 per cent of agents acted on behalf of a foreign buyer last year.

A total of 40 per cent of foreign buyers purchased a home as their primary residence, the report says.

While there was much speculation that a new B.C. tax would see many foreign buyers shift to the GTA, TREB's survey found less than 2 per cent of its agents represented someone that was impacted by the B.C. tax.

TREB is also raising flags about "unintended consequences" of a foreign buyer tax in Ontario, including even more price growth, less rental supply, and a potential "negative impact" on immigration.

 

By Trevor Dunn, CBC News

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Red-hot housing market encouraging buyers to purchase condos
Posted on Fri, 27 Jan 2017, 04:50:00 PM  in Home buying tips,  Home selling tips, etc.
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blog  Toronto’s condo market saw exponential price increases in 2016, according to the Toronto Real Estate Board.

The average Toronto condo sold for $437,281 in the fourth quarter of last year, up from 2015’s average of $381,981.

Inventory issues that have long plagued the single-family home market in the city are now being seen in the condo sector, according to TREB.

Double-digit annual sales increase, coupled with double-digit decline in new listings has resulted in supply concerns.

“Gone are the days when we were concerned about a potential glut in inventory in the condominium apartment market,” Toronto Real Estate Board President Larry Cerqua said. “The supply concerns that have been top-of-mind for ground-oriented home types are also now a reality for the condo market segment. 

“Regardless of the price measure considered, heightened competition between condo buyers has resulted in double-digit price inflation.”

Total sales in Q4 2016 were 6,831, up from 5,587 during the same period a year prior.

“First-time buyers represent an important component of home ownership demand.  Many households looking to purchase their first home will consider a condominium apartment,” Jason Mercer, TREB’s director of market analysis, said.  “Interest in this market segment has continued to grow as prices for low-rise home types have increased on a sustained basis.”

TREB’s report follows a similar one from CMHC that found Toronto’s hot single-family market is spilling over to surrounding areas as well as its own condo sector.

by Justin da Rosa

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GTA house price 'spillover' driving up prices as far away as Sudbury, Ottawa: CMHC
Posted on Tue, 24 Jan 2017, 01:50:00 PM  in Home selling tips,  My services, etc.
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blog   Potential homebuyers thinking that a longer commute is their solution to the red-hot real estate market in the Greater Toronto Area should be prepared to spend more time on the road – or relocate, if the results of a new report are any indication.

The report by the Canada Mortgage and Housing Corporation (CMHC) says house price "spillover" is occurring not only in traditional GTA alternatives like Hamilton and Guelph, but also further afield in cities like St. Catharines and even as far away as Sudbury and Ottawa.

"Our evidence indicates that increasing single-family home prices in the GTA are motivating buyers to purchase more affordable homes in nearby centres like Hamilton, Barrie and Guelph. In turn, this purchasing behaviour is driving up house prices in these markets," Jean Sébastien Michel, Principal Market Analyst with CMHC, said in a statement.

'Disproportionate' GTA growth

CMHC's latest Housing Market Insight report, released Tuesday, concludes that since the 2008-09 recession GTA home prices have increased "disproportionately" to other Ontario municipalities.

The gap is sending potential buyers outside of the GTA, especially those searching for detached and semi-detached single-family homes.

And since 2008-09, the report says, stronger "house price growth relationship" with the GTA has been occurring farther away, with larger effects in Barrie and St. Catharines-Niagara than in Hamilton, Guelph or Kitchener.

It doesn't stop there.

The report says even real estate prices in Sudbury and Ottawa "appear to be affected" by what's happening in the GTA.

CMHC has found a high correlation between apartment prices in the two cities and the GTA. It speculates that well-paying jobs and affordable housing in Sudbury and Ottawa may be encouraging first-time GTA homebuyers to relocate there.

Effects of a 'price shock'

The report also warns about the consequences that a GTA "price shock" could have elsewhere as its relationship with other markets tightens.

CMHC analysis shows that the effects would be greatest for those markets that are closer to the GTA.

The report says a one per cent house price shock in the GTA would cause a 1.4 per cent price change in Hamilton.

By Trevor Dunn, CBC News

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Toronto’s hot housing market spills over to condo rentals
Posted on Mon, 16 Jan 2017, 10:40:00 AM  in Home buying tips,  Home selling tips, etc.
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blog 

Toronto’s sizzling housing market is spilling over into the region’s rental market, pushing up rents to new records as tenants fought over a shortage of rental listings.

Average rents for condos rose 11.7 per cent in the fourth quarter of 2016, compared to the same period a year earlier, hitting nearly $1,990 a month for a typical 719-square-foot condo, according to new data from Urbanation Inc., a consulting and market research firm that focuses on the Greater Toronto Area’s condo market.

Rents rose the most in the Toronto city core, where condos rented for an average of $2,134 a month in the last three months of 2016, up 12 per cent from a year earlier. Average condo rents rose 7 per cent to $1,857 in the inner suburbs of Etobicoke, North York and Scarborough. They rose 6 per cent to $1,739 in the 905 region around the city.

Average rents have grown at their fastest rate since Urbanation started tracking the condo-rental market in 2011. Last year represented a “dramatic acceleration” from the 4.2-per-cent rent-price growth recorded during the same period in 2015, the market research firm said.

Renters have started to feel the effects of Toronto’s extremely hot housing market. Average resale home prices jumped 17.3 per cent in the GTA in 2016, while condo prices surged 15 per cent.

A widening gap between the price of single-family homes and condos has pushed many first-time buyers into the less-expensive condominium market, while the disparity between the cost of owning and renting has discouraged some tenants from becoming homeowners, Canada Mortgage and Housing Corp. said in a recent Toronto market analysis.

“For the first time in many years, the market was tighter for condominium apartment than for single-detached homes,” the Crown corporation wrote.

The strong growth in condo prices has also encouraged many owners to sell their units rather than rent them, and convinced many tenants to stay put, Urbanation said, pushing the number of rental condos listed on the Multiple Listings Service down an annualized 8 per cent in the final quarter of last year.

The typical condo spent just 13 days listed on the rental market in the fourth quarter of 2016 before finding a tenant, down a full week from the last three months of 2015.

“The undersupply of rentals in the GTA continued to worsen throughout the year, causing rents to surge alongside home prices and further deteriorating housing affordability across the region” wrote Shaun Hildebrand, Urbanation’s senior vice-president.

Other factors have also lit a fire under the GTA rental market, including a rising number of unemployed Albertans moving to Ontario for work in 2016.

The Toronto region also saw an increase in new permanent residents moving into the region in the first half of 2016 after reaching record lows in the prior year, CMHC said. The federal housing agency found that the international-student population has also doubled in the past six years.

Meanwhile, a widespread construction-trades strike across Ontario, in the spring of 2016, caused work on many housing projects to grind to a halt and aggravated a shortage of newly built rental condos and apartments coming onto the market.

In an open letter to home buyers published on its website, Tarion Warranty Corp., which administers Ontario’s new home warranty, called the delays caused by the strike “an unparalleled situation” that has reverberated across the housing market and dramatically delayed completion timelines for many projects.

“The sheer scope of the industry-wide strikes and their continuing impact on the delivery of finished new homes and condominiums is extraordinary,” the agency wrote.

Some analysts expect many of the conditions that fuelled the GTA’s hot housing market last year to subside in 2017, putting less pressure on rentals.

Encouraged by the strong growth in rents, more developers are opting to build rentals rather than condos. The number of applications filed by developers for rental apartments had more than tripled by the fourth quarter of 2016 from a year earlier, to 27,812, Urbanation said.

A surge in new homes under construction in 2016 – the majority of them condos – will also help ease tight market conditions this year, CMHC said.

“The high number of condominium apartment units under construction points to higher completions over the next couple of years, which will add to supply (in terms of both new listings and unsold units) in the future,” the agency wrote.

What’s more, stricter new federal rules for insured mortgages introduced last year are expected to curb home-price growth in the GTA, helping to slow the overall housing market next year, wrote Bank of Montreal senior economist Sal Guatieri. “We expect Toronto home sales will come off their highs this year, while price growth will simmer down to the mid-single digit range."

 

The Globe and Mail

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High-end Toronto market to continue exhibiting strong performance in 2017
Posted on Fri, 13 Jan 2017, 10:40:00 AM  in Home buying tips,  Home selling tips, etc.
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blog  As one of Canada’s most desirable markets, Toronto is projected to continue being a prime destination for would-be buyers of high-end real estate this year, according to Sotheby’s International Realty Canada.
 
In a fresh report, Sotheby’s predicted that 2017 would be the third succeeding year that Toronto will lead the rest of Canada in terms of sales volume in the luxury home segment.
 
Sotheby’s International Realty Canada president and CEO Brad Henderson attributed this strength to the prevailing environment of strong consumer confidence, robust employment numbers, and low interest rates, along with tight supply spurring heightened competition.
 
“With natural boundaries like the lake and the greenbelt, the Greater Toronto region has less developable land than other markets, and as a consequence there are less opportunities to add to the supply,” Henderson said in the report, as quoted by CBC News.
 
The Sotheby’s study revealed that the 2016 sales volume of Toronto residential properties worth $1 million and above spiked up by 77 per cent compared to the previous year, up to 19,692 completed transactions.
 
GTA sales numbers in the highest-end segment—homes worth more than $4 million—increased by an even more dramatic 95 per cent year-over-year.
 
Earlier this week, the Toronto Real Estate Board revealed that average home prices in the city have jumped up by 20 per cent year-over-year in December (up to $730,472)—a development that has been accompanied by sustained low levels of inventory in the GTA.
 
The confluence of factors will keep up Toronto’s status as one of the country’s strongest seller’s markets, taking into account the ever-increasing demand from would-be buyers, TREB added.

 

by Ephraim Vecina

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How laneway houses could help solve Toronto’s real-estate woes
Posted on Mon, 09 Jan 2017, 10:35:00 AM  in Home buying tips,  Home selling tips, etc.
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blog   The GTA housing market has been operating within a policy of intensification for more than a decade now. This has caused a shift away from ground-oriented homes and moved the market toward higher-density housing, such as condominiums.

Our real-estate market has seen consistent increases in the cost of housing, with the average price of a detached home in Toronto increasing by over 32 per cent this past November from the same month last year, according to the Toronto Real Estate Board.

While those who prefer urban living have embraced higher-density housing, folks looking for traditional ground-oriented housing must move farther and farther away from the city to find it.

So what if there was a way to introduce new ground-oriented housing in the heart of Toronto that could accommodate up to 100,000 people, and the solution was literally in our backyard all along? That is, if your backyard is along a laneway.

Laneway housing is an innovative concept first introduced in Toronto back in 2006. And while it ultimately went nowhere here, it did inspire Vancouver, Ottawa and other cities to introduce policies that embraced it.

The original concept a decade ago contemplated a separate dwelling being legally severed and requiring new municipal services, resulting in the digging up of laneways.

The new groundswell of interest in laneway housing (call it laneway housing 2.0) is focused on taking a different approach, where the new structures will be treated as secondary dwellings on the existing property.

That means the garage at the rear of the property could be rebuilt by the owner to include a secondary dwelling unit, potentially serviced through the existing municipal connections, limiting neighbourhood disruption and creating new appropriately sized, ground-oriented housing units that could range in size from 700 to 1,500 square feet.

This could represent one of the most innovative solutions to a wide range of the city‘s housing needs, including multi-generational households where the owner can provide accommodation for parents or children or introduce much needed rental housing stock and help generate new income from their property. And it would be creating new ground-oriented housing in areas close to transit and existing community amenities, with minimal neighbourhood disruption.

There is no silver bullet solution to solve all of our housing challenges in the GTA, but with approximately 300 kilometres of laneways in the City of Toronto, laneway housing could be a good start.

But this innovation will require that everyone works together: citizens, government and industry. And community consultations are underway. If you’re interested, you can participate by going online to: lanescape.ca/survey to learn more about the initiative and provide your input.

 

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Real estate agent warns of 'lowball' offers targeting older Toronto homeowners
Posted on Fri, 06 Jan 2017, 01:45:00 PM  in Home buying tips,  Home selling tips, etc.
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blog A real estate agent wants to warn potential sellers about a rise in what he calls "questionable tactics" from buyers trying to put in lowball offers before a property even hits the market. 

Desmond Brown said he began noticing the practice in late 2016 — and said that it seems to target those who have owned a home for decades and may not be aware of its value in the current market. 

"The owners have paid such a low amount for this property they've owned for 20, 30, 40 years, they think this [offer] is huge," he said. 

He first encountered the issue when he planned to list an East York two-bedroom, detached bungalow near Coxwell and Mortimer avenues for $799,000. The home had been the family's possession for 75 years, but its elderly owner had recently died.

But before the home hit the open market, a buying agent, who said they represented a developer, went directly to the sellers and offered to buy the bungalow for lower than the listing price.

Sensing that something was amiss, the family declined and decided to test the market. 

"We ended up selling it for a good $75,000 more than what that agent had brought before it went on the market," Brown said. And "that agent who came in with the original offer to them, was nowhere to be seen."

Since then, Brown said he's seen the same thing happen with at least four other listings.

These agents are acting in bad faith, he said, by trying to deal directly with a seller and "basically trying to rip them off."

There are many reasons why a buying agent, like the one who approached Brown's clients, may try to get an older property for cheaper than its market value. Chief among them is the possibility of renovating, and then flipping the home for a significant profit.

A competitive market

But right now, Toronto is a seller's market. The average home price in the Greater Toronto Area jumped to $730,472 in December, up 20 per cent from the previous year. 

And with housing inventory low in the Greater Toronto Area, demand from prospective buyers continues to grow, said Kelvin Kucey, deputy registrar of regulatory compliance for the Real Estate Council of Ontario (RECO). 

Kucey said this creates a situation where buyers — whether working for themselves or on behalf of a developer — are willing to push any advantage to get property in popular neighbourhoods. 

"[These buyers] are trying to swing a deal for their client, and certainly, acting only in their client's best interest," Kucey said. "It's certainly not with a view to being fair or doing so honestly." 

The "lowball" tactic Brown encountered may not be illegal, but Kucey said it could breach the Realtor code of ethics. 

And if someone lodges an official complaint against an real estate agent, they can take legal action against the buyer who made a direct offer to a seller. 

"Real estate professionals know very well they shouldn't be contacting ... a seller directly," Kucey said. "They have to go through the agent. 

How to protect your interests

In order to ensure sellers get good value from their homes, real estate experts recommend following these steps before selling:

  • Take time to do your homework and understand the state of the market
  • Enlist an experienced real estate agent to represent you
  • Hire an appraiser to establish a ballpark figure for the property
  • Refer to RECO or the Ontario Real Estate Association for operating records of real estate agents

 

By Adrian Cheung, CBC News

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