Good evening everyone;
I hope the first day of spring this past week was an enjoyable one. I left my snow-blower at the curb last Thursday. After 10 years of faithful service it virtually blew up. I think despite it being busted, the action was more of a “take that winter I’m done with you!” – We have received 8cm of snow since and it is still way too cold! Really?
Buyers Conditions in Offers to Purchase
It has been a whirlwind weekend! Last night, on one of my listings, I received and offer that had the sale of the home being conditional on the amount of “SOUTHERN” sun light that entered the house – huh? They agreed that home was uber bright but it had to be southern sun (which ultimately it was for the most part) I asked the buying agent – “How would you even quantify that?” – Because this condition is so subjective and clouded with ambiguity it immediately raised a red flag to myself and my sellers. Needless to say the negotiations came to a halt. In the end we worked with another offer.
This condition was born out of the cultural importance of “southern sunlight” for the buyers. The purchasers were of Chinese background and it mattered to them quite a lot. I learned something new! I already knew about the number 8 being good luck and number 4 being bad luck, and that stairs facing the front door is terrible as all the good luck will exit through the front. The amount of Southern sun light was a first.
I respect and appreciate that all cultures have their own customs and preferences and ultimately a buyer should be happy in their new home. As a buyer, if you have unique needs the best strategy is to satisfy yourself as much as possible to these “unique needs” before submitting an offer (especially when in a competitive situation). As a buying agent we should undercover these needs prior to presenting an offer as to give our clients the best chance at being successful. Sellers may not appreciate the requests being made and may be ultimately frustrated.
GREATER TORONTO REALTORS® REPORT LATEST MID-MONTH RESALE MARKET FIGURES
TORONTO, March 19, 2014 – Toronto Real Estate Board President Dianne Usher announced that Greater Toronto Area REALTORS® reported 3,459 transactions through the TorontoMLS system during the first two weeks of March 2014. This result for the TREB market area as a whole was virtually unchanged in comparison to 3,464 transactions completed during the same period in 2013.
“Despite the poor weather conditions experienced during the first half of March, an abundance of willing buyers were actively searching for a home to purchase. However, many of these people continued to be affected by the enduring shortage of single-detached, semi-detached and townhouse listings, which means that in some cases they could not find a home on which to make an offer, or they were facing stiff competition from other buyers,” said Ms. Usher.
For all home types combined in the GTA, the average selling price was $560,948 – up by almost six per cent in comparison to the average price for the same time frame in 2013. The semi-detached market segment in the City of Toronto led the way in terms of price growth during the first 14 days of March, with a year-over-year increase of more than ten per cent.
“Semi-detached houses represent a more affordable ownership option for some households. Because of this, some semi-detached listings have attracted many interested buyers. This competition has served to exert strong upward pressure on the average selling price,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.
“The average single-detached price was down slightly in the City of Toronto year over year because of a smaller share of luxury deals this year compared to last. Tight market conditions will continue to drive strong detached price growth in 2014,” added Mercer.
High Ratio Mortgage Changes Coming
CMHC to Increase Mortgage Insurance Premiums
OTTAWA, February 28, 2014 — Following the annual review of its insurance products and capital requirements, CMHC will increase its mortgage loan insurance premiums for homeowner and 1 – 4 unit rental properties effective May 1, 2014.
The increase applies to mortgage loan insurance premiums for owner occupied, self-employed and 1-to-4 unit rental properties, including low-ratio refinance premiums. This does not apply to mortgages currently insured by CMHC.
CMHC’s capital management framework is consistent with international practices and Canadian guidelines for mortgage insurers. Increased capital targets are consistent with Canadian and international industry trends and makes the financial system more stable and resilient.
“The higher premiums reflect CMHC’s higher capital targets” said Steven Mennill, CMHC’s Vice-President, Insurance Operations. “CMHC’s capital holdings reduce Canadian taxpayers’ exposure to the housing market and contribute to the long term stability of the financial system.”
For the average Canadian homebuyer requiring CMHC insured financing, the higher premium will result in an increase of approximately $5 to their monthly mortgage payment. This is not expected to have a material impact on the housing market.
Effective May 1st, CMHC Purchase (owner occupied 1 – 4 unit) mortgage insurance premiums will increase by approximately 15%, on average, for all loan-to-value ranges.
Loan-to-Value Ratio Standard Premium (Current) Standard Premium (Effective May 1st, 2014)
Up to and including 65% 0.50% 0.60%
Up to and including 75% 0.65% 0.75%
Up to and including 80% 1.00% 1.25%
Up to and including 85% 1.75% 1.80%
Up to and including 90% 2.00% 2.40%
Up to and including 95% 2.75% 3.15%
90.01% to 95% – 2.90% 3.35%
Have a fantastic week, Anthony