Happy New Year to everyone and I hope you all have settled somewhat into 2015. This year has started with many realty reports that state the exact opposite of each other (Just like many years past).
Over the last 2 weeks much has been said about Canada’s Real Estate market being overvalued by as much as 30%. We just came off a close to record year and yet Royal Lepage forecasts GTA prices to rise another 4.5% this year (a slower pace rise but still significant).
I see it every day in my business that there is not enough inventory! Bidding wars are still common. Reports forecast interest rates rising as soon as second quarter but now with Oil prices tumbling there is fear that Alberta may fall into a recession and bring Canada down into ne as well. These pressures and many others all factor into whether or not the federal government will raise rates.
Also consider that if interest rates do rise it will be a gradual increase. Every Canadian who buys a home and obtains a mortgage has to qualify at a non-discounted posted interest rate. Theoretically home owners should have a “buffer” for interest rate tolerance. Also consider that not everyone’s mortgage is up for renewal at the same time as soon as interest rates rise.
Most are forecasting a soft landing, not a crash or a burst. For 2015 however, a rise is still in the cards!
Market Watch – Near Record Sales in 2014 (Download the December 2014 report)
January 7, 2015 — Toronto Real Estate Board President Paul Etherington announced that Greater Toronto REALTORS® reported 92,867 residential sales through the TorontoMLS system in 2014, including 4,446 in December. The calendar year 2014 sales result represented a 6.7 per cent increase over the 2013 sales figure of 87,049 and was just short of the record set in 2007.
“TREB’s 2014 sales figures are a testament to the importance Greater Toronto Area households continue to place on home ownership. GTA households realize that home purchases have been a quality long-term investment. While home prices certainly increased substantially in 2014, the purchase of an average priced home remained affordable, in terms of the average household’s ability to comfortably cover their monthly mortgage payments,” said Mr. Etherington.
“Even with a constrained supply of homes for sale in many parts of the Greater Toronto Area, buyers continued to get deals done last month. Households remain upbeat about home ownership because monthly mortgage payments remain affordable relative to accepted lending standards. This is coupled with the fact that housing has proven to be a quality long-term investment,” stated Mr. Etherington.
The average selling price continued to grow on a year-over-year basis in calendar year 2014, with an 8.4 per cent increase over calendar year 2013 to $566,726. This included a seven per cent increase in the December 2014 average selling price to $556,602. Throughout 2014, annual increases in the average selling price and the MLS® HPI Composite Benchmark were consistently reported on a monthly basis for most market segments, from detached homes through to condominium apartments.
“The strong price growth we experienced in 2014 can be explained with two words: listings shortage. The constrained supply of listings was especially evident for low-rise home types like singles, semis and town houses. The number of households looking to purchase these home types increased, while the number of homes from which they could choose decreased. This situation resulted in more competition between buyers and more aggressive offers,” said Jason Mercer, TREB’s Director of Market Analysis.
Selling my house in the winter: Am I crazy?
Most people think it’s very hard to sell your house in the winter. And many will just wait out the storm before they list. The truth is, there can be some real advantages to putting up that “For Sale” board during the cooler months. Because you’re away from the ‘crazy’ spring real estate frenzy, there will certainly be less competition. Perfect because big life changes (new jobs, growing family, downsizing) happen all year round.
So what are some things you can do in the winter to get your house ready?
Clean up your outside! Whatever you can’t paint in the winter, you can clean up. Make sure your walkways are clear of snow and ice and your eaves troughs are clear of leaves and debris. Clean up minor repairs and cracks too. Be sure to tend to foliage and adorn that entryway with a beautiful wreath and a welcome mat.
Make a great first impression. It only takes potential buyers about 10 minutes to decide on a house. Make your home feel inviting in the winter months by having a rubber mat at the entry for wet boots and having one-size-all slippers for buyers to wear as they browse through your home. Light a few candles and turn on your fireplace. It’s cold outside, you want buyers to feel warm and comfort in your home.
Give each room a warm touch. Drape a comfy throw over the back of an armchair, place a plump quilt at the foot of the bed and add area rugs to make a big difference in the way a room feels to prospective buyers. Also, be sure that every light is on — even for daytime showings. Winter days are dim, and your house will look its best when it’s as warmly lit as possible.
With these tips in mind, your winter sale can be a breeze. (Warm breeze that is!).
The cheapest day to buy by Jamie Henry | 13 Jan 2015
In what might be a useless bit of information for brokers to share with their clients, one Realtor has pinpointed the cheapest day of the year to buy a house.
“Despite the colossal price spikes and market shifts over the past half-decade, one trend has remained true and consistent – January has proven to be the least expensive month of the year to buy a home,” The Red Pin wrote in its 5 year GTA Breakdown about the best time to buy and sell a home. “Not just in 2014 but in every year since 2010.”
According to the report, the average price in January over the past five years is $467,761, which is nearly $16,000 less than the next cheapest month and $60,000 cheaper than the most expensive month.
However, the Realtor took it one step further and discovered the best day of the year to buy a home, according to its research: January 20th.
“The savings amounts to a lot for the buyer,” Rokham Fard chief marketing officer of TheRedPin.com told the Financial Post. He estimates the total savings amount to $20,000 over the next cheapest month. And according to Fard, the date happens to fall on the perfect day of the week – Tuesday — as well.
“Everything is back into gear in the third week,” Fard told the Post. “On Tuesday, you have some time before the open houses start on the weekend to see a property and research it and put in an offer.”
Have a fantastic weekend and a great week, Anthony