In the last week we received multiple offers on three bungalows, one of which sold in 4 days at 112% of list, the second in 3 days at 103% of list and the third in 8 days at 115% of list. All our sellers are extremely happy and we believe the buyers, who were able to take advantage of today’s low rates, purchased properties that are unique with "value added" in terms of location, design or condition. 

Our day-to-day experience is mirrored in The Toronto Real Estate Boards Apr.18 Report on Mid-Month Resale Figures. Competition remains a reality; we are seeing record prices, multiple offers and quick sales.

Tasi’s recent comment in our Edenbridge Humber Valley Newsletter continues to hold true, “Multiple offers and bully offers are the norm.  This holds true for properties up to
$1million but is not always the case for properties over $1 million.”  The three properties referenced were all in the $725,000 to $1 million range.

In a “Hot” market like we are experiencing in Toronto, where you buy and how long you  intend to live in a home becomes increasingly important.  Buying over list to ensure you get the property you love is currently the norm. We encourage our clients to weigh “their must-haves” slightly in favour of a prime location as homes in desirable neighbourhoods will retain value in the event of what the press refers to as a “market correction”.  Historically the market is cyclic and our Team has weathered the ups and downs, all of which add to our experience level. Finding the perfect house in a competitive market requires finesse, something the Farquhar Team has in spades! Please call us to discuss.

Why not mark Earth Day (Sunday April 22, 2012)
by planting a tree?

We hope this week’s Home by Design article, "The Far Reaching Benefits of Trees" will inspire you to plant a tree this spring. There are many reasons we plant trees on our properties, to add beauty and colour, to provide privacy, to block unsightly views, to soften the hard edges of a building, to cool by providing shade, to filter pollutants, to absorb sound and provide a haven for city wildlife. The end result is that we have increased the value of our property and have made a positive contribution to the environment.

We have compiled a list of additional resources:

Sheridan Nurseries article "Deciduous Trees" offers pointers on how to choose a tree, describes the features of each and increases your chances of success with planting & watering tips.

Check out the Ministry of Natural Resource's "Tree Atlas" to determine which tree species are native to your area.

Visit the Ontario Trees and Shrubs web site for a comprehensive guide with photographs.

Issues related to the City of Toronto Trees can be found on the city's Urban Forestry Page

For a list of Ontario Earth Day Events click here.

Thinking of Breaking Your Mortgage Contract? With today’s low rates, it is increasingly attractive to renegotiate.

Prior to making a decision you have to crunch some numbers and one of those numbers is the amount of bank penalty fees you will incur for breaking the contract. Historically most lenders are somewhat vague as to the amount you will owe. Penalties are not standardized and are described by many mortgage lenders as “moving targets”. Banks calculate penalties using various methods and rates to calculate the “interest rate differential” (a term normally used when breaking a Fixed Rate Mortgage); Some are more penalizing than others.

Last week the Federal Government has announced plans to improve disclosure of penalties that apply when borrowers want to collapse their mortgage before the scheduled renewal date.

The new regulations which will be phased in over the next 12 months will relate to new mortgages and require that banks:

• provide annual information on how buyers can prepay their mortgage,
• provide access to an online prepayment calculator, and
• divulge how they calculate their prepayment penalty.

Disclosure will help borrowers when they are shopping for a mortgage and will facilitate “fairness awareness” as to how penalties are calculated. Having to provide a calculator requires that the calculation process be at least semi-permanent. All else being equal, if one lender will penalize you $12,000 and another 18,000 and you know this upfront, which would you choose?

Read Rob Carrick’s March 5 / Globe & Mail article “Goodbye to three irritating bank practices...”

Where have all the sellers gone?!

The new year kicked off with a sluggish start to what is proving to be another sellers market. There was very little product on the market in January, with a slight improvement in February,  which has left the masses of buyers competing for the same properties, as there was very little to choose from. We saw homes in Mimico go for $100,000 over the asking price!

The sellers who are thinking about making a move this spring have started to come out of the woodwork, catching news of the buzz, getting themselves organized to do so a bit earlier than originally planned.  As we head into the Spring, we expect to see more product, but still think that there will not be enough product to satisfy the demand, especially with the current ever low interest rates that are holding.

Now is a fantastic time to sell. Call us to find out how you can take advantage of this market.

Adrienne

The number of cranes in and around Toronto speaks to the changes afoot in both Toronto's silhouette and in the way many Torontonians are choosing to live their life.

In a BNN broadcast last week it was noted that in 2011, condo sales represented 62% of sales in the GTA new home market.  This represents a dramatic shift away from the traditional new home low rise subdivision.  It is not just a “downtown phenomena” as the “up-not-out” philosophy is gaining acceptance in the 905 area as well, where one in every three new sales is a condominium.

Transition from a low rise to high rise market and intensification is inevitable in Toronto where there is a favourable political climate and location and geography are factors. It is likely a permanent trend, you cannot buy what is not available and those entering the market for the first time are drawn to what is affordable. The response of the industry is to make new condos more compact, often sweetening the pot with attractive amenities including gym facilities, guest suites, party rooms etc.

Buyers include new Canadians, first time buyers, commuters looking to take advantage of city transit and downsizers.  According to the broadcast "Real" buyers are filling existing units.  The buyers we are currently working with are definitely real and Condos in desireable locations continue to sell quickly.

Click Here to View the Video

Both TD and Royal have pulled their discount mortgage rates that were planned to be available until the end of the month: 2.99%, four year, fixed rate.  This offer was in response to BMO’s five year, fixed rate, 2.99% which was limited to a two week period. 

 The banks are stating slim lending margins for the reason they halted the offer.  Increasing speculation of inflation has brought on a two month high bond rate, reflecting the subsequent increase in the cost of funds.   

TD and RBC have increased the fixed rate to 3.39%.  Much of this is in response to the improving US outlook, which has caused some upward pressure on the banks borrowing costs.  Variable rates still remain extremely low at 2.99% or lower. 

The trick is to pick the product that best suits your financial scenario without overextending yourself.  Do your homework and make decisions based on solid information. 

Read The Globe & Mail's article : http://www.theglobeandmail.com/globe-investor/canadian-banks-call-truce-in-easy-money-mortgage-battle/article2331673/  

So you've already decided that home ownership is a priority. Alright, where to get started?

Here and Now by assessing what you spend vs. what you earn. The process, Budgeting, is a necessary step (did someone say evil?) Knowledge is power and in many cases individuals are shocked when they go through the process and figure out where they are financially...you may be fortunate and be pleasantly surprised.

A realistic budget to forecast your spending for the year will help with long term financial planning, will help you get a handle on how much you can save and ensure you make it to your goal of home ownership.

An inheritance would be nice, well fabulous actually, but for most of us it’s a day-to-day balance between needs, wants and "well I really shouldn't have".

Check out Gail Vaz-Oxlade's web site. It includes a budget worksheet and directions! http://www.gailvazoxlade.com/resources/guide_to_building_budget.html

It's your money and you can do with it whatever you like, but be aware that:

• It's easier to spend when you use plastic and there are a number of financial institutions banking on it.
• You need to prioritize your expenses and live within your means. If in debt, pay off high interest obligations first, then use that payment amount to pay off the next most expensive debt until its retired (and hopefully you aren't).
  Consider consolidating debt at a lower rate of interest.
• From time to time you should re-assess your lifestyle, if you live in a city do you really need the expense of a car? Do you purchase a daily Starbucks, lunch, meet friends for a drink?
• Saving bonuses will get you to your goal faster. Note: Once you purchase a home, related expenses will use up 35-40% of your monthly cash flow.
• Look for ways to do things more economically, use the library for books and movies, use coupons, buy on sale, look for deals on sports equipment, toys etc at garage sales.
• Borrow from your RSP. Click here to see our article.
• Finally, stash that money in a tax-free savings account.

A new Home Price Index ( The MLS® Home Price Index or the MLS® HPI) has been launched based on single family, townhouse/row unit, and apartment unit sales activity in Greater Vancouver, Fraser Valley, Calgary, Greater Montreal, and Greater Toronto. The players include the Canadian Real Estate Association, the five boards of the cities listed above and Altus Group. 

 What will it do for us?

Too new to tell at this point... the data will get added into the mix and will help us provide our clients with more accurate "historical" picture of the city and neighbourhood of interest, as well as the type of home they are looking for. We understand the structure compensates for swings in average and median home prices that result from changes in the mix of home sales and are "open to misinterpretation". Gregory Klump, CREA’s Chief Economist said "The MLS® HPI overcomes this shortcoming, and does a better job of tracking Canadian home price trends than any other measure."

The index will provide clients and REALTORS with a more timely and accurate gauge of home values the five markets. Data will be available for: single family homes, which are further split into 1-storey, and 2-storey single family homes; townhouse/row units; and apartment units.

We will be able to look at composite changes, compare markets and look at month-over-month changes in sales of single family homes etc.  Data for these housing types are also available along detailed neighbourhood lines in each of the markets.

What does it tell us today?

Home prices edge higher in January - February 6

The index remains 5.2 per cent above levels for January 2011. Led by Toronto (7.6%), all five of the markets tracked posted year-over-year increases. The index was also up from year-ago levels in all housing categories, led by two-storey single family homes (6.7%).

More at http://homepriceindex.ca

As a Realtor, my response to that has been that Toronto (proper) has been very resilient to the economic shifts (high demand, not enough supply). Depending on where you live and what type of property you own will determine how the value of that product is affected (if we go through another recession).

If you bought a condo unit in a high rise where there are hundreds if not thousands of them just like yours, well then what's to distinguish yours from the next one?  Also too the other major red light to look for is how many of the owners are end users versus investors?  End users are much more vested in looking after the building and running a healthy corporation.

On the flip side, if you own a condo in a boutique building or conversion loft, then it is more unique and will continue to have much more demand. Or a home in a great Neighbourhood close to a park, public transit, shops and cafes, these too are amenities high in demand which will continue to be at the top of the urban buyers "must have" list.

Realtors know where to invest and what to buy. Take advantage of our skills and call us to help you make your sound investment in real estate.

Adrienne

From The Globe and Mail: Low Interest Rates May Shield Housing Market From Bubble 

The Canadian bank regulator is going to find out. They are stepping in to assess lending practices and determine if over time, these loans could actually be paid back or not.

The fear is that lending standards have become increasingly liberal. For example, borrowers not having to prove their income before getting a loan.

Did you have to prove your income before getting your loan?  Is your debt servicing 40% or more than your disposable income? 

Important questions to ask yourself in order to stay on top of your finances and not put yourself in a vulnerable financial scenario.

Regular assessments of your finances is highly recommended to make sure you are making the right decisions and not over extending yourself.

As we are extremely low on product right now, it is a good time to consider de-leveraging and selling an investment property in order to pay off your loans or lines of credit.

From The Globe and Mail: Bank Watchdog Targets Condo Speculators