My Toronto Real Estate Blog

Real estate recovering, economists say

2009-06-20T10:21:00.001-04:00

t was only a few weeks ago that Vancouver realtor Pamela Allen noticed a welcome shift in the market – she began to see bidding wars on resale homes.
“My last three buyers, all three lost their offer because they were in a bidding war,” the Re/Max agent said in an interview, adding she has been busier than she has been in months.
“Anything up to $600,000 is flying off the shelves,” she said.
Ms. Allen's experience is markedly different from as recently as January, when sales in Vancouver were down 59 per cent from a year earlier. Indeed, prices have dropped, and May sales in Vancouver were 17 per cent above May, 2008, for the first year-over-year gains in months.
Canada's real estate market is clearly on the path to recovery, economists say, citing recent data as evidence that the worst of the slump may be over.
“You're seeing people beginning to kick those tires again in the housing market,” said BMO Nesbitt Burns senior economist Michael Gregory.
Many local real estate boards are, for the fourth month in a row, reporting strong sales in May, compared with the previous month.
Observers are watching for a national report on May sales expected today from the Canadian Real Estate Association.
National sales have been rising month over month since February, and in April, for example, sales on a monthly basis jumped 11.2 per cent, seasonally adjusted.
The national market has yet to eke out a year-over-year gain. But economists expect that to change within the next couple of months.
“If you don't get it into positive territory in May, it probably will in June,” said Bank of Nova Scotia senior economist Adrienne Warren.
When it does happen, it will mark a sharp rebound from January, when sales were at their lowest point in 10 years.
“The worst of Canada's recession occurred through December and January of this year,” Mr. Gregory said. “Things were looking really bleak. It caused people to be cautious.”
Now, thanks to low mortgage interest rates and a slide in prices, buyers are more confident, he added.
Most activity is among first-time buyers at the more affordable end of the market, Ms. Warren said. In Calgary, for example, 70 per cent of resales in May were on homes priced under $400,000.
“First-time buyers are coming in to take advantage of the ultra-low interest rates we're seeing right now,” Ms. Warren said.
The recent growth is due partly to pent-up demand from the end of last year, and observers said this could level off over the summer once that delayed activity has been satisfied, and as rising unemployment continues to temper consumer activity.
“The worst is over,” Mr. Gregory said. “But will the recovery be strong and robust? The jury's still out on that one.”

Canadian home resale prices rise to record in May

2009-06-20T10:16:00.000-04:00

TORONTO, June 15 (Reuters) - Resale prices for Canadian homes rose to their highest average on record in May, while sales activity climbed for a fourth straight month as consumer confidence strengthened, according to an industry report released on Monday.
But rebounding sales in some of the most expensive markets skewed the national average, the Canadian Real Estate Association said in the report.
The average home price last month rose 0.4 percent to C$319,757 ($282,971), topping the previous record set a year ago. It was the first year-over-year increase since May last year.
The average price has recovered 16.4 percent from the low reached in January, CREA said.
Home sales rose 8 percent to 37,649 units in May from April, the fourth consecutive monthly increase on a seasonally adjusted basis. Nationally, 49,521 units changed hands in May, down 0.8 percent from a year ago.
"New records were posted in only 15 percent of local markets in May, none of which are among the most active or expensive," CREA said.
"The strong rebound in sales activity, not price, in Canada's most expensive markets is driving up average prices nationally and in some provinces, just as a sharp decline in activity in these markets pushed average prices lower in late 2008."
Of the 25 major markets that CREA tracks, 14 reported rises in unit sales year-over-year, with five markets, mostly in the western provinces of Alberta and British Columbia, posting double-digit increases.
Prices rose in 14 markets, led by a 17.3 percent increase in Newfoundland and Labrador and a 12.1 percent climb in Saint John, New Brunswick.

($1=$1.13 Canadian) (Reporting by Ka Yan Ng; Editing by Frank McGurty)

2009-04-17T11:20:00.001-04:00

TORONTO, April 6, 2009 - In March 2009, Greater Toronto REALTORS® reported 6,171 sales down seven per cent from March 2008, representing the smallest year-over-year decline in the last five months. The average price for March transactions was $362,052 – down less than five per cent from the same month last year.
“The Greater Toronto housing market has stood up very well given the challenging economic
times the world has experienced in recent months,” commented TREB President Maureen
O’Neill. “In fact, over the past two months, the situation in the housing market has improved.”
The seasonally-adjusted annual rate of sales increased to 65,600 in March – up 36 per cent
from the ten-year low reached in January.1 “Sales in March increased at a rate over and above what would be expected from the normal spring-time bump,” said Jason Mercer TREB’s Senior Manager of Market Analysis. “A greater number of households have taken advantage of increased affordability in the housing marketplace.”

Seasonally adjusting TREB MLS® data removes recurring seasonal trends observed each year. For example, MLS® sales are highest in late spring each year and lowest in the winter months. Removing the recurring seasonality, allows for the analysis of a meaningful trend reflecting actual changes in market conditions. By multiplying the monthly seasonally-adjusted figure by 12, creating an annual rate, we can compare how the current month relates to historical annual figures.

2009-02-05T22:38:00.001-05:00

The Toronto Real Estate Board reported 2,670 sales in January 2009, a 47% decrease over the 5,075 sales reported in Janauary 2008. The average home price in the Greater Toronto Area was $343,632, compared to $374,449 last January. The median price was $303,000 compared to $319,000 last year.
“Demand for existing homes in the Greater Toronto Area moderated as the housing market followed the broader economic slowdown in Canada,” said Jason Mercer, the Toronto Real Estate Board’s Senior Manager of Market Analysis.

“Current selling prices are a reflection of more choice in the existing home marketplace,” said Mercer. “At the same time, low mortgage rates have helped keep ownership housing an affordable option. Given that we are not facing an early-1990s-style affordability crisis, the rebound in the housing market will likely be quick once economic recovery takes hold,” added Mercer.

RENTAL TRANSACTIONS INCREASE

2009-02-05T22:37:00.001-05:00

RENTAL TRANSACTIONS INCREASE
TORONTO, February 5, 2009 - Between September 1, 2008 and December 31, 2008, Toronto Real
Estate Board (TREB) Members reported 3,433 rented condominium apartments and townhouses in the Greater Toronto Area. This represented a 30 per cent increase over the 2,635 transactions recorded during the same time frame in 2007. A good part of this increase likely came from rental listings in newly completed condominium apartment buildings containing investor-owned units. "The increasing strength of the rental market combined with low interest rates and reasonable home prices mean that now could be an excellent time to purchase an investment property," said Maureen O'Neill, President, Toronto Real Estate Board.
"Given the demand for rental units, tenants can cover some of the owner's operating costs for an investment property, while property owners look forward to a healthy return in owner's equity in the long term." Condominium apartment rents on an annual basis rose for one, two, and three bedroom types during the September to December period. Two bedroom units, for example, rose two per cent to $1,895 per month. "Investor-owned condominium apartments have become an increasingly important component of the GTA rental market," according to Jason Mercer, Senior Manager Market Analysis.
"Very few purpose-built rental apartments have been completed in the GTA over the past few years. Many renters searching for apartments with modern finishings and amenities have been attracted to rental condominium apartments listed by TREB Members on the TorontoMLS system."
See full report at www.AlexPrasoulis.com

Canada's Economic Action Plan

2009-02-05T22:35:00.000-05:00

Canada's Economic Action Plan
The Home Renovation Tax Credit
PDF Version

Home renovations are smart investments in the long term value of a home and also create economic activity by increasing the demand for labour, building materials and other goods. Renovations can also reduce energy consumption and the long-term cost of owning a home.
To provide some $3 billion of much-needed fiscal stimulus and encourage investments in Canada’s housing stock, Budget 2009 proposes to implement a temporary Home Renovation Tax Credit (HRTC).
Temporary, Timely and Targeted Stimulus
The HRTC will apply to eligible home renovation expenditures for work performed, or goods acquired, after January 27, 2009 and before February 1, 2010, pursuant to agreements entered into after January 27, 2009. The temporary nature of the credit will provide an immediate incentive for Canadians to undertake new renovations or accelerate planned projects.
The HRTC can be claimed for renovations and enduring alterations to a dwelling, or the land on which it sits.
How the HRTC Will Work
The 15-per-cent credit may be claimed on the portion of eligible expenditures exceeding $1,000, but not more than $10,000, meaning that the maximum tax credit that can be received is $1,350.
The credit can be claimed on eligible expenditures incurred on one or more of an individual’s eligible dwellings. Properties eligible for the HRTC include houses, cottages and condominium units that are owned for personal use.
Renovation costs for projects such as finishing a basement or re-modelling a kitchen will be eligible for the credit, along with associated expenses such as building permits, professional services, equipment rentals and incidental expenses.
Routine repairs and maintenance will not qualify for the credit. Nor will the cost of purchasing furniture, appliances, audio-visual electronics or construction equipment.
Who Can Claim the HRTC?
About 4.6 million families in Canada are expected to benefit from the credit.
Taxpayers can claim the HRTC when filing their 2009 tax return.
Eligibility for the HRTC will be family-based. For the purpose of the credit, a family is generally considered to consist of an individual, and where applicable, the individual’s spouse or common-law partner.
Family members will be able to share the credit.
Examples of HRTC Eligible and Ineligible Expenditures
Eligible
Renovating a kitchen, bathroom, or basement
New carpet or hardwood floors
Building an addition, deck, fence or retaining wall
A new furnace or water heater
Painting the interior or exterior of a house
Resurfacing a driveway
Laying new sod
Ineligible
Furniture and appliances (refrigerator, stove, couch)
Purchase of tools
Carpet cleaning
Maintenance contracts (furnace cleaning, snow removal, lawn care, pool cleaning, etc.)

Examples of the Benefits of the Home Renovation Tax Credit
The following examples illustrate how homeowners can benefit from the HRTC
Sally and Ed are a couple who have recently purchased a house. In response to the temporary HRTC, they decide to replace their old windows and improve the insulation in their home in 2009, instead of waiting, incurring $10,000 in expenditures. After taking into account the $1,000 minimum threshold, a 15-per-cent credit will be available on $9,000 in eligible expenditures, providing tax relief of $1,350.
William and Marie are a couple who are planning to purchase a more energy-efficient furnace for their home, and build a deck at their cottage sometime later. To take full advantage of the temporary HRTC, they decide to do both projects in 2009 rather than waiting. They pay $5,000 for the furnace and $3,500 for the deck. They also decide to have the area around the deck landscaped for $2,500, bringing their total costs to $11,000 ($5,000 + $3,500 + $2,500). Marie claims a credit of $1,350 on the maximum allowable amount of $9,000.
Karen and Heather are sisters who share ownership of a condominium unit. They each incur $7,500 in expenditures renovating the kitchen in the condo. Karen and Heather each claim a $975 credit on eligible expenditures of $6,500 ($7,500 - $1,000).
How Can I Get More Information?
Additional information on the Home Renovation Tax Credit will soon be available on Canada Revenue Agency’s website at (www.cra-arc.gc.ca).
Information is also available at www.fin.gc.ca

What's in store for housing market in 2009

2009-01-03T10:00:00.001-05:00

As the local market succumbs to the global credit crunch, we ask several top economists what's in store for 2009January 3, 2009

At Christmastime a year ago, Toronto-area realtors had good reason to celebrate. The year ended with record high sales and the industry never looked healthier.
"Home buyers had to stop at Chapters last year for reading material just to stand in line for a condo," says realtor Mike Donia. "The banks were lending you money hand over fist."
One year later the turnaround has been dramatic and unprecedented.
At the end of 2007 prices rose by 7 per cent and sales by 12 per cent over the previous year.
But in September, as the global credit crunch started to exact a toll, the Toronto market finally succumbed to a 3 per cent price decline, the first such drop in more than a decade. By the end of November, the average home was some $25,000 cheaper than it was during the same time last year.
"The swiftness of the change in real estate market conditions and market sentiment was quite surprising," says RBC senior economist Robert Hogue. "For most of us looking at where the GTA economy was heading it was fairly clear there would be some dampening, but over the last few months it looked as if the market just priced in all the problems at once."
Given the credit crunch on Wall Street that has spread to markets globally, the question remains as to how much further Canadian households will be affected in 2009? For the average homeowner, the worry is whether prices will fall further and, if so, by how much.
Economists missed calling the real estate decline by a wide margin, to the point that last month the Bank of Canada warned ominously that many Canadians were in danger of losing their homes if the economic crisis gets worse.
But how did we get to this point?
The mantra, repeated endlessly by the real estate industry and some analysts, was that Canada was largely isolated from the pain in the United States, and that high oil prices and a more conservative approach to lending had helped us to partially decouple from sectors of the global economy.
"We're fine – it's the rest of the world that has problems" seemed to be the key message over the past few years.
"Canadians have watched with amazement for nearly two years now at the collapse of the housing sector in the United States, the United Kingdom and other countries that experienced overvalued housing prices with the sense that markets in this country stand on more solid ground," says Hogue.
It wasn't until last year, when prices started to fall in western provinces that some economists started to question the strength of the Canadian housing market.
And while sales in Toronto fell every month last year compared with the previous year, prices seemed to be holding the line.
"We're fine – it's the western provinces that have the problems – they appreciated too far and too fast" seemed to be the consensus then.
Analysts forecast that, after a decade-long run, the Greater Toronto Area's real estate market would be in for a "soft landing," and they seemed to be right.
In January, sales were down by only 2 per cent – a rounding error compared with the record numbers of 2007.
As the year progressed, sales started to decline further, but more importantly for homeowners, prices didn't.
But since September, prices and sales started to fall. The most recent numbers from the Toronto Real Estate Board show that, in the first two weeks of December, there were 1,487 sales, or about 48 per cent less than the same time in 2007.
Most people are hoping this is just a blip on the way to greener pastures.
After all, the Canadian economy is still fundamentally sound. It's true that our export earnings, job growth and corporate balance sheets are better than other nations, and the Organization for Economic Co-operation and Development said last month that Canada will lead the G7 nations in economic recovery in 2010.
A lot, of course, depends on what happens to our neighbours to the south. A prolonged recession means that fewer Americans will be buying cars from Ontario or lumber from British Columbia.
During the last bubble, average prices of existing home in Toronto hit $280,000 in 1989 and took seven years to sink downward, hitting bottom in 1996 at $196,000 before taking off again in 1997.
No one expects this market to be as brutal, but then again, no one expected oil to be below $50 U.S. per barrel, and a Canadian dollar more than 20 per cent less than at the start of the year.
To see what's in store for this year, the Star asked some of the country's top economists what they thought 2009 would bring for the real estate market:
Benjamin TalSenior economist, CIBC Capital Markets
"The question is what kind of correction are we having?" asks Tal. "Are we seeing a U.S.-style meltdown, or simply a recessionary correction?"
Tal says that Canada never had a subprime problem in the league of the United States, which means a market correction here will be more moderate.
"What we have is the U.S. situation minus the subprime problem, which gives you Canada," says Tal. "It's not a freefall, but it will still be a recession.
"In that case it's reasonable to expect to see a notable decline in major cities."
Tal expects average prices across the country to fall another 10 to 12 per cent by the end of 2009.
"Is this a crisis? No. Is it pretty? Still no, and you will lose two years of price appreciation. But this is part of the economic cycle."
Tal predicts that there may be a slight uptick in sales in the spring but "nothing significant" as the market will continue to level off till the end of the year.
After 2009, he is forecasting that the market will "flatline" for three or possibly four years, with not much activity, similar to the 1992 to 1997 period in the Toronto market after the last real estate bubble burst.
The most immediate problem for the Toronto market is a potential oversupply of newly built condominiums, says the economist.
Condo pricing will lead the correction down, even as he expects some future supply to be cut as developers are unable to get financing for some projects. He is bullish on the condo market in the longer run of at least five to 10 years, because new immigrants and baby boomers still will be attracted to that form of housing, says Tal.
Carl GomezVP research, Bentall Capital
Canada's housing market is "modestly overvalued" with home prices needing to fall by as much as 25 to 30 per cent from the peak in Alberta and British Columbia, says Gomez.
Ontario prices, he figures, are about 10 per cent overvalued.
"The market is in correction phase, and the question is how far back will we continue to go?" asks Gomez.
Protracted job losses in the key Ontario market, for example, would mean further pain. And while manufacturing has been hit over the years, Toronto has been largely isolated from the problems because of its strong financial services sector, says Gomez.
"You are starting to see some problems in the services sector now. They have been a major driver of growth in Toronto, everything from banks to insurance companies to accountants and realtors. We haven't really seen this shoe drop yet, but if you see things coming off dramatically, then things will definitely get worse and prices will be pushed down further."
Like Tal, Gomez sees the most vulnerability in the Toronto condo market.
"In some pockets it's dominated by speculators. If they sense they are not getting the kind of return they want, they are the first to pull the plug," says Gomez.
Robert HogueSenior economist, RBC
The next few months will be significant to determine where the market is heading, says Hogue.
"But given the economic context where conditions have deteriorated quite significantly, you'd be hard pressed to see a quick recovery," he says. "For 2009 we will likely remain in a period of fairly soft sales and declining prices."
A housing affordability study prepared by Hogue shows that homes are becoming modestly more affordable in the Toronto market.
It takes 53.3 per cent of pre-tax earnings to afford a bungalow in the Toronto market. But that's still up from the long-term average of 48.3 per cent.
"That means you've got to have a decline in interest rates or prices of homes coming down to meet the long-term average."
Still, Toronto looks solid compared with some other Canadian cities, where the affordability index is 33 per cent higher than long-term averages for Vancouver and 40 per cent for Saskatoon.
Will DunningHousing economist
For Toronto economist Will Dunning, the most important numbers are the jobs figures; employed Canadians mean mortgage-paying customers for new and existing homes.
Canadian employers cut 71,000 jobs in November, the worst single-month figure in 26 years.
As a result, Dunning isn't looking for a bright 2009 – and his forecast is for average prices to fall by up to 8 per cent by the end of next year.
Last month, he released a report that forecast that there would be "substantial correction" in the condominium market, given that there were more than 30,000 completions in the pipeline for the Toronto area.

Source- The Toronto Star

New condos rise as market falls

2008-12-31T09:12:00.000-05:00

Toronto's condominium boom is heading for a bust.

The record number of condo units set for completion in 2009 and beyond will drive down Toronto housing prices and cause vacancy rates to go up as some condos sit empty. By the end of September, there were 33,919 condos under construction in the Toronto metropolitan area – more than three times the city's annual average – said housing economist Will Dunning in a report on the rental and condo markets. "This very large pending inventory is setting the stage for a substantial correction," Dunning said.
The warning comes on the heels of figures yesterday showing sales of existing homes in Canada continued to slide in the year's fourth quarter. Declines were steep amid the lowest level of monthly activity in almost eight years as investors worry about the faltering Canadian economy.
"In the short term, condos are the most vulnerable aspect of the market," said CIBC World Markets senior economist Benjamin Tal. "I think there is a lot of oversupply, especially in cities such as Toronto and Vancouver."
Already, some prominent developers have warned some condo projects being marketed may not make it to completion. In a tight credit market, as falling sales hit the new home market, speculators and investors take cover.
Toronto condominium starts are normally in the 10,000 to 12,000 range annually, but a bottleneck in construction from record sales in prior years has a significant number of units still to be completed, Dunning said.
Many of those units were bought by finicky investors who are quick to exit the market if they don't get the returns they expected. Analysts say 30 per cent to 50 per cent of sales in certain buildings were to such investors, with some already set to exit the market.
As a result, the number of condos listed for sale in central Toronto is already up a stunning 75 per cent in November from those on sale a year earlier, according to Dunning. "It appears that this process – excess supply in the condo sector and owners acting to sell the units – may be underway already."
The large supply of condos will affect the apartment rental market, Dunning said, as units now under construction become available for occupancy; in effect, "With the weaker economy, the supply will exceed the need."
The Canada Mortgage and Housing Corporation reported last week the vacancy rate in the Toronto area fell sharply to 2 per cent from 3.2 per cent a year earlier, but Dunning said the supply of new condos in the coming year will keep rates from dropping further, and will likely cause vacancy rates to rise.
So far there haven't been any catastrophic failures in the Toronto area, although one key project, MintoUrban Communities Inc.'s 300-unit Minto King West site, is on hold because of slow sales.
Before the advent of the economic meltdown in the United States at the beginning of the fourth quarter, new condo prices in the Toronto area were holding up well.
Prices for new condos in the third quarter were up by 2.5 per cent over the prior quarter, or about $406 per square foot, according to market research firm Urbanation. Since then, many developers have slashed prices off their suites and added incentives such as free televisions and even a new car over the past few months.
In 2006 the average condo price in Toronto was $239,816.
Meanwhile, there was more dismal news for the national real estate market as seasonally adjusted sales for November numbered 27,743 units, according to figures released by the Canadian Real Estate Association.
Sales were down 12.3 per cent on a seasonally adjusted month over month basis, and a far steeper 42 per cent unadjusted compared with November 2007.
The national average price of a home was down 9.8 per cent to $280,880, or more than $30,000 less than a year ago.
"The report underscores that the Canadian housing correction continued in earnest," said Millan Mulraine, economics strategist for TD Securities.
British Columbia, Alberta and Ontario were the three provinces reflecting the greatest decreases, said the realtor association.
"National sales activity and price trends will continue reflecting increased cautiousness on the part of lenders and buyers as the economy works its way through and out of the recession," said the real estate association's chief economist Gregory Klump.
In cities such as Toronto, sales of existing homes plunged by 50 per cent in November, the biggest decline since April 1989 when sales dropped to 54 per cent.
Source: Tony Wong, the Toronto Star

Intertest Rates are not a Problem in Canada

2008-12-31T09:11:00.001-05:00

Interest rates are not a problem in Canada - the Bank of Canada’s overnight rate is only 1.50% - and mortgages are available for those with reasonable credit ratings. The long-term higher-risk mortgage market has been shut down by the federal government in a delayed response to the problems that have overwhelmed the U.S. housing market.
Affordability is coming back into line as a result of new and existing homes either stabilizing or coming down in price. But the major impediment to a buying commitment is growing worries about employment and incomes. Another factor that will slow starts next year has been the buildup in unsold inventories. While this is apparent in the singles market, it is even more dramatically evident in multiples. Toronto’s condo market, for example, appears to be way overcommitted. Projects are in danger of being cancelled.

U.S. home prices down 18%

2008-12-31T09:10:00.002-05:00

Home values in the 20 largest metropolitan areas in the U.S. dropped at a record pace in October as the fallout from the financial collapse reverberated through the housing market, according to data released yesterday. The price of single-family homes fell 18 per cent in October from a year earlier, according to the closely watched Standard & Poor's/Case Shiller Housing Index.
All 20 cities reported annual price declines in October; prices in 14 of the 20 metropolitan areas surveyed fell at a record rate as the financial crisis reached a critical point.
"October was clearly the free-fall month," said David Blitzer, chair of the index committee at Standard & Poor's. "Everything was going against us in October."
Home prices have fallen every month since January 2007, their slide accelerating as troubles in the housing market infected the broader economy and brought down financial firms. Prices are falling at their fastest pace on record, a sign the U.S. housing market is a long way from recovery.
"It is unlikely that we are anywhere near a bottom in nationwide home prices," Joshua Shapiro, chief U.S. economist at research firm MFR, wrote in a note.
The 10-city index dropped 19.1 per cent in October, its largest decline in its 21-year history, and the new numbers show the cities that hosted the greatest excesses of the housing boom are suffering the deepest drops.
Prices in Las Vegas and Phoenix, Ariz., where developers built subdivisions stretching into the desert, fell by nearly a third in October. Home prices fell 31 per cent in San Francisco and 29 per cent in Miami. Prices in New York declined 7.5 per cent in October over the same month a year ago.
Fourteen of the 20 cities in the Case-Shiller survey posted double-digit declines for the year.
The relative winner was Dallas, which had the smallest yearly decline of 3 per cent. The value of a single-family house in Detroit, which has been pummelled by closing plants and the implosion of the auto industry, was less in October than it was in October 1998.
The Case-Shiller numbers were the latest round of bleak news for the U.S. housing sector, which is at the centre of the country's broader economic troubles. Foreclosures, bad loans and collapsing housing prices contributed to the financial crisis earlier this year, and now the widening recession is dragging housing down even more.
Last week, the U.S. National Association of Realtors reported that previously owned homes, which dominate the market, suffered their sharpest drop in more than 40 years. Home values tumbled 13 per cent in November from a year earlier, the industry group reported.
Housing is likely to deteriorate further in 2009 as the jobs picture continues to weaken. The U.S. unemployment rate is now at 6.7 per cent, its highest point in a decade, and economists predict it will rise to 8 or 10 per cent next year.
"People who think they're going to lose their job don't buy a home," said Steven Ricchiuto, chief economist at Mizuho Securities.

Source: The New York Times

Canadian City Forecast

2008-12-31T09:08:00.001-05:00

By major city, Toronto will see a marked decline in its new condo market next year. Ottawa will hang in relatively well, since it is the epitome of a government town and employment is relatively assured. Montréal is the major urban centre in a regional economy that is suffering along with the U.S. recession.
Edmonton has recorded a greater than 50% drop in starts in 2008 and should level out next year. Calgary’s new housing market will be held back by an energy sector that is struggling with oil prices at only one-third of their peak value. Vancouver is the major player in a provincial economy that, through its forestry sector, will pick up in activity faster than any other region in Canada, once U.S. housing starts show some signs of life.

Latest CMHC and CREA Data on Home Starts and Sales

2008-12-31T09:06:00.000-05:00

Canada Mortgage and Housing Corporation (CMHC) says that housing starts plunged in November to only 172,000 units on a seasonally-adjusted annual basis, versus 212,000 units the month before. According to the Canadian Real Estate Association, the number of existing homes sold in November was the lowest since January 2001 and the national average price of homes sold was off by 10% versus a year ago.
Existing home sales more often than not tie in with new home data, since the former is often a necessary step for someone wanting to move up to the latter. Home buying confidence generally has been sent into a tailspin since the late-September crash in stock markets that weakened individuals’ and families’ financial position.

It's a buyers market!

2008-12-26T18:14:00.004-05:00

Over the past three months the Toronto Real estate market has slowed down significantly. Consumers are definately watching there pocket books. At this time last year my listings were selling like hot cakes. This year is going to be much different! With that said I see great opportunities for buyers who have been thinking of owning there own home or homeowners who were considering upgrading. Now can be a great opportunity to buy a home at a significantly lower price than you would have paid last year for the same home. Sales are down by at least 20-30% overall depending on what area you are looking in. It seems as though sales of higher end homes, ($500 thousand +) are coming down more than your entry level homes ($500 thousand and less) so for a move up buyer with a small mortgage or no mortgage this is a great time to upgrade into that home you have been dreaming of! Buy low sell high! That's been one of my modo's forever. For a first time buyer with secure employment, good credit and a small downpayment now is a great time to get into homeownership! You would be basically buying at wholesale. Human nature is weird. When things are down nobody seems to buy, when prices are increasing and at the top of the range everybody seems to want to buy. Real estate in general will always appreciate in time overall and you will putting a roof you can call your own over your head. Why pay off the landlords mortgage when you can be paying yours off. Think about it and if you need more help feel free to contact me. I have attached a file which will show you how real estate has appreciated over the past twenty years.

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Over 3,600 Greater Toronto Area Resale Housing Sales in November

2008-12-26T10:37:00.001-05:00

TORONTO, December 04, 2008 -- Greater Toronto REALTORS® recorded 3,640 transactions last month, from 7,313 sales in November 2007, Toronto Real Estate Board President Maureen O’Neill announced today. Year-to-date sales figures for the Greater Toronto Area show 72,086 transactions in 2008, from 88,695 sales recorded in the same January to November period a year ago. By contrast, the 2008 year-to-date average price in the GTA is $379,489, from $375,445 in 2007. “Its important for the public to understand that while sales activity has moderated in 2008, due to current economic conditions, the average price of homes has increased from 2006 still making real estate a solid long term investment,” said O’Neill. In the 416 area, 1,523 transactions took place last month, from 3,426 sales recorded in November 2007. From a year-to-date perspective, there have been 28,806 sales in the 416 area this year, from 36,804 transactions a year ago. In the 905 Region 2,117 homes changed hands last month, from November 2007’s 3,887 sales. The 905 Region’s year-to-date figures show 43,280 transactions this year, from 51,891 sales recorded during the same period in 2007. “Homeownership in the Greater Toronto Area continues to be an affordable, stable and secure investment,” said Ms. O’Neill. “Home buyers and sellers should be confident about their bricks and mortar investment which provides shelter and a place to raise a family.” “Home prices are affordable, interest rates are at historical low levels and the supply of homes for sale is good providing additional reasons for buyers thinking of entering the market,” added O’Neill. The average price of a home in the GTA last month was $368,582, from $393,747 noted in November 2007. In November 2006 the average price was recorded at $355,727. In the 416 area, last month’s average price was $390,225, from $433,859 noted in November 2007. The average price recorded in November 2006 was $381,188. From a year-to-date perspective the 2008 average price in the 416 area is $411,155, from last year’s $411,640. In the 905 Region, the average price recorded last month was $353,012, from $358,391 recorded in November of 2007. In November 2006 the average price was $335,522. The year-to-date average price in the 905 Region this year is $359,245, from $349,774 in 2007. The average number of days a home currently remains on the market in the GTA is 41, from an average of 32 days last November. There are currently 27,037 homes listed on the TorontoMLS system compared to 18,309 available properties in November 2007. “While homeownership offers immediate benefits and long term value by way of equity, it also provides tax benefits over time,” said Ms. O’Neill. “If you bought a house five years ago, it would be worth more than 20 per cent more today.” “As REALTORS®, we help build communities and will continue to do so even during challenging economic times,” added Ms. O’Neill. “It’s important to consult with a REALTOR® to get accurate local market information.”