Toronto Condo Market ... Up Up and Away

Condo market in Toronto is going strong. The reason is simple. With roughly 80 thousand net migration to Greater Toronto Area, we add several thousand in population over the years. Land is scarce. This has resulted in prices of detached houses to go up. In order to keep revenues up and housing affordable, the house lots are either getting smaller or builders are opting for semi-detached and townhouses. High Rise condominium apartments are the obvious answer.

During a seminar with RealNET and FLY Condos in February 2010, I met with Christine Brennan, Director of Sales & Marketing, High Rise at Empire Communities. Empire Communities has given Greater Toronto Area a wonderful selection of excellent buildings. Their FLY condo project in the Entertainment District in downtown Toronto is a huge success. During the seminar, a presentation by RealNET president showed the trending of condos in downtown.

In my opinion, the condo market is going to appreciate on an ongoing basis. Short of having a crystal ball, the general demand will grow. Low mortgage rates are also helping. Even with the new mortgage qualification rules and the introduction of HST, the sales haven't slowed down. The average buyer will still be exempt from 75% of the new tax. New mortgage rules will ensure that we do not have buyers overstretching themselves. In the long run, this will result in a robust real estate market.

Projects like FLY Condos have a healthy mix of owners and investors. Because of this, there will not be too many units for sale at the same time, resulting in over supply. Prices are and will continue to go up significantly ahead of the inflation rate. This is one of the best time to trade and invest in real estate.

Opinion regarding "Why doesn't Century 21 want more people viewing its real estate listings?"

Cliff Peskin's has written about "Why doesn't Century 21 want more people viewing its real estate listings?" and about Century 21 suing Rogers Communications Inc regarding over its website Zoocasa (source: Financial Post).

Listing data by REALTORS® is up loaded on MLS® system directly through their regional boards. MLS®, which is a trademark, thus enables members of the public to see the information protected under strict data integrity guidelines. Century 21 REALTORS, like other licensed REALTORS, are part of this trademark. Any business would and should protect its trademarks - wouldn't you?

The writer's claim that CREA and Century 21 have an "iron like grip...thereby any individual looking to purchase a home must go through them" doesn't hold much ground. If one reviews the flow of any real estate transaction, the answer to this will become obvious. Once the Seller has retained a REALTOR® to exclusively protect its rights, then no matter where the buyer sees the information about the house, the buyer has to come through the REALTOR® representing the Seller. This is for the protection of the Sellers since REALTORS® are professionals safeguarding the Seller interests.

There is strong possibility that by scraping and aggregation of the listing data, a loss of control occurs and the information might be misquoted or misrepresented, thereby putting the Seller’s interest at risk. Moreover, isn't the data on MLS aggregated anyways? Why is there a need for scraping it and aggregating it again, other than that the company doing so wants to scrape some advertising dollars from such websites. That is my opinion. – Jagdeep Singh is a Century 21 REALTOR® and the Team Leader of the Residential Club at Century 21 New Star Realty Inc., a flourishing Brokerage based in Toronto.

Why migrate to Canada?

OK this is not really about real estate. So if that’s the only reason you are reading this, I suggest you to stop now, ’cuz I am going to let out my rant. Suaad Hagi Mohamud, the woman you have probably heard about a lot by now because she was detained in Kenya, is back in Toronto. I am very happy. It is something to celebrate. But this shouldn’t have been in news at all. Here’s how it SHOULD HAVE unfolded. This lady should have been allowed to board the airplane when she showed up at the airport with her Canadian Passport. No one should have to prove their ID beyond the travel document or may be, as she did, by showing one’s Ontario driver’s licence and perhaps a Canadian citizenship certificate. She actually went further and even produced her OHIP health card, Social Insurance Card, Shoppers Drug Mart “Optimum” card and even a dry cleaner’s receipt. The last two aren’t exactly ID’s but they do show that the person knows their way around the city and had clearly gone to Kenya from Canada.

Two reasons I am writing about it. One, I am from Toronto just as she is. And secondly, this has happened to me too, while I was travelling in India. It was nowhere close to Suaad’s ordeal because I was able to board the flight I was supposed to. But that happened because the Airline staff stood by me and the flight superintendent argued on my behalf with the officials at the airport. All the guy at the India’s New Delhi airport wanted was money (read as bribe) to grease his palms. He gave the same reason as was given to Suaad Hagi Mohamud; i.e. I didn’t look like my picture.

When one travels to countries where the law and order situation is questionable or worse, we hope that the Canadian government would stand by us. I mean, isn’t that the real reason we all migrated to Canada. Among other things, Canada prides herself to provide its citizens with equal rights and opportunities. Greater Toronto Area alone has a net migration number of close to 70,000. That speaks for something. I left India because of religious persecution but I still like to go back when I can.

OK I have to say this: I, as a Canadian citizen, want to be able to travel other parts of the world without having to fear about becoming a target of some corrupt system BECAUSE I AM A CANADIAN CITIZEN AND EXPECT THE GOVERNMENT TO STAND BEHIND ME, minus the racial profiling.

Mildly put, here’s why I don’t like what happened to Suaad Hagi Mohamud: If she wasn’t helped because of what she looks like, then that makes the Canadian system CORRUPT. So I am back into a systematic trend that I tried to get out of by migrating to Canada. So why come here?

The poor lady had to endure so much, including DNA testing, hiring lawyers etc. If she wasn’t able to do all that then she would be rotting right now in a Kenyan jail and we wouldn’t have even heard about it. The Canadian system failed this woman and Mr. Stephen Harper is “looking into it”. Yah right !!!

Toronto Real Estate Board -- Sales Up 28% from July 2008

In July 2009, Greater Toronto REALTORS® reported a record 9,967 sales, up 28 per cent from July 2008. The average price for July transactions was $395,414 - up by six per cent compared to the same month last year.

"Households confident in their positioning within the current economic environment have taken advantage of housing affordability in the GTA," said TREB President Tom Lebour. "The real estate sector has been one of the sectors making a positive contribution to economic growth in the GTA, not to mention Ontario and Canada more broadly."

Year-to-date sales, at 50,632 are down 1.2 per cent compared to the first seven months of 2008. Average price, at $385,808 is down by less than one-half of one per cent.

"The steep drop-off in sales experienced at the beginning of the year has all but dissipated," explained Jason Mercer, TREB's Senior Manager of Market Analysis. "With five months left to go in the year, it is probable that total existing home sales in 2009 will be at or above last year's level."

For a complete copy of the Market Watch Report visit the TREB website here.

The Dream Condo – Which May Remain Just That ... a Dream

Anyone who is familiar with Toronto knows it to be a world class city, compared with the top urban centres around the world. Any such person would also know that the Bloor and Yonge intersection, (although not truly the downtown as per the original Toronto municipality) is the epicentre of activity. Mainly because the only two subway lines intersect underground at this point and this happens on the world’s longest street, our very own Yonge Street.

So when the Bazis International’s hotel and retail development project was unveiled at 1 Bloor Street, it was touted to be the most prestigious address to be at, rivalling the Donald Trump’s project a few blocks away. Boasting of its five star lifestyle and luxurious residences, it promised stunning architecture, which now may never become a reality.

Gary Berman, whose consortium lent money for the 1 Bloor project stated that “The loan has been in an almost constant state of default since December 2008”. On Monday, the lenders are going to ask a court to put the Kazakhstan backed project into receivership and sell the now vacant land.

This may not be the only project in this situation. The obvious answer is the world economy, sub-prime loans, bank troubles, etc. etc. However, there is more to the story than what’s obvious.

Anyone who followed the project when it was released knows that buyers paid students by the hour to stand in line for days and nights as place holders, so that when the sales office opened, they could be the first to buy their dream unit in the building. This despite the fact that the per square foot price of the units in this building were significantly high to begin with. Some families even moved into hotels next door to take turns in the line. These were not just ordinary buyers but also savvy investors and REALTORS® alike.

Can this kind of over inflated buying frenzy be justified? No sane decision can come from such over-pressured situation. People who have units in this and other buildings are now been told that their deposits may be returned.

Even if the property is being bought to live in, there is always an investment component. At the end a buyer should always consider how the purchase would fit into their lifestyle and their financial portfolio. With that being said, one needs to remove the pressure from the situation and analyse the project and the corresponding decision in a calm rationale manner. Does this mean that we should pass up on these high profile projects? Absolutely not. The answer is to involve a professional. Who better to come to your rescue than your trusted REALTOR®? Not only, a REALTOR® knows better from experience, he or she is also emotionally removed from the decision and hence can serve to be the voice of reason. REALTORS® who themselves are the buyers should consult with fellow professionals. Personally, I can think of six other ideas were the deposit money could have been better off rather than being tied in a low interest or worse yet, no interest situation.

Real Estate Statistics 101

Mr. Don Lawby, President of CENTURY 21 Canada recently published a white paper titled Real Estate Statistics 101: What every Canadian homeowner should know about home price statistics. The objective of this White Paper is to help homeowners understand the relationship between widely reported real estate statistics and the value of their homes

Here are some of the excerpts from this white paper that are relevant to Greater Toronto Area. To read the report in its entirety, contact me and I will email it to you.

Media reports of real estate statistics have left many Canadian homeowners rightfully confused. The problem is that these statistics are usually based on averages of city,provincial and national markets. Such averages are pretty much irrelevant to what’s really happening in specific neighbourhoods.

The Toronto Real Estate Board reports that the average home price in May 2009 was $395,609 for all transactions (single and detached homes, condo apartments and condo townhouses) in the Greater Toronto Area (GTA). The GTA is the country’s most populous urban concentration bounded by Lake Ontario on the south, Lake Simcoe on the north,Burlington on the west, and Newcastle on the east.

This average price has little relevance to prices in the specific neighbourhoods and communities in the GTA, where prices for single detached homes ranged from $1.53million in the Toronto neighbourhood between St. Clair Avenue and Bloor Street east of Bayview Avenue; to $709,000 in a rural neighbourhood east of Newmarket; to $255,000 in Oshawa.

Getting an accurate value of your home

So, the question remains: How does a Canadian homeowner determine the value of his or her existing home? Or how does a buyer determine the value of a prospective purchase?
Most relevant are surveys of recent selling prices of similar homes on the same street or in the same neighbourhoods.

That said, it is difficult for homeowners to do their own surveys because listing prices — not selling prices — are available to the general public on the local MLS. The best course is to ask a REALTOR of your choice to show you statistics of selling prices of homes similar to yours in your neighbourhood. You will incur no obligation and, depending on your evaluation of the statistics you are shown, you will have a head start on your search for a realtor should you decide to sell your home.

CENTURY 21 Canada home price surveys

CENTURY 21 Canada produces home price surveys to provide useful and relevant information to homeowners. These surveys monitor prices of homes that are typical inspecific neighbourhoods in major markets across the country. On June 11, 2009, CENTURY 21 published a survey of the Hottest Neighbourhoods in Canada. Contact me today to get his report.

Ontario Green Energy Act and Residential Real Estate

Bill 150 was tabled at the Legislative Assembly of Ontario on February 23, 2009 and passed into law on May 14, 2009.

Some of the issues the legislation focusses on are green energy procurement, financing green energy, community energy, engaging First Nations and Métis communities, grid upgrades and evolution, conservation and protecting the environment.

The purpose of this Act is to facilitate the development of a sustainable energy economy which would protect the environment while streamlining and improving the environmental and planning approvals process, mitigate climate change, engage communities and build a world-class green industrial sector, enable all Ontarians to participate and benefit from green energy as conservers and generators, at the lowest cost to consumers.

Now that the legislation has passed, it makes home energy audits mandatory for home sellers, unless waived by buyers. However, the Bill’s requirements regarding home energy audits are NOT YET IN EFFECT and are not expected to take effect until 2010.

The Ministry of Energy and Infrastructure is working on preparing regulations that will outline the details on how the home energy audit requirement will be implemented. The home energy audit requirement will not take effect until these regulations are finalized, which is expected in 2010. REALTOR®, through TREB and OREA expect to work with the Ministry of Energy and Infrastructure to provide input on the regulations.