Toronto Real Estate Report

No Confidentiality for Offers

Beware.  As a buyer, if you submit an offer to a seller who is just posting their listing on the MLS, and it's not being handled by a Registered Salesperson, there is no obligation to keep the terms and conditions of your offer confidential.

Real Estate Brokers and Salesperson's are governed by the Real Estate and Business Brokers Act and must abide by it's regulations, but it does not govern the conduct or actions of non-registrants.

So if you submit an offer to what is essentially a "For Sale By Owner" situation, be prepared to have your offer shown to other interested parties, and they can use it to shop for a better offer.  Basically use your offer to better their position.

You know the saying goes " A lawyer who represents himself has a fool for a client" 

Real estate can be complicated, hire a professional, don't be a fool.

Is the frenzy over?

Has the spring real estate market in Toronto lost steam?  It certainly feels like the environment has changed a bit.  Homes not selling on offer night, some agents removing the "offer date" strategy all together with the inviting "Offers any time!". Some homes are initially listed to attract multiple offers and when they don't appear, the home is re-listed at the actual value the seller was expecting.

There are a few factors that are causing this hiccup.  Interest rates are on the rise, the mortgage rules have changed in order to tighten the credit markets and avoid "bubble like" conditions, the HST is coming July 1st.

The new tax will affect all the services related to purchasing a resale home, such as the legal fees, home inspections and all the additional services used to renovate and maintain the home.  The overall cost of purchasing and owning a home will increase 8%, for a total tax of 13%.

This tax increase will also affect condo maintenance fees and reserve funds will need to be topped up adequately to budget for this increase.

Want to learn more about the tax, click on this link: HST

Consumer Confidence

That's a term that is often quoted these days.  It is "defined as the degree of optimism on the state of the economy that consumers are expressing through their activities of savings and spending".  When consumer confidence is low, people aren't out spending and stimulating the economy.  Production slows down in many sectors and a ripple effect takes place.  Is the current level of consumer confidence affecting our housing market?

I met with a young couple recently that, contrary to popular belief, have a positive outlook on todays housing market.  They are looking to move-up to a larger home, in a more desirable neighbourhood.  They told me that they believe this is the best time to buy a house, as mortgage rates are low and prices have come down, or at least stabilized.  The realize they may not get as much money for the present smaller home as they may have a year ago, but will benefit from a reduced price on their move-up house, and actually get more for their money now. 

WOW!  Some people actually get it.  Real estate agents are often criticized for telling people it's always a good time to buy real estate.  We're only in it for the quick sale, the commission and want to move on to the next deal.  If you're buying a home because you need a place to live and for long term financial security, then YES, it's always a good time to buy real estate.  AND some people understand this.

How refreshing.

So if you're thinking of making the leap as a first time home buyer or moving up to something larger, go for it!  But, beware of the agent in it for a quick sale.  Find a Realtor who is going to look after your best interest, provide you with professional guidance and develop a long term relationship so that you can turn to them long after the sale for resources, trade references and market updates.

Consumer confidence extends to having confidence in your Realtor, that they will help steer you in the right direction and assist you in making one of your largest single investment decisions.  Choose carefully and buy wisely.