86% of real estate professionals said they worry.

Realtors polled in a recent cross-Canada survey indicated that the country’s real estate market is both highly competitive and provides the necessary safeguards to protect consumers. 

 

Eighty-six percent of real estate professionals said they worry that severe deregulation in the real estate industry would erode standards of customer service for Canadians who are buying or selling a home.

 

According to the online poll of 1,726 realtors by Royal LePage Real Estate Services, the proposed changes to the Multiple Listing Service (MLS) will do little to improve an already competitive industry.

 

Eighty-six percent of agents surveyed said they are “concerned that the push to foster increased competition in the industry will result in lower customer service standards.” When asked about the state of the current marketplace, 76% of respondents said the industry is “highly competitive.” 

 

Click here to read more from the Royal LePage survey.

 

Neither recession, global uncertainty nor growing joblessness appears to have stayed Canadians’ appetite for spending money they don’t have.

 

A new report by the Certified General Accountants Association of Canada shows that household debt in the country kept rising through the recession and peaked in December at $1.41 trillion.

 

That’s $41,740 on average per Canadian, or debt to income ratio of 144%, which is the worst among 20 advanced countries in the Organization for Economic Co-operation and Development.

 

“This report is another indication of Canadians’ readiness to consume today and pay later,” said association President Anthony Ariganello. “The concern is do they understand the full cost of paying later?”

 

The Bank of Canada has also voiced similar concerns, with Governor Mark Carney having repeatedly advised Canadians to ensure they will be able to meet their mortgage commitments once rates increase. Ottawa has put that cautionary principle into effect by stiffening the means test chartered banks must apply when issuing open-ended mortgages.

 

Most Canadians don’t yet share that concern. The accountants’ survey found that almost 60% of Canadians whose debt had increased still felt they could manage it or take on more obligations.

 

Click here to read more from CBC.

Recent Mortgage & Real Estate News Items

Time is right to buy a home: real estate group
[Source - JEREMY ASHLEY, THE INTELLIGENCER]

The time may be right to jump into the local housing market, according to the president of the local real estate organization.
Local real estate numbers downward slide as compared to the heydays only a few short months ago, according to numbers released by the Quinte and District Real Estate Board this week.
As a result, the time is ripe for buyers to jump in and walk away with a bargain, said board president Roy Millar.
"There were 344 sales in June," said Millar, which represented about a six per cent drop as compared to the same month last year.
"Of those sales, 309 were residential, representing 90 per cent of the market," said the local real estate agent.
The remaining 35 units were a mix of vacant land or commercial, industrial or multiplex sales, Millar added.
While the highest percentage of sales were between $100,000 and $300,000, Millar said the challenging economic climate pummel lower and high-end house sale prices in the region.
"The under-$100K and the over-300K market has been decreasing, which seems to be a result of our economic times. Belleville's average sale price for the month of June is the same as the Belleville overall average for the last 12 months, hovering around $190,000," he noted.
There may be a glimmer of hope on the horizon, however.
Looking long-term, Millar said the market seems to "indicate that pricing will be going up as well as interest rates, over the next few years.
"So now seems to be a very good time to buy, but stay well within your budget," Millar advised.

Turnaround in second quarter of 2009 quite remarkable
[Source - National Post - Friday, July 10, 2009]

Canada's housing market has bounced back sufficiently from an "awful winter" for prices and unit sales to stabilize by the end of the year, Royal LePage said this week.
The real estate firm forecast in its latest survey that the 2009 national average house price will be down by 2% at $297,500 by year-end. That's up from its January forecast of a 3% decline.
It sees a 1% drop in unit sales to 430,000. Its forecast in January was for 416,000 sales.
"Given the grim shape that Canada's real estate market was in this past winter, the turnaround we have witnessed in the second quarter is really quite remarkable," said Phil Soper, president and CEO of Royal LePage Real Estate. Reuters

Do record home sales mean the worst is over?
[Source - Helen Morris, National Post Published: Friday, July 10, 2009]

There were positive housing numbers out this week, but analysts still caution against expectations of rapid recovery.
According to the Toronto Real Estate Board, home sales in the GTA rose 27% in June, compared with the same month a year earlier. The Greater Toronto realtors recorded 10,955 sales last month. The June figure translates into a seasonally adjusted annual rate of sales of 100,700.
"The record result in June is testament to the fundamentally sound housing market in the GTA," said the TREB president Tom Lebour in a release. "An increasing number of households have been confident in purchasing a home in the region's affordable and diverse resale housing market."
Alongside rising sales, prices are also increasing. The average price of a transaction in June was $403,972, that is a 2% rise on the same month last year when the average sale price was $395,866.

Dominion Lending Centres Industry News

In its monthly Global Forecast Update entitled Rebooting Growth released last Thursday, Scotia Economics raised its projections – indicating that the global economy is on the verge of crossing over from recession to recovery. The report also forecasts that the Bank of Canada and the US Federal Reserve will begin raising interest rates as early as the first quarter of next year.

“Although the restructuring and retrenchment underway in a number of key sectors and regions will remain a significant drag on the pace of activity, strong cyclical forces are providing much-needed impetus to growth,” said Warren Jestin, Scotiabank Chief Economist. “Canada and many other countries around the world are expected to piggyback on the renewed momentum being generated by the globe’s primary economic engines, the United States and China. The recovery should become increasingly more broadly based, with the likelihood of accelerating economic gains through the balance of this year extending into 2010.”

Canada’s economy should be buoyed by strengthening demand in the United States and internationally for manufactured and commodity-related products, although the nation’s performance will likely lag the upturn because of competitive issues, including a stronger currency.

According to the report, even with the globe’s output growth turning positive in the second half of the year, the contraction in worldwide real GDP in 2009 is still likely to average 2.7%, a post-war record. But building upon the strengthening economic momentum, global output growth is now expected to average 2.6% in 2010, a roughly half-percentage point higher than Scotia Economics’ previous forecast.

Residential construction in Canada increased in May – yet another positive development for the housing market. Housing starts across the country rose more than 9% in May to 128,400, seasonally adjusted and at an annual rate, from 117,600 in April, CMHC said Monday.

“Housing starts data for May from CMHC provided us with the first sign that a bottom might be forming in Canadian home building activity,” said Toronto-Dominion Bank economist Pascal Gauthier.

The increase was broad-based, including both single homes and multiple units such as condominiums, and was better than economists had projected.

Housing starts surged in Ontario and the Prairies, and rose more modestly elsewhere, although construction declined in British Columbia, New Brunswick, and Newfoundland and Labrador. – Globe and Mail

Consumer confidence has climbed to its highest level in 15 months as Canadians become increasingly assured that better economic times are ahead, a Harris/Decima poll showed last week.

The cloud of pessimism that followed the economic collapse of 2008 began to evaporate from February through June, with the percentage of people anticipating hard times to come falling by half from 59% in February to 29% in June, the poll showed.

The resurgence in public sentiment – a reading of 78.5, the highest since February 2008 – also showed a doubling, from 10% to 20%, in the number of people optimistic about the outlook for 2010.

Canadians’ longer-term outlook also rose, with 51% expecting positive results over the next five years, compared with 39% in February. Also, the number of Canadians who feel it is a good time to make a major purchase rose from 41% to 49%. – Financial Post

Real estate still the single best investment

You can find many articles in papers and online why real estate is still a good investment, even with all the negative press we receive regarding the state of the economy. Here are some good perspectives from an article that appeared on parrysound.com

Real estate still the single best investment
by Carli Whitwell - parrysound.com

Excerpt from Article:
"Steiner said while the Toronto Stock Exchange has fallen 47 per cent, real estate, across the country, is only down on average nine per cent.
“Real estate is still the single best investment. It is tax-free, if it is your primary residence,” he said, adding, if it is bought wisely if will go up in value over time."
Read Full Article

The local market still looks sound

Many people are wondering whether the housing crisis in the U.S will be the same here in Canada, and specifically Ontario. There are many reasons why it will not, and that is good news. There was a great article in Friday's Globe in Mail that puts into perspective and spoke about the key indicators to consider.

The local market still looks sound
[Source - DEREK RAYMAKER, From Friday's Globe and Mail October 17, 2008]

There's an old saying that goes: when the water-hole dries up, that's when all the animals start to look at each other funny.

The last two weeks have seen a spectacular crash of global equity markets and a virtual paralysis in capital flow. The headlines are frightening, but digging behind them even slightly is enough to make your blood run cold.

This is especially true if you are close to retirement and have just watched your investments go for a swan dive off the tallest peak of Bay Street, ripping one-third or more of their value on the way down. But the scariest part of a good old-fashioned economic meltdown is waiting for the other shoe to drop. That's when the terror sets in — not having a clue what comes next.

As last week's stock market collapse showed, psychology can drive events to a crisis point as much as real economic happenings such as job losses, trade slowdowns, property foreclosures and bank failures. So how do home buyers and sellers keep their heads on straight in these troubled times?

Read entire article here