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Here is a real life example from BC of why it is so important for home sellers to interview potential realtors before listing their home with someone. It is so important to ensure any agents you interview are giving you a true picture of the real estate market in your neighborhood and that they are truly working in YOUR best interest.

 

http://www.theglobeandmail.com/news/investigations/inside-a-fast-growing-bc-firm-that-has-home-sellers-crying-foul/article29578417/

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New mortgage rule might 'temper' hot markets, but not for long

Starting Feb. 15, CMHC requires 10% down payment on portion of mortgages above $500K

By Lucas Powers, CBC News Posted: Feb 11, 2016 5:00 AM ET Last Updated: Feb 11, 2016 7:43 AM ET

Vancouver and Toronto saw real estate prices, particularly for detached and semi-detached home, continue to rise last year. Most other markets saw only modest increases, or even decreases in some cases.

Vancouver and Toronto saw real estate prices, particularly for detached and semi-detached home, continue to rise last year. Most other markets saw only modest increases, or even decreases in some cases. (Mark Blinch/Reuters)

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Beginning next week, many Canadians hoping to buy an abode will need to put more cash down before they can call it home. The extra cost might keep some would-be homeowners from mortgages they can't really afford, but it's unlikely to leave any lasting impressions on the country's most "overheated" real estate markets.

The federal government said in December that the Canadian Mortgage and Housing Corporation will require a 10 per cent down payment on any portion of a mortgage it insures above $500,000 and up to $999,000. That's double the five per cent down the Crown corporation currently asks to insure mortgages worth more than 80 per cent of a home's value.

"We want to make sure we create an environment that protects the people buying homes so they have sufficient equity in their home," said Finance Bill Morneau at the time, also noting that "elevated" house prices were the driving force behind the move.

The change will "likely impact a broad spectrum of buyers," though it will surely be the highest hurdle for those who don't already have a good bit of equity from one home already.

"The majority of the impact is going to be on first-time homebuyers, particularly first-time buyers in the hotter markets," says Don Murray, senior analyst at Real Estate Investment Network, an organization that tracks Canadian housing trends.

Bill Morneau Finance Minister

Finance Minister Bill Morneau announced the new mortgage rule in December, saying the government was trying stabilize real estate markets in some cities, like Toronto and Vancouver. (Chris Wattie/Reuters)

"It could certainly prevent them from getting into a market that is overheated."

That could, the theory goes, ease the intense demand for starter properties such as single-family detached homes in places like Toronto and Vancouver — one of just several factors keeping average house prices in those cities so astonishingly high — and perhaps help those markets cool off a bit.

Good politics, bad policy?

It could also help save some people from themselves, encouraging sober second thought about getting locked into mortgages that would stretch their finances dangerously thin.

There's plenty of evidence that many Canadians have taken on alarming debt loads to finance their dream of home ownership, leaving them vulnerable to ruin if the markets start to deflate. 

Young Canadians and their families would face the brunt of the impact. A report by the Canadian Centre for Policy Alternatives, for example, found that about 10 per cent of homeowners under 40 would be bankrupted if housing prices dropped 20 per cent.

The C.D. Howe Institute similarly calculated that about half a million first-time homeowners, mainly young people with lower-than-average incomes, could be left ruined if the historically low interest rates that have fuelled drastic jumps in house prices went up, or they faced a personal financial crisis.

Canadians who have built equity in their homes throughout the real estate boom of the last 15 years or so, though, would be on more stable ground.

Once it becomes psychologically normalized for people, there'll be less of an effect.
- Don Murray, real estate analyst

The underlying problem is that it's far from clear if the new mortgage rule — just the latest in a string of government-led measures to shield the economy from the high household debt loads Canadians are carrying around — will make a mark where one is most needed.

"I would say, generally speaking, there is some good politics in this but not much good policy," says Jon Sowerby, a licensed mortgage broker with Toronto-based TvH Financial.

"It's made to look like Mr. Morneau is on top of things, but the reality is that it's not going to have a massive impact on the market."

$500K downpayment graphic

Starting on Monday, CMHC will require a 10-per-cent down payment on the portion of any mortgage it insures over $500,000. (CBC News)

Drop in the bucket

The Canadian Association of Accredited Mortgage Professionals agrees. The organization revealed last year that first-time homebuyers put down an average of about 21 per cent of their home's purchase price, a number that has not deviated much since real estate prices began their relentless climb in the late 1990s.

The analysis is based on data gathered from an annual survey of 800 Canadians who just bought a new home.

The same report estimates that of the 120,000 to 125,000 sales of homes that involve a mortgage of $500,000 or more each year in Canada, around 10,000, or 2 per cent, would involve down payments that had to be increased under the new rule.

Eveline Zia housing real estate prices

Last summer Eveline Zia, who began the popular social media hashtag #DontHave1Million, led demonstrations in Vancouver, demanding more decisive action from the government on soaring real estate prices. (Jim Jeong/Reuters)

It concludes that the change will have negligible resonance in the Canadian mortgages market.

That's not to say that first-time buyers haven't been looking ahead to the deadline, hoping to get in before a down payment lightens the coffer that much more.

The minds of homebuyers

Michael Elmenhoff is a realtor who does a lot of work in the east end of Toronto, a formerly blue-collar area of the city where the average starter home in a "cool neighbourhood" sells for about $650,000.

He says he saw about a 50-per-cent traffic increase in the first few weeks of this year compared to 2015, a time that is generally considered a slow period for buying before the spring markets picks up.

For example, Elmenhoff listed a rowhouse with three bedrooms, two baths and no parking on the boundary of the trendy Leaside neighbourhood for $499,999 dollars in early January. The property attracted about 150 prospective buyers and 13 offers before selling for $649,000.

The interest was almost exclusively from first-time homebuyers, Elmenhoff says. "That kind of traffic is unheard of, really."

He expects to see a slowdown come Monday.

"With the market seeming to be at precariously high price points, the new mortgage rule could help ease the situation," he says, adding that "anything to temper the speculation and the leveraging" is welcome.

Low rates, inventory remain factors

But realtors and analysts agree that, at best, any changes will likely be very short-lived because so many of the factors keeping prices sky high, like low mortgage rates, a short supply of detached homes, and speculation by foreign buyers, all remain in place.

"Once it becomes psychologically normalized for people, there'll be less of an effect. It will slow down buyers in that $500,000 to $900,000 range for a while, then it won't," says Murray.

"Or people will just get more creative in securing a loan."

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Whether you are buying or selling your home or property the end goal is for you to make the greatest possible deal that is in your best interest.  If you are in the market to sell your home, your goal should be to secure the highest possible price for your home. Conversely, when purchasing you want to be able to obtain the finest quality home you can find that meets your personal family needs at the lowest possible price.

The question is, how can you be sure that you will achieve these goals and ensure there are no hidden surprises that will surface that will derail your intended success of buying or selling?

 

There truly is a lot to consider, especially when you are dealing with finances that under normal circumstances, involve the most significant investments of your lifetime.

 

Let’s explore the world of Real Estate and take some of the mystery out of what can be very confusing and difficult decisions.

 

I’m a Home Seller – How Do I Find The Right REALTOR®?


First and foremost, it is always wise to interview more than one REALTOR®.  Let’s face it, as much as there is a strong code of ethics that govern how REALTORS® perform, there are those in the business that may not have your best interest at heart.  There are those who will price your home at a price that will allow them to sell your home quickly rather than advising you to price your home more to your benefit and being a little more patient given all the current market circumstances.

 

Conversely, there are those REALTORS® who will recommend a price much higher than market value in a bid to convince you that they have the ability to get more money for your home, subsequently convincing you to hire them.  Often, the pricing reality is somewhere in between the two.

 

Let’s make one thing crystal clear.  The correct selling price of a home is the highest price that the market will bear.  A well trained and experienced REALTOR® who is doing their job ethically and correctly will help you determine the right price based on current market trends.

 

Keep in mind that market trends can change on a dime and it is important that you have a REALTOR® who is constantly evaluating the market; keeping you appraised if and when you need to adjust your selling price to stay competitive.  The key is to stay competitive while not staying listed for an extended period of time and at the same time ensuring you do not undervalue your home.

 

So what ideals do you look for when selecting a REALTOR® that will meet your needs?  First, personality!  Remember, the person you select is your representative.  Are they open and responsive to your needs?  Do you feel they truly have your personal interest at heart rather than simply being anxious to complete another sale?  Are they technology savvy?  What avenues do they have to advertise your home to the marketplace other than the standard Multiple Listing Service (MLS®)? You can often get an excellent read on the personality of a REALTOR® by visiting their web site.  Take the time to explore each potential candidate’s web site before contacting them for an interview.  Are they willing to come to your home and give you an appraisal and not just ask you questions over the phone?  In other words are you important to them? Will they work hard to help you get the most out of your home to help you prepare for your future goals?   Are they the type of person who will constantly keep you updated on the showings of your home and spend the time to conduct open houses to help market your home?

 

A good REALTOR® is not just someone who advertises how many homes they have been able to sell.  A good REALTOR® is someone who is willing to spend the time to help you achieve your personal goals.  In the end, the most important benefit for your REALTOR® is the referrals they receive from you to help them make their business grow, which brings up one more vital part of interviewing your REALTOR®.  Go to their website and check for testimonials.  See what other clients say about the agent you are interviewing, and finally, ask your potential candidates for references if you have any doubt.  There is no better way to determine the true potential of your REALTOR® than talking directly with someone who has worked with them in the past!

 

Natasha Eden – Urban Real Estate Services 403-399-0809

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1089 EAst Chestermere Drive

Enjoy living the lakeside lifestyle in this charming 6 bedroom walk-out bungalow in a quiet cul-de-sac on Chestermere Lake!  The design of this home provides a relaxing and gorgeous view of the lake and Rocky Mountains. This is an open concept home with high vaulted ceilings throughout.


The main floor features a warm and relaxing family room with a stone fireplace, lovely open kitchen with conversation ledge, wall oven, gas stove, eating nook with a beautiful view of the lake, separate dining room and main floor laundry. It also features an oversized master suite with his/her closets and an ensuite with a corner jetted tub, 2 sinks, separate shower and a sitting area overlooking the lake.


Two additional well sized bedrooms on the main floor. This incredible home also features a second kitchen facility in the lower w/out bsmnt along with a large family room with a built-in wall unit a second fireplace, pool table area, entertainment center as well as 3 additional bedrooms. The backyard offers vinyl fencing and is fully landscaped with a stamped concrete patio, gazebo, and maintenance free dock. Oversized 22’x40’ front attached garage.This home has to be seen to be truly appreciated.


View this home at http://househuntingadventures.com/mylistings.html/listing.c4036780-1089-east-chestermere-drive-chestermere-t1x-1a9.52550193#viewtop and call for an appointment to view.

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As a current homeowner, you might be planning you next move to a new home. You are now stuck with the dilemma of whether to buy or sell your existing home first. You could try to buy a home with a condition that says the purchase is subject to the sale of your existing home but in most markets that will give you a huge disadvantage when competing with other buyers.


Truth be told, there are rewards and drawbacks with either choice. It is in your best interest to keep the following in mind to explore what might be the best move for you.


1. Consult your Realtor about your options


An experienced, trusted, and knowledgeable Realtor can provide a realistic value expectation of your present home and give an overview of options such as porting a mortgage, bridge financing, and a conditional offer. Essentially, your Realtor can set the strategy with the terms and conditions in your listing and purchase contract. Also, your Realtor can negotiate possession dates to prevent you from being homeless in between homes or stuck with two homes and becoming a reluctant landlord.


2. Value of your current home - know your budget


Obtain a realistic value of your present home through provided by your Realtor or an independent appraiser. Keep in mind to include selling costs such as mortgage penalties, lawyer fees, and real estate commission. This information will help you estimate the amount of equity remaining after your present home sells.


3. Be realistic about your financial capabilities


Once you know how much equity you will have, check with your lender to determine your options regarding your current mortgage and to find out if bridge financing is a possibility. This allows you to take possession of your new home before the funds for your existing home are received by your lender. Find out how much this will cost you based on the interest rate and any fees included. If financing is not, you may have to sell your current home and make temporary living arrangements until you get the perfect new home.


4. Keep all of your properties


It may be an option to keep your present home as an investment property. Your bank will consider the monthly rental income to qualify you. Just take into consideration all the things that come with being a landlord, such as property management, vacancy, property upkeep, and taxes to name a few.

In the end, your decision will most likely be based on a number of factors, but knowing the potential upsides and drawbacks are important before you make your next move.

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The Canadian Press

 

VAUGHAN, Ont. – The Conservatives are setting a target of creating 700,000 new homeowners by 2020.

Party leader Stephen Harper says a combination of previous tax breaks and new promises makes that a realistic goal.

 

They include commitments made on this campaign to expand the home buyers’ plan, establish a permanent home renovation tax credit and measures to address foreign ownership of Canadian residential real estate.

 

Harper says home ownership provides Canadians with financial stability and strengthens communities.

According to information provided by the party, the target would raise Canada’s home ownership rate to approximately 72.5 per cent. The Canada Mortgage and Housing Corp., citing information from Statistics Canada’s National Household Survey, says the home ownership rate was 69.0 per cent as of 2011, the most current data available.

 

Harper made the announcement at a new home development site in the Toronto-area city of Vaughan.

Cabinet minister Julian Fantino is fighting for re-election in one of the area’s ridings, Vaughan-Woodbridge, while the Conservatives are also seeking to win the newly-created riding of King-Vaughan.

 

WATCH: Harper says Liberals, NDP focused more on social housing than home ownership

The announcement of a target for the impact of political promises mirrors a commitment from the Conservatives exactly one week ago that their policies would create 1.3 million net new jobs by 2020.

 

Observers were split on whether that was a realistic number, but Harper said the plan was run by experts.

He’s saying the same Tuesday about his goal for home ownership, noting the target was based on projections from CMHC and the Canadian Home Builders Association.

 

Both have set projections of ownership growth of more than 140,000 per year until 2021.

“Our Conservative government’s low-tax balanced-budget plan will ensure that home ownership is within reach for even more Canadians,” he said.

 

© The Canadian Press, 2015

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Today’s technology can be a real asset in your search for a new home, however in my experience it seems that many people are afraid that if they leave any information on a REALTOR’S® website, that the information will be used inappropriately.  While it is understandable that you might be resistant to leaving your contact information at the same time, you may be missing out on some truly valuable resources.

 

One of the resources offered free of charge on many REALTOR’S® websites which can be a very powerful asset in your search for a new home is the Virtual Office.  You will see it listed on some websites as a VOW, Personalized MLS® Home Search, or Virtual Back Office.  Many people who log into the website will browse the listings but hesitate to sign onto the service because it requires them to leave an Email address, however it is necessary in order for your system to be able to provide you information that you request of it. 

 

In a nutshell, the REALTOR® has paid for a specialized tool to be embedded into their website that allows you to access all the public information that is available on the MLS® without any restriction, and that is just the beginning.

 

How Does Your Back Office Work?


When people begin researching to purchase a home, they immediately turn to the MLS®.  What your REALTOR® offers you by allowing you to use their web server as a registered user, is the ability to search for and save properties and property details to a special repository that is dedicated and set aside for your personal use only.

 

Secondly, you can trigger the system to send you confidential emails with any new listings that come on the market the moment they are listed on the MLS®.  For example, let’s say you are searching for a home in Chestermere in a price range between $500,000 and $650,000.  You require 3 bedrooms and a finished basement.  From your personal virtual office, you can set this criteria and the system will automatically search for and send you a private email with any homes that come up on the MLS® system the moment they are listed.  If you are looking for Real Estate updates, news or promotions from this REALTOR®, most virtual offices will provide you an option to opt-in for that information as well.  The dream of the system is that you can opt-out and unsubscribe from any of the services at any time. They are fully automated services that you are in full control of.

 

That Scary Sign Up!


Your Virtual Back office is designed to empower you in your search for a new home. You will find a number of questions that you are asked when you first set up, and this is where most people hesitate.  It is understandable that you may not want the REALTOR® to know a lot of information about you, however once you are registered in the system, should you decide to contact the REALTOR® regarding homes you would like to see, or you just have questions about a specific home, or the market in general, the information that you have provided in your sign up process helps the REALTOR® to understand where you are it in the process. It also enables the system to send you the updates that you customize for yourself once you are logged in.

 

There is no limit to the number of homes you can save into your system, and it is the ideal venue for you to do side by side comparisons of homes that might be suitable for your family.  In the end, that is the real goal of you and your REALTOR®, not just to find a home, but to find the right home for you, that special place you love coming home to, and taking your time and doing thorough research can assist you in attaining that goal.

 

One of the great aspects of the virtual office is that as you save a number of homes to your personal file folders, should you decide that you wish to have a personal tour of the homes you have selected, you can contact your REALTOR® and advise them that you would like to set some appointments to view the homes in your virtual office.  The REALTOR® can then open up the folder from their side, access the listings and make the appropriate appointments to view if the homes are still actively listed. 

 

Learning how to access and properly use your virtual office truly empowers you as a new home buyer and if used properly, keeps you abreast of the market as it changes.  It is truly a valuable tool free to use and made possible by most REALTORS® who are current in their use of technology.

 

Absolutely Free To Use


To take advantage of the multiple tools available for you on your own personal Real Estate office, look for any sign up option on your favorite REALTOR'S® website, or if you want to take one for a spin on my website, you can sign in and try it out at http://househuntingadventures.com/vow.html/VowLanding.form?showsignup

 

 

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What’s Your Home Worth?


When you decide the time has come for that change of scenery, upgrade to a bigger home or downgrade to a smaller home because you have become empty nesters, the first thing you look for is advice on what your home is actually worth in today’s current market place. 

 

A very simple and key principle to the question of what your home is worth is this: The correct selling price of a home is the highest price that the market will bear.  

 

But how do you determine what fair market value is for your home?  That’s where the true value of a good REALTOR® comes into play.  But then again, not all REALTORS® work the same way, and some may not have your best interest at heart.  For this reason, the most important move you can make is to consider interviewing more than one REALTOR® in order to obtain varied opinions on the true value of your home in the current market. 

 

CMA’s – What are they?


CMA stands for comparative market analysis.  Every REALTOR® has their own way of determining what the selling price of your home should be, however the simple explanation of how they determine the selling price of your home is by comparing the selling prices of comparable homes in your neighborhood.  It sounds pretty simple doesn’t it?  In fact, you can often receive online valuations, or simply call up a REALTOR® who is willing to provide you a quick estimate over the phone, so it must be easy enough to do.  At least that’s what many home owners believe. 

 

Wise Decisions Will Save You Thousands $$


The reality is quite different however. There are many REALTORS® who will work very hard for you and who will have your best interests at heart.  They want your business, and your referrals and to earn your trust and referrals they know they need to do everything they can to make sure you reach your financial goals.  But, not all REALTORS® are created equal!  Each one has their own style and has their own reasons for doing business the way they do. It is for this reason, it is always wise to interview more than one REALTOR® and determine which agent you feel will represent you the best and price your home properly keeping YOUR goals in mind.  Here are a few clues to help you weave your way through what can sometimes be a challenging decision.

 

The Three Tiers


Every REALTOR® has their own method of working and in my experience I see three common listing presentations that are shown to potential clients.

 

          1. CMA presentation based on a very limited numbers of homes in your neighborhood that are priced very low.  A common practice, when asked by a client for a home valuation for a good listing price for their home, the REALTOR® will research all the comparable homes in your market area and select a small number of homes with the lowest prices.  These homes are presented to you to show you the homes you will be competing with.  When you compare the pricing, you will likely set the selling price of your home within a similar price range in order to be competitive. In most cases, should you follow this guidance, your home is likely to sell quickly, however did you get the most value for your home?  There can be some value to pricing your home on the low end of the market, which I will explain later.

 

          2. CMA presentation based on home prices on a limited number of homes valued on the high end of the market. This scenario does not play out very often, however is a sales technique that might encourage you to select a particular REALTOR® because he/she has advised you that your home is worth more money than what other REALTORS® are suggesting. After all, you want as much money out of your home as you can get, so you would rather list with a REALTOR® that says they can provide you with better financial results.  By convincing you your home is more valuable than what others have recommended, he/she wins your confidence and the opportunity to work with you. The downside?  The REALTOR® knows that your home will likely be on the market for an extended period of time.  If after a few weeks you have had very few or no showings on the property, you will find that he or she is recommending that you lower your price to be more competitive.   They won the listing by artificially pricing the home high during your listing presentation, however in the end, the reality is that the true value of your home is quite different, and your expectations are not met.  This is not to say that even if your home is fairly priced that there will not be a need to lower your price to be competitive. As fluid as the market is, sometimes it is necessary to lower your price even on a well-priced home in order to stay competitive, particularly in a good seller’s market.

 

          3. CMA presentation based on a more balanced estimate on a larger number of comparable homes in a varied price range from low to high that are for sale in your market area.  This is the most un-biased method of providing an accurate selling price for your home. The REALTOR® is providing you with a wide range of pricing and property types to compare to, and guiding you to a selling price based on what your personal goals are.  The CMA numbers are balanced.  From these numbers you along with the guidance from your REALTOR® will help guide you to a well-priced and competitive selling price that will help you achieve your goals.

 

Your Selling Price Depends On YOUR Goals


Yes, the best selling price for your home is the highest price that the current market will bear, however there are times, when there is value to pricing your home in a certain way.  For example, in exigent circumstances, whether it be financial hardship, family circumstances or you are simply financially comfortable and have an opportunity to move to another home better suited to you that you have put an offer on, it may be in your best interest to make your home more competitive in the market by offering a lower selling price.  If you want to move your home quickly, your REALTOR® should be able to help guide you to a selling price that meets your needs without sacrificing more than you need.

 

If however you are not in a rush to sell, but want the best value you can obtain within a reasonable time, help your REALTOR® to understand what your financial expectations are and set a selling price that is within the scope of moderately priced homes are selling for.  Patience is truly a virtue in this business, and it will pay off in the end.  Keep in mind that a good home valuation simply cannot be done over the phone or using an online system.  A good REALTOR® will come to your home and take into account many features in your home that can enhance the value of your home. He or she will know what the current market trends are and what potential home buyers are looking for.  They will look at your entire property, taking into account the landscaping, finishing and upgrades as well as any other special features of your home that make it unique and could positively affect the value of your home.

 

It’s always FREE!

It probably goes without saying that home valuations to provide you a Comparative Market Analysis and determine an appropriate selling price for your home are always provided by every REALTOR® free of charge. You have absolutely nothing to lose by contacting and interviewing more than one REALTOR® in your quest to find who you feel will work in your best interest! 

Natasha Eden

 

 

 

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The slide in Calgary’s resale housing market continued in May and uncertainty about the new NDP government could keep buyers on the sidelines for another few months.

 

May marked the sixth consecutive month in which MLS sales declined, year-over-year in the Calgary market. It was the fifth straight month in which average prices declined on a year-over-year basis.

 

Sales were down 25.5 per cent from May 2014, at 2,190 transactions. The average price declined 1.5 per cent to $478,7790, while the median price was down 0.3 per cent to $433,000.

 

New listings also fell, down 26.7 per cent to 3,161. However, the number of active listings at the end of the month was up 16.1 per cent, to 5,342. Homes are also spending longer on the market — the average number of days to sell a listing was 41 in May, up from 27 in May 2014.

 

Don Campbell, senior analyst with the Real Estate Investment Network, said political confusion will be a factor over the next six months, as buyers watch for the NDP government to set policy — particularly for key industries in Alberta.

 

“What policies and announcements will the new government make in their first six months to provide stability and confidence to businesses, citizens and industry?” said Campbell. “The more clear they get the more that potential buyers can decide when to enter the real estate market and therefore prop up the demand side of the Calgary real estate market. Right now, the confidence is low and the clarity is low, post-election and therefore buyers continue to sit and wait.

 

“We can expect those December and January panic listings to expire, as many are six-month listing contracts, in June and July so we should also see homes coming back on the market at lower prices – or removed completely.”

 

Campbell said the Calgary housing market is performing exactly as expected after nine to 10 months of declining oil prices.

 

He said average prices continue to be relatively flat.

 

“This is to be expected, as those who listed in a panic when oil began to drop, especially December and January, were refusing to lower their expected prices, even as competition heated up and listings skyrocketed,” said Campbell.

 

“Number of sales is down significantly as buyers sat back waiting for two key occurrences. The first one was for sellers to start getting a little more desperate and move their expected sale prices down dramatically. This desperation has not occurred, except in a small segment of the market, especially luxury. The second key that the buyers were looking for was some sense of stability to arise in the oil and gas industry — and to date this has not occurred. Buyers have traditionally been more patient than sellers and so the waiting game continues.”

Campbell said another added component protecting the downside of the market is Calgary’s very low vacancy rates and high rents. A seller, no matter how desperate they may believe they are to sell, still needs an affordable — and more importantly, available — place to move to as the majority are not leaving Calgary region and the rental market remains tight.

 

Cody Battershill, a realtor with RE/MAX House of Real Estate in Calgary, said the year-over-year decline in city sales is continuing, but the market has improved significantly from the beginning of the year. In January and February, year-over-year sales fell by 38.9 per cent and 34.2 per cent respectively.

 

“It’s interesting because some people would say that the market’s crashing, that the market’s imploding,” he said. “We haven’t seen prices come off that much yet. I am seeing a lot more flexibility when negotiating with sellers, representing buyers, and vice versa.

 

“It’s interesting that the prices have continued to remain resilient . . .  If you like (famed investor) Warren Buffett, he tells people to buy when everyone’s afraid or be contrarian. At the end of the day, you’ve got to rent, own or live in a box. You’ve got to live somewhere.”

 

Ann-Marie Lurie, chief economist with CREB, said new listings have eased, which is helping push the market to more balanced conditions.

 

“Sales levels have continued to be lower than what we typically see at this time of year,” said Lurie.

Economic uncertainty, she said, can prompt people to wait and see before making the decision to buy a home.

“With a new government, we really don’t know what their plans will be. It could be that people are waiting to see what that response will be and how they will impact business,” said Lurie. “Obviously when I’m looking at housing it’s really what will happen to the jobs scenario . . . Having continued weakness in the energy sector, I want to start seeing how it’s impacting employment. We’ve seen some pullback in employment, but it seems to be levelling off at this point.”

 

She said the new home market has started to record some gains in inventory, but the current level remains relatively low.

 

“However, the overall impact on Calgary’s housing prices will ultimately depend on the duration of the economic slowdown and the amount of inventory build-up in the new home sector,” added Lurie.

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Consumer Affairs Reporter  Global News“We continue to watch the housing market and the lending and borrowing situation very carefully," Prime Minister Stephen Harper said Wednesday.

Prime Minister Stephen Harper said Wednesday Ottawa is closely watching developments in the still-hot housing market, but there’s no need for another intervention. “I’m not saying I’m unconcerned. We are watching it. We’re not planning to take any immediate action,” Harper told reporters after an event in Mississauga, Ont.

“We continue to watch the housing market and the lending and borrowing situation very carefully,” he said.

 

The Prime Minister made the remarks as Canada’s big banks made fresh cuts to mortgage lending rates, with the Bank of Montreal leading the market lower by slicing its 5-year, fixed rate to 2.79 per cent.

That should help rev up home sales across the country this spring, even as buyers confront affordability constraints in big centres — namely Vancouver and Toronto.

 

There are also concerns though that Canadians have piled on too much debt and that some pockets of the housing market have become “overheated.”

 

MORE: Spring real estate market heats up in Toronto, Vancouver, realtors say

But with borrowing rates edging back toward all-time lows, Harper said debt-servicing costs are falling and default rates remain extremely low.

 

Harper said Wednesday he believes Canada’s financial institutions remain strong and well capitalized.

The last time the big banks cut mortgage rates to their current levels, in 2013, then-Finance Minister Jim Flaherty publicly criticized lenders for their “race to the bottom” approach. Lenders raised rates after the warning.

Flaherty’s public criticism was preceded by a series of mortgage-tightening rules were implemented, chiefly in 2012 when amortization periods for insured home loans were capped at 25 years.

 

MORE: IMF warns over Canada’s ‘overheated housing market’ — again

Lending re-accelerates

While the moves created a lull in lending growth, experts have noted a re-acceleration in recent months.

“Following a sustained period of stable year-over-year increases, mortgage growth accelerated for the third consecutive month in January,” RBC economists said in a research note published earlier this month.

Total outstanding home loans grew by 5.4 per cent from the year-ago level to mark the fastest rate of growth since November 2013, RBC said.

Prices cooling

The faster pace of lending appears to be concentrated to within a dwindling number of markets, though, namely — again — Vancouver and Toronto.

 

 

Resale and pricing data published by the Canada Real Estate Association last week show the country’s two most expensive markets propping up national figures, which otherwise would be far weaker.

 

 

“The national average home price remains skewed by sales activity in Greater Vancouver and Greater Toronto, which are among Canada’s most active and expensive housing markets,” the association said.

 

MORE: Home prices are cooling everywhere but red-hot Vancouver, Toronto


The average benchmark price for a home in Canada continued to rise at a surprisingly strong pace last month, climbing 6.3 per cent, to $431,812. But excluding those two markets, the average price gain would have come in at a much tamer 1.5 per cent, to an average price of $326,910.

 

Calgary, formerly the hottest housing market in the country as higher oil prices bolstered an active market, still saw average prices climb nearly 6 per cent last month, according to CREA. But “the increase was far smaller than gains posted last year and the smallest since December 2012,” the association said.

 

“In other markets from West to East, prices were up compared to year-ago levels by between two and two-and-a-half per cent in the Fraser Valley, Victoria, and Vancouver Island, while holding steady in Saskatoon, Ottawa, and Greater Montreal, and falling in Regina and Greater Moncton,” CREA said.

 

— With files from the Canadia

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As you are no doubt aware, yesterday’s release of Budget 2015 contains increases to fees for real estate transfers as of July 1, 2015. In statements related to the Budget, Service Alberta identified real estate associations among the stakeholders who were consulted on increases to fees related to the transfer of real estate. To that effect, AREA CEO Ian Burns has released the following statement to clarify that AREA was not consulted on these increases and to state the association’s position:

 

"Budget 2015 includes significant hikes to fees paid by real estate consumers beginning July 1, 2015, including registering new land titles and mortgage documents.


The Alberta Real Estate Association (AREA), the provincial, professional association for Alberta’s 10,000 REALTORS®, was not one of the real estate association stakeholders consulted on these increases.

AREA appreciates the fiscal challenges faced by government and recognizes that, after this increase, fees related to real estate transfers remain lower in Alberta than other provinces. We have asked Service Alberta to confirm what sources they are quoting when expressing that real estate associations were among the stakeholders who identified that there was ‘room for these fees to grow’."


Increases to fees are certainly never welcomed and the table below details the impact of these increases on the fees for a $500,000 home with a $400,000 mortgage:

 

 

Fees Prior to July 1, 2015
($50 + $1 per $5,000 increment)

Fees After July 1, 2015
($75 + $6 per $5,000 increment)

Land Title Registration

$150

$675

Mortgage Registration

$130

$555

Total

$280

$1,230

Though the increase as of July 1st represents a hike of more than 400% for the real estate consumer, the cost of real estate transfers in Alberta remains lower than other provinces. This can be attributed to the continued avoidance of a Land Transfer Tax in Alberta at either the provincial or local levels.

 

Rest assured that AREA continues to monitor discussions by government and advocate on behalf of members to avoid Land Transfer Tax ever becoming a reality in our province.


AREA also believes that preferable alternatives to increasing fees exist, and will continue to have discussions with Service Alberta to that effect. Enhancements to the Land Titles Registry could incorporate all existing property records under one, centralized system (e.g. property-related permits, condominium documents, grow-op history, environmental assessments and New Home Warranties). All of these records under one roof could allow the Government to increase revenues through the provision of these documents.

 

Click here to view information on AREA’s positions on both Land Transfer Tax and enhancements to the Land Titles Registry.

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Harper says no need for action in housing market, as rate wars rage

“We continue to watch the housing market and the lending and borrowing situation very carefully," Prime Minister Stephen Harper said Wednesday.

“We continue to watch the housing market and the lending and borrowing situation very carefully," Prime Minister Stephen Harper said Wednesday.

CANADIAN PRESS/Sean Kilpatrick

Prime Minister Stephen Harper said Wednesday Ottawa is closely watching developments in the still-hot housing market, but there’s no need for another intervention.

“I’m not saying I’m unconcerned. We are watching it. We’re not planning to take any immediate action,” Harper told reporters after an event in Mississauga, Ont.

“We continue to watch the housing market and the lending and borrowing situation very carefully,” he said.

 

The Prime Minister made the remarks as Canada’s big banks made fresh cuts to mortgage lending rates, with the Bank of Montreal leading the market lower by slicing its 5-year, fixed rate to 2.79 per cent.

That should help rev up home sales across the country this spring, even as buyers confront affordability constraints in big centres — namely Vancouver and Toronto.

There are also concerns though that Canadians have piled on too much debt and that some pockets of the housing market have become “overheated.”

MORE: Spring real estate market heats up in Toronto, Vancouver, realtors say

But with borrowing rates edging back toward all-time lows, Harper said debt-servicing costs are falling and default rates remain extremely low.

Harper said Wednesday he believes Canada’s financial institutions remain strong and well capitalized.

The last time the big banks cut mortgage rates to their current levels, in 2013, then-Finance Minister Jim Flaherty publicly criticized lenders for their “race to the bottom” approach. Lenders raised rates after the warning.

Flaherty’s public criticism was preceded by a series of mortgage-tightening rules were implemented, chiefly in 2012 when amortization periods for insured home loans were capped at 25 years.

MORE: IMF warns over Canada’s ‘overheated housing market’ — again

Lending re-accelerates

While the moves created a lull in lending growth, experts have noted a re-acceleration in recent months.

“Following a sustained period of stable year-over-year increases, mortgage growth accelerated for the third consecutive month in January,” RBC economists said in a research note published earlier this month.

Total outstanding home loans grew by 5.4 per cent from the year-ago level to mark the fastest rate of growth since November 2013, RBC said.

Prices cooling

The faster pace of lending appears to be concentrated to within a dwindling number of markets, though, namely — again — Vancouver and Toronto.

Resale and pricing data published by the Canada Real Estate Association last week show the country’s two most expensive markets propping up national figures, which otherwise would be far weaker.

“The national average home price remains skewed by sales activity in Greater Vancouver and Greater Toronto, which are among Canada’s most active and expensive housing markets,” the association said.

MORE: Home prices are cooling everywhere but red-hot Vancouver, Toronto

The average benchmark price for a home in Canada continued to rise at a surprisingly strong pace last month, climbing 6.3 per cent, to $431,812. But excluding those two markets, the average price gain would have come in at a much tamer 1.5 per cent, to an average price of $326,910.

Calgary, formerly the hottest housing market in the country as higher oil prices bolstered an active market, still saw average prices climb nearly 6 per cent last month, according to CREA. But “the increase was far smaller than gains posted last year and the smallest since December 2012,” the association said.

“In other markets from West to East, prices were up compared to year-ago levels by between two and two-and-a-half per cent in the Fraser Valley, Victoria, and Vancouver Island, while holding steady in Saskatoon, Ottawa, and Greater Montreal, and falling in Regina and Greater Moncton,” CREA said.

– With files from the Canadian Press

jamie.sturgeon@globalnews.ca

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New condo construction in Calgary on February 9, 2015.

New condo construction in Calgary on February 9, 2015.

Colleen De Neve / Calgary Herald


 

The recent oil price decline has put the brakes on the hot housing market in the Calgary region, but during the last five major oil price declines, new home prices only fell in just two of those instances, says a new report by Fortress Real Developments.

 

The semi-annual Market Manuscript, released on Monday, said completed and unsold housing units fell to their lowest level in more than 25 years in the Calgary census metropolitan area in 2014, with just one unsold condominium.

 

“In October, Calgary was ranked as the top real estate market to watch for 2015. That optimism has faded, with many housing experts now calling for balanced market conditions in the metropolitan area,” it said. “Demand clearly exceeded supply in the late stages of 2014 in the Calgary CMA. The cooling effect on homebuyer demand that is expected in 2015 will contribute to a re-balancing of the demand-supply equation for the CMA in the first half of the year. It is expected that Calgary will move from a seller’s market to a more balanced market.

 

“In three of the last five major oil price declines, new house prices in Calgary didn’t decline, let alone crash.”

Analyst Ben Myers, the author of the report, said he was surprised by the data, adding that Calgary’s housing market is historically fairly resilient when it comes to economic downturns.

 

“Certainly from everything that I read, the analysts tend to think that Calgary is a lot more diversified than it ever has been before,” said Myers. “It’s a much bigger census metropolitan area and there’s other things going on than just the oil industry.

 

“Right now, everyone’s in that ‘we’re not sure what’s going on period so we’re just going to hold off. We’re not going to make this huge decision in our lives until we kind of figure out what’s happening’. It looks like oil prices have stabilized a bit. They’re not really going up but they’re not really going down anymore. The slide has kind of stopped.”

 

The report said the World Bank has identified five other major episodes where oil prices dropped by 30 per cent or more over a six-month period besides the current one.

 

“These declines coincided with other global events: an increase in supply of oil and change in OPEC policy (1985-86); U.S. recessions (1990-91 and 2001); the Asian crisis (1997-98); and the global financial crisis (2007-09). New house prices (in Calgary) only declined in the 1991 and 2009 situations,” said the report.

It said new house prices in the City of Calgary increased 12.5 per cent in 2014, with condominium apartment prices jumping 28.9 per cent, adding that absorption rates should remain strong in 2015, as a significant portion of the new home product is pre-sold.

 

“Household formation figures indicate there is minimal risk of oversupply in the Calgary CMA over the next year,” said the report.

 

It said absorptions were just short of a record high in the Calgary CMA in 2014 at 12,740, while completed and unabsorbed supply fell to just 451 units at the end of December, marking a 25-year low. There was only one completed and unabsorbed apartment at the end of 2014, down from 600 units in 2010.

 

Between February 1986 and December 1986, oil prices were down 49 per cent year-over-year on average. During that same period, new house prices in the Calgary CMA increased eight per cent annually on average, said the report.

 

Between August 1991 to January 1992, oil prices were down 29 per cent on average, new house prices were down two per cent on average.

 

Between September 1997 to February 1999, oil prices declined 27 per cent on average, new house prices increased seven per cent on average.

 

Between June 2001 to March 2002, oil prices declined 24 per cent on average, new house prices increased three per cent on average.

 

Between November 2008 to September 2009, oil prices declined 50 per cent on average and new house prices declined seven per cent on average.

 

“The biggest new house price decline occurred during the last ‘episode’ in 2008/2009, when Calgary and the world were in the midst of the global economic meltdown,” said the report. “During this crisis period, credit was totally cut off, the U.S. was in terrible financial shape, and Calgary was already on a downward spiral following bubble-like conditions in their housing market in 2007.”

 

Original article from the Calgary Herald at http://calgaryherald.com/business/real-estate/calgary-new-home-prices-survived-three-of-five-previous-oil-price-collapses

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Global News, just came out with a great article on Renting vs Buying that is a very good read.  We have a website set up specifically for first time home buyers at RentStinks.ca that is set up to help anyone who is considering purchasing their first home.  They key is to be properly prepared and not pressured into your first purchased. I have a number of tools that can guide new buyers, so please don't hesitate to get in touch, as I am more than happy to help.

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Calgary sales in January totaled 880 units, well below typical activity


Low oil prices throughout January, combined with a shifting outlook in the energy sector, caused unease for consumers. As a result, monthly housing sales activity fell to levels not seen in five years.

 

“Economic conditions this year are expected to be weaker than original estimates provided in December 2014," said CREB® chief economist Ann-Marie Lurie.

 

“This change is partly connected to continued low energy prices, which impact consumer confidence. A lack of recovery in oil has many concerned about their employment status and this concern is reflected through the weaker sales activity in Calgary’s January resale figures,” said Lurie.

 

Sales levels were over 35 per cent lower than the 10 year average and declined across all three sectors in the city (Attached, detached and apartment). Meanwhile, new listings increased by 39 per cent city-wide, causing inventory levels to rise.

 

“There are many reasons for consumers to list their home,” said CREB® president Corinne Lyall. “One reason may be that consumers are concerned about what will happen to Calgary’s economy and their personal exposure to this risk,” said Lyall.

 

While new listing activity increased in every price range this month, the rise in new listings was primarily due to gains in the higher price ranges. In the detached sector, new listings increase by 32 per cent relative to January 2014, all of which occurred in product priced over $400,000.

 

Despite the recent supply increase in the market, benchmark prices managed to remain relatively stable this month. January benchmark prices totaled $459,100, a 7.7 per cent increase relative to January 2014, but similar to December figures.

 

Although residential prices remained relatively stable, there was some variation in sectors. The apartment sector recorded the largest gain in new listings relative to sales and inventory levels nearly doubled reaching 1,148 units. The rise in supply relative to demand placed downward pressure on benchmark prices, which fell to $298,700 compared to $300,400 in December.

 

“It’s important for sellers to set appropriate expectations in this market,” said Lyall. “They need to consider their property type, the competition they may be facing in their community, their reasons for selling and, of course, when they ultimately need their property to be sold.”

 

Detached benchmark prices totaled $518,600 in January, similar to December levels, but a 7.9 per cent increase relative to January 2014. Meanwhile, the attached unadjusted benchmark price in January totaled $356,200, similar to prices recorded in December.

 

“Housing decisions will likely continue to be postponed for many consumers until they can see what happens with the economic climate in the spring,” said Lurie.

 

“Nonetheless, if supply levels continue to rise at levels that exceed the pace of demand growth, we can expect this will start to impact prices in the city.”

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Major banks like RBC have finally lowered interest rates on home loans in tandem with the Bank of Canada’s rate cut made last week.

 

Big lenders have begun offering fixed-rate mortgages at rock-bottom rates of as little as 2.84 per cent, while smaller lenders can be found providing fixed-rate loans at as low as 2.69 per cent.

 

Meanwhile home loans with variable rates – i.e. with an interest rate that’s not set but instead floats up and down – have edged below 2 per cent.

 

The renewed mortgage rate wars sparked by the Bank of Canada’s surprise cut are sure to draw out house hunters in the weeks and months ahead. But can you afford that mortgage, even at the current ultra-low levels of interest?


Rule of thumb


The historical rule of thumb among mortgage experts is that no more than about 32 percent of household pre-tax income should be spent on housing costs, like your mortgage, utilities, condo fees and property taxes.

A record boom in housing prices however has thrown that threshold out the window for more than a few Canadian households. Royal Bank of Canada suggests the average family who owns a home dedicates 42.6 per cent of their income to covering the mortgage, utilities, property taxes as well as fees for condominium owners.

 

In some centres – notably Vancouver (83.6 per cent) and Toronto (56.3 per cent) – the percentage is far higher.

 

How much house can you handle? Use this calculator to find out.


For condo owners, simply lump monthly fees into property taxes. (And to determine your potential monthly payment, use this calculator to find out.


Affordability Calculator

Mortgage experts suggest no more than 32% of household income be spent on housing costs. Whether you're looking for a home or already have one, use this calculator to determine your affordability reading.

 

Original Article by Global News

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Here is a real life example from BC of why it is so important for home sellers to interview potential realtors before listing their home with someone. It is so important to ensure any agents you interview are giving you a true picture of the real estate market in your neighborhood and that they are truly working in YOUR best interest.

 

http://www.theglobeandmail.com/news/investigations/inside-a-fast-growing-bc-firm-that-has-home-sellers-crying-foul/article29578417/

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New mortgage rule might 'temper' hot markets, but not for long

Starting Feb. 15, CMHC requires 10% down payment on portion of mortgages above $500K

By Lucas Powers, CBC News Posted: Feb 11, 2016 5:00 AM ET Last Updated: Feb 11, 2016 7:43 AM ET

Vancouver and Toronto saw real estate prices, particularly for detached and semi-detached home, continue to rise last year. Most other markets saw only modest increases, or even decreases in some cases.

Vancouver and Toronto saw real estate prices, particularly for detached and semi-detached home, continue to rise last year. Most other markets saw only modest increases, or even decreases in some cases. (Mark Blinch/Reuters)

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Beginning next week, many Canadians hoping to buy an abode will need to put more cash down before they can call it home. The extra cost might keep some would-be homeowners from mortgages they can't really afford, but it's unlikely to leave any lasting impressions on the country's most "overheated" real estate markets.

The federal government said in December that the Canadian Mortgage and Housing Corporation will require a 10 per cent down payment on any portion of a mortgage it insures above $500,000 and up to $999,000. That's double the five per cent down the Crown corporation currently asks to insure mortgages worth more than 80 per cent of a home's value.

"We want to make sure we create an environment that protects the people buying homes so they have sufficient equity in their home," said Finance Bill Morneau at the time, also noting that "elevated" house prices were the driving force behind the move.

The change will "likely impact a broad spectrum of buyers," though it will surely be the highest hurdle for those who don't already have a good bit of equity from one home already.

"The majority of the impact is going to be on first-time homebuyers, particularly first-time buyers in the hotter markets," says Don Murray, senior analyst at Real Estate Investment Network, an organization that tracks Canadian housing trends.

Bill Morneau Finance Minister

Finance Minister Bill Morneau announced the new mortgage rule in December, saying the government was trying stabilize real estate markets in some cities, like Toronto and Vancouver. (Chris Wattie/Reuters)

"It could certainly prevent them from getting into a market that is overheated."

That could, the theory goes, ease the intense demand for starter properties such as single-family detached homes in places like Toronto and Vancouver — one of just several factors keeping average house prices in those cities so astonishingly high — and perhaps help those markets cool off a bit.

Good politics, bad policy?

It could also help save some people from themselves, encouraging sober second thought about getting locked into mortgages that would stretch their finances dangerously thin.

There's plenty of evidence that many Canadians have taken on alarming debt loads to finance their dream of home ownership, leaving them vulnerable to ruin if the markets start to deflate. 

Young Canadians and their families would face the brunt of the impact. A report by the Canadian Centre for Policy Alternatives, for example, found that about 10 per cent of homeowners under 40 would be bankrupted if housing prices dropped 20 per cent.

The C.D. Howe Institute similarly calculated that about half a million first-time homeowners, mainly young people with lower-than-average incomes, could be left ruined if the historically low interest rates that have fuelled drastic jumps in house prices went up, or they faced a personal financial crisis.

Canadians who have built equity in their homes throughout the real estate boom of the last 15 years or so, though, would be on more stable ground.

Once it becomes psychologically normalized for people, there'll be less of an effect.
- Don Murray, real estate analyst

The underlying problem is that it's far from clear if the new mortgage rule — just the latest in a string of government-led measures to shield the economy from the high household debt loads Canadians are carrying around — will make a mark where one is most needed.

"I would say, generally speaking, there is some good politics in this but not much good policy," says Jon Sowerby, a licensed mortgage broker with Toronto-based TvH Financial.

"It's made to look like Mr. Morneau is on top of things, but the reality is that it's not going to have a massive impact on the market."

$500K downpayment graphic

Starting on Monday, CMHC will require a 10-per-cent down payment on the portion of any mortgage it insures over $500,000. (CBC News)

Drop in the bucket

The Canadian Association of Accredited Mortgage Professionals agrees. The organization revealed last year that first-time homebuyers put down an average of about 21 per cent of their home's purchase price, a number that has not deviated much since real estate prices began their relentless climb in the late 1990s.

The analysis is based on data gathered from an annual survey of 800 Canadians who just bought a new home.

The same report estimates that of the 120,000 to 125,000 sales of homes that involve a mortgage of $500,000 or more each year in Canada, around 10,000, or 2 per cent, would involve down payments that had to be increased under the new rule.

Eveline Zia housing real estate prices

Last summer Eveline Zia, who began the popular social media hashtag #DontHave1Million, led demonstrations in Vancouver, demanding more decisive action from the government on soaring real estate prices. (Jim Jeong/Reuters)

It concludes that the change will have negligible resonance in the Canadian mortgages market.

That's not to say that first-time buyers haven't been looking ahead to the deadline, hoping to get in before a down payment lightens the coffer that much more.

The minds of homebuyers

Michael Elmenhoff is a realtor who does a lot of work in the east end of Toronto, a formerly blue-collar area of the city where the average starter home in a "cool neighbourhood" sells for about $650,000.

He says he saw about a 50-per-cent traffic increase in the first few weeks of this year compared to 2015, a time that is generally considered a slow period for buying before the spring markets picks up.

For example, Elmenhoff listed a rowhouse with three bedrooms, two baths and no parking on the boundary of the trendy Leaside neighbourhood for $499,999 dollars in early January. The property attracted about 150 prospective buyers and 13 offers before selling for $649,000.

The interest was almost exclusively from first-time homebuyers, Elmenhoff says. "That kind of traffic is unheard of, really."

He expects to see a slowdown come Monday.

"With the market seeming to be at precariously high price points, the new mortgage rule could help ease the situation," he says, adding that "anything to temper the speculation and the leveraging" is welcome.

Low rates, inventory remain factors

But realtors and analysts agree that, at best, any changes will likely be very short-lived because so many of the factors keeping prices sky high, like low mortgage rates, a short supply of detached homes, and speculation by foreign buyers, all remain in place.

"Once it becomes psychologically normalized for people, there'll be less of an effect. It will slow down buyers in that $500,000 to $900,000 range for a while, then it won't," says Murray.

"Or people will just get more creative in securing a loan."

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Whether you are buying or selling your home or property the end goal is for you to make the greatest possible deal that is in your best interest.  If you are in the market to sell your home, your goal should be to secure the highest possible price for your home. Conversely, when purchasing you want to be able to obtain the finest quality home you can find that meets your personal family needs at the lowest possible price.

The question is, how can you be sure that you will achieve these goals and ensure there are no hidden surprises that will surface that will derail your intended success of buying or selling?

 

There truly is a lot to consider, especially when you are dealing with finances that under normal circumstances, involve the most significant investments of your lifetime.

 

Let’s explore the world of Real Estate and take some of the mystery out of what can be very confusing and difficult decisions.

 

I’m a Home Seller – How Do I Find The Right REALTOR®?


First and foremost, it is always wise to interview more than one REALTOR®.  Let’s face it, as much as there is a strong code of ethics that govern how REALTORS® perform, there are those in the business that may not have your best interest at heart.  There are those who will price your home at a price that will allow them to sell your home quickly rather than advising you to price your home more to your benefit and being a little more patient given all the current market circumstances.

 

Conversely, there are those REALTORS® who will recommend a price much higher than market value in a bid to convince you that they have the ability to get more money for your home, subsequently convincing you to hire them.  Often, the pricing reality is somewhere in between the two.

 

Let’s make one thing crystal clear.  The correct selling price of a home is the highest price that the market will bear.  A well trained and experienced REALTOR® who is doing their job ethically and correctly will help you determine the right price based on current market trends.

 

Keep in mind that market trends can change on a dime and it is important that you have a REALTOR® who is constantly evaluating the market; keeping you appraised if and when you need to adjust your selling price to stay competitive.  The key is to stay competitive while not staying listed for an extended period of time and at the same time ensuring you do not undervalue your home.

 

So what ideals do you look for when selecting a REALTOR® that will meet your needs?  First, personality!  Remember, the person you select is your representative.  Are they open and responsive to your needs?  Do you feel they truly have your personal interest at heart rather than simply being anxious to complete another sale?  Are they technology savvy?  What avenues do they have to advertise your home to the marketplace other than the standard Multiple Listing Service (MLS®)? You can often get an excellent read on the personality of a REALTOR® by visiting their web site.  Take the time to explore each potential candidate’s web site before contacting them for an interview.  Are they willing to come to your home and give you an appraisal and not just ask you questions over the phone?  In other words are you important to them? Will they work hard to help you get the most out of your home to help you prepare for your future goals?   Are they the type of person who will constantly keep you updated on the showings of your home and spend the time to conduct open houses to help market your home?

 

A good REALTOR® is not just someone who advertises how many homes they have been able to sell.  A good REALTOR® is someone who is willing to spend the time to help you achieve your personal goals.  In the end, the most important benefit for your REALTOR® is the referrals they receive from you to help them make their business grow, which brings up one more vital part of interviewing your REALTOR®.  Go to their website and check for testimonials.  See what other clients say about the agent you are interviewing, and finally, ask your potential candidates for references if you have any doubt.  There is no better way to determine the true potential of your REALTOR® than talking directly with someone who has worked with them in the past!

 

Natasha Eden – Urban Real Estate Services 403-399-0809

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1089 EAst Chestermere Drive

Enjoy living the lakeside lifestyle in this charming 6 bedroom walk-out bungalow in a quiet cul-de-sac on Chestermere Lake!  The design of this home provides a relaxing and gorgeous view of the lake and Rocky Mountains. This is an open concept home with high vaulted ceilings throughout.


The main floor features a warm and relaxing family room with a stone fireplace, lovely open kitchen with conversation ledge, wall oven, gas stove, eating nook with a beautiful view of the lake, separate dining room and main floor laundry. It also features an oversized master suite with his/her closets and an ensuite with a corner jetted tub, 2 sinks, separate shower and a sitting area overlooking the lake.


Two additional well sized bedrooms on the main floor. This incredible home also features a second kitchen facility in the lower w/out bsmnt along with a large family room with a built-in wall unit a second fireplace, pool table area, entertainment center as well as 3 additional bedrooms. The backyard offers vinyl fencing and is fully landscaped with a stamped concrete patio, gazebo, and maintenance free dock. Oversized 22’x40’ front attached garage.This home has to be seen to be truly appreciated.


View this home at http://househuntingadventures.com/mylistings.html/listing.c4036780-1089-east-chestermere-drive-chestermere-t1x-1a9.52550193#viewtop and call for an appointment to view.

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As a current homeowner, you might be planning you next move to a new home. You are now stuck with the dilemma of whether to buy or sell your existing home first. You could try to buy a home with a condition that says the purchase is subject to the sale of your existing home but in most markets that will give you a huge disadvantage when competing with other buyers.


Truth be told, there are rewards and drawbacks with either choice. It is in your best interest to keep the following in mind to explore what might be the best move for you.


1. Consult your Realtor about your options


An experienced, trusted, and knowledgeable Realtor can provide a realistic value expectation of your present home and give an overview of options such as porting a mortgage, bridge financing, and a conditional offer. Essentially, your Realtor can set the strategy with the terms and conditions in your listing and purchase contract. Also, your Realtor can negotiate possession dates to prevent you from being homeless in between homes or stuck with two homes and becoming a reluctant landlord.


2. Value of your current home - know your budget


Obtain a realistic value of your present home through provided by your Realtor or an independent appraiser. Keep in mind to include selling costs such as mortgage penalties, lawyer fees, and real estate commission. This information will help you estimate the amount of equity remaining after your present home sells.


3. Be realistic about your financial capabilities


Once you know how much equity you will have, check with your lender to determine your options regarding your current mortgage and to find out if bridge financing is a possibility. This allows you to take possession of your new home before the funds for your existing home are received by your lender. Find out how much this will cost you based on the interest rate and any fees included. If financing is not, you may have to sell your current home and make temporary living arrangements until you get the perfect new home.


4. Keep all of your properties


It may be an option to keep your present home as an investment property. Your bank will consider the monthly rental income to qualify you. Just take into consideration all the things that come with being a landlord, such as property management, vacancy, property upkeep, and taxes to name a few.

In the end, your decision will most likely be based on a number of factors, but knowing the potential upsides and drawbacks are important before you make your next move.

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The Canadian Press

 

VAUGHAN, Ont. – The Conservatives are setting a target of creating 700,000 new homeowners by 2020.

Party leader Stephen Harper says a combination of previous tax breaks and new promises makes that a realistic goal.

 

They include commitments made on this campaign to expand the home buyers’ plan, establish a permanent home renovation tax credit and measures to address foreign ownership of Canadian residential real estate.

 

Harper says home ownership provides Canadians with financial stability and strengthens communities.

According to information provided by the party, the target would raise Canada’s home ownership rate to approximately 72.5 per cent. The Canada Mortgage and Housing Corp., citing information from Statistics Canada’s National Household Survey, says the home ownership rate was 69.0 per cent as of 2011, the most current data available.

 

Harper made the announcement at a new home development site in the Toronto-area city of Vaughan.

Cabinet minister Julian Fantino is fighting for re-election in one of the area’s ridings, Vaughan-Woodbridge, while the Conservatives are also seeking to win the newly-created riding of King-Vaughan.

 

WATCH: Harper says Liberals, NDP focused more on social housing than home ownership

The announcement of a target for the impact of political promises mirrors a commitment from the Conservatives exactly one week ago that their policies would create 1.3 million net new jobs by 2020.

 

Observers were split on whether that was a realistic number, but Harper said the plan was run by experts.

He’s saying the same Tuesday about his goal for home ownership, noting the target was based on projections from CMHC and the Canadian Home Builders Association.

 

Both have set projections of ownership growth of more than 140,000 per year until 2021.

“Our Conservative government’s low-tax balanced-budget plan will ensure that home ownership is within reach for even more Canadians,” he said.

 

© The Canadian Press, 2015

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Today’s technology can be a real asset in your search for a new home, however in my experience it seems that many people are afraid that if they leave any information on a REALTOR’S® website, that the information will be used inappropriately.  While it is understandable that you might be resistant to leaving your contact information at the same time, you may be missing out on some truly valuable resources.

 

One of the resources offered free of charge on many REALTOR’S® websites which can be a very powerful asset in your search for a new home is the Virtual Office.  You will see it listed on some websites as a VOW, Personalized MLS® Home Search, or Virtual Back Office.  Many people who log into the website will browse the listings but hesitate to sign onto the service because it requires them to leave an Email address, however it is necessary in order for your system to be able to provide you information that you request of it. 

 

In a nutshell, the REALTOR® has paid for a specialized tool to be embedded into their website that allows you to access all the public information that is available on the MLS® without any restriction, and that is just the beginning.

 

How Does Your Back Office Work?


When people begin researching to purchase a home, they immediately turn to the MLS®.  What your REALTOR® offers you by allowing you to use their web server as a registered user, is the ability to search for and save properties and property details to a special repository that is dedicated and set aside for your personal use only.

 

Secondly, you can trigger the system to send you confidential emails with any new listings that come on the market the moment they are listed on the MLS®.  For example, let’s say you are searching for a home in Chestermere in a price range between $500,000 and $650,000.  You require 3 bedrooms and a finished basement.  From your personal virtual office, you can set this criteria and the system will automatically search for and send you a private email with any homes that come up on the MLS® system the moment they are listed.  If you are looking for Real Estate updates, news or promotions from this REALTOR®, most virtual offices will provide you an option to opt-in for that information as well.  The dream of the system is that you can opt-out and unsubscribe from any of the services at any time. They are fully automated services that you are in full control of.

 

That Scary Sign Up!


Your Virtual Back office is designed to empower you in your search for a new home. You will find a number of questions that you are asked when you first set up, and this is where most people hesitate.  It is understandable that you may not want the REALTOR® to know a lot of information about you, however once you are registered in the system, should you decide to contact the REALTOR® regarding homes you would like to see, or you just have questions about a specific home, or the market in general, the information that you have provided in your sign up process helps the REALTOR® to understand where you are it in the process. It also enables the system to send you the updates that you customize for yourself once you are logged in.

 

There is no limit to the number of homes you can save into your system, and it is the ideal venue for you to do side by side comparisons of homes that might be suitable for your family.  In the end, that is the real goal of you and your REALTOR®, not just to find a home, but to find the right home for you, that special place you love coming home to, and taking your time and doing thorough research can assist you in attaining that goal.

 

One of the great aspects of the virtual office is that as you save a number of homes to your personal file folders, should you decide that you wish to have a personal tour of the homes you have selected, you can contact your REALTOR® and advise them that you would like to set some appointments to view the homes in your virtual office.  The REALTOR® can then open up the folder from their side, access the listings and make the appropriate appointments to view if the homes are still actively listed. 

 

Learning how to access and properly use your virtual office truly empowers you as a new home buyer and if used properly, keeps you abreast of the market as it changes.  It is truly a valuable tool free to use and made possible by most REALTORS® who are current in their use of technology.

 

Absolutely Free To Use


To take advantage of the multiple tools available for you on your own personal Real Estate office, look for any sign up option on your favorite REALTOR'S® website, or if you want to take one for a spin on my website, you can sign in and try it out at http://househuntingadventures.com/vow.html/VowLanding.form?showsignup

 

 

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What’s Your Home Worth?


When you decide the time has come for that change of scenery, upgrade to a bigger home or downgrade to a smaller home because you have become empty nesters, the first thing you look for is advice on what your home is actually worth in today’s current market place. 

 

A very simple and key principle to the question of what your home is worth is this: The correct selling price of a home is the highest price that the market will bear.  

 

But how do you determine what fair market value is for your home?  That’s where the true value of a good REALTOR® comes into play.  But then again, not all REALTORS® work the same way, and some may not have your best interest at heart.  For this reason, the most important move you can make is to consider interviewing more than one REALTOR® in order to obtain varied opinions on the true value of your home in the current market. 

 

CMA’s – What are they?


CMA stands for comparative market analysis.  Every REALTOR® has their own way of determining what the selling price of your home should be, however the simple explanation of how they determine the selling price of your home is by comparing the selling prices of comparable homes in your neighborhood.  It sounds pretty simple doesn’t it?  In fact, you can often receive online valuations, or simply call up a REALTOR® who is willing to provide you a quick estimate over the phone, so it must be easy enough to do.  At least that’s what many home owners believe. 

 

Wise Decisions Will Save You Thousands $$


The reality is quite different however. There are many REALTORS® who will work very hard for you and who will have your best interests at heart.  They want your business, and your referrals and to earn your trust and referrals they know they need to do everything they can to make sure you reach your financial goals.  But, not all REALTORS® are created equal!  Each one has their own style and has their own reasons for doing business the way they do. It is for this reason, it is always wise to interview more than one REALTOR® and determine which agent you feel will represent you the best and price your home properly keeping YOUR goals in mind.  Here are a few clues to help you weave your way through what can sometimes be a challenging decision.

 

The Three Tiers


Every REALTOR® has their own method of working and in my experience I see three common listing presentations that are shown to potential clients.

 

          1. CMA presentation based on a very limited numbers of homes in your neighborhood that are priced very low.  A common practice, when asked by a client for a home valuation for a good listing price for their home, the REALTOR® will research all the comparable homes in your market area and select a small number of homes with the lowest prices.  These homes are presented to you to show you the homes you will be competing with.  When you compare the pricing, you will likely set the selling price of your home within a similar price range in order to be competitive. In most cases, should you follow this guidance, your home is likely to sell quickly, however did you get the most value for your home?  There can be some value to pricing your home on the low end of the market, which I will explain later.

 

          2. CMA presentation based on home prices on a limited number of homes valued on the high end of the market. This scenario does not play out very often, however is a sales technique that might encourage you to select a particular REALTOR® because he/she has advised you that your home is worth more money than what other REALTORS® are suggesting. After all, you want as much money out of your home as you can get, so you would rather list with a REALTOR® that says they can provide you with better financial results.  By convincing you your home is more valuable than what others have recommended, he/she wins your confidence and the opportunity to work with you. The downside?  The REALTOR® knows that your home will likely be on the market for an extended period of time.  If after a few weeks you have had very few or no showings on the property, you will find that he or she is recommending that you lower your price to be more competitive.   They won the listing by artificially pricing the home high during your listing presentation, however in the end, the reality is that the true value of your home is quite different, and your expectations are not met.  This is not to say that even if your home is fairly priced that there will not be a need to lower your price to be competitive. As fluid as the market is, sometimes it is necessary to lower your price even on a well-priced home in order to stay competitive, particularly in a good seller’s market.

 

          3. CMA presentation based on a more balanced estimate on a larger number of comparable homes in a varied price range from low to high that are for sale in your market area.  This is the most un-biased method of providing an accurate selling price for your home. The REALTOR® is providing you with a wide range of pricing and property types to compare to, and guiding you to a selling price based on what your personal goals are.  The CMA numbers are balanced.  From these numbers you along with the guidance from your REALTOR® will help guide you to a well-priced and competitive selling price that will help you achieve your goals.

 

Your Selling Price Depends On YOUR Goals


Yes, the best selling price for your home is the highest price that the current market will bear, however there are times, when there is value to pricing your home in a certain way.  For example, in exigent circumstances, whether it be financial hardship, family circumstances or you are simply financially comfortable and have an opportunity to move to another home better suited to you that you have put an offer on, it may be in your best interest to make your home more competitive in the market by offering a lower selling price.  If you want to move your home quickly, your REALTOR® should be able to help guide you to a selling price that meets your needs without sacrificing more than you need.

 

If however you are not in a rush to sell, but want the best value you can obtain within a reasonable time, help your REALTOR® to understand what your financial expectations are and set a selling price that is within the scope of moderately priced homes are selling for.  Patience is truly a virtue in this business, and it will pay off in the end.  Keep in mind that a good home valuation simply cannot be done over the phone or using an online system.  A good REALTOR® will come to your home and take into account many features in your home that can enhance the value of your home. He or she will know what the current market trends are and what potential home buyers are looking for.  They will look at your entire property, taking into account the landscaping, finishing and upgrades as well as any other special features of your home that make it unique and could positively affect the value of your home.

 

It’s always FREE!

It probably goes without saying that home valuations to provide you a Comparative Market Analysis and determine an appropriate selling price for your home are always provided by every REALTOR® free of charge. You have absolutely nothing to lose by contacting and interviewing more than one REALTOR® in your quest to find who you feel will work in your best interest! 

Natasha Eden

 

 

 

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The slide in Calgary’s resale housing market continued in May and uncertainty about the new NDP government could keep buyers on the sidelines for another few months.

 

May marked the sixth consecutive month in which MLS sales declined, year-over-year in the Calgary market. It was the fifth straight month in which average prices declined on a year-over-year basis.

 

Sales were down 25.5 per cent from May 2014, at 2,190 transactions. The average price declined 1.5 per cent to $478,7790, while the median price was down 0.3 per cent to $433,000.

 

New listings also fell, down 26.7 per cent to 3,161. However, the number of active listings at the end of the month was up 16.1 per cent, to 5,342. Homes are also spending longer on the market — the average number of days to sell a listing was 41 in May, up from 27 in May 2014.

 

Don Campbell, senior analyst with the Real Estate Investment Network, said political confusion will be a factor over the next six months, as buyers watch for the NDP government to set policy — particularly for key industries in Alberta.

 

“What policies and announcements will the new government make in their first six months to provide stability and confidence to businesses, citizens and industry?” said Campbell. “The more clear they get the more that potential buyers can decide when to enter the real estate market and therefore prop up the demand side of the Calgary real estate market. Right now, the confidence is low and the clarity is low, post-election and therefore buyers continue to sit and wait.

 

“We can expect those December and January panic listings to expire, as many are six-month listing contracts, in June and July so we should also see homes coming back on the market at lower prices – or removed completely.”

 

Campbell said the Calgary housing market is performing exactly as expected after nine to 10 months of declining oil prices.

 

He said average prices continue to be relatively flat.

 

“This is to be expected, as those who listed in a panic when oil began to drop, especially December and January, were refusing to lower their expected prices, even as competition heated up and listings skyrocketed,” said Campbell.

 

“Number of sales is down significantly as buyers sat back waiting for two key occurrences. The first one was for sellers to start getting a little more desperate and move their expected sale prices down dramatically. This desperation has not occurred, except in a small segment of the market, especially luxury. The second key that the buyers were looking for was some sense of stability to arise in the oil and gas industry — and to date this has not occurred. Buyers have traditionally been more patient than sellers and so the waiting game continues.”

Campbell said another added component protecting the downside of the market is Calgary’s very low vacancy rates and high rents. A seller, no matter how desperate they may believe they are to sell, still needs an affordable — and more importantly, available — place to move to as the majority are not leaving Calgary region and the rental market remains tight.

 

Cody Battershill, a realtor with RE/MAX House of Real Estate in Calgary, said the year-over-year decline in city sales is continuing, but the market has improved significantly from the beginning of the year. In January and February, year-over-year sales fell by 38.9 per cent and 34.2 per cent respectively.

 

“It’s interesting because some people would say that the market’s crashing, that the market’s imploding,” he said. “We haven’t seen prices come off that much yet. I am seeing a lot more flexibility when negotiating with sellers, representing buyers, and vice versa.

 

“It’s interesting that the prices have continued to remain resilient . . .  If you like (famed investor) Warren Buffett, he tells people to buy when everyone’s afraid or be contrarian. At the end of the day, you’ve got to rent, own or live in a box. You’ve got to live somewhere.”

 

Ann-Marie Lurie, chief economist with CREB, said new listings have eased, which is helping push the market to more balanced conditions.

 

“Sales levels have continued to be lower than what we typically see at this time of year,” said Lurie.

Economic uncertainty, she said, can prompt people to wait and see before making the decision to buy a home.

“With a new government, we really don’t know what their plans will be. It could be that people are waiting to see what that response will be and how they will impact business,” said Lurie. “Obviously when I’m looking at housing it’s really what will happen to the jobs scenario . . . Having continued weakness in the energy sector, I want to start seeing how it’s impacting employment. We’ve seen some pullback in employment, but it seems to be levelling off at this point.”

 

She said the new home market has started to record some gains in inventory, but the current level remains relatively low.

 

“However, the overall impact on Calgary’s housing prices will ultimately depend on the duration of the economic slowdown and the amount of inventory build-up in the new home sector,” added Lurie.

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Consumer Affairs Reporter  Global News“We continue to watch the housing market and the lending and borrowing situation very carefully," Prime Minister Stephen Harper said Wednesday.

Prime Minister Stephen Harper said Wednesday Ottawa is closely watching developments in the still-hot housing market, but there’s no need for another intervention. “I’m not saying I’m unconcerned. We are watching it. We’re not planning to take any immediate action,” Harper told reporters after an event in Mississauga, Ont.

“We continue to watch the housing market and the lending and borrowing situation very carefully,” he said.

 

The Prime Minister made the remarks as Canada’s big banks made fresh cuts to mortgage lending rates, with the Bank of Montreal leading the market lower by slicing its 5-year, fixed rate to 2.79 per cent.

That should help rev up home sales across the country this spring, even as buyers confront affordability constraints in big centres — namely Vancouver and Toronto.

 

There are also concerns though that Canadians have piled on too much debt and that some pockets of the housing market have become “overheated.”

 

MORE: Spring real estate market heats up in Toronto, Vancouver, realtors say

But with borrowing rates edging back toward all-time lows, Harper said debt-servicing costs are falling and default rates remain extremely low.

 

Harper said Wednesday he believes Canada’s financial institutions remain strong and well capitalized.

The last time the big banks cut mortgage rates to their current levels, in 2013, then-Finance Minister Jim Flaherty publicly criticized lenders for their “race to the bottom” approach. Lenders raised rates after the warning.

Flaherty’s public criticism was preceded by a series of mortgage-tightening rules were implemented, chiefly in 2012 when amortization periods for insured home loans were capped at 25 years.

 

MORE: IMF warns over Canada’s ‘overheated housing market’ — again

Lending re-accelerates

While the moves created a lull in lending growth, experts have noted a re-acceleration in recent months.

“Following a sustained period of stable year-over-year increases, mortgage growth accelerated for the third consecutive month in January,” RBC economists said in a research note published earlier this month.

Total outstanding home loans grew by 5.4 per cent from the year-ago level to mark the fastest rate of growth since November 2013, RBC said.

Prices cooling

The faster pace of lending appears to be concentrated to within a dwindling number of markets, though, namely — again — Vancouver and Toronto.

 

 

Resale and pricing data published by the Canada Real Estate Association last week show the country’s two most expensive markets propping up national figures, which otherwise would be far weaker.

 

 

“The national average home price remains skewed by sales activity in Greater Vancouver and Greater Toronto, which are among Canada’s most active and expensive housing markets,” the association said.

 

MORE: Home prices are cooling everywhere but red-hot Vancouver, Toronto


The average benchmark price for a home in Canada continued to rise at a surprisingly strong pace last month, climbing 6.3 per cent, to $431,812. But excluding those two markets, the average price gain would have come in at a much tamer 1.5 per cent, to an average price of $326,910.

 

Calgary, formerly the hottest housing market in the country as higher oil prices bolstered an active market, still saw average prices climb nearly 6 per cent last month, according to CREA. But “the increase was far smaller than gains posted last year and the smallest since December 2012,” the association said.

 

“In other markets from West to East, prices were up compared to year-ago levels by between two and two-and-a-half per cent in the Fraser Valley, Victoria, and Vancouver Island, while holding steady in Saskatoon, Ottawa, and Greater Montreal, and falling in Regina and Greater Moncton,” CREA said.

 

— With files from the Canadia

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As you are no doubt aware, yesterday’s release of Budget 2015 contains increases to fees for real estate transfers as of July 1, 2015. In statements related to the Budget, Service Alberta identified real estate associations among the stakeholders who were consulted on increases to fees related to the transfer of real estate. To that effect, AREA CEO Ian Burns has released the following statement to clarify that AREA was not consulted on these increases and to state the association’s position:

 

"Budget 2015 includes significant hikes to fees paid by real estate consumers beginning July 1, 2015, including registering new land titles and mortgage documents.


The Alberta Real Estate Association (AREA), the provincial, professional association for Alberta’s 10,000 REALTORS®, was not one of the real estate association stakeholders consulted on these increases.

AREA appreciates the fiscal challenges faced by government and recognizes that, after this increase, fees related to real estate transfers remain lower in Alberta than other provinces. We have asked Service Alberta to confirm what sources they are quoting when expressing that real estate associations were among the stakeholders who identified that there was ‘room for these fees to grow’."


Increases to fees are certainly never welcomed and the table below details the impact of these increases on the fees for a $500,000 home with a $400,000 mortgage:

 

 

Fees Prior to July 1, 2015
($50 + $1 per $5,000 increment)

Fees After July 1, 2015
($75 + $6 per $5,000 increment)

Land Title Registration

$150

$675

Mortgage Registration

$130

$555

Total

$280

$1,230

Though the increase as of July 1st represents a hike of more than 400% for the real estate consumer, the cost of real estate transfers in Alberta remains lower than other provinces. This can be attributed to the continued avoidance of a Land Transfer Tax in Alberta at either the provincial or local levels.

 

Rest assured that AREA continues to monitor discussions by government and advocate on behalf of members to avoid Land Transfer Tax ever becoming a reality in our province.


AREA also believes that preferable alternatives to increasing fees exist, and will continue to have discussions with Service Alberta to that effect. Enhancements to the Land Titles Registry could incorporate all existing property records under one, centralized system (e.g. property-related permits, condominium documents, grow-op history, environmental assessments and New Home Warranties). All of these records under one roof could allow the Government to increase revenues through the provision of these documents.

 

Click here to view information on AREA’s positions on both Land Transfer Tax and enhancements to the Land Titles Registry.

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Harper says no need for action in housing market, as rate wars rage

“We continue to watch the housing market and the lending and borrowing situation very carefully," Prime Minister Stephen Harper said Wednesday.

“We continue to watch the housing market and the lending and borrowing situation very carefully," Prime Minister Stephen Harper said Wednesday.

CANADIAN PRESS/Sean Kilpatrick

Prime Minister Stephen Harper said Wednesday Ottawa is closely watching developments in the still-hot housing market, but there’s no need for another intervention.

“I’m not saying I’m unconcerned. We are watching it. We’re not planning to take any immediate action,” Harper told reporters after an event in Mississauga, Ont.

“We continue to watch the housing market and the lending and borrowing situation very carefully,” he said.

 

The Prime Minister made the remarks as Canada’s big banks made fresh cuts to mortgage lending rates, with the Bank of Montreal leading the market lower by slicing its 5-year, fixed rate to 2.79 per cent.

That should help rev up home sales across the country this spring, even as buyers confront affordability constraints in big centres — namely Vancouver and Toronto.

There are also concerns though that Canadians have piled on too much debt and that some pockets of the housing market have become “overheated.”

MORE: Spring real estate market heats up in Toronto, Vancouver, realtors say

But with borrowing rates edging back toward all-time lows, Harper said debt-servicing costs are falling and default rates remain extremely low.

Harper said Wednesday he believes Canada’s financial institutions remain strong and well capitalized.

The last time the big banks cut mortgage rates to their current levels, in 2013, then-Finance Minister Jim Flaherty publicly criticized lenders for their “race to the bottom” approach. Lenders raised rates after the warning.

Flaherty’s public criticism was preceded by a series of mortgage-tightening rules were implemented, chiefly in 2012 when amortization periods for insured home loans were capped at 25 years.

MORE: IMF warns over Canada’s ‘overheated housing market’ — again

Lending re-accelerates

While the moves created a lull in lending growth, experts have noted a re-acceleration in recent months.

“Following a sustained period of stable year-over-year increases, mortgage growth accelerated for the third consecutive month in January,” RBC economists said in a research note published earlier this month.

Total outstanding home loans grew by 5.4 per cent from the year-ago level to mark the fastest rate of growth since November 2013, RBC said.

Prices cooling

The faster pace of lending appears to be concentrated to within a dwindling number of markets, though, namely — again — Vancouver and Toronto.

Resale and pricing data published by the Canada Real Estate Association last week show the country’s two most expensive markets propping up national figures, which otherwise would be far weaker.

“The national average home price remains skewed by sales activity in Greater Vancouver and Greater Toronto, which are among Canada’s most active and expensive housing markets,” the association said.

MORE: Home prices are cooling everywhere but red-hot Vancouver, Toronto

The average benchmark price for a home in Canada continued to rise at a surprisingly strong pace last month, climbing 6.3 per cent, to $431,812. But excluding those two markets, the average price gain would have come in at a much tamer 1.5 per cent, to an average price of $326,910.

Calgary, formerly the hottest housing market in the country as higher oil prices bolstered an active market, still saw average prices climb nearly 6 per cent last month, according to CREA. But “the increase was far smaller than gains posted last year and the smallest since December 2012,” the association said.

“In other markets from West to East, prices were up compared to year-ago levels by between two and two-and-a-half per cent in the Fraser Valley, Victoria, and Vancouver Island, while holding steady in Saskatoon, Ottawa, and Greater Montreal, and falling in Regina and Greater Moncton,” CREA said.

– With files from the Canadian Press

jamie.sturgeon@globalnews.ca

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New condo construction in Calgary on February 9, 2015.

New condo construction in Calgary on February 9, 2015.

Colleen De Neve / Calgary Herald


 

The recent oil price decline has put the brakes on the hot housing market in the Calgary region, but during the last five major oil price declines, new home prices only fell in just two of those instances, says a new report by Fortress Real Developments.

 

The semi-annual Market Manuscript, released on Monday, said completed and unsold housing units fell to their lowest level in more than 25 years in the Calgary census metropolitan area in 2014, with just one unsold condominium.

 

“In October, Calgary was ranked as the top real estate market to watch for 2015. That optimism has faded, with many housing experts now calling for balanced market conditions in the metropolitan area,” it said. “Demand clearly exceeded supply in the late stages of 2014 in the Calgary CMA. The cooling effect on homebuyer demand that is expected in 2015 will contribute to a re-balancing of the demand-supply equation for the CMA in the first half of the year. It is expected that Calgary will move from a seller’s market to a more balanced market.

 

“In three of the last five major oil price declines, new house prices in Calgary didn’t decline, let alone crash.”

Analyst Ben Myers, the author of the report, said he was surprised by the data, adding that Calgary’s housing market is historically fairly resilient when it comes to economic downturns.

 

“Certainly from everything that I read, the analysts tend to think that Calgary is a lot more diversified than it ever has been before,” said Myers. “It’s a much bigger census metropolitan area and there’s other things going on than just the oil industry.

 

“Right now, everyone’s in that ‘we’re not sure what’s going on period so we’re just going to hold off. We’re not going to make this huge decision in our lives until we kind of figure out what’s happening’. It looks like oil prices have stabilized a bit. They’re not really going up but they’re not really going down anymore. The slide has kind of stopped.”

 

The report said the World Bank has identified five other major episodes where oil prices dropped by 30 per cent or more over a six-month period besides the current one.

 

“These declines coincided with other global events: an increase in supply of oil and change in OPEC policy (1985-86); U.S. recessions (1990-91 and 2001); the Asian crisis (1997-98); and the global financial crisis (2007-09). New house prices (in Calgary) only declined in the 1991 and 2009 situations,” said the report.

It said new house prices in the City of Calgary increased 12.5 per cent in 2014, with condominium apartment prices jumping 28.9 per cent, adding that absorption rates should remain strong in 2015, as a significant portion of the new home product is pre-sold.

 

“Household formation figures indicate there is minimal risk of oversupply in the Calgary CMA over the next year,” said the report.

 

It said absorptions were just short of a record high in the Calgary CMA in 2014 at 12,740, while completed and unabsorbed supply fell to just 451 units at the end of December, marking a 25-year low. There was only one completed and unabsorbed apartment at the end of 2014, down from 600 units in 2010.

 

Between February 1986 and December 1986, oil prices were down 49 per cent year-over-year on average. During that same period, new house prices in the Calgary CMA increased eight per cent annually on average, said the report.

 

Between August 1991 to January 1992, oil prices were down 29 per cent on average, new house prices were down two per cent on average.

 

Between September 1997 to February 1999, oil prices declined 27 per cent on average, new house prices increased seven per cent on average.

 

Between June 2001 to March 2002, oil prices declined 24 per cent on average, new house prices increased three per cent on average.

 

Between November 2008 to September 2009, oil prices declined 50 per cent on average and new house prices declined seven per cent on average.

 

“The biggest new house price decline occurred during the last ‘episode’ in 2008/2009, when Calgary and the world were in the midst of the global economic meltdown,” said the report. “During this crisis period, credit was totally cut off, the U.S. was in terrible financial shape, and Calgary was already on a downward spiral following bubble-like conditions in their housing market in 2007.”

 

Original article from the Calgary Herald at http://calgaryherald.com/business/real-estate/calgary-new-home-prices-survived-three-of-five-previous-oil-price-collapses

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Global News, just came out with a great article on Renting vs Buying that is a very good read.  We have a website set up specifically for first time home buyers at RentStinks.ca that is set up to help anyone who is considering purchasing their first home.  They key is to be properly prepared and not pressured into your first purchased. I have a number of tools that can guide new buyers, so please don't hesitate to get in touch, as I am more than happy to help.

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Calgary sales in January totaled 880 units, well below typical activity


Low oil prices throughout January, combined with a shifting outlook in the energy sector, caused unease for consumers. As a result, monthly housing sales activity fell to levels not seen in five years.

 

“Economic conditions this year are expected to be weaker than original estimates provided in December 2014," said CREB® chief economist Ann-Marie Lurie.

 

“This change is partly connected to continued low energy prices, which impact consumer confidence. A lack of recovery in oil has many concerned about their employment status and this concern is reflected through the weaker sales activity in Calgary’s January resale figures,” said Lurie.

 

Sales levels were over 35 per cent lower than the 10 year average and declined across all three sectors in the city (Attached, detached and apartment). Meanwhile, new listings increased by 39 per cent city-wide, causing inventory levels to rise.

 

“There are many reasons for consumers to list their home,” said CREB® president Corinne Lyall. “One reason may be that consumers are concerned about what will happen to Calgary’s economy and their personal exposure to this risk,” said Lyall.

 

While new listing activity increased in every price range this month, the rise in new listings was primarily due to gains in the higher price ranges. In the detached sector, new listings increase by 32 per cent relative to January 2014, all of which occurred in product priced over $400,000.

 

Despite the recent supply increase in the market, benchmark prices managed to remain relatively stable this month. January benchmark prices totaled $459,100, a 7.7 per cent increase relative to January 2014, but similar to December figures.

 

Although residential prices remained relatively stable, there was some variation in sectors. The apartment sector recorded the largest gain in new listings relative to sales and inventory levels nearly doubled reaching 1,148 units. The rise in supply relative to demand placed downward pressure on benchmark prices, which fell to $298,700 compared to $300,400 in December.

 

“It’s important for sellers to set appropriate expectations in this market,” said Lyall. “They need to consider their property type, the competition they may be facing in their community, their reasons for selling and, of course, when they ultimately need their property to be sold.”

 

Detached benchmark prices totaled $518,600 in January, similar to December levels, but a 7.9 per cent increase relative to January 2014. Meanwhile, the attached unadjusted benchmark price in January totaled $356,200, similar to prices recorded in December.

 

“Housing decisions will likely continue to be postponed for many consumers until they can see what happens with the economic climate in the spring,” said Lurie.

 

“Nonetheless, if supply levels continue to rise at levels that exceed the pace of demand growth, we can expect this will start to impact prices in the city.”

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Major banks like RBC have finally lowered interest rates on home loans in tandem with the Bank of Canada’s rate cut made last week.

 

Big lenders have begun offering fixed-rate mortgages at rock-bottom rates of as little as 2.84 per cent, while smaller lenders can be found providing fixed-rate loans at as low as 2.69 per cent.

 

Meanwhile home loans with variable rates – i.e. with an interest rate that’s not set but instead floats up and down – have edged below 2 per cent.

 

The renewed mortgage rate wars sparked by the Bank of Canada’s surprise cut are sure to draw out house hunters in the weeks and months ahead. But can you afford that mortgage, even at the current ultra-low levels of interest?


Rule of thumb


The historical rule of thumb among mortgage experts is that no more than about 32 percent of household pre-tax income should be spent on housing costs, like your mortgage, utilities, condo fees and property taxes.

A record boom in housing prices however has thrown that threshold out the window for more than a few Canadian households. Royal Bank of Canada suggests the average family who owns a home dedicates 42.6 per cent of their income to covering the mortgage, utilities, property taxes as well as fees for condominium owners.

 

In some centres – notably Vancouver (83.6 per cent) and Toronto (56.3 per cent) – the percentage is far higher.

 

How much house can you handle? Use this calculator to find out.


For condo owners, simply lump monthly fees into property taxes. (And to determine your potential monthly payment, use this calculator to find out.


Affordability Calculator

Mortgage experts suggest no more than 32% of household income be spent on housing costs. Whether you're looking for a home or already have one, use this calculator to determine your affordability reading.

 

Original Article by Global News

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