RBC speculating Bank of Canada will drop rate to .5% - unprecedented!

RBC made some interesting comments regarding the Bank of Canada a few days back. They expect the Bank of Canada to drop their prime rate to .5% in March, wow, that would be unprecedented!

See the article below.

I hope this finds you happy and healthy,
Mark


Bank of Canada —Now what?

The bleak near-term outlook supported the Bank’s decision to cut the overnight rate by 50 basis points to 1.00% in mid-January and early 2009 data confirmed that the recession is building momentum.

With the surprising large drop in employment and corresponding jump in the unemployment rate, we now look for the Bank to ease the policy rate to just 0.5% in March.

With so much bad news already embedded in the Bank’s forecast, it would take signs of a more severe global contraction, another financial market hiccup or a failure of the government’s fiscal stimulus package to produce results before we would look for the Bank to lower the policy rate to zero or resort to more unconventional policy measures.

Unfortunately, none of these factors can be ruled out!

The Bank of Canada lowered the policy rate

RBS is reporting that 2010 will be the year of recovery, let's hope!

The Bank of Canada lowered the policy rate to 1% and issued a dire near-term outlook alongside a relatively upbeat forecast for 2010.

• Recent economic data have been bleak, raising the risk of a severe recession that is likely to see the Bank ease again.

Still, fiscal stimulus and easy monetary policy will likely yield a recovery in the second half of the year.

Read more about:

• Interest Rates
• Power of Sale Properties
• Price Trends
• or Search the MLS and more at my website

Thank you for reading my blog and if there is anything else I can help you with please don't hesitate to contact me,

Mark

A. Mark Argentino
P. Eng. Broker
Specializing in Residential & Investment Real Estate

Thinking of Selling? Best Mortgage Rates Current Home Prices Search MLS
RE/MAX Realty Specialists Inc.

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TREB membership statistics- plenty of competition!

See the figures below showing that the number of registered sales people is up with TREB, but nearly 2000 people! That's more realtors competing for less sales, makes for a very competitive marketplace for sellers and buyers. Plenty of choice!

All the best,

Mark

Total Membership:

December 2007 = 26,861

December 2008 = 28,673

Days on Market up in GTA real estate marketplace

The table below shows the current state of the market at a glance.

It shows the days that it takes for a property to sell in the GTA is up significantly compared to last year. January of 2008 showed that it took on average 36 days to sell your property. January of 2009 it was 49 days, this is a significant increase and shows how the market has slowed since last year.





As well, the table below shows that the number of active listings is up by about 29% meaning there is much more choice in the marketplace in Toronto and the GTA.





With the number of sales down about 47% for year over year, this all equates to a buyers market.





With interest rates at historic lows, this all means it's a great time to buy real estate and buyers should be buying!





I wish you all the best,


Mark




For more information please contact A. Mark Argentino

A. Mark Argentino, Broker, P.Eng.,
Specializing in Residential & Investment Real Estate
RE/MAX Realty Specialists Inc., Brokerage
2691 Credit Valley Road, Suite 101, Mississauga, Ontario L5M 7A1

BUS. 905-828-3434
FAX. 905-828-2829
E-MAIL: mark@mississauga4sale.com
Website: Mississauga4Sale.com

Should you do renovations on a fixer upper or sell as is?

I received this question today and thought I would post my answer here.

In a market such as the one we are experiencing now, I would suggest that you don't spend too much money at all on renovations.

Quick and inexpensive cosmetic fix ups are fine, but don't spend too much, you just won't get it back.

Pricing is everything in our marketplace.

When you have unfinished floors or stairs, I think you should put down the flooring and try to finish hardwood stairs.

Paint is not the end of the world, many will repaint once they move in.

With regards to the heaps of dirt or debris in your back yard, let's pray for more snow! :-)) Just kidding, and backyards are not deal breakers.

We will probably have another few weeks of harsh winter, but in my 21 years of real estate experience, one of the best times of the year to list your home for sale is just before or just after March break. People seem to begin their house search at that time and you may benefit by this.

Please let me know if you have any other questions.

I hope this finds you happy and healthy!

Thank you,

Mark

Shortage of supply? and Little competition? You're kidding!

People are asking me when I make comments such as there is a "Shortage of supply? and Little competition?" and this is the truth in many areas of Mississauga.

That's exactly what we are finding. I know it's not intuitively correct, but many of the properties currently on the market have been there for some time, are tired and not updated.

There is a serious shortage of good homes on the market, especially in some higher demand areas of Churchill Meadows. I've sold two homes in Churchill Meadows, both sold in less than 10 days because they showed very well and were priced right.

Credit Pointe is also an area that is in good demand and you live on one of the nicer streets, so if your home shows well and is priced right, it will sell.

It's not catastrophe out in our Mississauga marketplace, just a slower paced market, there are still hundreds of homes selling each month.

I feel we are about near the bottom, we many stay here for 2 to 6 months, but I don't see prices falling too much more. I may be wrong, but there is much pent up demand out there, many people with cash waiting to hear the news that the market has turned and by then it will be too late.

At any rate, just wanted to clarify and post here on my blog for all to see my comments!

Thank you,

Mark

TREB GTA annual volume of sales 1991 to 2008

The graph below shows the average number of resale homes from the period 1991 to 2008

Note the huge surge in sales in 2005 and 2007

It's not that our marketplace has crashed, just slowed. It will pick up again, just a matter of when

I hope this finds you happy and healthy,

Mark

Monthly single family average sale price in the GTA for 2007 and 2008

The graph below shows the monthly single family average sale price in the GTA for 2007 and 2008

The data shows that our market has slowed since about September of 2008 compared to 2007 and previous years.

This has been felt throughout our GTA market and sellers have been adjusting their prices back to about the same as summer of 2007 levels in order to sell

I hope this finds you happy and healthy,

Mark

What happens if a buyer does not close on a real estate sale?

This is a common question that I receive from sellers that I deal with, such as "what happens in the event when the purchaser does not have the funds upon closing and will not have the funds, regardless of any extensions"

Please understand that I am not a lawyer and cannot give legal advice to this question, this is a question for a lawyer to answer in full. I can shed some light on my experiences and teachings with such matters.

If the purchaser does not close on a sale on the agreed upon date, then it's incumbent upon the seller to put the property back on the market and try and resell at the best price and terms. In law, it's called, you have to "mitigate your damages". This means that you, the seller, has to try and reduce any potential loss you may incur when you resell. If there is a shortfall from the second sale compared to the first and you may incur extra costs, the seller would go after the first buyer for costs and additional out of pocket expenses.

Then there is the issue of the deposit that my real estate company is holding in trust for the buyer. It remains in our real estate trust account until one of the following occurs.

My teaching and experience regarding closings that fail is that there are 3 'typical' methods that a deposit comes out of trust.

1. If there is a successful sale
2. if there is a mutual release and
3. if there is a court order

There are others, but these are the main methods. Thus, if you sale does not close, you attempt to resell, any loss you incur you will attempt to go after the money in trust and attempt to negotiate with the first buyer to cover these costs.

On the mutual release you and the original buyer would agree to an amount of the deposit that comes to you and an amount that goes back to the buyer. If you cannot agree on the terms of the mutual release, you would have to go to court and sue the buyer for what is called 'specific performance' since the buyer did not consummate the sale.

Again, I am not a lawyer and you should ask your lawyer to further clarify what happens if a sale does not close.

Thankfully, this situation of a buyer not closing does not happen too frequently in real estate so we don't have to deal with it too often.

I've been in the real estate business for just over 21 years and this has never happened to any of my sales over the course of my career in real estate.

Thank you,

Mark

Price reductions In Mississauga to sell current listings

The reality of our current GTA and Mississauga marketplace is that you have to price aggressively in order to get sold. When I say aggressively, I mean that you have to be priced within 2% or so of market value, otherwise you may not sell in this marketplace.

I've had 3 listings that have been on the market for just over a month and although we are receiving showings, we've now had to reduce the prices to be price leaders in order to sell.

One listing is located at 3120 Turbine Crescent, a freehold townhouse in Churchill Meadows and it's now reduced to 299,999

See details and slide show at this link for Turbine:

http://www.mississauga4sale.com/listings/3120-Turbine-Crescent.htm

I also have two semi detached homes that are side by side (attached) where one is currently owned by the parents and the other by the children. This is a perfect setup for people that would like to have separate homes, but attached!

The one semi is located at 1185 Prestonwood is now asking $354,900 and the next door attached semi is now reduced at 1187 Prestonwood to $334,900

See details and slide show at this link for both properties at Prestonwood at this link:

http://www.mississauga4sale.com/listings/1185-Prestonwood-Crescent-Heartland.htm

and

http://www.mississauga4sale.com/listings/1187-Prestonwood-Heartland-District.htm

Please let me know if you would like to see inside any of the above great homes!

Thanks

Mark