Is now the time to buy real estate in Toronto or the GTA?

John asked:

Hi Mark,

I am a follower of your website, my family and I moved to Mississauga end of last year and has slowly looking for a property for us to live since March, we saw the price up and up, so now we are in a dilemma whether we should buy now or we just wait a little bit until later this year, I know this is a very specific question, but please give us some of your advice based on your experience and observations, thanks very much.

John

Hello John,
Thank you for your real estate inquiry. Nice to hear from a long time reader.

Yes, we can certainly help you find a place to live.

Whether this is the right time of year or the market to purchase, nobody knows for sure. The prices have only been escalating at a fairly constant rate since about 2000 and nearly every year since 1995, see here:

http://www.mississauga4sale.com/TREBavg1995date.htm

There are no guarantees, but it appears the market will continue.

HST and increased rates may have something to do with our current rise, but rates are still exceptionally low compared to historical figures, this is why our market has done so well in the past 5 years or so. Even if rates increase 1% in the next 9 months, the mortgage rates are still very low.

You should get into the market as soon as you can in your life, this way you are paying down the mortgage rather than throwing rent money out the window, that's my advice. Buying a home is forced savings, in 25 years at the longest, you will own it outright and then you have a nice property with large equity. If you rent you do not have this at the end of 25 years.

The entire buying process is explained here
http://www.mississauga4sale.com/buying.htm

Please let me know if you have any other questions or if there is anything else I can help you with.

Mark

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

Power of Sales, Foreclosures and Quit Claim Deeds in this section - New Section

I've recently added a New Power of Sale section to my website that will show you the pitfalls to avoid and the clauses to put into your offer when you buy a Power of Sale property in Ontario. This new section will also explain Power of Sale and Foreclosure in detail. Read more here.


You will become educated about Power of Sales, Foreclosures and Quit Claim Deeds in this section.

You will learn the pitfalls to avoid, the clauses you could expect to see in an offer and read about the special clauses you can insert into your offer when you buy a Power of Sale Property. I will also explain the remedies open to sellers of these types of properties and how this affects you.

Power of Sales, Foreclosures and Quit Claim Deeds in this section.



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

Sales and prices summary comparison in the GTA for real estate

The table below shows you the sales and prices summary comparison in the GTA

March Real Estate Resale Market Figures for the GTA, Toronto and Mississauga

The results for March sales are in and there were over 10,000 sales in March. The average price climbed to $434,696 up marginally from the previous month figure of $431,509

All good news for sellers. Buyers are still finding it difficult to find a home because of multiple offers on most listings.

The entire report is below.

All the best,

Mark

Greater Toronto REALTORS(r) report March Resale Market Figures

TORONTO, April 6, 2010 - Greater Toronto REALTORS(r) reported 10,430 sales through the Multiple Listing Service(r) (MLS(r)) in March, pushing total first quarter 2010 sales to

22,418 - the best result on record under the current Toronto Real Estate Board (TREB) boundaries. The average price for March transactions was $434,696. The average price for the first quarter was $427,948.

"The strong rebound in the existing home market was one of the initial drivers of economic recovery," said TREB President Tom Lebour. "While we don't expect to see the same rates growth moving forward, GTA households will remain confident in ownership housing as a quality long-term investment, especially as economic recovery expands across all industries."

The annual rate of growth for new listings continued to accelerate in March.

The number of new listings grew by 42 per cent compared to March of 2008.

"The average home price in the GTA will continue to grow this year, but the pace will slow as we move through the spring," said Jason Mercer, TREB's Senior Manager of market Analysis. "As growth in new listings starts to outstrip growth in sales, buyers will experience

Mark

FAQ's on power of sale properties

I had a client email me with question about power of sale properties and I thought I would share my answers with you.
Mark

Hi Mark,
I saw the property below listed on the most recent POS listing.
I read that usually POS properties are sold "As Is".
I am sorry I am not familiar with some of the terminology and would like to
kindly ask for clarification:
- Pls Call The L.A Before Preparing Offer??? - what does this mean?
- Pls Allow 2 Banking Days Irrevoc. On All Offers.???
- No Survey, Property Being Sold As Is, Where Is Condition As Seen From
Outside Property As Per Mls - what is MIs

Thank you,
M.

Hello M.

Good questions! :-))

"As is" means that you are purchasing everything in the current as seen condition, whether or not any systems such as plumbing, electrical or otherwise are function or not. It's up to you to determine the current state of all systems in the house and we do this by performing a home inspection. The home inspection will uncover any deficiencies in the property.

"calling the listing agent before preparing offer" usually means that there are very particular disclosures that must be made prior to submitting an offer, such as the fact that the property was used as a grow house or something similar.

"2 banking days irrevocable" means that the bank needs 2 banking days to review and respond to your offer

"No Survey, Property Being Sold As Is, Where Is Condition As Seen From Outside Property As Per Mls" means that the agent and the seller are not making any disclosures regarding the current state of the property and that you must see the property only from the outside and your offer must be conditional upon seeing the inside of the property and you must make your
decision to proceed based upon the outside of the property and as per the MLS listing agreement.

MLS is Multiple Listing Service and these are all the listings that are available to any member of the mls through TREB or mls.ca

I hope this helps, please let me know if you have other questions.

Thank you,
Mark

Current Mortgage Interest Rates in Toronto and GTA

Current mortgage interest rates obtainable in the GTA
I can put you in contact with a TD mortgage person who can give you these
rates,
Mark


* Our Best Rates
* There's more to a mortgage than just a low rate

Our Best Rates

Terms Posted Rates
Best
obtainable
Rates
6 MONTHS 4.60% 3.85%
1 YEAR 3.65% 2.49%
2 YEARS 3.95% 2.95%
3 YEARS 4.70% 3.45%
4 YEARS 5.34% 3.69%
5 YEARS 5.85% 3.89%
7 YEARS 6.30% 4.65%
10 YEARS 6.50% 4.99%
Rates are subject to change without notice. *OAC E&OE

Variable rate mortgages from as low as Prime minus 0.40%.

Prime Rate is 2.25%.*

*Prime rate may vary according to lender. Be sure to check with your
mortgage professional for full variable-rate mortgage pricing details.

Rates are subject to change without notice. Fixed mortgage rates shown in
table above and quoted variable mortgage rates are available nationally to
qualified individuals. Lower rates may be available in certain regions, or
to those with higher credit scores or higher net worth - check with your
mortgage professional for full details.

What does MLS stand for?

Thank you Mark. I have one question. What does MLS stand for?

Natalie

Hi Natalie,
MLS is Multiple Listing Service
This means that if a property is listed on the MLS it is available to all
members of the MLS service. There are a few listings that are not on the
MLS.
Thank you,
Mark

What is so "critical" about a Status Certificate when selling a condominium in Ontario?

What is so 'critical' about the status certificate when you buy a condominium in Ontario?

When I am representing the seller, I tell them the status certificate is critical.

What I mean by " critical " is that we have nearly zero control over the content of the status certificate and how the buyers lawyer interprets the information contained within it.

If there are any issues with the financial status or operation of the condo (current or future) the buyer has the option to back out of the sale.

Most often the buyer and the buyer's lawyer is fine with the status certificate, but there are many issues that could arise. This is why I say it's the critical condition. Financing and inspection conditions are quite straightforward.

I'm not trying to scare you, these are just the facts.

Most Status certificates are fine, but once I receive the status certificate, I will copy the first 5 to 7 pages, these are the most important and specific pages to your particular unit (the balance of the status certificate is about 50 pages of budgets and legal information about the condo complex, and nothing particular about your unit) and I like to have a copy of these pages in the event of further discussion with the other agent or solicitor, more as a reference.

Typically, the status certificate for a condo should be fine as long as there are no new issues that you the seller does not know about.

I hope this helps,
Mark

Last chance for fixed rates by 5pm today

This came to me today....


Hi there,

I only have one lender left with fixed rates unchanged until 7pm today.

3 year fixed 3.40%
4 year fixed 3.69%
5 year fixed 3.84%.

But it only applies to real deal, not for pre-approval.

If you have clients who have the offer signed and would like to lock for the above rates, pls send the docs to me ASAP.

If you need these rates, let me know and I'll put you in touch with my mortgage contact.

Thanks
Mark

Has the market peaked? Should you sell your property now or later? What if market drops in 6 months?

Has the market peaked? Is this the time to "cash out" and move to a smaller home?

These are very difficult decisions to make.

I've always said this "you have to make the best decision you can at the time given all the information you have at hand and hope you make the right decision and most important accept it", such as me getting out of the financial mutual fund markets last fall, the stress was too large compared to the potential returns/losses.

You have a similar decision and ultimately, if you sell your current home and buy, for example, 1/2 to 2/3 of whatever your current home sells for, you will benefit more by selling now if the market drops.

But if the market does not drop you've not lost too much, but, if you don't sell now and the market drops you will lose more, but the house you were moving to would also drop, so your difference in prices is not as bad as it sounds.

Let's work with some numbers.

Say your current house is worth $800,000 and you are purchasing a home for $500,000 If you do this today then you will net approximately $300,000 If you wait 6 months, for example, and if the market were to drop on average 10% then the $500,000 home would be worth $450,000 but the larger home would drop more than 10%, due to the larger properties dropping more in a downswing (and rising more in an upswing), but even if we use the absolute number of 10% then the $800,000 home would be worth $720,000. Now the difference is $270,000 This indicates that all things being equal you would lose approximately $30,000 if you are trading down and you wait 6 months and the market drops 10%

If you wait and the market increases 10% in 6 months from now, then you gain an additional $30,000.

Thus, the difference in the buy/sell today versus buy/sell later if the market is up or down in the future is not as great as you think - the key is that the larger priced property will rise more in absolute dollars if the market increases and similarly will drop more in absolute dollars if the market falls, thus the dilemma, but the absolute difference is not as large as you may think.

Ultimately, it's your risk tolerance and whether you are betting the market will be better or worse than it is today.

I wish you the best of luck with everything you do!

Mark