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Experienced Realtor (2012, 2013, 2014 And 2015 Recipient Of The Prestigious RE/MAX PLATINUM CLUB AWARD For Sales Greater Than 10 Million Annually) in Durham Region And The GTA, #1 Team 2014 & 2015 Whitby Office. "THE JACKIE GOODLET TEAM" has extensive knowledge which includes selling resale homes, new build homes & condo's since 1989. With over 25 years experience and exceptional negotiating skills we are confident we can save you time and money on all your real estate endeavours. We look forward to hearing from you soon!

Wednesday, September 20, 2017

Ontario’s labour market could be at risk says think tank

Jobs for young people and low-income earners could be at risk from a $15 minimum wage in Ontario.

That’s the finding of a report from non-partisan think tank the Fraser Institute which says the 32% increase in the province’s minimum wage would be felt more in areas outside Toronto.

“Economic conditions are not the same across Ontario, so the negative effects of a $15 minimum wage—namely job losses for young and low-skilled workers—will be more severe in some areas of the province,” explained Ben Eisen, director of the Fraser Institute’s Ontario Prosperity Initiative and co-author of Ontario Enters Uncharted Waters with a $15 Minimum Wage.

The analysis of previous research shows that when the minimum wage is more than 45% of the average wage, negative economic impacts are more severe.

While $15 would be 47% of Toronto’s average wage, it would be 56% of the average hourly rate in Hamilton and London and 53% of the rate in Thunder Bay.

“Young people and low-skilled workers will suffer job losses across Ontario, but the costs could be especially high in regions of the province where the average wage is lower than in Toronto,” said Charles Lammam, director of fiscal studies at the Fraser Institute and study co-author.

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Canadians want green spaces to be protected says TD poll

Protecting Canada’s green spaces is a priority for most people but a survey shows that they could be improved.

The poll by TD Bank shows that 95% of Canadians say that access to green spaces will be important for their quality of life in the future but three quarters say local green space could be made better with more picnic areas, natural playgrounds and solar lighting.

Proximity to green space is a key factor in deciding where to live, with 18% ranking it a high priority, behind proximity to close schools and public transport.

"Canadians agree, community green spaces are an integral part of our identity," said Karen Clarke-Whistler, Chief Environment Officer, TD Bank Group. "As the pace of life around us intensifies, Canadians value outdoor spaces in their communities where they can find common ground."

Commercial development should not impact green space according to 40% of respondents with 24% saying that housing developments should also not mean cutting back on green space.

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Canadian debt-to-disposable income load rises in Q2

In its latest data release, Statistics Canada announced that the amount Canadians owed compared with their disposable income climbed higher in the second quarter.

The agency said household credit market debt as a proportion of household disposable income increased to 167.8 per cent, up from 166.6 per cent in the first quarter. This meant that for every dollar of household disposable income, there was $1.68 in credit market debt.

The increase in the debt ratio came as household net worth on a per capita basis fell by $1,300 to $285,900. In the same time frame, household income increased 1.2 per cent, while household credit market debt rose 1.9 per cent.

“A decline in household net worth, albeit modest, alongside a sharp increase in consumer credit growth are notable as together they suggest that the ability of households to absorb higher interest rates continued to deteriorate,” RBC economist Laura Cooper wrote in a commentary, as quoted by The Canadian Press.

Overall household credit market debt, which includes consumer credit, mortgage and non-mortgage loans, totalled nearly $2.08 trillion in the second quarter. Mortgage debt increased 1.6 per cent to $1.36 trillion, while consumer credit grew 2.4 per cent to $609.6 billion.

TD economist Dina Ignjatovic cautioned that household indebtedness remains a key risk to the economic outlook.

“This is especially true in regions that are more sensitive to higher interest rates such as B.C. and Ontario, with the latter even more at risk given the recent turn in the housing market,” Ignjatovic said in a commentary.

“Going forward, the spending environment – for consumers, businesses and governments – will become more challenging in light of the recent interest rate hikes by the Bank of Canada,” she added. “With [more] hikes likely in the pipeline, there will be some further deterioration in the debt service ratio in the coming quarters.”

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OSFI proposals will do more harm than good for consumers—observers

Further changes to mortgage rules proposed by the Office of the Superintendent of Financial Institutions will extend mortgage stress tests to uninsured loans, which might force some Canadians to go for more volatile options such as variable-rate mortgages.

The OSFI’s proposal would compel consumers to qualify for loans based on the rate on their contract plus 200 basis points, a move that might lead some people into shorter-term loans with lower rates.

“It could be one of the unintended consequences,” CIBC World Markets Inc. deputy chief economist Benjamin Tal told the Financial Post.

Tal added, however, that the OSFI will modify its proposal, taking into account how the regulatory regime is actually discouraging consumers from locking in their rates.

Urban Development Institute (Pacific Region) president and CEO Anne McMullin agreed, saying that the proposed changes are unnecessary, excessive, and “in many respects, counterproductive to growing our economy and improving housing affordability.”

McMullin warned that first-time buyers such as young families will suffer the most should the changes push through, as more and more members of this demographic will be priced out of the already ruinously expensive Canadian housing sector. The UDI executive also stressed the need for the government to focus on improving housing supply to successfully address the problem of steady price growth.

RateSpy.com founder Rob McLister stated that the potential impact of the OSFI proposals can be determined upon examination of the current yield curve, which shows longer term rates are still much higher. For instance, with the prime rate now 3.2 per cent and the average discount on a five-year variable rate mortgage around 65 basis points, consumers would have to qualify based on a rate of 2.55 per cent plus 200 basis points or 4.55 per cent.

“Generally, the variable will be cheaper. Maybe the one-year or two years (even more so). We have people who can’t qualify because of 10 basis points. I think it will force at least 10 per cent of uninsured borrowers to look at shorter-term rates that have more risk,” McLister explained.

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National sales numbers rally in August despite current GTA policies

The existing housing policy regime in Ontario has not stopped sales activity from intensifying in Toronto, a development that has in turn contributed to sales volume growth on a national basis last month.

According to statistics released last week by the Canadian Real Estate Association (CREA), national home sales rose by 1.3 per cent from July to August. Ontario sales posted a 14.3-per-cent month-over-month increase in the same time frame, despite the dampening presence of the foreign home buyers’ tax and the Ontario Fair Housing Plan.

“Experience shows that home buyers watch mortgage rates carefully and that recent interest rate increases will prompt some to make an offer before rates move higher, while moving others to the sidelines,” CREA president Andrew Peck said.

“Time will tell whether the monthly rise in August sales activity marks the beginning of a rebound, particularly in the Greater Golden Horseshoe region and other higher-priced urban centres,” CREA chief economist Gregory Klump added. “The picture will become clearer once mortgages that were pre-approved prior to recent interest rate hikes expire.”

Meanwhile, the number of new listings nationwide fell by 3.9 per cent in August, marking a third straight monthly decline.

“The national result largely reflects a reduction in newly listed homes in the GTA, Hamilton-Burlington, London-St. Thomas and Kitchener-Waterloo, as well as the Fraser Valley,” CREA reported.

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Buyers to face even greater hurdles

Last year’s mortgage rule changes placed roadblocks in front of millions of would-be buyers, but increased rates and future regulatory action may prove even more difficult for them to overcome.

That’s according to one leading economist, who argues the latest rate increases and the addition of another round of mortgage rules represent major hurdles in front of prospective homeowners.

“The posted mortgage rate has now increased 20 basis points to 4.84%, which is of particular importance because since October 2016 this is the assumed borrowing rate at which mortgage applicants must qualify for insured loans,” Dr. Sherry Cooper, chief economist for Dominion Lending Centres, wrote in her report on CREA’s latest data. “The Office of the Superintendent of Financial Institutions (OSFI) issued a proposal in July to tighten the qualification criterion for uninsured borrowers as well--that is, those that put at least 20% down on their home purchase. If the proposal were implemented, high loan-to-value mortgage borrowers would need to meet debt-servicing requirements at mortgage rates 200 basis points above the contract rate.

“Many believe this would have an even bigger negative impact on housing than the October 2016 measures.”

The Bank of Canada raised its target for the overnight rate to 1% earlier this month.

OSFI, meanwhile, is currently receiving consultation on its latest suggest mortgage policies, which include a qualifying stress test for all uninsured mortgages, as well as a crackdown on bundled mortgage loans.

If OSFI’s measures pass as currently written, they are expected to make it more difficult for Canadians to qualify for a mortgage.

However, with that – and the threat of further interest rate increases – on the horizon, brokers can likely expect an influx of potential clients in the coming months before a slight dampening in demand.

“Experience shows that home buyers watch mortgage rates carefully and that recent interest rate increases will prompt some to make an offer before rates move higher, while moving others to the sidelines,” CREA President Andrew Peck said last week.

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Tuesday, September 19, 2017

Government poised to make housing a right

The federal Liberals' are sending signals that they are ready to make a right to housing part of its national housing strategy.

The declaration appears largely aspirational in nature at this point, as sources with knowledge of the government's thinking said there won't be any legislated specifics tied to the promise _ unlike the detailed benchmarks on other parts of the plan to measure progress.

Government officials have told housing and homeless advocates to expect a declaration in the plan set to be released this fall, and have it put into legislation to make a bold statement that would be difficult for a future government to ignore or reverse.

A spokesman for Social Development Minister Jean-Yves Duclos said the government couldn't yet speak definitively to the details of the strategy.

The UN special rapporteur on adequate housing said declaring a right to housing in Canada would be a huge step forward for the country as it looks to curb homelessness and poverty.

``This country has been very slow to embrace all social and economic rights, including the right the housing,'' said Leilani Farha, who is also executive director of Canada Without Poverty.

``They're being pretty bold and creative in their thinking. I don't know how that thinking translates into strategy.''

Federal coffers will dole out $11.2 billion over the next decade on the housing strategy, which is being billed as a plan to ensure everyone in the country can find housing that is affordable and meets their needs.

The government will flow $5 billion of that money to the Canada Mortgage and Housing Corp. to stimulate private sector investments and hopefully create an extra $10.9 billion in funding over 11 years.

Officials are putting the final touches on the plan that is scheduled to be released this fall.

Sources say the Liberals are looking to create specific strategies each for First Nations, Metis, and Inuit, instead of a singular Aboriginal housing strategy. The 2017 federal budget included $300 million for housing in the North and $225 million to support programs that provide units to Indigenous Peoples off-reserve.

The depth of Canada's housing needs will be fully revealed at the end of October when Statistics Canada releases the data gleaned from the return of the mandatory, long-form census.

The most recent data available suggests there are 1.6 million households in ``core housing need'' _ those who spend more than one-third of their before-tax income on housing that may be substandard or doesn't meet their needs.

Census data released earlier this month showed that there were 4.8 million Canadians living below the poverty line, including 1.2 million children.

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Consumer confidence slips from 2017 high

Canadian consumer confidence hit its 2017 high mid-August but has since declined.

The weekly sentiment survey from Bloomberg and Nanos Research shows that the index was at 58.42 last week, down from the 58.45 of the previous week and the August 11 high of 61.19.

“Consumers appear to be rebalancing their expectations after a nearly year-long upswing in sentiment. Unemployment is nearing its pre-Financial Crisis lows, wage growth has been positive for the past 8 months, while house prices continue to climb despite the authorities' best efforts,” said Bloomberg economist Robert Lawrie. “Yet there have been signs of uncertainty regarding the strength of the recovery and its ability to reduce the remaining slack in the labour market.”

The share of those who expect real estate prices to increase in the next 6 months was higher last week though at 39.57% compared to 37.12% a week earlier.

Sentiment was also higher for the overall economy and personal finances including mortgages; but concern grew for job security.

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Calgary luxury market shows some improvement but condos lag

Luxury homes in the Calgary area have shown some positive signs in recent months as the region begins to adapt to the lower-oil-price environment.

Figures from Sotheby’s International Realty Canada show that 112 homes were bought in Calgary between July and August with a price tag of at least $1 million; that’s roughly in line with the same period of 2016.

However, the market is split with single-family homes in the luxury sector stabilizing while high-end condo sales slipped to just 2 sales over the summer compared to three times as many a year earlier.

“I think we’re seeing a fundamental shift in the Calgary market right now,” he said. “Buyers don’t want to pay those old prices and sellers aren’t racing to new price ranges, so there’s a mismatch between the two,” Sotheby’s International Realty Canada CEO Brad Henderson told the Calgary Herald.

Elsewhere, Montreal saw a 60% surge in luxury sales while Vancouver showed a slight increase and Toronto slipped back.

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Extent of Canadian credit breach soon to be revealed

Equifax Inc. says it intends to provide an update this week to Canadians on the impact of the massive data breach it recently suffered, but would not say how many individuals north of the border may have had their personal information compromised.

The credit data company told The Canadian Press that this update will include how Equifax intends to notify any potentially impacted individuals.

Canada's privacy commissioner said Friday that it started a probe into the cyberattack and Equifax has committed to contacting Canadians whose data may be at risk in writing as soon as possible.

Equifax said on Sept. 7 that it fell victim to a massive cyberattack in the summer that may have compromised the personal data of 143 million Americans and an undisclosed number of Canadian and U.K. residents.

Equifax has since said that approximately 400,000 U.K. individuals may have been affected, but has not quantified the number of Canadians whose data may have been stolen.

Equifax says on its Canadian website that the personal information that may have been breached includes names, addresses and social insurance numbers.

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Monday, September 18, 2017

Home sales edge back into growth as the GTA rebounds

There was a small increase in national home sales in August, reversing a four-month trend of decline, as the GTA rebounded.

The 1.3% rise reported by the Canadian Real Estate Association from July to August but means activity was still almost 14% below the peak in March. Actual activity (not seasonally adjusted) was nearly 10% below August 2016.

“Time will tell whether the monthly rise in August sales activity marks the beginning of a rebound, particularly in the Greater Golden Horseshoe region and other higher-priced urban centres,” said Gregory Klump, CREA’s Chief Economist. “The picture will become clearer once mortgages that were pre-approved prior to recent interest rate hikes expire.”

The growth for the GTA was the first since the Fair Housing Plan was announced but activity was 36% below the March peak and 32% below August 2016.

Outside the GTA sales were essentially flat.

New listings were down 3.9%, the third consecutive monthly decline, and there were 5 months of supply at current rate of sales.

Price appreciation slowed with the Aggregate Composite MLS HPI up 11.2% year-over-year in August largely due to softening prices in the Greater Golden Horseshoe.

Although benchmark price gains eased, they continued to outpace those of August 2016 in 12 of 13 markets tracked by CREA’s index including the GTA (14.3% year-over-year), Greater Vancouver (9.4%), Victoria (16%), Calgary (0.8%), Regina (5.6%), Ottawa (5.9%) and Greater Montreal (4.6%).

CREA’s outlook for sales in 2017 is a 5.3% decline nationally to 506,900 units with BC and Ontario down about 10% from the all-time records set in 2016.

Newfoundland & Labrador is set for an 8.1% decline in sales this year; Saskatchewan is expected to show a 4% decline.

Alberta (7.4%), Quebec (5.4%) and New Brunswick (5.7%) are also expected to record annual gains for 2017 while moderate gains are forecast for Manitoba and Nova Scotia with PEI unchanged.

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Ontario foreign home buyers’ tax appears to be working—provincial gov’t

Ever since Ontario’s implementation of a foreign home buyers’ tax and the introduction of its Fair Housing Plan, the number of non-resident owners of real estate in the Greater Golden Horseshoe has seen a noticeable decline, according to the latest numbers from the provincial government.

The proportion of Ontario homes purchased by those who are not citizens and permanent residents of Canada, or by foreign corporations, fell by 1.5 per cent from May 27 to August 18, 2017 compared to the period covering April 24 to May 26, 2017, the province’s Ministry of Finance said.

Roughly 3.2 per cent of 66,434 transactions in the Greater Golden Horseshoe involved at least one foreign individual or corporation, down from 4.7 per cent in the previous period. Across all of Ontario, 2.6 per cent of 101,698 deals involved a foreign entity, while Toronto’s share was 5.6 per cent, down from 7.2 per cent in the pre-FHP days.

“The measures that we introduced as a part of the Fair Housing Plan are working—we are seeing increased housing supply and evidence that more people are finding affordable homes. Ontario continues to be a place that welcomes all new residents, drawn by its rising employment and strong economy,” Ontario finance minister Charles Sousa said.

Ontario Real Estate Association CEO Tim Hudak praised the government for providing updated real estate data on foreign buyers, but he emphasized that this is merely the first step in creating an effective policy solution to the province’s housing woes.

“While demand side data is useful, we cannot lose sight of the fundamental challenge Ontario has with housing supply. There is too much red tape on housing development that drives up the cost of new homes and limits inventory in the marketplace,” Hudak said in a statement. “Infrastructure investments should be targeted at housing ready land and we should allow greater intensification along rail and transportation corridors.”

“No matter how you slice demand data, until we expand the quantity and choices in homes, home ownership will be pushed further out of reach for the next generation.”

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B.C. market's August strength not indicative of near-future trends

In its latest data release, the association representing realtors in British Columbia announced that home sales remained healthy across the province in August, but added that it is expecting to see trends shift over the coming months.

The B.C. Real Estate Association said that 9,162 residential properties were sold in August, representing a 2.4-per-cent increase compared with the same period last year.

The total dollar value of all sales climbed significantly to $6.2 billion, a 22-per-cent jump from August 2016. Meanwhile, the average property price was up 19.1 per cent in the same time frame, up to $678,186.

Association chief economist Cameron Muir pointed to strong economic conditions propelling the August sales, which he said mirrored figures in July on a seasonally adjusted basis.

However, Muir warned that climbing mortgage rates and home prices could dampen housing markets this fall.

“Rising home prices combined with upward pressure on mortgage interest rates is expected to temper demand over the balance of the year,” Muir stated in a news release.

Year-to-date figures in 2017 were still overshadowed by the sizzling first half of last year’s residential property market in B.C., with sales dollar volume down 15.9 per cent to $51.8 billion when compared with the first eight months of 2016.

Residential sales dipped 15 per cent over the same period, while the association said the average property price was down 1.1 per cent to $706,839.

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Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!

A Decade After the Crash

Ten years ago today, a lender called Northern Rock, bloated with billions of pounds of risky mortgages, received emergency support from the Bank of England after the short-term funding it relied on dried up. Depositors lined up outside branches to get their money back, the first run on a British bank in 150 years. It was the start of a crisis the country still hasn’t recovered from.

Northern Rock wasn’t the only name to disappear: Bradford & Bingley was nationalized too, and beleaguered Alliance & Leicester was sold on the cheap. But it’s the big retail bank survivors where the legacy of the crisis can still be seen: two are vastly smaller than they were a decade ago, one of them is still state-controlled and all are less profitable.

In the years since an estimated 1.2 trillion pounds ($1.6 trillion) was pledged to support the financial system, the U.K.’s four largest domestic banks have slashed $3.6 trillion of assets by exiting foreign countries, closing risky trading businesses and firing hundreds of thousands of staff. And they’re not finished yet.

The most drastic shrinkage has come at Royal Bank of Scotland Group Plc, still 71 percent owned by the state. RBS has cut its balance sheet to about a quarter of the size it was at its peak after receiving the world’s largest single bailout in 2008 and 2009, totaling 45.5 billion pounds. It has posted losses for nine straight years, and executives have said it’s headed for a tenth.

Barclays Plc has cut half its assets in the past eight years amid a retreat to London and New York, while incurring billions of dollars in fines for rigging interest rate and currency markets.

By contrast, Asia-focused HSBC Holdings Plc has grown modestly in size over the same period, even as it has exited less profitable or strategic emerging markets. It has also been hit by fines for compliance failings and ignoring U.S. sanctions.

Lloyds Banking Group Plc is also bigger than it was a decade earlier, but at a cost. It absorbed the assets of HBOS Plc in a government-orchestrated merger during the crisis, which ultimately played a large part in its subsequent nationalization.

Profitability Plunge

Improved profitability has been elusive. The average return on equity has plunged from 18.4 percent in 2007 to 4.5 percent today, data compiled by Bloomberg show, as lenders continue to build capital buffers and pay fines. Investors typically demand a minimum return of 10 percent, known as the "cost of equity." None of the four lenders exceed that threshold.

Mortgage lending has never recovered, falling to about a fifth of pre-crisis levels, according to data from the British Bankers’ Association. The crunch has been driven by the slow recovery of house prices in northern England, which left many borrowers in negative equity. While London property has boomed, taxes have risen on the capital’s landlords, while lenders have tightened underwriting standards.

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We hope you are finding our Blog informative and enjoyable to read while keeping you up to date with the ever changing real estate market.

Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!

Sunday, September 17, 2017

Canadian residential segment’s growth to grind to a crawl—Moody’s

The growth of residential property prices nationwide will weaken significantly in the next half decade as cooling policies in the hottest markets will make themselves felt, according to the latest study by Moody’s Analytics.

Canadians need to prepare for “several years of retrenchment” with 1.3 per cent annual price growth per year at most over the next 5 years, Moody’s said.

“Exact turning points are difficult to predict, but the combination of restricted mortgage lending, taxes on foreign purchases in the largest metro areas, and the expectation of higher mortgage rates means that house prices are likely to experience a slowdown in the next few years,” according to report author Andres Carbacho-Burgos, as quoted by the Financial Post.

“Affordability as measured by the median dwelling price to median family income ratio is also close to a record low, so it is hard to see house prices maintaining the same momentum as before,” the study added.

Moody’s also cautioned that further measures to curb speculation in Toronto and Vancouver will exacerbate the slowdown. Current trends in these markets will continue to hold, however.

“Greater Toronto is likely to maintain moderate house price growth, while the more policy-restricted market in Vancouver will lead to prices holding steady in coming years,” the report stated.

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We hope you are finding our Blog informative and enjoyable to read while keeping you up to date with the ever changing real estate market.

Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!

Home sales to foreign buyers decreasing in the Greater Golden Horseshoe area

The latest home sales data show a drop in the number of purchases by non-Canadians in an Ontario region that includes Toronto and is subject to a foreign buyer tax.

The 15 per cent tax was imposed in April on buyers in the Greater Golden Horseshoe area _ stretching from the Niagara Region to Peterborough _ who are not citizens, permanent residents or Canadian corporations.

The government previously released data from April 24 to May 26, which showed that about 4.7 per cent of properties were bought by people who aren't citizens or permanent residents.

The latest set of numbers covers May 27 to Aug. 18 and it shows the percentage of foreign transactions in the region dropped to about 3.2 per cent.

Finance Minister Charles Sousa says that the measures in the government's housing plan _ which include the tax _ are working.

York Region saw the highest percentage of foreign buyers in that three-month time period, with those transactions representing 6.9 per cent of the sales, and in Toronto that number was 5.6 per cent.

The new figures also looked outside the Greater Golden Horseshoe region, and in the first month of the tax foreign transactions represented 1.5 per cent of sales, while in the following three months it was nearly the same, at 1.6 per cent.

The foreign buyer tax was one part of a 16-part housing plan the government introduced as the housing market in the Toronto area and beyond saw year-over-year price increases of over 30 per cent.

The tax applies to purchases made on or after April 21, though there are exemptions for refugees, foreign nationals under the Ontario Immigrant Nominee Program, or if the property is jointly purchased with a spouse who is a Canadian citizen, permanent resident, refugee or exempt under the Ontario Immigrant Nominee Program.

Rebates will be available to people who subsequently get citizenship or permanent resident status, as well as foreign nationals working in Ontario and international students.

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We hope you are finding our Blog informative and enjoyable to read while keeping you up to date with the ever changing real estate market.

Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!

Home sales expected to fall 5.3% in 2017, 10% in Ont. and B.C.: CREA

The Canadian Real Estate Association has downgraded its sales forecast this year as national home sales slipped 9.9 per cent in August compared with a year ago.

The association expects sales to decline by 5.3 per cent year-over-year to 506,900 changing hands this year, or 20,000 fewer than previously forecast in June.

It projects sales in British Columbia and Ontario to fall by about 10 per cent in 2017, compared to record highs set in 2016.

The association says sales in August were down in nearly two-thirds of all local markets, led by the Greater Toronto Area and nearby housing markets.

However, the average price for a home sold last month was $472,247, up 3.6 per cent compared to a year ago.

Excluding Greater Vancouver and Greater Toronto, the national average price was $373,859

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Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!

Saturday, September 16, 2017

BC average home price up 19%

The average MLS price of a home in British Columbia was up 19.1% in August compared to a year earlier.

That takes the average to $678,186 and drove the total dollar volume of real estate sales in the province to $6.2 billion, up 22% year-over-year according to new data from the British Columbia Real Estate Association.

Sales in August were up 2.4% to 9,162, in line with sales in the previous month.

"Strong economic conditions are underpinning demand. However, rising home prices combined with upward pressure on mortgage interest rates is expected to temper demand over the balance of the year," said Cameron Muir, BCREA chief economist.

Year-to-date sales were 15% lower than the same period of 2016 with 73,267 units sold. Prices averaged $706,839, down 1.1% year-over-year.

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Markets observer twits BoC’s defensiveness

The Bank of Canada’s public rebuttal of criticism from BMO chief economist Doug Porter was an uncharacteristic blunder that the usually circumspect central bank should diligently avoid in future communications, according to a markets observer.

In his latest piece, Bloomberg contributor and analyst Daniel Moss rebuked the BoC for its sharp reaction to Porter’s comments regarding the rate hike earlier this month. Porter recently took the bank to task for failing to sufficiently communicate its intention to raise its benchmark interest rate.

“[Porter] clearly struck a nerve with the Bank of Canada, and spokesman Jeremy Harrison came out swinging. Harrison said the bank indicated in July that policy would be forward-looking and data-dependent. And while most economists didn’t forecast a step up last week, Harrison said that financial markets saw it as a more or less 50-50 proposition.”

“All true. But why be so defensive? This response to an outsider’s critique makes the Bank of Canada look vulnerable and unsure of itself,” Moss wrote. “Worse, it risks creating the perception that the bank will respond to economist notes that it doesn’t like or that it feels are wide of the mark.”

“Investors could end up speculating that the central bank’s silence about some economist’s note is equal to an endorsement,” he added. “This kind of speculation is exactly what banks want to avoid by trying to be tempered in their public statements. And the bank surely doesn’t want broadsides against analysts to be another form of forward guidance. That would be a mistake.”

Moss explained that the accuracy of Porter’s critiques is not even the point. “The point is that it’s dangerous for powerful institutions to appear defensive.”

“More communication isn’t necessarily more clarity. Canada has a good news story to tell. At the top of the Group of Seven growth league, it looks like a big beneficiary of the global economic upswing,” Moss concluded. “Don’t spoil it by spending too much time in the trenches.”

MBN

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BC market sees sluggish end of summer stats

Prices may be recovering, but buyers in British Columbia just aren’t as enthusiastic as they once were.

“BC home sales in August remained unchanged from July, on a seasonally adjusted basis,” said Cameron Muir, BCREA Chief Economist. “Strong economic conditions are underpinning demand.

However, rising home prices combined with upward pressure on mortgage interest rates is expected to temper demand over the balance of the year.”

Unit sales are down year-to-date in 67% of British Columbia’s markets, according to the British Columbia Real Estate Association, with Vancouver seeing the most precipitous decline at -20.3% YTD.

Overall, the province has seen a total of 73,267 sales this year, down 15% YTD.

The average price of a home in the province -- $706,839 -- is also down this year by 1.1% YTD.

Dollar volume is also down.

“Year-to-date, BC residential sales dollar volume was down 15.9% to $51.8 billion, when compared with the same period in 2016,” BCREA said in a release. “Residential unit sales declined 15.0 % to 73,267units, while the average MLS residential price was down 1.1%to $706,839.”

The silver lining, however, is that the average price is up in 11 of 12 of BC markets, with Vancouver experiencing the only drop in average price.

It should be noted that these declines could be the result of Vancouver’s foreign buyer tax, which was implemented in August of last year. That, and the market has obviously been impacted by last year’s federal mortgage rule changes as well.

CREW

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Canadian residential segment’s growth to grind to a crawl—Moody’s

The growth of residential property prices nationwide will weaken significantly in the next half decade as cooling policies in the hottest markets will make themselves felt, according to the latest study by Moody’s Analytics.

Canadians need to prepare for “several years of retrenchment” with 1.3 per cent annual price growth per year at most over the next 5 years, Moody’s said.

“Exact turning points are difficult to predict, but the combination of restricted mortgage lending, taxes on foreign purchases in the largest metro areas, and the expectation of higher mortgage rates means that house prices are likely to experience a slowdown in the next few years,” according to report author Andres Carbacho-Burgos, as quoted by the Financial Post.

“Affordability as measured by the median dwelling price to median family income ratio is also close to a record low, so it is hard to see house prices maintaining the same momentum as before,” the study added.

Moody’s also cautioned that further measures to curb speculation in Toronto and Vancouver will exacerbate the slowdown. Current trends in these markets will continue to hold, however.

“Greater Toronto is likely to maintain moderate house price growth, while the more policy-restricted market in Vancouver will lead to prices holding steady in coming years,” the report stated.

CREW

We hope you are finding our Blog informative and enjoyable to read while keeping you up to date with the ever changing real estate market.

Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!

Foreign buyers’ tax is working says Ontario government

The number of non-resident owners of real estate in The Greater Golden Horseshoe has declined since the introduction of Ontario’s Fair Housing Plan in the spring.

Ontario’s Ministry of Finance says that new data shows that the share of homes bought by those who are not citizens, permanent residents of Canada, or foreign corporations, was down by 1.5% in the period from May 27 to August 18, 2017 compared to April 24 to May 26, 2017.

That means that 3.2% of 66,434 transactions in the GGH involved at least one foreign entity, down from 4.7% in the previous period. In the whole of Ontario, 2.6% of 101,698 transactions involved a foreign individual or corporation while Toronto’s share was 5.6%, down from 7.2% before the FHP was implemented.

“The measures that we introduced as a part of the Fair Housing Plan are working—we are seeing increased housing supply and evidence that more people are finding affordable homes. Ontario continues to be a place that welcomes all new residents, drawn by its rising employment and strong economy,” commented Ontario’s finance minister Charles Sousa.

MBN

We hope you are finding our Blog informative and enjoyable to read while keeping you up to date with the ever changing real estate market.

Please feel free to contact me via Direct/Text or e-mail at any time and my team will be pleased to assist you, family members and friends with all your real estate needs. Referrals are always welcome!