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Archive for December, 2009
Home Sales Surge 73%
Dec 23rd
Average price rises 19% in November, compared with a year ago.
Steve Ladurantaye – Globe and Mail
National home sales increased by 73% in November from the trough seen a year ago, with Ontario and Quebec hitting new monthly records as buyers took advantage of record low interest rates to secure mortgages. The national average price gained 19% compared to November 2008, at $337,231, the Canadian Real Estate Association said. Since the beginning of the year, prices have gained 4.4% compared to the same time last year.
“The year-over-year increase in November continues to reflect the high degree to which the average was skewed downward last year by plummeting activity in Canada’s priciest markets, and then upward by rebounding activity,” the association said in a statement. CREA tracked 36,383 deals on its Multiple Listing Service in November. Crediting the housing market for leading “the overall Canadian economy out of the recession,” association president Dale Ripplinger said the numbers were a sign of an entrenched recovery. “National home sales activity last month shows how strongly the housing market has rebounded since the beginning of the year,” he said.
About 437,507 homes have been sold through the CREA-owned MLS system so far this year, up 5% from last year at the same time, but lower than the previous three years. One of the main drivers of price increases has been a lack of supply, but higher prices are beginning to draw more sellers into the market. Seasonally adjusted new listings rose 5% from October, to 69,110, in the largest gain since January 2008. There is still a dearth of supply however, with the number of homes for sale 23% lower than they were a year ago.
Comment: I wish we had 5% more listings here in Toronto! We are still down close to 50% from this time last year, making things very difficult for buyers.
The association’s economist, Gregory Klump, said as prices climb higher, would-be buyers may put off purchases, cooling off a hot market. Higher interest rates, expected in 2010, will also dampen their enthusiasm. “Deteriorating housing affordability will rein in sales activity as the overall economy further improves and the pool of buyers who qualify for financing shrinks,” he said.
While sellers have no doubt been delighted by the premiums their homes have been fetching, a growing chorus of economists are expressing concern that the recovery isn’t sustainable.
“We’ve got a long way to go before we could put a bubble label on this market,” Merrill Lynch Bank of American economist Sheryl King said Monday. “However, with mortgage rates at decades low – and even more attractive if home buyers choose the variable mortgage option which carries rates as low as 2.15% – the seeds of a bubble are definitely in place.”
Self-Employed? You Can Get a Mortgage
Dec 23rd
You will need to present the following documents to a banker or other lender for the application of your new mortgage:
Self-Employed
- 2 years of Notice of Assessments
- 2 years of T1 general tax return forms
- 2 years’ proof of business (your GST number and article of incorporation)
Employed
- Written employment letter from Human Resources stating salary or hour wage /minimum hourly work week/position /start date – if less than 3 months (letter stating you are not on probation)
- Current pay stub
- 2 years of T4 statements if you would like to use overtime earnings
Have these documents ready when you meet with your mortgage specialist and things will move swiftly for you.
Home for the Holidays
Dec 23rd
While everyone else is hanging up the mistletoe, or lighting the menorah, why shouldn’t you be scooping up all the great deals in real estate during the Holiday “break”? Realtors don’t really ever take breaks, and all the great conditions for buying a home remain the same despite the date on the calendar: Low interest rates, rising inventory of homes on the market, and relatively low house prices. In fact, house deals could be even more plentiful during the holiday season.
All you will be missing is competition – from other people looking to buy (or sell). No bidding wars for you; just nice, quiet walk-throughs of homes trimmed for the holidays, which, granted, may be a tad messier than home showings at other times of the year. Working some house viewings into your holiday schedule just might be your best chance to get your dream home for an affordable price, and certainly you’ll get it bought with less pressure/stress. Not only are other home buyers preoccupied with the holidays, the cold weather also can act as a deterrent for trudging out to see homes.
Other reasons to buy property during the holiday season:
- A seller who’s showing their home at this time of year is likely to be more motivated to sell than the average person, hence more flexible with the selling price.
- As realtors are less busy, you will likely get more personal attention, faster service than during peak buying/selling times. Realtors may also be more likely to take lower offers seriously.
- Who knows what the interest rates will be in the new year?
- Who knows how tight banks and other institutions will be with loans next year?
- Other service providers in the real estate industry – appraisers, home inspectors, title searchers, etc. – are less busy during the holiday season so you could get faster responses there, too.
So, why not put aside the baking and decorating for a few hours; go look at some homes and consider making an offer between now and the end of 2009 … you won’t get this chance again for another whole year. Have you ever bought, or sold, a home during the holiday season? How did it go for you? Leave your comments below.
