TORONTO, February 3, 2012

“A favourable affordability picture bolstered by very low posted fixed mortgage rates has kept home buyers confident in their ability to achieve the Canadian goal of home ownership,” said Toronto Real Estate Board President Richard Silver. “The buyer pool remains diverse in the GTA with strong interest in home types across the pricing spectrum,” continued Silver.

The average selling price for January 2012 transactions was $463,534 – up by almost nine per cent compared to January 2011.

“Low inventory levels have kept competition between buyers strong, resulting in robust annual rates of price growth over the last year. Strong price growth is expected to attract more listings. A better supplied market should result in a slower rate of price growth, especially in the second half of 2012,” said Jason Mercer, the Toronto Real Estate Board’s Senior Manager of Market Analysis.

Here is what I think:…like our neighbors to the South, Canadians have a DREAM and that includes a home where they share family life. We have more stringent tax laws and mortgage laws than south of the border and the “Canadian Dream” has always included paying off your mortgage and not using your home as an ATM.

Since 1980 when I started selling houses the market has gone up and down a few times. To me it has been all about finding the right fit for a family and I have watched a lot of those families grow and enjoy a few properties as their repertoire of moments grew. Values have changed but the real value in Real Estate has not been financial, it has been lifestyle oriented. When did home ownership become more about the money and less about the family?

Granted, Toronto has changed and the market here has been one of the healthiest in North America. We are lucky but are we overpriced? Talk to someone from Manhattan, Chicago, San Francisco, Hong Kong or London and they will tell you no…

Buyers: make your decisions based on community, schools, street life, Kitchens and Family rooms,  realizing that the market will go up and it will go down…just enjoy the ride in a home that fits your needs and makes you feel that you are living your “Canadian DREAM”.

Here is a link to an excellent recent article in the Economist. The article does deal with the economics of the marketplace but don’t give up the long term lifestyle dreams. My house goes up and down in value, but it is the center of great family memories are unable to monetize.

Last month alone, a total of 4,718 homes changed hands, representing a seven per cent increase over the 4,395 sales reported in December 2010.

Consistent with the month’s strong sales, sellers’ market conditions continued, with the amount of time that homes were available for sale averaging 32 days last month compared to 37 days a year ago.

Year-over-year sales growth in the 905 Region outpaced that of the City of Toronto in December, with increases of more than 12 per cent and seven per cent respectively. In total 2,770 sales took place in the 905 Region while 1,948 transactions occurred in the City of Toronto.

The number of homes newly available for sale in December also increased, by nearly 14 per cent compared to a year ago, with 4,811 new listings last month. Despite the increase in availability, sales generally kept pace with new supply, resulting in continued price growth.

The average cost of a GTA resale home increased four per cent year-over-year to $451,436. Gains were stronger in the 905 Region, with the December average price climbing nearly six per cent to $435,378 and the City of Toronto showing a two per cent increase in its average price, to $474,270.

For all of 2011, the average selling price was up by eight per cent to over $465,000 in comparison to the average of $431,276 in 2010.  We experienced moderate to strong price growth throughout 2011 because market conditions remained very tight because of strong sales growth coupled with a decline in listings.  Enhanced competition between buyers led to strong upward pressure on selling prices.

We can see just how tight the housing market has been in the GTA over the past two years when we consider a new indicator published by TREB: Months of Inventory (MOI).  MOI tells us how long (in months) it would take to completely sell the average number of active listings over the past 12 months given the average number of sales over the same period.  A lower number of months indicate tighter market conditions and vice-versa.  Over the past two years, MOI has been in the 2.0 to 2.5 months range.  This is substantially lower than the pre-recession norm of between 3.0 and 3.5 months.

Despite price growth, the cost of home ownership remains affordable, due to low interest rates and a stable employment picture.  Five-year fixed rate mortgages continue to be available at approximately five per cent while Toronto’s unemployment rate came in at 7.8 per cent in December, an improvement of more than half a percentage point from the previous month.

Moreover, favourable news regarding our country continues to be generated.  A recent study release by the Legatum Institute, which measured the world’s most prosperous nations ranked Canada as the sixth best country in the world based on criteria that have an effect on economic growth and personal well being. The flood of favourable reports on our country in recent months has been tempered though by warnings from the Bank of Canada and the International Monetary Fund regarding Canadians’ high household debt.  This coupled with the potential impact of other nations’ volatile economies should give all Canadians pause for thought.

It is a fiscally conservative approach, with respect to lending practices for example, that has landed our Canada at the top of so many world rankings, and we should continue to exercise the same prudence with respect to household finances.  There’s never been a better time to begin a new mortgage in order to consolidate debt or perhaps even to move to a home better suited to your lifestyle.  To learn more about the process of buying and selling a home visit www.TorontoRealEstateBoard.com.

Richard Silver is President of the Toronto Real Estate Board, a professional association that represents 32,000 REALTORS® in the Greater Toronto Area.

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Your thoughts?

Your thoughts??

Toronto, December 6, 2011

“We have seen strong annual sales growth through the 2011 fall market. The increase in transactions has been broad-based, with strong growth across low-rise and high-rise home types throughout the Greater Toronto Area,” said Toronto Real Estate Board (TREB) President Richard Silver. “The market has also become better supplied, with annual new listings growth outstripping that of sales. As this trend continues into 2012, we will see more balanced market conditions.” 

The average price for November transactions was $480,421, representing an increase of almost 10 per cent in comparison to $437,494 in November 2010. 

“Despite strong price growth this year, the housing market remains affordable in the GTA,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “The correct method of assessing affordability is to consider the share of the average household’s income that is dedicated to mortgage principal and interest, property taxes and utilities. Currently, this share remains in line with generally accepted lending guidelines. Given this positive affordability picture, average price growth is forecast to continue in 2012, albeit at a more moderate pace.”

Toronto, December 6, 2011

The poll was conducted by Ipsos Reid for the Toronto Real Estate Board (TREB) between November 17 and November 22, 2011.

“TREB supports the recommended 2012 Budget because it continues the process of bringing fiscal sustainability back to City Hall; however, while we support the direction of this Budget, we are pointing out that it does not begin the process of fulfilling Mayor Ford’s commitment to repeal the Toronto Land Transfer Tax in 2012. This is a commitment that is strongly supported by Torontonians,” said Richard Silver, TREB President.

The poll found that,

• 65 per cent of Torontonians continue to support Mayor Ford’s commitment to repeal the Toronto Land Transfer Tax. Even when asked to consider the City’s deficit and recent efforts to address it, public support for the repeal of this tax is at 57 per cent;
• Torontonians want to see respect for taxpayers during negotiations with City Unions: 67 per cent believe that City negotiators should seek concessions from the unions; 57 per cent would like to see an end to current job security provisions; and 54 per cent would support a lock-out if union representatives do not agree to concessions;
• in contrast to the public’s strong opposition to the Land Transfer Tax, 52% of Torontonians support increasing residential property taxes as part of the solution to addressing the City’s deficit and paying for services; and,
• 54%, a majority, believe that City spending on programs and services is cost-effective and efficient. This is an increase of 9 per cent , from 45 per cent to 54 per cent, since April, 2011 when Ipsos Reid last measured this sentiment for TREB, indicating an apparent shift in attitude.

“Notwithstanding the difficult decisions that City Council has faced with regard to the budget, Torontonians understand that the Land Transfer Tax is part of the problem because it unfairly forces home buyers and business owners to pay more than their fair share, costing the average Toronto home buyer more than $6,000 every time they move; it is an unpredictable revenue stream that goes up and down with the real estate market; and it makes the City less competitive than other GTA municipalities,” said Silver. “The Land Transfer Tax is simply a band aid that has delayed the true solutions to the City’s financial challenges.”

REALTORS® believe that sustainable solutions to the City’s financial challenges are a combination of cost reductions and fair revenue sources, like property taxes and user fees.

“TREB Members work with the public across the GTA, so they understand that the City’s Budget affects not only Torontonians but the entire region. Simply put, the City’s budget decisions affect where people live and work. You only need to travel along the DVP during morning rush hour to see the proof: as many people are leaving the City to get to their jobs as there are coming in,” said Richard Silver, TREB President.

“Toronto businesses face the highest commercial and industrial property tax rates. Making business property taxes more competitive will allow the property tax base to grow, providing long-term, reliable, revenue, which, ultimately, will benefit residents by relieving pressure on existing taxpayers and improving quality-of-life in Toronto and the entire GTA by keeping people and jobs close together, thereby reducing traffic congestion,” said Silver.

REALTORS® are encouraged with the direction of the 2012 Budget and, along with the public, are calling for fiscal reform to continue at City Hall.

“REALTORS®, and the public, believe that City Council has made progress in bringing respect for taxpayers back to City Hall. We strongly believe that moving ahead with repealing the Land Transfer Tax, continuing to reduce costs, and using fair revenue sources is the right way to continue to move forward,” said Silver.

These poll results were gathered from 401 residents of the City of Toronto, yielding a margin of error of +/- 4.9 percentage points 19 times out of 20.

Greater Toronto REALTORS® are passionate about their work. They are governed by a strict Code of Ethics and share a state-of-the-art Multiple Listing Service. Over 32,000 TREB Members serve consumers in the Greater Toronto Area. The Toronto Real Estate Board is Canada’s largest real estate board.