Real Estate News from Thom Gallagher August 2013   

When it comes to selling a home, people sometimes think about trying to do it themselves; however, there are many hidden pitfalls to be aware of.  This month's article outlines why it's important to retain a real estate agent's expertise.

There are also some tips that'll come in handy if you plan on flying with your kids this summer as well as the lowdown on geocaching which is a popular new way to enjoy the great outdoors!

Thanks so much for checking out this month's newsletter.  Please get in touch if you have any questions or comments regarding the articles, or real estate in general -- it'd be great to hear from you!


In this issue...
New Bank of Canada Governor Poloz Stays the Course 
The Bank of Canada announced on July 17th 2013 that it was keeping its trend-setting overnight lending rate 1 per cent, where it has been since September 2010.

Guidance about what to expect going forward was reworded slightly, but the bottom line remains the same, namely, that in an environment of moderate economic growth and low inflation, interest rates will remain on hold for some time yet.

The Bank expects Canadian economic growth to be “choppy” in the near-term owing to some “unusual temporary factors”.  The Monetary Policy Report (MPR) which accompanied the statement went into more detail, keying specifically on the recent flooding in Southern Alberta and the Quebec Construction Strike.

These two events are expected to result in weaker than expected economic growth in the second quarter of the year (1.0 per cent).  However, given the “temporary nature of the shocks and the eventual reconstruction and repair of damaged infrastructure in the flooded areas in Alberta”, the Bank expects a robust 3.8 per cent expansion in the third quarter.

Overall, the Bank now expects economic growth of 1.8 per cent in 2013, which is an upward revision from the 1.5 per cent projected back in April.  The outlook for 2014 and 2015 was little changed, with the Bank forecasting growth of 2.7 per cent in both years.

On the Canadian housing market, the Bank still sees a “constructive evolution of household imbalances”, adding that “recent increases in fixed-term mortgage rates will also provide a degree of restraint”.  And while the Bank did acknowledge the rebound in recent months for new construction, resale activity, and prices, at this point the Bank views these simply as variation around a still positive trend.

The Bank noted that “inflation has been low in recent months and is expected to remain subdued in the near term”.  The Bank still expects that inflation will not return to its 2 per cent target until mid-2015.

The forward guidance on the future path of interest rates was reworded, dropping the direct reference to rake hikes in favour of the phrase “a gradual normalization of policy interest rates”.

That said, it means the same thing, namely, that while economic growth is expected to pick up heading into 2014, it will take time to absorb the “significant slack in the Canadian economy”.  That means low inflation and low interest rates will persist for some time, but will eventually be followed by small and gradual rates hikes when and if conditions eventually return to “normal”.

As of July 17th, 2013, the advertised five-year lending rate stood at 5.14 per cent, unchanged from the previous Bank rate announcement on May 29th.

What to Expect when Selling your Home Privately 
If you're planning on selling your home, you may have considered putting up a "For Sale" sign and doing it yourself.

Many people have successfully sold their own homes; however, they don't always necessarily come out ahead financially.

Just as it's not recommended to represent yourself in court, it's not a good idea to market and negotiate your biggest asset.  Here are a few reasons why it's important to retain the services of a professional real estate agent:

  1. No Upfront Costs - You don't have to worry about the various advertising costs which can quickly amount to a small fortune.  Time is money too and oftentimes it makes more financial sense to spend time on other projects.

  2. Exposure - Your pool of potential buyers will be very limited whereas an agent can expose your home to the masses!  Selling privately can take a while which drives up carrying costs and the longer a home sits on the market, the less it's likely to sell for.

  3. Motivation - The only reason to sell on your own is to try and save money.  Buyers who go it alone know this and expect to share in your savings.  Real estate agents are paid on commission so it's in their best interest to get you top dollar!

  4. Third Party Negotiator - Buying or selling a home is an emotional roller coaster!  Just one wrong remark can cause a deal to fall apart.  A third party negotiator provides an important buffer between the buyer and the seller.

  5. Experience - Real estate transactions can be fraught with potential problems.  Agents can advise you on various legal matters as well as multiple and counter offer scenarios.  An agent can also help stage your home in order to attract the best possible price.

  6. Convenience - You'll have to show your home to strangers on short notice which can be frustrating and dangerous.  Most prospects aren't that serious or are just plain nosy.  Agents only work with qualified buyers so they don't waste time or compromise their personal safety.

Selling a home privately can be risky which means you're gambling with your biggest asset.  It pays to have a professional on side to look out for your best interests throughout this complex financial and emotional transaction.  Do-it-yourself jobs are great in certain situations but when it comes to selling a home, it's best to enlist the services of a professional.

Things to Know When Flying With Kids In Tow 
If you have young children, flying has likely taken on a whole new meaning and fun probably isn't a word that springs to mind!

Flying with little ones can be somewhat bearable though if you're properly prepared.  Here are a few tips to keep in mind:

  1. Call Ahead - Get details on seat selection, strollers and car seats.  Reserve the bulkhead seats if you're traveling with an infant and ask for a cot.

  2. Extra Extra!! - Bring extra snacks, crayons and toys.  Put diapers and wipes in a separate bag so you won't have to lug your entire backpack to the bathroom.

  3. Get a Move On! - Keep your kids moving before the flight to help them cope with the confined space onboard.  They'll burn up energy which will stop them from kicking the seat in front of you.

  4. Fasten Your Seatbelts - Have a few items handy in case there's turbulence and you can't access the overhead compartment and always have a drink ready to help relieve their ear pressure.

It always takes longer to do anything with kids so make sure to allow lots of extra time.  Although it seems like you'll have an eternity at the airport, activities such as check-in, snack time and bathroom breaks will quickly eat up your time but if you're properly prepared, you'll be able to relax and enjoy a smooth flight!

Geocaching: High Tech Hide & Seek 
Geocaching is a high tech treasure hunt where a GPS is used to locate hidden caches.  It's a great way to get active with your family and explore the great outdoors!

Geocaches are containers that include a log book and small treasures.  Once you find the geocache, you replace the treasure with something of your own, log in your details and then check-in online.

Exploring hometown hiking trails takes on a whole new meaning and the best part is that geocaching doesn't cost a cent!  Instead of searching around for the remote this Sunday afternoon, head outdoors for a real life treasure hunt.  For more information, visit

PS Let me help you, or someone you know, achieve your residential or investment real estate goals. You bring the vision and I help you get it done. Call me today at (416)524-6530 to discuss your plans or visit my web site to start your search. I look forward to wowing you with top notch service. 

Not meant to solicit clients already under contract.