Real Estate News from Thom Gallagher March 2014   

The world of real estate is full of ups and downs so trying to figure out when to buy or sell can be a real challenge.  This month's article offers some useful strategies for those who are looking to make a move in today’s market.

There’s also a must read article if you have young children who use Facebook, as well as a few simple yet effective tips that’ll make your car less of a target to thieves.

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...
Canadian Home Sales Changed Little In February 
According to statistics released by The Canadian Real Estate Association (CREA), national home sales activity was little changed in February 2014 on a month-over-month basis.

The number of home sales processed through the MLS® Systems of Canadian real estate Boards and Associations was little changed from January to February 2014, edging up just three tenths of one per cent.

The February result follows five straight monthly declines and leaves activity 9.3 per cent below the peak reached in August 2013.

The number of local housing markets where February sales were up ran roughly even with the number of markets where sales declined, with little change in activity among most of Canada’s large urban markets.

“Sales in February rebounded in some of the smaller local markets where activity was impacted by harsh winter weather in January,” said CREA President Laura Leyser.  “The strength of sales activity during the crucial spring market period will be influenced by the availability of listings, which varies considerably from market to market.  To best understand how the balance between available listings and demand is shaping up this spring where you live or might like to, your best bet is to talk to your local REALTOR®.”

Actual (not seasonally adjusted) activity stood 1.9 per cent above levels posted in February 2013.  Most of the year-over-year gain reflects increased sales activity in British Columbia’s Lower Mainland and to a lesser extent in Calgary.

“Sales activity this spring will be supported by the recent decline in the benchmark five-year conventional mortgage rate,” said Gregory Klump, CREA’s Chief Economist.  “That’s because buyers needing mortgage default insurance who opt for a term of less than five years must qualify for mortgage financing based on that rate, and not a discounted rate that their lender may be offering.  The support will be of particular importance in some of Canada’s larger urban markets where home prices are higher than those in smaller markets.”

The number of newly listed homes was also little changed in February, having edged up 0.6 per cent on a month-over-month basis.  As with sales activity, there was a roughly even split between the number of local markets where new listings were up from the previous month and those where they were down.  The number of new listings nationally would have declined had it not been for a 7.8 per cent increase in Greater Toronto, where new listings in January had dropped to the lowest level in more than three years.  The rise in new listings in Greater Toronto was offset by monthly declines in new listings in Greater Vancouver and Edmonton.

With sales and new listings having both edged slightly higher in February, the national sales-to-new listings ratio was 52.1 per cent – virtually unchanged from 52.3 per cent in January.  Since early 2010, the ratio has remained firmly entrenched within the range from 40 to 60 per cent that marks balanced territory.  Just under two-thirds of all local markets posted a sales-to-new listings ratio in this range in February.

The number of months of inventory is another important measure of balance between housing supply and demand.  It represents the number of months it would take to completely liquidate current inventories at the current rate of sales activity.  There were 6.4 months of inventory at the national level at the end of February 2014, down slightly from 6.5 months at the end of January.  As with the sales-to-new listings ratio, the months of inventory measure continues to point to a well-balanced housing market at the national level.

The actual (not seasonally adjusted) national average price for homes sold in February 2014 was $406,372, an increase of 10.1 per cent from the same month last year.  The size of year-over-year average price gains continues to reflect the decline in sales activity in February of last year among some of Canada’s most active and expensive markets, which dropped the national average at that time.  This phenomenon was particularly clear this month, with Greater Vancouver having posted the biggest year-over-year increase in activity by a large margin.

The MLS® Home Price Index (MLS® HPI) provides a better gauge of price trends because it is not affected by changes in the mix of sales activity the way that average price is.  The Aggregate Composite MLS® HPI rose 5.05 per cent on a year-over-year basis in February 2014, up from a 4.83 per cent gain in January.  Year-over-year price growth picked up among all property types tracked by the index.

Year-over-year price gains were led by two-storey single family homes (+5.84 per cent) and one-storey single family homes (+5.40 per cent).  This was closely followed by price increases for townhouse/row units (+4.05 per cent) and apartment units (+3.74 per cent).

Year-over-year price growth in the MLS® HPI varied among housing markets tracked by the index, with the biggest gains again having been posted by Calgary (+9.10 per cent) and Greater Toronto (+7.28 per cent).  Greater Vancouver’s MLS® HPI recorded a fourth consecutive year-over-year increase (+3.17 per cent).  While prices in Victoria remained lower than year-ago levels, February’s decline (-1.01 per cent) was the smallest in more than three years.

Is It a Good Buy or Goodbye? 
Is the housing market going to cool down, level out or gain steam?

No one can say for sure what’s around the corner.  If you're currently considering home ownership, here are a few points to consider:

  1. Do Your Homework - It's important to plan ahead so research local amenities and public transportation.  Consider features like parks and schools if you’re planning to start a family.

  2. Financial Accountability - Ensure you're financially ready to buy a home.  There are many other costs in addition to mortgage payments so know what you're getting yourself into.

  3. Go Pro - Have a real estate agent guide you through the process.  Get a market analysis of the homes recently sold in the area you're interested in as well as an idea of community trends.

  4. Stick to Your Budget - Be sure to examine your individual needs and never overextend yourself financially.  Make a list of the features that fit your family's lifestyle before looking at homes and stick to it.

  5. Think Straight - It’s normal for home buyers to experience a full range of emotions during the complex, real estate rollercoaster ride.  House hunting should be fun so don’t take things personally or let your emotions rule every decision.

  6. Inspect the Unexpected - Just because you've checked over the house thoroughly doesn't mean all’s well behind the scenes.  Making an offer conditional on a home inspection means there won't be any nasty, expensive surprises.

An uncertain real estate market can make it difficult to know whether you should hold off purchasing a home in case prices fall or jump right in before prices skyrocket.  The time to buy is when your budget matches your needs so always consider your personal circumstances carefully before making decisions.

Don’t Kid Around with Facebook! 
Are your kids pleading with you to go on Facebook?

Facebook’s current policy (which could soon be changing) is that you have to be at least 13 years old to sign up for an account.

There’s no real way to police this so as with anything, education is key.  Here are a few points you should be aware of if you’re thinking of opening an account for your child:

  1. Fake Friends - Predators prey on unsuspecting children by creating fake profiles to befriend them.  Children want to boost their friends list and sometimes accept questionable requests.

  2. It’s Not Nice to Share - Children don’t always understand the concept of privacy.  They often share passwords and release private information that reveals their identity.

  3. Endorsement Errors - If your child “Likes” a company that’s on Facebook, their image may appear next to an ad for that business when random strangers view their news feeds.

  4. Assess Access - If your child creates a fake birthdate to sign up, Facebook will think your child is 18 when they’re actually much younger.  They’ll then be subjected to ads that are geared towards adults.

  5. Itchy Fingers - An impulsive rant could easily come back to haunt your child with devastating consequences.  Make sure they understand that their posts aren’t owned by them and can never be taken back.

It’s important that parents proactively educate their children in today’s ever changing online world.  If your kids are on Facebook, make sure to check their privacy and location settings and teach them about the new age “facts of life”.

Dude, Where’s My Car? 
A car or truck is stolen every minute of every day!

Deserted parking lots are stereotypically the stomping ground for car thieves but the truth is you’re more likely to be a victim of an opportunistic thief who looks for unlocked cars.  Here are a few helpful tips that'll make your car less of a target:

  • conceal valuable items in order to avoid a thief’s temptation

  • steering clamps will deter thieves or at least slow them down

  • always lock your car and never leave it running, even for a minute

Imagine how you’d feel if you went to your car only to find an empty parking spot.  The more time and effort it takes for a thief to steal your car, the less attractive it (and its contents) becomes so be pro-active and keep your car in its spot.

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.