Friday, July 20, 2012

GTA REALTORS® RELEASE MID-MONTH RESALE FIGURES

TORONTO, July 18, 2012 – Greater Toronto REALTORS® reported 3,679 sales through the first 14 day of July 2012, representing a 5.6 per cent increase compared to the 3,484 sales reported for the same period in 2011. New listings were up by 14.4 per cent over the same time frame. “Housing demand remained strong in the first half of July. Sales growth occurred in the regions surrounding the City of Toronto. In the City of Toronto, where sales were down, the relatively higher cost of home ownership likely prompted some buyers to purchase elsewhere in the GTA. Higher costs in the City of Toronto include the upfront payment of the additional land transfer tax,” said Toronto Real Estate Board (TREB) President Ann Hannah.

The average selling price in the first half of July was $473,466 – up by 2.3 per cent compared to last year. On average, homes sold for 98 per cent of the asking price in 25 days – in line with July 2011. Price growth was strongest in the City of Toronto, climbing by 3.5 per cent to $496,645.
“A better supplied market contributed to a slower annual rate of price growth in July relative to the first half of 2012,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “As buyers benefit from more choice in the second half of this year, expect price growth to slow to a more sustainable pace.”

Saturday, July 14, 2012

Toronto Real Estate Blog: Alex's July Market Update

Toronto Real Estate Blog: Alex's July Market Update: I hope everyone is enjoying the summer so far. In the past couple of weeks the market has appeared to cool down somewhat. This cool down is...

Alex's July Market Update

I hope everyone is enjoying the summer so far. In the past couple of weeks the market has appeared to cool down somewhat. This cool down is common and usually occurs around this time every year. 9,422 home sales were reported through the TorontoMLS system in June 2012. The number of transactions was down by 5.4 per cent in comparison to June 2011. The year-over-year decline was largest in the City of Toronto, where sales were down by 13 per cent compared to June 2011. Sales in the rest of the Toronto Real Estate Board (TREB) market area were comparable to a year ago.

Buyers continue to face the substantial upfront cost associated with the City of Toronto’s unfair Land Transfer Tax. Recent polling by TREB suggests that many households are considering home purchases outside of the City of Toronto to avoid paying the Land Transfer Tax. This goes a long way in explaining the disproportionate decline in sales in the City versus surrounding regions.
The average selling price in June was $508,622 – up by 7.3 per cent compared to June 2011. The mortgage payment associated with the average priced home in June, assuming five per cent down and a five-year fixed rate mortgage amortized over 25 years, would account for approximately 35 per cent of the average household’s income in the GTA after adding property tax and utility payments.
According to new mortgage lending guidelines set out by Finance Minister Jim Flaherty, the GTA housing market remains affordable. The share of the average household’s income going toward major home ownership payments for the average priced home remains below the 39 per cent ceiling recently announced by Mr. Flaherty.
The average household in the GTA continues to benefit from a considerable amount of flexibility to account for higher interest rates moving forward. I expect for the market to be a more balanced market in the second half of the year which will make it a better buying environment for buyers. With new listings increasing there will be more selection for buyers and pressure on sellers to be priced well. The low interest rates and better supply will make it an ideal buying time and I expect buyers and investors will take advantage of this.

Friday, July 6, 2012


Goverment introduces new Mortgage Rules

Effective July 9, 2012:

 

  • The Maximum Amortization Period has been reduced to 25 years from 30 years

  • Refinance Maximum Loan to Value: The maximum loan to value for 1-4 unit residential properties will be reduced to 80% from 85% 

  • The maximum purchase price or as-improved value for purchase plus improvement loans cannot exceed $999,999.99 (must be less than $1 Million)
  • Maximum Debt Service Ratio Limits (clients with beacon scores less than 680)
    • The maximum Gross Debt Service ratio (GDS) cannot exceed 35%
    • The Total Debt Service (TDS) cannot exceed 42%
  • Maximum Debt Service Ratio Limits (clients with beacon scores equal to or greater than 680)
    • The maximum Gross Debt Service ratio (GDS) cannot exceed 39%
    • The Total Debt Service (TDS) cannot exceed 44%