Toronto real estate. Healthy Toronto housing market seen in 2010

Toronto’s housing market will stay healthy next year as new home groundbreakings in Canada’s most populous city jump even as existing home sales cool, said the Canada Mortgage and Housing Corp.

The federal government agency expects a 26-percent rise in housing starts next year to 36,140 units.

But existing home sales are expected to dip to 78,000 in 2010 from 82,000 this year. Still, CMHC expects average prices to rise by 5 percent, which is in line with the annual average for this decade.

The agency said that while overall demand for home ownership is expected to moderate next year, households with stable employment will take advantage of improved affordability.

Housing has been a rare bright spot as the Canadian economy struggles to emerge from recession. Toronto has seen an upswing in housing activity in recent months, helped by low mortgage rates.

The Bank of Canada cut interest rates to a record low this year and conditionally pledged to keep them there until at least the end of the first half of 2010.

Toronto real estate: Variable mortgage rates can save you money

Fixed mortgage rates may help you feel secure in your budgeting, but the Bank of Montreal says the more volatile variable rate mortgages will save you money in the long run.

A new report from the bank shows that, over the past 30 years, variable-rate mortgages have been more cost-effective about 82 per cent of the time.

That may come as a surprise to some after studies have shown many Canadians prefer a fixed-rate mortgage.

A fixed rate locks the borrower into a set interest rate for a certain period of time.

That gives many borrowers peace of mind knowing how much money to set aside each month for their mortgage payment.

Variable rates change along with interest-rate moves.

BMO said the Bank of Canada’s overnight lending rate is at its lowest possible point now, which could mean there are fewer benefits to a variable rate in the foreseeable future.

BMO highlighted two historical periods when fixed rates were considered beneficial — in the late 1970s and late 1980s — and both were just before interest rates started rising again.

The bank added that the current interest environment is similar to both of these periods.

“Short-term rates are at extreme lows, and pressure is likely to build for higher rates in the year ahead,” said deputy chief economist Doug Porter in the report.

“The question of whether to lock in to a longer-term fixed mortgage rate or stay in a variable rate has become an increasingly complex and important issue.”

Canada has been in a long-term declining rate environment since the early 1980s, the bank suggested.

As a result, the spread between five-year fixed mortgages and variable mortgages has been pushed wider in recent years and is now near an all-time high.

If you want to know more about mortgages call Alex Malkhassiants, mortgage agent with Centim Inc, at (416) 723-9383 (cell).

Younger Canadians feel prepared to buy a first home

While homeowners of all ages agree that purchasing a house is a solid long term investment, there is a marked difference in today’s 18-34 year old first time home buyers  actions and attitudes as compared to older generations aged 55+ when they were first time buyers of the same age.

Young Canadians aged 18-34 are more likely to feel they are financially ready to buy a house than their parents and grandparents were when they were purchasing their first home. What is motivating this belief? The TD Canada Trust Generational Homeownership Study reveals a trend by 18-34 year olds towards purchasing older homes and a significant increase in young homebuyers who are relying on financial assistance from family to make their home purchase a reality.

When asked what prompted them to consider buying their first home, just over half of younger Canadians (51%) said they felt financially ready compared to 37% of older Canadians 55+ when they were thinking of buying their first home. However, over a third of younger Canadians 18-34 (36%) said they could not have afforded their first home without help from family (compared to 16% of those 55+), and 27% said that they received money as a gift or borrowed from family/friends to put towards the purchase of their first home (compared to only 10% of those 55+).

When today’s Canadians 55+ bought their first home, paying off their mortgage was a top priority; more important than it is to today’s younger homebuyers. Today, less than half of young Canadian adults (49%) agree that paying off their mortgage is a first priority, compared to 64% of Canadians over 55.But for Canadians across all generations, their home is their biggest investment. Eighty-eight per cent of Canadian adults 18-34, 87% of Canadians 35-54 and 78% of 55+ all agreed that their first home was an investment for the future. Sixty-four per cent of younger Canadian adults 18-34 said that they put all their savings into their first home compared to 62% of Canadians 55+ and 54% of Canadians 35-54.

The research revealed that when it comes to getting a mortgage, young adults tend to shop around more than their older counterparts did. Sixty-two per cent of older Canadians were loyal to their own bank and received financing where they were already a customer, compared to 36% of younger homeowners who were more likely to shop around and take recommendations.

“There are so many different options available now, and easier access to information with the use of the internet, that it’s no wonder today’s first time homebuyer shops around a bit more,” added Wisniewski. “It’s a great idea to look around and see what’s available. 30 years ago when people were looking for financing, they usually had limited choices. Now there are many options to explore with your bank including a variety of fixed rate mortgages, variable rate mortgages, and even green mortgages for buyers who want to lessen their footprint on the environment.” tradingmarkets.com

Banks reaching out to help new Canadians buy a home

      In the past, many immigrants to Canada came by sea – often landing at Pier 21 in Halifax. Nowadays, as a new Canadian, you are more than likely to touch down at Pearson International Airport after a journey of several hours rather than days or weeks.

    Either way, once on the ground, making a financial start has always been a tough route. Thankfully, today’s evolution of technology makes it easier to prove your creditworthiness in Canada, and to qualify for a mortgage in order to buy your first home here.

    “One of the key things … is credit. You have to find some sort of credit history,” says Jim Rawson, regional manager of Invis mortgage brokerage firm in Toronto. “With the Internet, with easy access to information, we can now check credit from just about anywhere, so we can get credit histories much easier than we could in the past.”

    As with any financial agreement, your credit status will determine how much you can borrow.

    “There are different kinds of qualifications, depending on how long you’ve been here and depending on whether you have a job or not, whether you’re landed immigrants or here on work permits,” Mr. Rawson says. “But there are several lenders that have new-immigrant policies.”

    Every country has its own customs and laws when it comes to home purchasing, and Canada is no different. Colleagues and friends can be a good source of recommendations for trusted accredited real estate agents, lawyers and mortgage brokers to guide you through the process.

     Canada Mortgage and Housing Corp. has also produced The Newcomer’s Guide to Canadian Housing, which includes a section on what to consider when buying a home in Canada – right from scoping out a location, to the documents required, to budgeting for the many expenses involved, and the process of making an offer.

    As well as the usual costs attached to home purchasing, as a new immigrant, you will need to add on the additional time and expense of obtaining proof of your immigration and financial status and maybe even fees for wiring money from your country of origin to cover the purchase deposit.

     Buying a home will likely be your largest financial commitment when you come to Canada, but it may not necessarily be the most complex purchase.

    “Getting a mortgage for a house was easier than getting a car loan,” says Graeme Morton, who emigrated from Scotland to Guelph. “I had to get my colleague to counter-sign to get the car loan – which was less than $10,000.

    “And as for cellphones, they asked for so much proof as to who we were it was unreal. Obviously, houses are the less portable of the three!”

    If you do not have a credit history, then financial institutions with specific programs for immigrants, such as HSBC and Scotiabank, may help.

    “We have a program, where, even before they establish their Canadian credit history, new immigrants who are willing to put down a 30% downpayment will most likely be approved for 70% of their home purchase,” says David Kuo, vice- president, retail branch network for HSBC, Ontario East.

     Mr. Rawson at Invis says that in the past, immigrants could have been required to have a larger deposit to secure a mortgage.

    “If you’re not landed [a permanent resident] you might be looking for a larger deposit,” Mr. Rawson says. “But the insurers CMHC and Genworth have pretty decent new-immigrant policies that [allow for] high-ratio financing.” kelowna.com

    If you want to know more about Toronto real estate, call sales representative and mortgage agent Alexandre (Alex) Malkhassiants with all your questions: (416) 723-9383 (cell).

Canada housing sales hit record in July

July housing sales across the country were the best on record for the month and the largest year-over year increase in two years, said the Canadian Real Estate Association.

The Ottawa-based group, which represents about 100 boards across the country, said there were 50,270 units sold via the multiple listing service last month. That’s an 18.2 per cent jump from a year ago. It also marked the first time sales had topped 50,000 in July.

 ”The difference in the resale housing market now, compared to the beginning of the year, is night and day and nowhere is this more evident than in the west,” said Dale Ripplinger, president of CREA. “Homebuyers recognize that interest rates and prices have bottomed out, and are taking advantage of excellent affordability before prices and interest rates move higher.”

A five-year fixed-rate mortgage, the most popular product among consumers, is still available for under four per cent at some financial institutions. Variable rate mortgages, tied to prime, remain in the three per cent range and are not expected to rise until June. The Bank of Canada has pledged not to change its lending rate until then — but it is not an ironclad guarantee.

The low rates seem to have worked and have the housing market even hotter than it was in 2007, a record year. July sales in 2009 were 3.9 per cent above the previous July high set in 2007.

It has been a stunning reversal for a real estate market that had almost ground to a halt over the winter. MLS sales on a seasonally adjusted basis have risen for six straight months and are up 61.2 per cent off the decade-low set in January. Sales are only off 1.4 per cent from the May, 2007 peak.

The strength in the market is being felt right across the country. Vancouver sales last were up 90 per cent from a year ago to lead the pack. Toronto sales climbed 28 per cent from a year ago and Edmonton sales rose 28 per cent during the same period.

With demand strong in the country’s highest-priced markets, it is skewing average price but in the opposite way from what was happening when the market was slumping. The average price of a home sold on MLS last month rose 7.6 per cent from a year ago to $326,832.

Part of the pressure on prices is coming from a dearth of supply. New listings in July were down 13 per cent from a year ago to 73,444. It marked the seventh monthly year-over-year decline in new listings.

The overall supply of homes for sale on the MLS was down to 219,982 at the end of July, a 12.5 per cent decrease from 2008. Based on present activity, there is only 4.4 months of housing inventory in the mark. That’s a sharp contrast to the 12.8 months of inventory available in January.

“Home sales through the MLS systems in July provide clear evidence that sentiment about making major purchases continues to improve,” said Gregory Klump, chief economist with CREA. “Activity may level out over the rest of the year as home prices and mortgage lending interest rates creep higher. The number of new listings coming onto the market is down from last year and the rebound in sales activity is paring inventories, so the number months of inventory is on the wane. These trends are supporting average prices.”

vancouversun.com

Celebrities and real estate. New home for Slumdog child star

The makers of the hit movie Slumdog Millionaire have bought a new house for one of the two child stars discovered in Mumbai’s slums.

The purchase of a 23m, one-bedroom apartment for the family of Azharuddin Mohammed Ismail, 10, was finalised on Monday, said Nirja Mattoo, who helps oversee a trust set up by the filmmakers to help Azharuddin and his 9- year-old co-star Rubina Ali.

’ “They can move in,” Mattoo said, adding that the trust planned to deliver the keys on Thursday.

Both children lost their homes last month when authorities demolished parts of their slum.

Mattoo said the trust was actively looking for a new home for Rubina.

Ownership of the first apartment, which cost about 2.5-million rupees (50000), will be transferred from the trust to Azharuddin when he turns 18, provided he completes school, Mattoo said.

“He has to complete an education. We are very clear about that,” she said. However, she declined to say what would happen to the property if he did not finish school.

The apartment is located in Santa Cruz West, a suburb of Mumbai just north of the slum where the two children now live.

The government has promised to give both of them new apartments, but the families have resisted, saying the government flats are too far away from their neighbours and school.

Toronto Real Estate Market Sets Records in early May 2009

There are more signs of stabilization in the local real estate market.

Interest rates are at a record low for a five-year, fixed-term mortgage, still the most popular product among homeowners. Some banks are offering rates as low as 3.75%, if the buyer locks in for a full five years. But variable rates, tied to prime, have also continued to drop as the Bank of Canada has lowered rates.

The average house price of a single family home in Toronto has reached record levels. Last year, in the first two weeks of May, right after the April peak, and long before the news of the stock market crash and the world financial crisis, single family homes were worth on average $437,205. Now, that number has climbed to $439,459, which is the highest recorded.

So, if you were waiting for prices to drop in half like they did in some locations in the United States, you’ve probably waited too long.

Prices are rising, not dropping. Vendors with exceptional properties didn’t list them this year. They were going to wait and watch the market. So, this is the time to see the better properties become available. These are the properties that buyers stretch for. These are the ones that vendors insist on the best price. If they get listed over the next six weeks, you’ll see a significant upward push in the price structure.

Why? The answer is simple! First mortgages are at their lowest rates in 50 years.

Here are some comparative figures for Toronto, the 905, and the entire GTA. While the 905 didn’t fare quite as well as Toronto, the performance is still quite outstanding. The first two weeks of May 2009 appear, compared with the first two weeks of May 2008 in brackets:

City of TORONTO (”416″)

Sales 1,864 (1,734)

Average Price $439,459 ($437,205)

Rest of GTA (”905″)

Sales 2,697 (2,688)

Average Price $372,408 ($377,344)

GTA

Sales 4,561 (4,422)

Average Price $399,811 ($400,817)

Oddly enough, and this situation occurs rarely; it is both a good time to buy and a good time to sell.

In the condo market as well, one of the G.T.A’s top sellers, Brad Lamb tells The Sun there’s never been a better time to buy with developers offering many incentives.

Lamb says the condo market survived the worst of the bank crisis last fall, and prices are expected to hold steady for the next year at least.

Toronto real estate. No Bank Failures in Canada

One place where none of the banking drama is taking place is Canada.

Banks in Canada didn’t do the things that blew other banks up.  In the last quarter of 2008, all of Canada’s major banks were profitable, collectively making $2.5 billion during a period when U.S. banks lost more than $26 billion.

In fact, since the financial crisis began, American taxpayers have provided more than $300 billion dollars to more than 450 companies. During that same period, from their government, Canadian banks have not received one penny.

One reason: Take those infamous subprime mortgages given to risky homebuyers. They crippled banks in the U.S., where at peak, 25 percent of loans were subprime. In Canada? Three percent.

Another villain in the financial crisis were toxic mortgage-backed securities – risky loans that were chopped up and resold in countless different ways. Many banks gobbled up the now virtually worthless investments.

Canadian banks were up to their ankles in the toxic muck whereas American banks were over there heads.

One reason why Canada is the only industrialized nation in the world without a single bank failure in the current economic downturn.

Here you can read more about Toronto real estate market and great Toronto mortgages – http://www.torontogreathomes.com/ONTARIO_MORTGAGE/page_929364.html

Alexandre Malkhassiants, Sales Representative and Mortgage Specialist,
Right at Home Realty, Centum Mortgage Decision
Office: (416) 391-3232
Cell: (416) 723-9383
E-mail: amalkhass@rogers.com
Web site: www.torontogreathomes.com
Toronto real estate market blog: http://torontorealestate.wordpress.com/

Toronto real estate. TORONTO GOES GREEN

Toronto real estate.  Toronto city committee wants to make green roofs mandatory on most new buildings.

 Roofs on new buildings with an area of 5,000 square metres or greater to be 30% to 60% covered by vegetation. The bigger the building, the more planted space it would have to have – otherwise fines of up to $100,000 could be levied.

As drafted, the bylaw would cover mid- to high-rise condos, retail space and office towers, but exempt low-rise, large-scale industrial, non-profit housing and public buildings like schools.

Deputy Mayor Joe Pantalone, who helped bring the city’s first power-generating wind mill to the Exhibition grounds, said he was “disappointed” the first draft of the bylaw was so “tepid.”

Mr. Pantalone asked city staff to come back in a month with a proposal that would include schools, low-rise buildings on “Main Street” and even private residences.

“Either we are the leading city in the world or we’re the ones who looked in the mirror and got scared,” he said.

Stephen Upton, vice-president development planning at building giant Tridel, pointed out that once installed, the rooftop shrubbery has to be left untouched for two years to allow it to take root.

More information is also required about how long the longevity of green roofs and how much should be budgeted in a condo corporation’s building fund for future replacement.

“I think there’s still quite a bit left to be understood, digested and refined,” Mr. Upton said. “Toronto green standards, those are things that shouldn’t be mandated but should be encouraged, like LEED is in the industry.”

But while the developers were balking at the bylaw, environmental groups were urging Toronto to move further and faster. The issue will return to the planning and growth committee for further debate in May.
network.nationalpost.com

If you want to know more about green Toronto, go here – http://www.torontogreathomes.com

Toronto real estate. GIVE YOUR MORTGAGE A SPRING CLEANING

Spring is here! And it just might be a good time to give your mortgage a spring cleaning – it could make a noticeable difference to your finances.

There’s one good thing about a recession:  it forces us to rediscover the virtues of a solid family budget. For some reason, the first budget items to be scrutinized tend to be the little luxuries:  outings, treats… But we shouldn’t forget the item that, for most families, constitutes the number one expense:  the mortgage.

Here are seven tips for managing your mortgage better.

Set the right goal

Not all households have been put in the same position by the current economic climate. For some, the situation is touch and go. Others aren’t on such shaky ground, but still want to be prepared for any eventuality. Unfortunately, giving yourself some short-term breathing room by reducing your mortgage payments also means signing up for a longer repayment period, which entails higher costs in the end. It’s important to be clear about your ability to pay in the short term so you don’t sacrifice your long-term security:  do you really need to reduce your monthly payments?

Reconsider your amortization

If you do need to lower your monthly payments, you can ask your financial institution to lengthen your mortgage amortization period. For instance, if you’ve borrowed $150,000 and your amortization period is 15 years, you can reduce your monthly payments by $300 simply by increasing the amortization to 25 years. Be careful, though! As soon as your financial situation allows, reverse this change:  shorten your amortization period to reduce the long-term cost of your loan.

Amortization:  a balancing act
$150,000 mortgage at 5.75%

Amortization	Monthly payment	Interest cost
30 years	$ 869	$ 162,811
25 years	$ 938	$ 131.259
15 years	$ 1,240	$ 73,232

If you have questions about mortgage, call mortgage agent Alex Malkhassiants at (416) 723-9383

You can find more information here – http://www.torontogreathomes.com/