When it Comes to Offers, it’s Not Always about Price

When considering which of two or more competing offers to accept for your home, there is no doubt price plays a huge role. After all, if Offer #1 is $10,000 higher than Offer #2, that’s an enticing difference that puts thousands of extra dollars in your pocket. However, price isn’t the only thing you should think about when comparing multiple offers. There are other factors you need to consider as well. For example, what conditions are in the offer? If Offer #1 is conditional upon the buyer selling his current property for a specific amount, then what if that doesn’t happen? You could end up with an offer that dies and be forced to list your home all over again. In that circumstance, accepting the lower offer may be your best move. There’s also financing to consider. Most buyers will attach a certificate from their mortgage lender to show that they can afford the home and will likely secure financing with little difficulty. If you get an offer where the ability of the buyer to get financing is in doubt, that’s a red flag. The closing date is another important factor. Offer #1 might propose a closing date that’s perfect for you, while Offer #2 is four weeks later. If you’ve already purchased another home, you might require a month of bridge financing if you accept Offer #2. There’s nothing wrong with that per se, but the costs and additional hassle are factors you should consider. As you can see, assessing competing offers isn’t as easy as it looks. Fortunately, as your REALTOR®, I will guide you toward making the right decision.

CMHC Housing Market Assessment - Canada - Date Released - Second Quarter 2016

Check out CMHC's web site for other major Canadian markets.

Ottawa: Moderate evidence of problematic conditions We continue to detect moderate evidence of overbuilding in Ottawa’s housing market. The number of completed and unsold condo apartment units per 10,000 population has been steadily rising throughout 2015, and rose once more in the fourth quarter, pointing to moderate evidence of overbuilding. The increase in unsold units has been accompanied by rising vacancy rates in primary and secondary rental markets pointing to softer demand conditions. While the number of condo units under construction declined in the fourth quarter, inventory management is still needed until the high number of completed and unsold units is absorbed by the market. Conditions in the market continue to point to weak evidence of overvaluation due to modest price growth despite soft income performance.

March resale market springs into action

Article courtesy of the Ottawa Real Estate Board April 20, 2016

OTTAWA, April 19, 2016 - Members of the Ottawa Real Estate Board sold 1,166 residential properties in March through the Board’s Multiple Listing Service® system, compared with 1,200 in March 2015, a decrease of 2.8 per cent. The five-year average for March sales is 1,220.

“We are definitely seeing a resale market increase from the previous month, with 256 more properties sold in March over February,” says President of the Ottawa Real Estate Board, Shane Silva. “Properties are starting to sell faster, indicating that we are heading into our busy spring market.”

 March’s sales included 221 in the condominium property class, and 945 in the residential property class. The condominium property class includes any property, regardless of style (i.e. detached, semi-detached, apartment, townhouse, etc.), which is registered as a condominium, as well as properties which are co-operatives, life leases and timeshares. The residential property class includes all other residential properties.

“In March, 3,203 homes were listed, up 38.6 per cent since February, and inventory on hand at the end of March also rose by 17.5 per cent from last month,” says Silva. “Although there is a slight dip in units sold compared to last year, average price remains steady keeping the Ottawa resale market healthy and strong. Canada’s capital continues to be a great place to buy and sell real estate.”

The average sale price of a residentialclass property sold in March in the Ottawa area was $394,951, an increase of two per cent over March 2015. The average sale price for a condominium-class property was $258,714, an increase of 2.4 per cent over March 2015. The Board cautions that average sale price information can be useful in establishing trends over time but should not be used as an indicator that specific properties have increased or decreased in value. The average sale price is calculated based on the total dollar volume of all properties sold.

 “The hottest segments in our market continues to be in the $300,000 to $400,000 price range, followed by the $200,000 to $300,000 price range,” says Silva. “Residential two-storey and bungalow homes, and one level condo properties have the highest concentration of buyers in March. In addition to residential and condominium sales, OREB Members assisted clients with renting 695 properties since the beginning of the year.”

What Buyers Don’t Want to See in Your Backyard

When you put your home up for sale, you want it to look its best to potential buyers. That’s why you clean, tidy and de-clutter every room.

Some sellers, however, miss the backyard. You need to pay just as much attention to that space as you do to the interior of your home. The backyard is as important a living space as the family room. To some buyers, even more.

 Buyers want to see an attractive backyard space, with the grass cut and the hedges trimmed. The more neat and tidy you can make it, the better. Be sure to sweep walkways and wipe down patio furniture.

 Also, watch out for the following things that buyers do not want to see:
 • Bags of garage and other waste.
 • Doggie do-do. (Be sure to stoop and scoop!)
 • Rakes and other tools piled in the corner.
• Cluttered and disorganized storage sheds, pool huts and other backyard structures.
• Weeds in the flower beds.
• Items stored underneath the deck.
• Hoses not stowed neatly.
 • Electrical outlets and water faucets that don’t work.

 These are not difficult issues to fix. Doing so will positively impact the impression the buyer gets of your backyard.

 Do you have a backyard that shows particularly well in the summer? Here’s a tip: Take pictures. Those photos will help buyers be able to appreciate how it looks should you list your home in the winter.

 Want more tips on making your home show well so that it sells fast? Call or email Ian. 613-222-2662 or ian@royallepage.ca

Upgrades That Hold Their Value

Do you have a renovation project in mind – and wonder how much value it will add to your home? Remodeling Magazine recently did a study of renovation projects, comparing costs to added value. Here are some of the results: Replacing a main entry door has a return on investment of over 95%. After all, the entrance to a home is one of the first things a prospective buyer notices. Adding a new deck also adds a lot of value. Depending on the materials used, you can expect to get back three-quarters of the money invested. Another high-payback project is the garage door. This once again demonstrates the importance of a home’s “curb appeal.” If you’re tackling a big project, such as a basement renovation, you’ll be glad to know that, according to the study, a project like this adds a lot of value. Finally, minor improvements to bathrooms and kitchens – such as adding new countertops or cupboards, can also be good investments that mostly pay back when you sell your home. Of course, these figures are averages and can vary widely depending on location, type of property, and other factors. Need help determining how a particular home improvement might impact the selling price? Call Ian today. 613-222-2662 or email ian@royallepage.ca

Busy spring season arrives amidst March snow banks-

Members of the Ottawa Real Estate Board sold 1,208 residential properties in March through the Board's Multiple Listing Service® system, compared with 1,184 in March 2014, an increase of two per cent. The five-year average for March sales is 1,236.

"Sales increased month over month, with 356 more properties sold in March over February, a 41.8 per cent increase," says David Oikle, President of the Ottawa Real Estate Board. "Indications of a fast approaching spring market were noted in February, and these numbers are proof that Ottawa is indeed experiencing an upswing in sales."

March's sales included 228 in the condominium property class, and 980 in the residential property class. The condominium property class includes any property, regardless of style (i.e. detached, semi-detached, apartment, townhouse, etc.), which is registered as a condominium, as well as properties which are co-operatives, life leases and timeshares. The residential property class includes all other residential properties.

"The average cumulative days on market came in at 83 for the month of March, lower than the average of 99 days in February and 119 days in January indicating that properties are starting to move faster as we enter the second quarter of 2015," explains Oikle. "Year-to-date sales for the first quarter of 2015 are 1.8 per cent higher than the first quarter of 2014. Average sales price has also increased, ever so slightly, by 0.8 per cent. So far, the 2015 resale market in Ottawa remains steady and strong."

The average sale price of residential properties, including condominiums, sold in March in the Ottawa area was $361,572, an increase of 0.7 per cent over March 2014. The average sale price for a condominium-class property was $251,666, no change over March 2014. The average sale price of a residential-class property was $387,141, no change over March 2014. While average sale price information can be useful in establishing trends over time, it should not be used as an indicator that specific properties have increased or decreased in value, because the average sale price is calculated based on the total dollar volume of all properties sold.

"The hottest segments of our market in March were sales between $300,000 to $400,000, followed by the $200,000 to $300,000 price range," says Oikle. "Residential two-storey homes continue to be the highest sold property class, followed by bungalows and one-level condos. In addition to residential and condominium sales, OREB members assisted clients with renting 593 properties since the beginning of the year."

Courtesy of the Ottawa Real Estate Board 

April 8, 2015

Toronto condo market booming again; While banks and other lenders return to the market, the latest wave of completions and sales signals recent lull could be over

The Globe and Mail – Mon Mar 2 2015 Byline:TAMSIN McMAHON

After years of slow growth, Toronto’s condo market has come roaring back to life.

Builders were putting the finishing touches on nearly 10,400 new condo units in January, eight times more than the monthly average over the past decade, Bank of Montreal senior economist Sal Guatieri said in a report last week.

The vast majority of the new condo units have already been sold. Still, the influx of new units has helped push the number of unabsorbed condos – those that have been built but not sold – to a 21-year high.

It is a dramatic rise for a city whose condo market has been at the centre of concerns among federal regulators and international organizations such as Deutsche Bank about rising levels of household debt in Canada.

The latest wave of Toronto condo completions and sales could mark a new upswing after a lull in the market. Sales hit a fourand-a-half year low last fall, while new condo completions had been falling for the past 18 months.

Much of the new supply is the echo of a building boom that began in early 2012, when developers started construction in more than 37,000 new condo units in the city, well above the long-term average of 25,000 units a year.

But the January condo boom also reflects the fact that banks and other lenders are returning to the market, now convinced the city’s condo sector isn’t poised for collapse.

Under pressure in the past from federal regulators, such as former Bank of Canada governor Mark Carney and former finance minister Jim Flaherty, lenders had largely retreated from Toronto’s condo market, working only with well-known developers and often requiring a high number of presales before they would agree to finance construction.

But officials in Ottawa have grown quiet and banks are now eager to fill holes in their loan portfolios, several lenders told a commercial real estate conference last week.

“It’s a very competitive market out there,” Frank Margani, executive vice-president of strategy and development at Fortress Real Developments, told the RealCapital forum. “Portfolios are down and everybody is scrambling to get their piece of the action.’ ” Lenders are now willing to finance as much as 75 per cent of the value of a project, up from 70 per cent in recent years, said Chris Milne, vice-president of real estate banking at the Bank of Nova Scotia.

Some have also eased up on their presale requirements, typically asking that developers have buyers for at least 65 per cent of their units, confident that builders will eventually find buyers for unsold units.

“There’s very little walk-away in the market,” Mr. Milne said.

“We’re very different from the U.S. People sign with their name.”

With condo projects growing larger, more complex and more expensive, lenders have also been getting more creative about how they finance them, increasingly turning to syndicated loans involving multiple lenders, Mr. Margani said.

Still, many say the market doesn’t appear to be headed toward the speculative boom of the past, when prices rose as much as 9 per cent a year, encouraging investors to flip their units for profit.

Prices are growing at half that pace today. Investors are now looking to hold onto their units and rent them out and they have established a price ceiling of about $600 a square foot to keep prices from outstripping rent.

“It’s actually sort of the magic number for the investors to still be interested,” Mr. Margani said.

January’s boom in new condo completions is likely to prove temporary and the numbers of new units should start to fall later this year, predicted Royal Bank of Canada chief Robert Hogue.

Even as they are growing more aggressive about lending to the condo industry, banks are becoming more realistic about about where the condo market is headed. “Sales are not what they were in late 2007 when you could sell a high-rise condo in a week it seems,” Mr. Milne said. “Now it takes awhile.”