What’s ahead for the Canadian real estate market this year? In general, the Canadian Real Estate Association predicts a strong year ahead, with balance coming to markets outside Toronto. Scotiabank chief economist Warren Jestin suggests that the Canadian market is likely to “simmer” – it won’t reach any new heights, but it will stay steady, and there won’t be any sign of a crash. Both of these forecasts rely in upward trends in the general economy at large. In Ontario, Hamilton is leading the rise in prices, with prices increasing there faster than anywhere else.
And what about that oft-predicted “correction”? Royal LePage claims that there have already been several “mini-corrections” across Canadian markets, and we’re unlikely to see anything more significant until the price of money rises, which is unlikely to happen anytime soon. Meanwhile, the solid 2014 that CREA predicts is driven in part by the supply/demand imbalance in major urban markets like Toronto’s and Vancouver’s. “Housing price gains are always stronger in places where supply is tight relative to demand, such as we’re seeing in Calgary and in parts of southern Ontario including the low rise market in Toronto,” said Gregory Klump, the chief economist at CREA.
One of the drivers of Toronto real estate market is foreign investment; investors from abroad are buying a fair bit of Canada’s luxury real estate. This is part of a global trend in luxury real estate, with buyers from China, Iran, and elsewhere buying up homes in London, New York, and Toronto. In London in particular, home prices have soared in the past few years since the 2008 crash as foreign investors have bought up much of the Square Mile.
While Canadian buyers are used to Canadian interest rates and are situated to this particular context and all the expectations that come with it, foreign buyers have seen higher prices and shakier economies and are more experienced in weathering real estate storms. If they are immigrating, they may also have access to capital and savings as part of the application process. These funds can help make putting together a down payment much easier.
Stay tuned for Part 2, in which we’ll discuss Toronto-specific market trends for 2014!
It’s the end of the year, which means we’re looking at real estate trends to watch for in 2014, and the media is wondering yet again if we’re on the brink of a bubble. (The “bubble” talk has been going on for years now, with no real estate bubble in sight.) But among the hope, anxiety, and rumour, some things have become quite clear.
For instance: condos are rallying. The Toronto Real Estate Board reports that condos have seen a 5.4% year-over-year price increase. Meanwhile, a report from the Canadian Housing Observer suggests that under 25% of condos in Toronto are owned by owner-investors who rent the units out, though others debate that number: it doesn’t include free listings on services like Craigslist, or units that are sitting empty. The Toronto Star suggests that as many as 40% of Toronto’s condos might be owned by investors.
So who are these investors? Although some are international buyers looking for a safe place to put money, more and more condo investors in Toronto are young single women, a demographic traditionally neglected by developers and brokers alike. Condos are proving increasingly attractive to these buyers: greater security, luxury amenities, prime locations, and the opportunity to build equity are what a new generation of professional Millennial women want.
These women are only part of a larger trend of urban Canadians living alone, a trend that has bolstered the market for smaller properties. This comes at a time when the Toronto rental market is stranger than it’s ever been, with rents increasing to the point where renters are considering buying.
What remains to be seen is how many families will buy into the condo market. Condos are shrinking in size, but the prices aren’t. What would those amenities look like if layouts took on an extra 100 square feet, and made room for playground space in the courtyard and daycare in the basement?
What is the role of luxury homes in the real estate market? That can be tough to determine. In Canada, we know that luxury home sales are expected to climb, in part because changes to the Canadian mortgage rules have less impact on wealthier buyers. It’s understandable: buyers who need to save for a down payment often do so by achieving a delicate financial balance, and buyers who have ready cash are better insulated against the shifts in the market. What that means is that while the luxury market is only a small piece of the total Toronto real estate market, it can often be steadier.
With that said, there are still changes to the global luxury real estate market, many of which are coming – or have already come – to Toronto. In New York, foreign investment is taking up a growing portion of luxury real estate, with visitors from China and the Middle East taking up part-time residence in America. What’s more is that these clients are demanding extra special treatment from their agents, almost akin to something like personal management. In this way, the entire suite of services that a broker or agent provides is changing, and brokers are becoming more like consultants. That’s because brokers have to provide more to a smaller segment of customers in order to remain competitive.
A quick glance at the luxury homes available in Ontario shows exactly why these homes remain in high demand despite the ups and downs of the economy in general. Luxury farmhouse estates, downtown mansions, and new modernist wonders are always hot. And that’s because they take advantage of the existing landscape to provide the best attractions to potential buyers, just as Manhattan penthouses do in New York or Spanish revivals do in the Hollywood hills. Connecting buyers to homes means keeping an eye out for how each home functions as an experience in context. Is it an escape into the wild? Is it neck-deep in city life? As with all real estate, the most important thing to know is what your buyer wants most out of the property.
As the weather grows colder, you might be thinking about how to insulate your home against the chill. Luckily, there are all kinds of new advances in innovative green technology insulation and heat-preserving technologies.
For example, how would you feel about insulating your home with mushrooms? That’s right, mushrooms. Mushrooms could soon replace plastic in home insulation. Although it requires thicker walls, mushroom insulation also improves air quality. Soon, it could even replace other building materials, like acoustic tile. Ecovative received a grant to research ways of growing new materials, and that research has culminated in the Mushroom Tiny House, explained in this video here:
Another technology that’s changing the way we save energy is that of smart windows. Windows like these can use thermoptic or photochromic pigments to darken when exposed to sunlight, just like some eyeglasses. Liquid crystal material in windows can do the same thing when exposed to electric current, creating the possibility of “privacy windows” that go opaque at the flip of a switch.
Of course, if you don’t have the time or resources to change out your insulation or your windows, there are far simpler ways to help bring down your heating bill this winter. Plugging leaks, replacing air filters, reversing fans, and using your oven to roast your dinner are all ways to be more energy and heat-efficient.
It’s the dark half of October, and cinemas and televisions are full of haunted house stories. But what about the “real” haunted real estate, the houses that sellers honestly believe to be inhabited by forces beyond their comprehension?
Ghosts can actually be good for business, because some buyers like the idea of living in a haunted house. They may not actually believe in ghosts, but they may like the idea of telling their friends and family they live in a haunted house. (Or perhaps they do believe in ghosts, and want a set of housemates who won’t use up all the hot water.)Buyers of homes with a haunting history may be eager to buy at a discount. Either way, ghosts can give a house some extra character, if not a whole cast of extra characters.
On the other hand, homes where a violent crime has occurred have a hard time finding new buyers. If you’re concerned that the home you’re buying has a violent (or criminal, or just plain creepy) past, it’s important to insert a “stigma” clause in the Agreement of Purchase and Sale. It should go something like this:
“The Seller warrants that to the best of their knowledge there has never been a murder in the home, the home is not haunted or stigmatized in any way that could affect the Buyers decision to purchase the home.”
And if you’re thinking about concealing a home’s troubling past from potential homebuyers, forget about it. In 1991, an appeals court in New York awarded damages to a homebuyer who sued after discovering that the homeowner had sold stories of the haunted property to Reader’s Digest, and appeared on local television stations talking about the poltergeist that allegedly shook the bed each morning. So if you’ve ever spoken to friends about things that go bump in the night, or blogged about it, or discussed it over social media, expect your stories to come back and bite your bottom line. Now that’s a truly scary thought.
You love your house. Really. It’s just…not enough. There’s not enough space, not enough storage, not enough light, or yard, or the neighbourhood is wrong, or you have more kids on the way, or your knees are acting up and the idea of ten more years making that steep climb up from the basement laundry room is sounding like even more of a chore than usual. So, a dilemma: do you renovate, or do you move? And how do you decide?
Well, you could just watch a bunch of episodes of Love It or List It. But when you come back to real life from reality TV, there are a few special criteria for deciding that might make your choice easier. Here are a few:
Ultimately, both decisions will involve a lot of time, money, energy, and frustration. What matters is how much of each you are willing to expend in service to your goal, and what exact types of frustration you’re willing to live with. If attending open houses and participating in bidding wars sounds more attractive than yet another trip to Home Depot, or yet another call from your contractor, you may want a new house. If the thought of unpacking a moving truck for the nth time in your life gives you hives, you may need to stay where you are.
Buying a Toronto home we’ve all been there. Really, the flaws aren’t that major. There are just some underlying problems that need to be dealt with. You know it could work out, if you just put enough work into it. If you only made the right choices, and had the right opportunities, and just enough time and patience to put in a worthwhile effort, things would be…perfect.
But this is real estate, not university, and you’re looking for a home, not dating a guitarist. So, how do you know when enough is enough with a fixer-upper? After all, the 1980’s comedy we’re all trying to re-live is probably Ferris Bueller’s Day Off, not The Money Pit.
So, what questions should you ask yourself before making the investment in a fixer-upper? Lifehacker has a few ideas. Basically, it comes down to being realistic, being prepared, and knowing how to compromise.
All of these factors should influence the offer you make on the property. As This Old House points out:
Figuring out what you should pay to buy a fixer-upper starts with a simple equation. First, add up the costs to renovate the property based on a thorough assessment of the condition of the house. Be tough with this estimate, which should include materials and labor — yours and other people’s. Next, subtract that from the home’s likely market value after renovation, drawn from comparable real estate prices in the neighborhood. Then deduct at least another 5 to 10 percent for extras you decide to add, unforeseen problems and mishaps that have to be dealt with, and inflation. What’s left should be your offer.
Ultimately, buying a fixer-upper is all about what you’re prepared for, and how much you want to take on. What is one person’s fixer-upper is another person’s weekend project. Plan ahead, delegate tasks, and celebrate milestones with project management software like OmniPlan or Clutterpad, and you’re halfway there!
Were you one of those people who didn’t find the time for a winter vacation property? Are you just not a summer person? Don’t laugh; being a “summer” or a “winter” goes beyond what stylists told their customers in the 80’s. For some people, going away to a hot, sticky wilderness cottage with no air conditioning and too many bugs is just not their idea of the perfect vacation. (And if you wound up with sunburns or fire ant bites this summer, you might just agree.)
For those people, winter vacations are the best possible getaway: skiing (both downhill and cross-country), snowboarding, cozying up to the fire, taking a hot tub in the midst of a quiet snowfall, getting away from the city when it’s covered in slush. And all of these pleasures can be part of a great winter vacation or retreat in Ontario.
As you may know, we have plenty of agents in Muskoka who are ready to help you find the best winter property for your needs and desires. Our agents know Muskoka, and they know what you’ll need to get the best out of winter there. The cross-country skiing and snowshoeing can be fabulous out that way. But Muskoka isn’t the only place to have a four-season cottage or condo; if you’re ski-oriented, a ski-in chalet near Georgian Bay – with ski clubs like Alpine and Georgian Peaks – may be more up your alley.
How should you decide what you really want? What are the factors that will make for the best winter retreat? Here are some elements to keep in mind for when you decide to get out in the elements:
Do you like the idea of buying or leasing yourself a great winter getaway? Get in touch now with one of our real estate agents!
Micro-condos have arrived in Toronto with the building of Smart Home at Queen West near University Ave. The 25-storey building boasts two floors of retail space, two floors of offices, and a series of 300-square foot condos on the other floors. The microscopic scale of the condos is supplemented by big amenities: a gym, guest suites for out-of-town visitors, and a patio with fire pits and barbecues.
Micro-condos might be new to Toronto, but the rest of the world has had them for quite some time. Tokyo’s Nakagin Capsule Tower is the most famous example, with its unique “capsule” design of small concrete boxes slid into a larger stack at irregular intervals. This design was part of the Metabolist movement of Japanese design in the 1970s, an offshoot of the design movement responsible for both the World Trade Center and the Pruitt-Igoe projects that defined Japanese architecture abroad in the 1960s. There’s a fascinating account of life in the Nakagin at Domus, written by two Portuguese architects who lucked into a capsule of their own. A detail:
Inside, the space doesn’t seem that small. And, honestly, it doesn’t even seem so relevant in our daily lives. The capsule perfectly fulfils its modern function of a “machine for living” and, as a couple, which theoretically makes the experience even more extreme, we can live normally. We are happy here. We prefer to live in a smaller space in central Tokyo than in a big house in the suburbs. Our routine is to leave home in the morning and return at night to rest. We feel like normal, happy examples of the “contemporary nomad” whom Kurokawa wrote about. Nevertheless, it still feels like we are living somewhere in between a hotel and a scientific experiment.
So, say that capsule (or micro) living is for you. Maybe you want to downsize, or maybe you just don’t need that much stuff, or maybe you’re an investor, or maybe you’re just tired of renting and want to build some equity. How do you adapt to your new environment?
It’s easier than you might think, provided you’re willing to cut emotional ties to “stuff.” It’s hard to let go of clutter, but you’ll feel better for having done so. And after you’ve let go, you can start hacking your new space to fit your new life. This is an interesting, fun challenge, and the best part is that it involves buying shiny new furnishings. UMBRA has some great storage solutions, as does IKEA. Or you could pay a designer to implement some of these awesome solutions.
Would you like to try capsule living? The idea of having your own little urban treehouse might not be so farfetched as you think…
In case you’ve been living under a rock for the past week, the 2013 Toronto International Film Festival is in full swing, meaning that downtown is swarming with stars, stargazers, press trucks, orange-clad volunteers, and reporters leaning heavily on coffee carts. The epicentre of all this activity is TIFF Bell Lightbox, a five-storey cinema and gallery space at the corner of King and John streets in Toronto’s entertainment district.
The presence of the Lightbox has made several changes to the Toronto landscape. First, it’s increased the amount of residential real estate in the area significantly. The penthouse condo at Cinema Tower (perched atop the Lightbox) was a Toronto Life Condo of the Week in 2011, with a stunning all-white 2,173 square-foot space featuring killer views and 10-foot ceilings.
Condos have always been popular downtown, but thanks to Lightbox and Cinema Tower, Toronto’s entertainment district is enjoying a bit of a renaissance. This piece in the National Post chronicles its many charms, from the accessibility of public transit to the numerous restaurants, clubs, and theatres in the area. It’s truly a car-optional neighbourhood, perfect for young couples without children or older people who want all the excitement of downtown and none of the aches and pains associated with shovelling driveways every winter.
Perhaps to capitalize on the neighbourhood’s unique positioning and attractions, the Entertainment District BIA revealed plans in 2011 to create a “cultural corridor” with a ceiling of lights, that would be pedestrian-friendly and encourage neighbourly interaction among condo-dwellers. This has been a focus of Toronto’s urban planners and developers for a while now, as more people are settling in condos and trying to replicate a neighbourhood experience there.
What do you think about the entertainment district? Would you ever consider living there?