Canadian real estate

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New to Canada Homebuyer Program A Big Plus For Recent Immigrants

Published February 19, 2024 by Real Estate Leads

We certainly don’t need convincing that Canada is a great country. Here at Real Estate Leads, we’ve met all sorts of like-minded people in our aim to introduce realtors to ways to get more real estate leads as an agent and it seems the consensus is unanimous.

What makes Canada so appealing to those of us from families who’ve been here for generations is what makes it appealing to newcomers too. Many of us had great-grandparents who came to Canada from the British Isles hundreds of years ago with the same idea of a new and better life.

Back then you could get a large parcel of land for what wouldn’t even be half your down payment on a home these days, and the word ‘condo’ didn’t even exist. With the fact home ownership can be dauntingly expensive, it’s ideal that the New to Canada Program for Immigrants has been introduced to make home ownership a possible reality for people who have recently immigrated to Canada and are bringing their professional expertise and career prospects with them.

This versatile program makes it possible for qualified homebuyers new to Canada within the last 5 years to purchase a home with a down payment of as little as 5%. You can purchase a home, build equity, and become economically established in Canada sooner than ever before.

The property value must be less than $1,000,000, and loan security is available on first mortgages. Borrower qualifications include standard income and employment verification, plus 3 months minimum full-time employment in Canada, with borrowers being transferred under a corporate relocation program being exempt.

Only certain homes and home purchase quantities are allowed within the program. The maximum number of units an applicant can purchase is 2, and 1 unit must be owner occupied. Newly constructed home must be covered by a lender approved New Home Warranty Program, and existing resale properties must be readily marketable residential dwellings, located in markets with demonstrated ongoing re-sale demand. The estimated remaining economic life of the property should be a minimum of 25 years, as may be determined by a qualified provincially-appointed appraiser if deemed necessary.

Other lending stipulations for this program include:

Applicants must have a 90.01-95% International credit report (Equifax or Transunion) score demonstrating a strong credit profile OR 2 alternative sources of credit demonstrating timely payments (no arrears) for the past 12 months
Applicant must have immigrated or relocated to Canada within the last 60 months
Must have a valid work permit or obtained landed immigrant status
All debts held outside of the country must be included in the total debt servicing ratio (note: rental income earned outside of Canada is to be excluded from the GDS/TDS calculation)
Guarantors are not permitted
Foreign diplomats who do not pay tax in Canada are ineligible for this program

Qualifying terms and interest rates are as follows:

Fixed, standard variable, capped variable and adjustable rate mortgages are permitted
Maximum interest rate term of 25 years
The qualifying interest rate is the greater of the contract rate or 5-year benchmark rate

and purchase transactions may be made up to a 95% LTV (loan to value) limit, with – as mentioned – a 5% down payment on properties up to 500,000 in value, and a 5% down payment on $500,000, with an additional 10% down payment on the portion of the home value above $500,000 if purchased for any price between 500k and 1 million.

We hope this programs is helpful for valuable newcomers coming to Canada to make our country a better place to live, as has been the case for well more than 200 years now. And we also hope it makes for more clients for our realtor readership. Check Real Estate Leads Availability here and receive qualified online-generated leads provided to you exclusively for your exclusive region every month, and ask away with any questions too.

Growing Optimism Regarding Housing Market Amongst Canadians

Published August 20, 2019 by Real Estate Leads

Earlier this year, the CMHC joined economists and many other industry experts in declaring that the market for detached homes in Canada was now ‘flat’ – meaning that it wasn’t moving in either direction and thus favouring either buyers or sellers OR meaning increased or decreased property values for homeowners.

It would appear that things have changed since then. Have they changed enough to warrant a change in the ‘flat’ condition of the detached home market? That’s up for debate, but of course as well all know there’s much more to the market and housing stock in Canada than just detached, single-family dwellings. Sure, they may be the shining pinnacle of home ownership, but the reality is that the ‘norm’ of what housing and should entail is shifting very rapidly in todays’ world.

Ascribing to and working with these new bigger-picture realities is a part of what separates a great realtor from a good one, and as we keep harping at here – knowledge is real power in this business in much the same way it is for any of them. Here at Real Estate Leads, our online real estate lead generation system is an excellent way for realtors to harness the power of the Internet and get so much more out of their prospecting efforts. And that means opportunities for you to flex your real estate industry knowledge muscles!

Stronger Market Performance Seen

The consensus seen nowadays is that Canadians have an increasingly positive outlook on housing, and that’s something of a marked change from as recently as 2 summers ago. This has been amplified by stronger market performance and an increase in housing starts across the country as a whole.

The Bloomberg Nanos Canadian Confidence Index confirms this, with a posted a 58.6 reading that’s up from the 58.3 seen at the end of June. The increase may seem small at face value, but in this context it’s significant. Vancouver and Toronto continue to be the very centres of real estate activity and demand in the country, and accordingly this growing optimism is being bolstered by surging home sales in Toronto and Vancouver.

Both cities enjoyed 24% growth last month.

National Economy Influences

This is then coupled with a steadily recovering national economy, along with downward movement in borrowing costs. As a result, ever greater numbers of Canadians are less intimidated at the thought of a potential housing downturn.

According to a recent Bloomberg-Nanos survey, 43.2% of respondents believe local real estate prices in their area should increase in the next 6 months. Oppositely, the percentage of those expecting lower prices came in at 15.2%, which was decidedly lower than the 2019 average of 16.4%.

This more positive consumer outlook is buoyed further by higher levels of construction activity or building ‘starts’ as they’re referred to in the industry. Recent CMHC figures indicated that the national trend in housing starts was 208,970 for last month (July), an increase from the 205,765 units that were started in June.

Most notable here were High levels of activity in apartment and row starts in urban centres, and these housing types and the locations of them were integral in reflecting in the high level of the total starts trend in July.

The ‘Smart’ Choice: Multi-Family Development Starts Leading the Way

Vancouver in particular was key to all of this and provided a major boost – upwards of 85% of the market’s new housing starts last month were in the multi-family development category. Of course, these types of developments flourish in environments where available land constraints and supply-demand imbalance that’s drastically weighted towards demand make them the much smarter choice for civic planners and the like.

We can expect to see much more of multi-family home development projects all across Canada, and the trend is definitely something that’s worthwhile for realtors to take note of in being increasingly aware of where the market is going, and the types of housing that will make the most sense for many of their clients.

And so speaking of clients, we highly recommend that you sign up with Real Estate Leads here and receive a guaranteed monthly quota of qualified, online-generated buyer and / or seller leads that are delivered to you exclusively – no one else will receive them, and as such you benefit exclusively. And not only that, but you’ll also have your own region of any city or town in Canada protected for only you as well.

That’s provided it’s still available and that another realtor hasn’t beaten you to it, so if this online lead generator for realtors in Canada sounds good to you then don’t delay in getting onboard with this!

Outskirts of Vancouver Seeing Bulk of New Rental Development

Published July 22, 2019 by Real Estate Leads

That both Vancouver and Toronto are cities in desperate need of more rental housing stock has been discussed at great length in the news these days, and it’s also true that other big Canadian cities are feeling this pinch too. Both Vancouver and Toronto have municipal governments that are taking steps to address the problem. However, it seems that while the results are in fact helping to create more rental housing it is not being built where it’s most critically needed – in the Metro areas of the cities.

We’ll take a look at this in greater detail here, but first mention that trends like these have a very measurable effect on a realtor’s business in big cities like these. Here at Real Estate Leads, our online real estate lead generation system is an excellent resource for real estate agents in Canada who want to get much more out of their client prospecting efforts.

Which – given this rental-housing shortage – is important. That’s because this aberration in the housing hierarchy is quite a departure from all the generations previous. The lack of rental housing in metro areas has the very detrimental effect of driving young, talented professionals out into suburban areas and forcing them to make long commutes.

In some instances, they leave the city area altogether. Not only is that something of a ‘brain drain’ as the expression goes, but it also disrupts the natural homebuyer continuum. That could be an entire discussion on its own, but just trust us when we say that adequate rental housing levels for young professionals makes for more property buyers in the future.

Most on The Outsides

The number of rental construction proposals in Vancouver’s satellite regions (tri-cities areas most notably) are currently far exceeding those seen in Metro Vancouver, as is laid out in the Goodman Report’s 2019 Mid-Year Metro Vancouver Rental Apartment Review.

Over the last 3 years new proposals for rental-purpose buildings in the city have gone down by 29%. Considering the glaring need for rental housing, it’s hard to make sense of that. Much of the new volume has been focused on the suburb – where a 147% increase in proposals has been seen during the same time period.

Looking past the land available for development constraints that are a reality for nearly any major city in North America, this is a real failure on Vancouver’s part. Especially when you consider that many years will go by before all these suites are available – and assuming they’re all actually built.

Young, ambitious professionals who would be renting IN the city and building up their down-payment on a house are either taking themselves elsewhere or assuming the literal and quality-of-life costs that come with having to make long commutes 5 times a week.

One end result of this is that there are inevitably fewer ready home buyers once the next batch of them come around at the age they’re ‘supposed’ to.

Detrimental Government Intervention

Significant government intervention has pulled Vancouver’s rental transactions down by 50%, and overall value by around 27% in that same 2016-present timeframe. Along with that, dollar volume has shrunk by as much as 62%, from $1.383 billion last year to $529 million this year. And to ice this mismanagement cake, at the same time cap rates in the City of Vancouver have gone up 50%.

Long story short, in the last two years the City of Vancouver has been disproportionately outpaced by the suburban rental housing market. All this despite knowing full well that METRO rental housing was where the need truly existed.

What’s even more problematic is that these trends are usually self-perpetuating. Fast-forward two and a half years, and we’re likely going to see an even more disparate rate at which developers are applying to build rental in other municipalities.

All of which has a damaging influence on the real estate market as a whole, for the reasons stated above.

Sign up with Real Estate Leads here and receive a monthly quota of qualified, online generated buyer and / or seller leads that are delivered to you exclusively and for your privately-served region of any city or town in Canada. It’s a dynamite way to supercharge your prospecting efforts, and grow your client base like never before.

The Promise of Blockchain Technology Development for Real Estate

Published July 15, 2019 by Real Estate Leads

There’s few buzzwords if any that are as hot in the world of computing quite like Blockchain is. Some realtors in Canada may be familiar with Blockchain, but we imagine the majority aren’t familiar with it. A blockchain is a growing list of records that are resistant to modification of the data and can digitally record transactions between two parties efficiently, verifiably, and permanently.

Now some will read that and see the words ‘transactions’ and ‘verifiability’ to quickly make the connection for how blockchain technology could be beneficial for real estate. Others may still need it to be laid out a little further, and that’s perfectly fine too. And of course while we’re on the subject of beneficial technologies, here at Real Estate Leads our online real estate lead generation system is 100% proven beneficial realtors looking to build on their customer base. See out testimonials page for more convincing on that if you need it.

But back to Blockchain for now. What makes it have so much potential for Real Estate?

Open, Transparent, and Traceable

A group called the Enterprise Ethereum Alliance (EEA) recently put out a 30-page Real Estate Use Case document to promote blockchain as a more open, transparent and traceable method of conducting transactions in the real estate industry.

It lists eight different uses for blockchain, including:

-property identification (including listings and data)

-token-enabled marketplaces

-token securitization

-public registries detailing ownership of properties

-sales process optimization

Along with its role in the creation of a real estate exchange, blockchain has been used as a platform for conventional real estate sales. Look no further than New York-based ShelterZoom, who have plans to go live this year with a platform enabling buyers and sellers to make and consider offers over an Ethereum blockchain.

Real estate tokenization may take some time to take hold, but it’s quit likely that it will. How this will almost certainly work is that the firm will offer a number of buildings in an index, and participants can buy tokens from that index. The appeal is quite simple, less risk and more profit.

It’s important to remember that the real estate market is highly liquid, meaning property can be bought or sold relatively speedily with little to no loss in value. To date, however, the marketplace has primarily been for a wealthy investors. Blockchain has the potential to change that.

It will enable anyone to invest because the costs to do it are so much lower, and it enables fractionalized ownership. Tokenization makes it so that someone can indirectly acquire a piece of real estate, and it also has the potential to create a much more transparent marketplace. This makes more of a level playing field so that everyday people aren’t at a disadvantage compared to more seasoned, deeper-pocketed buyers.

It has the potential to enables anyone to own and acquire a piece of real estate. Blockchain allows anyone to sell anytime, even if that means selling your share on a secondary market. Of course, a decentralized exchange for real estate tokens.

Blockchain and REITs

A Real Estate Investment Trust (REIT) is a fund or security that allows investors to purchase shares of income-generating real estate properties. REITs are owned and operated by shareholders who invest in commercial properties such as office and apartment buildings, hotels, and shopping centers.

With the new technology, the property will have its own smart contract and thus its own token. They can choose to invest in a specific property at a specific address wherever they like.

How It Works

There will be a central authority of users who whitelist those who can participate by first authenticating their identities. Once the individual is cleared, their personally identifiable information is encrypted and stored in a crypto wallet – a piece of software that keeps track of the secret keys used to sign blockchain transactions digitally.

The blockchain onboarding process involves potential users automatically being asked questions and required to submit sufficient proof of identity through a business automation application known as a smart contract – which serves to satisfy financial industry regulations. Once buyers / investors have completed the onboarding process they’ll have their crypto wallets whitelisted for blockchain real estate transactions.

All very interesting stuff, and something for real estate professionals in Canada to keep tabs on.

Sign up for Real Estate Leads here and receive a monthly quota of buyer and / or seller leads delivered to you exclusively and for your similarly-exclusive area of any city or town in Canada. You’ll quickly come to see it as money well spent as you build your client base much more quickly than you would by traditional means. It’s a proven performer in every sense of the term!

CMHC: Canadian Housing Market No Longer Overly Vulnerable After Prices Ease

Published May 21, 2019 by Real Estate Leads

For some time we’ve heard that while the Canadian housing market is flat, the market itself and the value homeowners have in their homes in relation to it have been perched precariously over the last little while for a number of different reasons. It goes without saying that there are many people and livelihoods that have a vested interest in the well being of the housing market, and of course realtors like you are certainly one of them.

It’s for this reason that no matter where and how your interest in the health of the housing market is found, it’s good news these days as the Canada Mortgage and Housing Corporation (CMHC) is saying it no longer has the country’s housing market being ‘highly vulnerable’ after an overall easing of price acceleration has been seen across the country.

While that isn’t going to necessarily equate more homes being sold, it will mean a greater number of prospective homebuyers being further empowered within the overall sphere of business, and that bodes well for a realtor’s prospecting efforts as he or she seeks to drum up more business for themselves. Here at Real Estate Leads, our online real estate lead generation system is an excellent way to get more out of your efforts in this regard, and it comes highly recommended from many real estate agents who are already onboard.

Moderate Market Now

The CHMC’s report from Thursday of last week states that it rates the overall market at ‘moderate’ after 10 consecutive quarters of being rated ‘highly vulnerable.’This with the disclaimer that some cities remain at an elevated risk. A spokesperson said “the state of the national housing market has improved to moderate vulnerability.”

The consensus is that though moderate evidence of overvaluation continues for Canada as a whole, improved overall alignment between house prices and housing market fundamentals has been seen as of late.

The inflation-adjusted average price for a home in Canada went down 5.4% in the last quarter of 2018 from the same period in the year previous.

Vancouver Remains Vulnerable

The CMHC also reported that while house prices in Vancouver, Toronto, Victoria, and Hamilton moved towards more market sustainability, a high degree of vulnerability was still being seen in those markets. Further, Vancouver remains highly vulnerable, and in particular in response to overvaluation of homes there.

The largest cities in the Prairies are staying at a moderate degree of vulnerability. Ottawa, Montreal, Halifax, St. John’s, Quebec City, and Moncton are all seeing little to no risk of vulnerability.

The report determined vulnerability via several criteria; price acceleration, overvaluation, overbuilding, overheating, and others.

Relatedly, price acceleration has eased nationally, and in large part because of the federal government’s mortgage stress test regulations of 2018. They raised the bar as to what’s required to be able to qualify for a mortgage, and the entirety of tighter mortgage rules made for less demand for housing, as well as contributing to the seen decline of house prices.

The report concluded by noting that inflation resulted in personal disposable income dropping by 1.2 per cent, and this corresponding with a reduction in buying power. This was partially offset by a young-adult population that increased by 1.9 per cent and added to the pool of would-be (hopeful) first-time homebuyers by a small amount.

Sign up for Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads delivered to you exclusively and for your similarly-exclusive region of any city or town in Canada. It’s a nearly guaranteed way to be put in touch with genuine people who are genuinely looking to buy or sell a home in the area of the country where you hang your professional hat. Try it out, and we’re certain you’ll quickly come to see it as money well spent when it comes to advancing your real estate business.

The Basics of Putting Together a Solid Comparative Market Analysis

Published March 5, 2019 by Real Estate Leads

If you’re new realtor here in Canada you’ll quickly learn that offering a free market analysis for prospective clients and their homes is pretty much standard practice for every real estate agent. They’re a show of good faith and a nice little bonus for homeowners who are looking for an experience and knowledgeable realtor who is an expert with the local market. That’s an opportunity for you, and being able to put together a solid CMA for clients is definitely important. The same can be said for ANYTHING that helps you become ever more solidly cemented as a good realtor who’s known as a good choice.

Client prospecting is a multi-approach need for all realtors, not just those who are new to the business. Here at Real Estate Leads, our online real estate lead generation system is a real benefit for those who understand what the power of the Internet is capable of in regard to identifying people who are very sincere about buying or selling a home in the near future. Nearly everyone who’s signed up so far has come to regard it as money well spent, and there’s plenty of room left to get onboard.

But back to the topic here, what are the basics of what goes into putting together a CMA for homeowners you’d like to eventually see become your clients? Let’s discuss that now.

Plain and Simple Comparisons

The purpose of a CMA from the realtor’s perspective is twofold; to share valuable information with the homeowner, and equally as prominently to hopefully make them into clients down the road. From the homeowners perspective, however, it’s much simpler. They’d like to know what the value of their home is in comparison to those seen with other similar homes in the neighbourhood that have sold for certain prices.

Accessing sold property records allows the realtor to select recently sold properties that are similar to the subject property and in the same geographical area. Comparing these properties is only just a start, as you need to adjust for feature differences, and the realtor should always make explicitly clear that this CMA is only an estimate of the value seen for the subject property. Keep in mind that the best realtors will always be just fine with doing a second different CMA for a seller or a buyer.

A second CMA would include comparisons to currently listed similar properties in the area. The same process would be used, but using only currently listed properties. This is smart because it allows an assessment of the current competition, and may highlight increases or decreases in the estimate based on the sold properties. And of course you can be certain your initiative in providing a second CMA will put you in a very good light with the homeowners.

Quality of Comparable Selections

A crucial part of any CMA’s accuracy and one where you really need to do your homework to make sure you’re in the right with it is determining market value based on a selection of the best comparable properties. It’s true that choosing even one different comparable out of three or four homes taken into consideration can result in very different valuations. You want to have a CMA based on the best comparable properties, and for two reasons.

First, it ensure that there’s very little chance the homeowners will be disappointed when finding that there home has been overvalued in the CMA. Second, the lower value that will come with may end up leading the home to be listed at a price that eventually is exceed in the sale price due to competition amongst buyers who see more value there.

How that will appeal to homeowners needs no explanation!

Considerations When Choosing Comparable Properties

When the property sold: Homes that sold more than two or three months ago are not good comps, especially in fast-moving markets. The more recent the sale of the home being completed, the less likely it is that the market has shifted enough to make the properties’ sold prices less relevant to the market analysis you’re preparing.
The property’s location: The most ideal situation is that the home is in the same neighbourhood. When that’s not possible then the next consideration is locating comparable homes in the same suburb or in a next-door neighbourhood. This is nearly always possible, at least in large urban / suburban centers. In more rural areas there’s a lot more leeway with comparative properties used.

The home’s characteristics: This is pretty straightforward – what number of bedrooms? Baths? Overall square footage of the home? Size of the lot? The homes you choose as comparable homes should be as similar as possible with regard to these considerations. It’s rare to find ones that match exactly, so choose the ones that come closest.

Quality of the Adjustments

You need to also keep in mind that you must tailor your CMA numbers to compensate for differences in the structures. A realtor will understand the need to make adjustments when weighing the sold prices of the comparable homes to those being considered for the subject property.

An example; The prospective client owns a 3 bedroom, 2 bath home with a two-car attached garage, and 2500 square feet of living area. You’re tasked to find three or four comps with all of those features at approximately the same numbers:

One comp only has two bedrooms. You can assume that it would have sold for more money with three, so you can go ahead and add some money back to its actual sold price to adjust it to having its 3 bedrooms. The same approach can be used for baths and garage spaces.

If it is the opposite, say three bathrooms to the subject home only having two, you’ll go ahead and subtract the value of a bathroom from the sold price as you work out an approximate selling value for this comparable home.
Generally, square footage calculations aren’t touched until you do your calculation final.

Once you have adjusted the comparable homes sold prices, then you’ll divide each sold price by their square feet to get an exact sold price per square foot. Next, average those for your three or more comps to get one average value per square foot that can be applied to all of them as a ‘housing average’ for the area. Then you simply multiply that by your subject home’s square footage to arrive at an estimated current market value.

These are the basics of putting together a CMA, and there’s plenty more to be learned – from your real estate brokerage colleagues most likely.

Sign up with Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads that are delivered to you exclusively, and for your own exclusively-served region of any city or town in Canada. That part of it makes it important to act fast, as once a territory is claimed it’s then unavailable to anyone except that one realtor. It’s a dynamite way to supercharge your prospecting efforts, and the testimonials of realtors bear that out in a big way.

Maximum Loan Amortization Extension from Feds Has Major Potential Ramifications

Published February 26, 2019 by Real Estate Leads

Most people in the real estate industry will agree – even if grudgingly – that the new mortgage stress-test regulations rolled out by the Federal Government a year+ ago we’re entirely necessary to normalize the market and prevent hundreds of thousands of Canadians from becoming ‘house poor’, as the expression goes. This of course has had the effect of their being fewer qualified first-time home buyers, and the direct correlation between that and less business to be had for real estate agents is easy to understand.

It would seem now that the Federal Government is considering a reactionary move to improve the housing market, and we can safely assume that it’s in large part a response to the pinch felt by industries that are directly tied to the home construction and renovation industry, and to a lesser extent to stimulate the housing market as a whole.

These are trying times indeed, and it’s unlikely that we’ll see the the limited numbers of qualified buyers increasing anytime soon. As is always the case, when the going gets tough the tough get going and realtors now must work harder to secure new clients. Here at Real Estate Leads, our online real estate lead generation system is an excellent means of putting the power of the Internet to work for that aim. It’s highly recommended, but let’s get back on the topic here and discuss why this move by the Feds may have some rather unintended consequences.

Longer Amortizations, Lower Payments, More Interest

That’s the long and short of what this possible move is going to entail. The Government’s Ministry of Finance may not be intending to increase household debt with this move, but that’s what it will almost certainly do in the long run. In the short term, however it promised to be beneficial. Economists and those most familiar with the housing market are saying that – most relevantly – it’s likely to drive prices even higher when the next housing cycle begins.

What we would see is lower payments relative to 25-year amortizations, in exchange for paying more interest, and a proliferation of 30-year mortgages for first-time homebuyers.

What’s in Amortization?

As mentioned, the Feds are considering extending the maximum amortization schedule on mortgages. Amortization is the length of time determined for a borrower to be paying off their loan before it. Currently, insured mortgages are limited to a 25-year term, meaning that buyers can plan on paying off the home in 25 years. That’s not short period of time, but the reason we’ve become fairly accustomed to that in Canada is – plain and simple – that it allows Canadians of lesser financial means to buy a home.

What we’ve recently become aware of is that Canada is considering allowing first-time buyers the ability to amortize for 30 years. The aim is to increase affordability, but is that what we can expect it to do.

Hard Numbers

Let’s look at a typical scenario here; at typical Toronto home costing $761,800 (average median price for a detached single-family home at this time). Let’s assume next the the borrower has 10% down and is then borrowing at a rate of 3.59% on a 5-year fixed rate throughout the whole mortgage, which underestimates the cost.

What we see is that the minimum monthly payments drop roughly 12.5%, and that’s what makes it appealing to the would-be buyer. This is a result of lengthening the amortization, and while it might seem appealing it increases the amount of interest these buyers will be paying if they take they full time to pay off the mortgage (which nearly all buyer do nowadays).

It’s not going to increase it a bit, it’s going to increase it quite a lot, and that of course means increased household debt. Many people would agree that with this you’d be making people less house poor, but more indebted long term, and that the two sort of cancel each other out to really offer little to no tangible savings or affordability benefits for prospective homebuyers.

So going back to that average Toronto home – running those payments on the 25-year amortization models works out to a hefty $351,103 in interest payments over the term. Bump that up to a 30-year amortization and it climbs to $431,511.

Not as appealing as it might have seemed, is it?

More Expensive Housing in the Long-Term

We tend to agree that extending amortizations only makes housing more affordable temporarily, since credit inflates prices. Lowering the cost of borrowing is often thought of as a way to increase affordability. It may, but not in the long run and if you’re in a 25 or 3-year amortization mortgage the ‘long run’ is definitely part of your reality

Disposable Income to Service Debt Ratio

Over the past 5 years real home prices across Canada have increased 42.65%. The amount of disposable income to service this debt increased only 12.65%. Affordability today actually improved across Canada by 7.29% since 2007. Real home prices have gone up 86.54% over that same period.

Real estate agents are always inclined to wonder whether home prices will go higher, but perhaps now more so than ever. remember that’s long-term. Real estate works in a cycle, and right now prices need to correct for new buyers to enter. The most important consideration here is that borrowers with a 30-year amortization will pay less towards principal. In the long term that costs borrowers more, and it inflates home prices – which of course will be viewed very negatively in the not-too-distant future.

Sign up with Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads delivered to you exclusively and for your very own, protected region of any city or town in Canada. It’s a proven-effective way to get more out of your client prospecting efforts, and we’re nearly certainly you’ll quickly come to see it as a very worthwhile monthly expense when it comes to promoting your Real Estate business.

Realtor Know-How: Calculating Land-to-Building Ratio

Published February 11, 2019 by Real Estate Leads

Every second week we try to shift our subject matter back to topics that are among the many that new realtors can – and should – familiarize themselves with when aiming to become a more knowledgeable and well-rounded real estate professional. It’s a worthwhile aim for sure, as it goes a long way in being seen as realtor who has more to share with all the different sorts of real estate clients who will have different buying / selling prerogatives.

All of this is of course done in the big picture perspective of building your real estate business. Here at Real Estate Leads, our online real estate lead generation system is an excellent way to get even more out of your client prospecting efforts. Putting the power of the Internet to use and connecting you with people who are genuinely interested and increasingly ready to buy or sell a home should sound good to any realtor, and that’s exactly what you get with Real Estate Leads.

Today’s realtor know-how topic is one that will be very handy and practical when working with commercial or investment real estate buyers; calculating land-to-building ratio. Let’s get started.

Land Parcel Percentages

We can start with understanding that every structure occupies a certain portion or percentage of the land parcel it’s sitting on. This percentage or ratio of the size of the building to the land is referred to as the ‘land-to-building ratio.’ A high ratio indicates that the property isn’t being used to its fullest potential. A low one is indicative of the property already being at full capacity.

The Equation

It’s quite easy to calculate the land-to-building ratio. Here’s the equation:

Divide the square footage of the land parcel by the square footage of the building

Here’s an example:

188,000 square feet of land divided by 43,500 building square feet. This works out to 4.32

This is a 4.32:1 land to building ratio, and that’s a high one. The average is between 2.5:1 to 3.5:1.

Relevance for Residential Properties?

There can be, but it’s typically not something that factors in as strongly for residential properties. The land to building ratio is rarely seen in residential appraisals. It is helpful to know that the ration can be limited by municipal codes and property restrictions, however. In some instances there is a desire to keep the size of homes to a certain percentage of the lot space available for building.

Land-to-Building Ratio in Commercial Applications

The use of the land to building ratio is obviously of much greater relevance with commercial and industrial applications. For example, building codes usually include very firm requirements for the amount of parking that certain size structures must maintain, and the same goes for setback and green area considerations.

A commercial space with an 11 to 1 land-to-building ratio might not be best utilizing the land, there would definitely be value in the additional space. Another property with a ratio of 2.5 to 1 could be at maximum capacity.

It’s easy to imagine that most considerations around municipal and other regulations occur with commercial, industrial, and institutional real estate. Environmental protection issues often come into play with industrial properties as well, and in particular ones related to hazardous materials.

Let’s look at specific commercial real estate types and the considerations that are added to the Land-to-building ratio for each:

Retail Shopping Center or Mall

First and foremost here are population demographics considerations. A consistently sufficient flow of consumers to support the shops and businesses is a must. Traffic patterns are also important. Ratios of the tenant retail lease spaces and the overall theme of the center are important as well.

Office Buildings

The type of offices they’ll house is something to consider. For example, A medical office or dental office complex would have very different space requirements.

Warehousing and Specialty Operations

Warehouses require a lot of space, as well as large truck loading docks much of the time. They don’t need parking spaces the same way a retail development would. Specialty businesses like car and RV dealerships or any type of consumer service provider will have a whole array of different considerations that are unique to them, and different to land-to-building ratios

Excess Land Value

The decision where you will be more likely be expected to volunteer your expertise is whether paying for excess land and its zoning is a wise investment of capital. As the realtor, you may be asked if it that excess land can be divvied up and sold, either in the short-term or long-term. Is the overall land made up of two or more independent parcels? Do any existing or planned structures infringe upon one of them? Does the unused land have its own access? Can it be subdivided legally?

All of these are questions that your clients may ask of you. Be prepared to answer them.

Sign up for Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads that are delivered to you – and only you – for your similarly exclusive region of any city or town in Canada. Once you sign up with us, that region is yours and all of the leads for it go to you and no one else. We can say truthfully that pretty much every single realtor who’s gotten on board so far is happy with the service and sees it as money well spent as part of the business promotion and marketing budget.

Try it for yourself, we can guarantee you won’t be disappointed with the way it put you in touch with real prospective clients for your real estate business.

Real Estate Sales Drop Hard Across Country

Published January 22, 2019 by Real Estate Leads

Your take on the recent trend of cooling Canadian real estate sales will depend on who you are in the real estate market. If you’re an owner or an investor with funds in real estate, you likely won’t see it very favourably. Alternately, if you’re a home buyer – and in particular a first-time homebuyer, the recent news that sales dropped to a new multi-year low last month to close out 2018 will be cautiously promising.

As a real estate agent, of course, any downturn in the market isn’t what you want to be hearing. Fewer sales equates to less business to go around for the ever-greater numbers of licensed realtors in the business. Situations like this make being able identify, impress, and retain prospective clients increasingly important for a realtor.

Here at Real Estate Leads, our online real estate lead generation system makes it so that you get more out of the first part of that equation, and capable realtors have a way of using the second part to ensure the third and establish long-term clients. The same type of clients who are likely to recommend you to others as well. It’s a positive all around.

But back to topic, what’s to be made of this trend that continues to see the real estate market in Canada cooling off so significantly?

Canadian Real Estate Sales Dip Like They Haven’t Since 2012

Canadian real estate sales indicated one of the worst Decembers in years. A mere 21,909 sales went through the MLS nationwide for December, and this was down 34.24% compared to the month before. This is a 19% decline compared to the same month last year, and sales for the month have only been lower a pair of time over the past 10 years; 2012 and 2008.

The December numbers and annual growth rates were worth noting. Monthly declines are always seen in December, but this one was the biggest since 2007. What’s more, the annual decline is the third consecutive one to occur here, and the most pronounced one since March 2018. Since February of 2016, the annual growth rate has been trending lower.

Dec. ’18: Only a Single Major Canadian Real Estate Market Grew

The observed market declines were consistent across the board, but a few markets did better than others. Montreal came in at 2,825 sales for December, which was a 2.5% increase compared to the same month 2017. Ottawa had 677 sales, a 12.9% decrease from the previous December. Winnipeg’s number was 495, and also down 14.4% from the same time last year. Facts are facts, and only one major market with more than 500 sales last year grew over the course of 2018.

Scenario for Canada’s Bigger Urban Centres

We’ll start with Toronto and Calgary here. Toronto reported 3,781 sales in December, a big decline of 23.3% compared to December last year. Calgary reported 985 sales, a similar biggie at 24.2% down from one year ago. The CREA defines both those declines as middle of the market, however, and relatively speaking.

Of course, market restrictions in both Toronto and Vancouver can been credited with a large portion of the sales declines seen in Canada’s 2 biggest metropolitan areas. Mortgage stress testing has been a big factor as well, and should continue to be this year as well while the new definition of a ‘quality buyer’ is still a work in progress.

The risk of course is looking at those factors in a vacuum, but it’s safe to say that a broader weakness is being observed across the country. The fact that markets not subject to a foreign buyer tax are also seeing weakness in sales supports this understanding.

There are some that suggest that more Nationally-focused mortgage stress tests would be a good idea, but industry insiders counter that by saying that most markets with declines do not have home prices detached from local incomes (which is the explicit scenario in Vancouver and Toronto). That doesn’t mean prices are fair value, but it does indicate that the stress test has had minimal impacts.

It remains the way it’s always been in that a typical family in most cities can afford a typical home. The consensus seems to be that it’s primarily households that would be buying ‘beyond their means’ are the ones being impacted by the restrictions – and for many of them they might actually be glad for the wake-up call! In conclusion, though, and when we look at this objectively we can see that the impact of rising interest rates, and a contraction in general credit applications are behind the market dips. This happens nearly every time interest rates rise, and they are always moving in one direction or another.

Sign up with Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads delivered to ONLY to you and for your similarly-exclusively served area of any city or town in Canada. It really does wonders for supercharging your prospecting efforts, and if the ever-greater numbers of realtors coming on board are any indication – it’s definitely effective.

The Increased Costs of a Variable Mortgage in Canada

Published December 25, 2018 by Real Estate Leads

As a real estate agent it’s pretty much common knowledge that the vast majority of your homebuyer clients will be purchasing their new home with a mortgage. There are a few buyers who are sufficiently deep-pocketed to buying a home outright without the need for financing, but they’re few and far between these days. Being regarded the way you want to be by your clients is a product of being seen as an expert on every aspect of buying or selling a home, and the ins and outs of securing financing in the best way is a part of that.

Buyers will have a choice of a fixed or variable mortgage when buying their home, and these days in Canada it’s a much more costly option in the long run to choose a variable mortgage. This is true in the face of that being very different from the way it’s been for decades where choosing a variable mortgage had many advantages to it.

Here at Real Estate Leads, our online real estate lead generation system for Canada is a great way for you to get more out of your client prospecting efforts, and then share your expertise on anything and everything related to real estate – including what are their best choices when moving on to working with a mortgage provider. With that understood, let’s look at why variable mortgages are more often not the best choice anymore.

Understanding Variable Rate Mortgages

A variable rate mortgage involves the interest rate not being fixed for the life of the mortgage. Instead of being locked in a higher interest rate, the borrower has their interest calculated monthly and based on the lender’s prime rate (%). This can be a positive or negative for the borrower, depending on the type they have.

Conversely, a variable rate borrower pays a fixed monthly sum, but the amount paid towards the principal will change depending on whether the lender’s rates go up or down. If rates go down, you pay less interest and then more goes towards paying off your principal loan. This means your balance is reduced faster, and this has the potential to save you a significant amount of money. If your rate goes up, then you pay more in interest and reduce less of your principal loan amount. As you can see, that can cost you a lot more.

Over the past year, the variable mortgage rate has jumped considerably, and that’s been very disadvantageous for homeowners who chose variable rate mortgages

The Estimated Canadian Variable Rate Mortgage Is Now Up Over 22%

The cost of a variable rate mortgage has been increasing across Canada. The Bank of Canada has stated that the typical rate reached 2.72% on December 6, which is a jump of 2.25% from a month previous. The rate is now over 22.52% higher than it was at this time last year. The impact of this for borrowers is very substantial.

At mid-December last year it was at 2.23%. In late January of 2018 it spiked to 2.45% but in June it had levelled back out to 2.35%, but in July it began to climb hard. In October it shot up from 2.49% to 2.66% and his been rising ever since until now.

Paying More To Borrow The Same

Let’s look at that in real world impact. A borrower at the estimated rate who borrowed last year, would now have their interest payments sitting at a 22.5% higher rate. If they make the same payments, the amount paid to their principal would decrease by about 6.6%. When their variable term ends, they will have paid much more cash to the bank and made much less progress towards paying off their mortgage.

Interest rates fell for years, but now they’re starting to climb decisively. It used to be that variable rate mortgages worked in favour of borrowers, but as rates were cut these borrowers made principal contributions that tended to be higher. Now the scenario is exactly the opposite. Variable rates are rising in response to increasingly heavy mortgage debt levels, and this of course is making it more difficult for homebuyers to make real progress in paying their debt.

Long story short, advising your clients about the greater advisability of a fixed-rate mortgage these days may be something you’ll want to do.

Sign up with Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads delivered to you exclusively and for your similarly-exclusive region of any city or town in Canada. It’s a great way to get more out of your efforts and build your client base more efficiently and effectively.

Toronto Real Estate sees almost a 2% increase in sales in 2019

Published October 9, 2018 by Real Estate Leads

Last week, the Toronto Real Estate Board announced that year over year sales in the Greater Toronto Area had seen a 1.9% increase in overall sales. This year over year increase is good news for local realtors and even better news for those who are looking to buy or sell in the hot Toronto market. This kind of increase was expected, but with sales through the multiple-listings system going up over 120 this month when compared to last year, the board has been ecstatic.

This news was only made better when the board compared average selling price in the Greater Toronto Area. Last year, the average home sold for $774,489, while this year the average is now sitting at $796,789, an increase of over 2.9%. This is a huge jump, and although this is still a cool housing market when you compare Toronto to the likes of Vancouver, GTA realtors are starting to take notice.

GTA realtors might be enjoying a larger than normal selling price when compared to last year, but one of the more concerning numbers for those realtors who sell a lot of below-priced homes it the fact that new listings are down. Overall, the GTA has seen a decrease of 3.1% in new listings, and this could start to affect the bottom line of some of the regions top agents.

The board has seen an increase in price growth mainly in higher-density properties around the city. This means that realtors who are selling townhouses, condos or semi-detached homes have seen an increase in both profit and movement around their properties. The numbers have finally started to stabilise after the provincial government introduced the foreign buyer’s tax and speculation fees on vacant homes that saw the market dip in the new year. However, realtors need the advantage to stay ahead, and that comes in real estate leads.

Real estate leads are one of the best ways for Toronto or GTA based realtors to get ahead of the curve and ensure they are one of the more successful realtors in the area. From being able to get leads on who is selling, and who is buying, you will be able to match homes or condos to prospective buyers with relative ease. Imagine not having to cold call throughout the day, and instead, have warm leads delivered to you in a competitive market like Toronto.

This is the reality for those who use real estate leads, and with a hot market like the GTA, you need to get ahead. Now is the time to see how real estate leads can help you take advantage of this almost 2% jump in the market, and the almost 3% jump in pricing, and enjoy being a realtor again. With leads in your mailbox, you will be able to focus on what you love about your job, selling houses, and finding perspective home buyers the house or land of their dreams. It is time to start enjoying work again, see how real estate leads can help make that happen!

Fall Cleanup Ideas for Homes Soon to be Listed

Published September 11, 2018 by Real Estate Leads

Spring and summer are always peak season for the real estate market, and now that are both are getting behind us as 2018 moves into its final quarter it’s time for us to consider Fall and how it’s different for clients listed a home at this time of the year. As realtors, our clients rely on us to have a whole wealth of insights into the best ways to market a home and maximize their return on the sale of it. Obviously, landscaping and manicuring of the property becomes LESS important during FALL but don’t think for a minute that it becomes unimportant entirely.

Part of flexing your knowledge muscles for clients comes with meeting these would-be clients in the first place. Prospecting is as difficult as it’s ever been for realtors these day given the level of competition that’s out there and the fact that the real estate market in Canada has cooled considerably recently. Here at Real Estate Leads, our online real estate lead generator is an excellent way to supercharge your prospecting efforts and those who’ve already taken advantage of it tend to rave about how it’s done just that for them.

But back to the topic at hand; what can your clients do to make their home more marketable from an out-of-doors perspective? Read on.

Here are a few simple tips that won’t eat up much in the way of time or money so they can still enjoy the season while making their home look its best.

Start with the Exterior

It’s important to remember that the exterior of a home is just as important as the interior and that’s because it’s the first thing buyers see when approaching the home. However, they don’t need to be a professional landscaper to have an attractive front yard this season. Follow a few simple guidelines and they can take their lawn from eye-sore to exquisite quite quickly. Have them make sure that leaves are raked, grass is cut and flowerbeds are tidy. Instruct them to pull out their garden earlier than usual, as well as cleaning up all the weeds before adding a quick layer of fresh topsoil.

This is an easy and inexpensive way to make the home’s landscaping look its best. Next, if their patio set looks as though it has been sitting out all summer, suggest they give it a quick wipe down and clean the cushions of any dirt and debris. They should also get rid of any summer flowers that are now wilting and try some plants that are better suited for this type of changing weather. Those will certainly add a better feel to the area as far as potential buyers are concerned.

Welcoming Touches

Suggest some ways that your clients can make people feel welcome with a fall display outside their front door. An autumnal wreath and decorating the porch with harvest-themed plants with rich orange flowers, pumpkins, gourds, corn and bunches of apples will impress potential buyers and make them see the home differently in a good way. Once they feel like the exterior is in tip-top shape, they can then pay some attention to the interior of the home as well. One suggestion that’s been known amongst home stagers for years is to have a lingering smell of baking coming from the kitchen while an open house is being held.

With the inevitable arrival of fall, it’s time for them to pack away their summer clothes too. Boxing them up and storing them at a friend’s house if need be is a good idea. Cleaning out all of the cupboards (homebuyers often open them up for a look) is too, and they should ensure that the basic items left behind are tidy and well organized. Get rid of any cobwebs and don’t let them forget to dust off ceiling fans. Suggest a fresh coat of neutral paint and carpet cleaning if you know that they don’t have much in the way of budget constraints. Clients that minimize clutter and get rid of anything they do not need or don’t want to take with them is hugely beneficial.

Although selling a home in the fall requires spending a little more time tending to the outdoors, making the extra effort like this doesn’t go unnoticed with prospective homebuyers.

Sign up for Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads delivered to you exclusively and for your own protected region of any city or town in Canada. You’ll quickly see it’s money well spent as you’re put in touch with people who need the services of a real estate professional like you.

Market for Detached Homes in Canada Now Officially ‘Flat’

Published August 8, 2018 by Real Estate Leads

Realtors all across Canada have certainly been beneficiaries of the tear Canada’s housing market has been on for years. Come mid 2018 and we’re seeing that that era may now be over, and in hot markets like Vancouver and Toronto it’s becoming the ‘bubble’ isn’t going to exactly burst as predicted, but it isn’t getting any bigger either. That of course means something of a plateauing for home values, and particularly for detached homes that were nearly always selling for way over asking as a result of bidding wars. This and the larger number of qualified buyers looking to buy homes before the new Mortgage Stress Test Regulations via the BoC.

Home sale volumes for the period between March and April hit a nine-year low, according to the Canadian Real Estate Association (CREA), and that of course has effects of all sorts as the increased amount of inventory make it not so slantedly a seller’s market anymore.

Of course, realtors will have fewer prospective detached home buyers as a result of both these trends. Here at Real Estate Leads, our online real estate lead generation system is a great way to get more out of your client prospecting efforts and connect with individuals you want to be in touch with as a new realtor.

No Pop, For Now

Home prices for the most part aren’t dropping, at least for now. The national average home price slid 6.4% last month as compared to May 2017. Most of that’s attributable to the fact that the mix of homes being bought and sold now includes greater numbers of comparatively inexpensive properties, like condos and to a lesser extent townhomes, and less in the way of detached houses. The national average lower is skewed lower accordingly.

Looking at CREA’s benchmark home price, home values were up 1% in May 2018 compared to May of last year. That’s not cause for alarm, but it’s still a very big dip from the often tens of thousands of dollars worth in annual home equity gains many Canadian homeowners had been basking in.

The reality now seems to be price increases in the low-single digits. CREA predicts national average home prices to rise by 3.8% in 2019, with gains in Ontario, British Columbia, Quebec, New Brunswick, Nova Scotia and Prince Edward Island, and prices staying stable in the Prairies and Newfoundland and Labrador.

That trend of stagnating or modestly rising pricing, if it holds up, has implications for home sellers, home buyers and even homeowners who aren’t planning to sell.

Bidding Wars Becoming Fewer

Clients thinking of putting their home on the market should no longer rudimentarily assume that their home will sell for a higher price than their next-door neighbour received last year. There will be exceptions to that, and most likely in Ottawa and Montreal, where home prices are still recording healthy gains.

As a real estate agent, you should have a firm idea of how to price a client’s home competitively by looking at price trends over the past three months in your particular area. Being in the know up front prevents any type of misstep on the part of the seller that may hinder or disappoint them in the future. Know market value, and suggest listing prices accordingly.

Have your clients best interest firmly in place, and have all 3 of you ‘know’ your story as you say, knowing how to defend your price. Ideally, you’ll be able to present the buyer and the buyer’s agent with a spreadsheet showing prices for similar properties in your area over the past few months.

Pricing a home in the ‘high range’ of what it’s worth gives you and your clients room to negotiate, while underpricing a property with the idea of sparking a bidding war isn’t nearly as advisable as it used to be.

See bank appraisals for reasons for that. They’re not as assured as before either, and banks want to protect themselves as well in case of any downturn. Long and short of this is banks won’t lend more than a home’s appraised value. The winner of the bid war may not have the finances to cover the difference once the bank looks at mortgage terms.

It’s important to also have an end date for your client’s listing, to avoid their property languishing on the market and to place a cap on expenses incurred within listing the home professionally.

Downsizing Reconsidered More Often

As we mentioned in our blog of 2 weeks ago, more and more detached homeowners are staying put and not downsizing to smaller living spaces as has been the trend for a long time now. That’s because these owners are now having to resize their expectations, especially if home is Toronto or Vancouver.

Yes, sellers will still make a profit, but it won’t necessarily be the big gains they’d been planning on, and naturally their predisposition will be to hold tight for now

Relatedly, condo prices are soaring in all major urban areas in response to this and many other trends in Canadian real estate.

The prospect of getting a home for slightly less than the asking price has improved, and that’s good news for some buyers. Sign up here for Real Estate Leads and receive a monthly quota of qualified, online generated buyer and/or seller leads delivered to you exclusively for your independently-serviced area of any city or town in Canada. It’s a great way to supercharge your prospecting efforts and generate meeting opportunities with potential new clients.

Poll Shows More & More Seniors Committed to Staying In Family Home Through Retirement

Published July 23, 2018 by Real Estate Leads

Real estate agents are as familiar as anyone with what is, or at least has been, the typical cycle for families in relation to home ownership in Canada. Once the kids have grown up and moved out and you’ve reached what’s called ‘empty nest’ status then typically it was often the case that a couple approaching or already in retirement would consider downsizing to a home that meets the much lesser needs of the two of them.

According to a recent Ipsos poll nationwide, 9 out of 10 seniors now feel it’s at least somewhat important to stay in their current home through their retirement. The poll surveyed Canadian homeowners of all ages, and found that those aged 65 and up are more likely than younger homeowners to value living out their retirement years in their home.

That’s quite a departure, and the fact that many of these homeowners live in detached single family homes in urban hotbeds like Vancouver and Toronto definitely has the potential to sway the real estate market and change how realtors approach their business. Here at Real Estate Leads, our online real estate lead generation system is a great way to get the power of the Internet helping you with building your client base. But it seems that some of the bigger fish, if you will, won’t be in the pond now.

Reasons for the Putting Off or Delay in Downsizing

As mentioned, detached family homes are few and far between in Canada’s major housing markets, and this trend of older owners staying in spacious detached homes may leave new homebuyers in something of a lurch. It’s a fact that construction of new detached homes in Toronto and Vancouver has declined to the lowest rates in decades, much of that attributable to rising land prices and municipal density requirements.

The situation is then becoming that new homebuyers are largely competing for existing homes even as city populations continue to grow, and that has certainly fuelled the soaring prices of recent years.

Why the new reluctance?Seniors may be avoiding downsizing for a fear of not getting as much bang for their buck as they’d hoped, particularly as the market begins to cool in Canada’s major metropolitan areas. For this reason, seniors thinking of downsizing to free up some cash for retirement may be reevaluating their expectations, especially if their live in Toronto or Vancouver.

While prices for single-family homes in both cities are dropping or moving in a straight line at best, condo prices are still soaring. This is typically where many ‘downsizers’ will be focusing their purchase interests, having long been able to buy one and then ‘pocket’ a nice retirement fund from the sale of their detached home.

Knock, Knock

More relevant to you here , however, is the fact that this may also explain the increase in realtors approaching homeowners about selling their home, and especially in Ontario. Another survey found a quarter of those over 75 responded that they’d been approached by a realtor unsolicited, meaning they’d never expressed interest in selling their homes before.

Successful realtors adapt, and those who are door knocking here are most certainly showing the hustle needed to adapt in these new market environments.

We see now that without an influx of homes coming back on the market as Canada’s population continues to age, it may be even more difficult for new homebuyers may to compete for buying the home they need.

Things Looking Up?

2018 to date has had cities like Vancouver and Edmonton seeing a surplus in home inventory for the first time in years, keeping in mind that prices have yet to react.

Homes for sale in Metro Vancouver reached a 3-year high in June, according to REBGV. This is believed to be because buyers are less active today, making for a volume of homes for sale not seen in the last few years. Edmonton is at a similar peak, the highest since 2008 for that city.

Sign up for Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads delivered to you exclusively for your similarly exclusive area of any city or town in Canada. Make the most of each of them and you’ll almost certainly see your client directory growing in a hurry.

Census 2016: A Quick Review for Real Estate Agents

Published November 9, 2017 by Real Estate Leads

For the average Canadian, home ownership is on the decline, we can look at the high ownership cost in the three flagship cities as a direct correlation for this downswing. However, a higher rate of homeowners is now taking on mortgages, as well as a cost of carrying a home continues to show large growth. This is great news for those looking to sell homes on the market, and here at Real Estate Leads, we have the breakdown that matters.

5.6 million and counting

The total number of mortgages in the country grew to a staggering 5.6 million. Census 2016, which was conducted in early and mid-May 2017 showed 5,686,576 residential homeowners were still paying down a mortgage. This represents a 7.66% increase from the last long-form Census which was completed in 2011. However, this number is a little higher than expected, as unlike official numbers, the Census 2016 is self-reporting, and includes private mortgages. This is not normal for most real estate guides and does skew the numbers just a tad.

3% rise in homeowners with a mortgage

Another interesting stat to come out of the Census 2016 is that the rate of homeowners with mortgages got a 3% lift. Compared to 2011, the rate raised by 3.58% up to 60.7% of Canadians homeowners having a mortgage. This is an interesting trend, as although general homeownership is down, the rate of homes with a mortgage is up.

Homeowners costs are up 15.54%

Since 2011, we have seen costs go up substantially, but no more than those associated with homeowner costs. This median has risen over 15% to 15.54%, which is astronomically high. This would mean that the median cost of shelter from homeowners is $1130. Think about it this way, inflation growth over that same time period would only be 8%, this is almost double it. Consider the fact that we have a rapidly ageing population in this country, and the issues of affordability in our largest cities, it might represent a bit of a downturn in the market due to the cost of new homes.

So now what, well for us in the real estate business it is business as normal. Consider that only 1 in 7 people in Canada have a mortgage, and of the Canadian population, under 50% are currently part of the workforce. We have a new generation of home buyers, and although they have yet to start to flood the market, for those in the know, it is coming. Expect to be working with a smarter and better-educated client, and that is not a bad thing. What trends do you think will come out of the next long forum Census, continued decline in home ownership, or will we start to see things even out for the next generation? Leave your comments below!

Six Hallmarks of Successful Real Estate Agents

Published October 30, 2017 by Real Estate Leads

It’s been a while since we offered a blog post that wasn’t related to the nature of the market or the ins and outs of buying or selling a home for clients. Statistics reflect ever greater numbers of realtors becoming REB certified in most major cities in Canada, and while that’s to be expected it still poses competition issues for those who are new to the ‘game’ and feel a real need to start building their business with some expediency.

Here at Real Estate Leads, we’re happy to make our online real estate lead generation system available as a means of allowing these new realtors to start getting in touch with legitimate prospective clients in their area. We of course extend that invite to all of you, whether you’re new to the real estate business or well experienced. But today let’s get back to the basics and share tried-n-true approaches to getting your establishing yourself as a successful realtor, and sooner rather than later!

They are Genuinely Passionate about Real Estate

Quite plainly, nothing is more important than a genuine passion for both homes AND putting people in the right one for them. You need to get a real ‘kick’ out of doing so, and it MUST be more than simply a means of getting your commission. We can’t state this strongly enough.

They Return Calls and Emails with Little to No Delay

These are the realtors that take the opportunity of a lead and make something out of it the majority of the time. They immediately make contact and they follow up, answering any questions and perfectly happy to stay on the phone with clients for as long as the client needs to stay on the phone. They are never disconnected from email, text, and phone and they don’t loosen up on that until the entire client-service experience and transaction is complete.

What this does is foster and understanding in the client that they are very important to you, and that’ obviously a huge plus. In addition, be open to switching your communication avenue to match the client’s preferences. If the client prefers text, then text. If the client prefers calls, then call. Pretty simple really.

They are Familiar and Capable with the Latest Tech

This may be a challenge for some, and older newer realtors in particular. If you’re not 100% adept with modern communication devices and applications, putting time (and perhaps money) into getting up to speed with them ASAP is highly recommended. Most successful realtors are all about their tablets and smartphones, and you’ll find many are also quite capable with higher-end DSLR cameras. They make sure they have great data plans so they are never stuck without a remote internet connection. They try to go paperless as much as possible. They put nearly as much time into learning about technology as they do learning about the changing real estate industry in Canada.

They Know Their Neighbourhoods Explicitly Well

You want to become a “neighbourhood expert” as soon as possible. All top agents are walking, talking encyclopedias of what the neighbourhood offers for a prospective new home owner considering buying in the area. They know what’s on the market, what has sold recently, and the overall status of the neighborhood, including planned changes and developments lined up for the future. Becoming this way doesn’t just ‘happen’, you have to put in the time to learn and always have your ear to the ground to stay on top of what’s new in the neighbourhood.

They Are Entirely Open and Transparent Regarding Their Work

Successful agents don’t just make themselves available and then conduct their work out of sight until the client has a buyer for their home, or a new home to buy. The best ones are very active in ensuring their actions are entirely on display and relatable for the client. When they meet with the client for the first time they explain the process, the potential roadblocks, and any of the more likely scenarios that could occur. They keep the client entirely in the know with negotiations, and in this regard it’s better to be ‘overloading’ the client with information rather than supply a ‘reasonable’ amount of it.

Further, they discuss any perceived need to adjust their strategy with the client very proactively. Try to aim to make yourself so transparent in your operations that it’s unlikely that clients would even have the need to inquire about what you’re doing. But when they do, go on at great length and be very clear in why you think it’s the best course of action.

They Generate Leads by Any and All Means Necessary

Leads are nothing more than opportunities, and not all opportunities will lead to a new client. This is true in many cases where even doing everything in your power isn’t going to convert the lead into a client. That’s the nature of the business, always has been and always will be. Smart agents are experimenters, they try out different types of lead sources, they explore different types of ad campaigns, and they analyze what works and what doesn’t. They understand that having a social media presence is important and that advertising and promotion efforts need to be constantly reevaluated and changed given the current climates in the business.

They Have GREAT Networks

The best and most successful agents don’t just have a network to generate clientele, they have a network of top-notch real estate agent partners who have the same understanding of what’s required of them to be the top agents they are. They know the best contractors, appraisers, lenders, and insurance providers in the business. Aim to be a hub of a group of professionals that can advise and assist with anything real estate or home related. Top agents care for their network and are happy to refer clients to other agents from whom they can rely on receiving the best service. Further, they know and can identify realtors who don’t make the grade in this regard. Admittedly, the second part of that equation is one that takes some time to acquire

The best realtors are knowledgeable, authentic, and equal parts driven and passionate to really help people find themselves in the right home for that stage of their life. You too can become one of them, and signing up with Real Estate Leads here is a great start to begin generating those ‘opportunities’ we’ve been talking about. Follow the tips we’ve laid out for you here and you’ll almost certainly see more of your opportunities successfully converted into clients.

4 Pre-Construction Closing Costs Homebuyers Should Be Aware Of

Published October 2, 2017 by Real Estate Leads

There’s no debating that buying a home during a pre-sale or even further in advance of construction beginning has many benefits. In addition to more agreeable pricing as the first buyer, your clients will also have more in the way of options for customizing their home, modifying it to accommodate a mortgage-helper suite if need be, etc. etc. As well, presale buyers will often have a grandfathered-in clause allowing them autonomy over whether or not they choose to rent out their unit, independent of complex-specific rental restrictions.

Here at Real Estate Leads, our online lead generation system for realtors in Canada has been so especially well received by realtors coast to coast, and we believe that helping you have further success with the increased opportunities it’s providing for you is beneficial for one and all. A knowledgeable realtor is always one held in high regard by prospective clients, so this week we’ll yet again share information on a subject yours may well want to know of – pre-construction closing costs.

They tend to be rather unexpected surprises for many a buyer, and you’ll be fostering better relations between them and yourself if you can make them better aware of these costs long before they near their closing on purchasing a home.

A Few Last Pricey Hurdles

It’s easy to get caught off guard with closing costs when buying a pre-construction home. They’ll vary depending on the value of the home, the municipality in which it’s located, and whether you’re a first-time home buyer or not.

As a general rule of thumb, advise your clients to have 2 – 4% of the purchase price earmarked for closing related costs.

Some of the most common of these added closing costs are:

Development Charges

Pre-construction properties most often have development levies at the insistence of the city. The property developer will almost always pick up the lion’s share of them, but a portion of these costs are still passed on to the individual or couple purchasing the home. These development levies are very necessary; they go towards capital and operational expenses for the city, like building new schools, maintain utilities infrastructure, or funding new transit initiatives.

Clients considering buying a pre-construction home should aim to be very clear on whether or not there’s a cap on development charges, unless they’d like to be surprised at closing perhaps. Low rise homes will have their own specific charges, for benefits such as driveway paving, community tree planting, and work needing to be done to meet municipal building specs. Of course, every situation is different – you can go ahead and recommend your clients consult with a real estate lawyer you trust, in order to review the documents and be 100% clear on applicable fees.

New Home Warranty

A New Home warranty is the term used for a warranty for a buyer’s pre-construction home. What’s typically covered within it?

A multi-year warranty for major structural defects
Deposits (paid to the builder in advance of the construction of the home)
Certain defects in work and material Protection against unauthorized substitutions
Coverage for common elements in condominiums
Compensation for construction delays or occupancy
Against financial loss for contract homes

More information in regards to these different coverages are found at the different new home warranty providers’ websites, depending on your Province. The cost of enrollment is – not surprisingly – dependent on the purchase price of your client’s home.

Ontario – Tarion

British Columbia – New Home Warranty via BC Housing

Alberta – ANHWP

Saskatchewan – NHWP.org

Manitoba – MBNHWP

Quebec – RBQ

New Brunswick / Nova Scotia / PEI / Newfoundland – AHWP

Taxes

There are a pair of main taxes on pre-construction homes; the first is the provincial land transfer tax, and the next is provincial sales taxes. If your clients are purchasing a new townhouse, condo or house, however, there may also be an additional municipal land transfer tax.

In Ontario, for example, rates vary with their land transfer tax, depending on the purchase price of the home. Using the same example as above, a $532,000 home would correlate to a land transfer tax bill of approximately $7,100. Keep in mind that first-time homebuyers will likely be eligible for a $4,000 rebate.

To make it simpler, I recommend using RateHub’s land transfer tax calculator to determine the approximate amount your clients will come out at. (Can be used for any Province)

Pre-construction project pricing usually include the GST, or HST depending on your Province. In fact, the builders get a tax rebate on your behalf. Keep this in mind though – if the property is not going to be their principal residence and instead is going to be an investment property, in some (not all) Provinces you will face a tax bill that’s a percentage of your home’s purchase price. If you’re planning on using the home as an investment, be sure to budget for this additional tax.

Foreign buyers should also keep in mind that there’s also an additional 15-per-cent Non Resident Speculative Tax (NRST) for buyers in Metro Vancouver and Metro Toronto, which of course has been smartly implemented to protect housing for Canadians living in those metro areas.

Lawyer Fees

Last but not least, there will also be lawyer fees that need to be accounted for. Real estate lawyers have a pair of main responsibilities; the first is conducting a title search, and the second is preparing an adjustment statement. This includes closing costs plus any additional applicable fees. It’s typical to expect to pay somewhere between $1200 – $1700 in legal fees, depending on the purchasing specifics. It’s always best to shop around for competitive rates, and going with experienced real estate lawyers is best.

It’s definitely stressful, but buying a new home is overall an enjoyable experience for most people. As a realtor you have the most power to make it so your clients’ experience, and by signing up with Real Estate Leads here you’ll have all the more opportunities to do what you do best and ensure your clients are 100% happy with every step of the process AND without too many unexpected surprising costs.

Canadian Home Sales Likely to Drop to Lowest Level in 3 Years

Published September 19, 2017 by Real Estate Leads

Despite certain suggestions to the contrary and the assurances of others, it appears that 2018 will see Canadian home sales dropping to their lowest level in three years, driven in large part by a measurable decline in Ontario. All of this according to the Canadian Real Estate Association, and a forecast that comes with both troubling and promising aspects depending on which side of the owner / buyer fence you’re on.

Here at Real Estate Leads, we understand that predictions of this variety will weigh heavily with those of you who make up the bulk of our audience and registrants – realtors. Our online lead generation system for realtors has been a big success, and we feel that sharing relevant information regarding the national market and facilitating discussion around it benefits everyone.

So let’s look at this forecast in greater detail.

A Noticeable Dip

The association’s expectation is that a number slightly in excess of 495,100 will indicate the number of homes to be sold next year, downgrading its sales forecast for 2017 with a 9.9% drop in August as compared to a year ago.

Come January and the beginning of 2018, the prediction is that sales will fall 2.3% through 2018, and further that the remainder of 2017 will see a 5.3% decline on the original forecast of roughly 506,000 homes to be sold between June 1 and Dec.31 of this year, a number that’s approximately 20K less than what was first forecast in June of this year.

Looking at in greater depth, it’s interesting to note that seasonally adjusted sales in August rose 1.3% from the prior month, in large part due to a 14.3% boost coming from the GTA area. While that in itself will sound promising, the fact that sales in this area are down 35% from a year ago tempers the positivity considerably.

More than a few industry experts believe that the worst may have passed for the GTA, especially following provincially-implemented policy changes restricting foreign buyers, but there’s a lack of anything tangible to bear out that optimism.

Similar Outcomes Elsewhere

The CREA expects sales in British Columbia and Ontario will show themselves to have fallen by 10% or so by the end of 2017, and of course that’s in comparison to record highs set in 2016.

Sales last month were down in nearly 2/3 of all local markets, led by the country’s most populated greater metro area – Greater Toronto and its nearby housing markets.

Meanwhile, out west in Vancouver, August sales were up 7.3% from July and 21.3% higher than where they came in a year ago. Given the ever-hot and fast moving nature of the market in the Lower Mainland, homebuyers are of course watching mortgage rates carefully. Recent interest rate increases are prompting some to make offers before the rates make the scheduled climb, but at the same time others are pulling back.

Housing prices, however, continue to climb and seem unaffected by the dip-in-sales trend, at least for now. The average price for a home sold last month was $472,247, which is up 3.6% compared to a year ago. Greater Toronto was up 3.1%, and Greater Vancouver came in at 17.9%.

The national average price excluding these 2 regions? $373,859.

That number is expected to be up 3.4% to $507,700 come the end of December, which is lower than the prior forecast and that’s in large part because of fewer luxury home sales in Ontario’s Greater Golden Horseshoe region.

The projected 0.6% drop to $503,500 next year is expected to be a reflection of a record number of high-end home sales around Toronto earlier this year, but the fact that that likely won’t be repeated in 2018 is behind the drop.

Other Projections by Area

Newfoundland and Labrador sales this year are forecast to dip by 8.1%.

Saskatchewan should decline by about 4%.

Alberta is predicted to buck the trend, and projected to have Canada’s largest increase here at 7.4%. While that’s a plus for sure, it’s still below the provincial 10-year average.

Last but not least, sales are forecast to expand 5.4 % in Quebec and 5.7% in New Brunswick.

With all of this understood, we’ll of course have to wait and see if these predictions materialize. Should they do so, it will of course mean a bit of a downswing in the industry but as the old saying goes ‘when the going gets tough, the tough get going.’ Put more into your prospecting efforts and apply yourself more stringently and you’ll be able to keep your earnings where they need to be.

Of course, signing up with Real Estate Leads here is a great idea to supercharge those efforts. You’ll receive qualified online-generated buyer and seller leads delivered to you exclusively for your exclusively-retained area / neighbourhood of your home province. From there, what you turn this opportunities into is up to you!

4 Innovative Approaches to Marketing Real Estate

Published September 7, 2017 by Real Estate Leads

Ask any realtor what’s the number one engine driving change in the way properties are marketed and he or she will almost certainly reply that it’s technology, and web-based ones in particular. As is always the case, it’s those who adapt to and embrace these new technologies who gain the greatest amount of benefit from them before their use and application becomes commonplace. Here at Real Estate Leads, we’re obviously keen on new technologies too, having brought our own offering to the table with our online lead generation system for realtors in Canada that’s been especially well received.

Technology comes from innovation, and in turn technology is implemented with innovative approaches to using it. These new approaches can give real estate agents and brokers and edge in an increasingly crowded place. Embracing changing technology, generating unique content, and carving out a specialty niche to stand out from the competition is highly recommended.

Here are 4 innovative marketing trends for real estate agents or brokers.

Video or Live Streaming of Property or Neighbourhood Walk-Throughs

Most of us can take quality 1080p HD video with our smartphones, and video has the potential to be an enormous marketing asset. People by and large pay more attention to videos than text communications and, as of this year, video constitutes 74% of all web traffic.

Short, bite sized videos let real estate agents quickly and easily share the appeal of a specific property. Many brokerages or individual real estate agents will have a prominent section of their website dedicated to video real estate listings.

What’s exploded in popularity these days among realtors, however, is live streaming. It’s a fact that people spend 3x longer watching live streaming video than they are willing to give to other forms of video.

That should sound plenty good to real estate agents: they can live stream videos to Facebook, Instagram, YouTube or other social media platforms to allow potential clients an in-person look at available properties or neighbourhood hot spots.

Here’s a quick tutorial on how to ‘go live’ on YouTube –

Target Specific SEO Keywords Highlighting Your Real Estate Niche

In real estate, 9 times out of 10 your buyer or seller will come from a targeted audience. Keep in mind though that the website of an individual real estate agent won’t able to compete with the well-paid SEO efforts of MLS giants like Zillow.com or Realtor.com. That’s not to say you can’t increase the visibility of your site for search engine like Google and the like, and the key to doing so is by identifying related keywords that are specific to your niche or location – whatever or wherever that may be.

The key here is to NOT attempt these revisions to the text on your website – unless you’re an SEO professional or experienced web copywriter. If you’re not familiar with SEO optimization, meet with one of these experts and share what it is that makes YOU unique in your capacity to serve SPECIFIC customers in YOUR area. He or she will then incorporate these changes to your web copy, without ‘stuffing’ the content – which is the common mistake made by anyone who attempts to DIY upgrade their search engine optimization. It needs to read naturally for 2 reasons; first, keyword stuffing really reads awfully, and second, Google and other major search engines will actually penalize you for it – meaning it will actually harm your website’s SEO!

Zoom in on hyper-local keywords such as neighbourhoods or even postal codes. Are you an expert in neighborhoods like Kingsway or Spruce Grove, for example? Content marketing that’s developed according to specific neighborhoods is getting big. Smart real estate agents or brokers make their targeted locations clear, so as suggested above go ahead and ask around and be open to paying for the services of a professional.

Use a Real Estate Website Building Service

The majority of you won’t have hours or thousands of dollars to spend constructing and maintaining a real estate website. Most realtors will have a website, but the technology associated with web development has grown in leaps and bounds and you stand to benefit immensely if you upgrade to one of the much more dynamic websites that are available these days.

Much the same as above, don’t hesitate to pay a web developer to build you a website that’s both a reflection of the calibre of your business and one that’s particularly engaging for would-be clients that visit it.

Here is a list of the top web developers in Canada.

Many of these new super dynamic real estate sites are MLS integrated and easily customized to target a variety of audience types, generate leads, and more. Your developer may also be able to incorporate building pages, which show a specific development’s unique story. Speaking of stories…

Tell & Sell the Real Estate Story

As is the case in every industry now, content marketing in real estate is more powerful by the day. Realtors can and should be able to sell the experience and tell a great story, whether on their own (you’re likely a much better writer than you’re aware) or with the help of a content marketing specialist. Create content that focuses on the neighborhoods you cover; for example, what are the 3 best schools in that area? What sports or recreational pursuits are available in the nearby vicinity? You get the idea.

Also, when you’re putting together your content make sure you’re not simply rolling out one ‘fact’ after another. The best stories create a bond between you and your prospective clients. Research has shown that 92% of consumers want marketing materials that share some type of story where they can imagine themselves in the experience, rather than being told ‘it’s like this, it’s like that’ . Be creative, especially with your real estate blog posts. Share an engaging bit with them about what their experience could well be in their new home.

These are but 4 examples of ways you can harness the power of new digital media for your benefit with your real estate business. Of course, signing up with Real Estate Leads here and enjoying online-generated qualified buyer and seller leads delivered to you exclusively each month will be similarly beneficial, and we bet you’ll be plenty intrigued with our service once you dig into the details of it a bit.

Growing Numbers of Canadian $ Spent on U.S. Real Estate

Published July 31, 2017 by Real Estate Leads

Canadians buying property in the States has been going on for decades, and vice versa with Americans buying property in Canada. While the volume of homes and vacation properties in Canada being sold to American buyers has remained fairly consistent, the number of U.S. properties going to Canadian buyers has surged upwards in recent years. There are a number of factors playing into that trend, and the first and most obvious of them being the prohibitively high price of real estate in major metropolitan areas in Canada.

Here at Real Estate Leads, we’re thrilled with how our online lead generation system for realtors has been so well received by the real estate agent community in Canada, and we’ll continue to make adjustments to it to ensure it’s serving its purpose with maximum efficiency. We also enjoy keeping our thumb on the pulse of trends that are emerging in real estate.

The increasing number of U.S. properties being sold to Canadian buyers is one that’s particularly interesting to note. With accelerated house price growth in Canada’s hottest markets – Toronto and Vancouver – more Canadians are opting to buy affordable properties across the border. Given that we can assume the majority of those buyers do not have dual citizenship or a work visa, there can be some guessing as to what would spur the purchase of a home in a country that – despite being your next door neighbour – is just that, a foreign country.

That can and will be a discussion for a different day, however.

Residential All the Rave

From April 2016 to March 2017, the $19 billion that Canadians spent on residential properties in the United States was a record — in fact, it’s more than double the total of $8.9 billion recorded in last year’s report. All this from the National Association of Realtors’ (NAR) latest report from earlier this month. During this same period, a total of 284,455 properties were sold to foreign investors, a number that was up 32% from 2016.

Canadian buyers made up for 33,819 of those properties, a jump of nearly 7,000 from 2016. China led the way with the most foreign purchases for a third consecutive year, making 40,572 purchases in the US worth an astounding $31.7 million.

This is further despite the fact that inventory shortages continue to drive up US home prices, and it would seem that many of these Canadian buyers are looking south of the 40^th in search of affordable vacation homes.

The common consensus seems to be that a measure of the acceleration in foreign purchases over the past year is coming from the combination of more affordable property choices in the U.S. with foreigners assured in their decision to buy now by understanding that any further weakening of their local currency against the dollar will make buying in the future considerably more expensive.

Exchange Rate Factors

Foreign investment from Canadians dropped from 2015 to 2016 in the US as a result of the weakening Loonie, but this year’s heightened activity is believed to be a temporary phenomenon when we consider the red-hot market activity seen in Vancouver and Toronto. Industry experts expect to see continued strong demand from Canadian buyers, but they also believer there is very like going to be a pullback too.

The median price tag for US homes purchased by Canadians was $288, 615 – which was up from just over $222k in 2016. An interesting trend to note is that from April 2016 to March 2017, the majority of Canadian buyers were choosing the southeast and southwest areas of the US as their preferable investment areas, and most particularly in Florida.

Affordable options and a warmer climate pair to make up the top reasons why Canadians consistently are in the top 3 nationalities of foreign buyers purchasing homes in the U.S. That’s in large part because home price appreciation is quite strong in Canada relative to the United States, and you then factor in warm weather is a driver all on its own. Further, you also tend to get a lot more for your money in terms of square footage and kind of proximity to amenities in U.S. locations

Overall, foreign buyers and immigrants spent $153 billion on homes, and not only is this number a notable 49% increase from $102.6 billion in 2016, it’s a new record high that suggests the purchasing prerogatives for buyers here in Canada and elsewhere are changing to be less focused on the domestic market and buying homes for housing to more focused on investment and acquisition of assets.

Working with buyers is an equal 50% of what most realty professionals do here in Canada, and working in conjunction with similar professionals working in the U.S. to accommodate the purchasing wishes of clients looking for an investment home in U.S.A can be very much a mutually beneficial arrangement.

Sign up with Real Estate Leads here and receive qualified online-generated real estate buyer and seller leads delivered to you exclusively for your exclusive region of the country. You’ll have that region protected, and the leads will be provided only for you. It’s a great business booster that you really ought to take advantage of without delay.

Getting a Getaway: Recreational Properties Set to Become Increasingly Popular Purchases

Published July 17, 2017 by Real Estate Leads

It could be a cottage on the lake, a chalet at the foot of a favourite ski hill, or even a cabin in the remote northernmost part of your province. Interest in buying a recreational property or vacation home is increasing amongst different buyer groups in Canada, and that trend is one that real estate industry professionals would be wise to take note of.

Here at Real Estate Leads, our online real estate lead generation system is a proven effective way for realtors to get more seller leads, and buyer leads too. In particular as it relates to buyer leads, realtors in less-urban areas of the country will want to take particular note of this trend as it may be that greater numbers of prospective buyers will be looking for a real estate professional to assist them with buying a recreational property in rural Canada.

RE/MAX is one of Canada’s leading real estate agencies, and according to their latest recreational property report for 2017, 43% of Canadians would consider buying a recreational property in the next decade. Interestingly, 28% of them with children under the age of 18 would consider selling their primary residence to help finance that purchase, suggesting that it’s not just financially sound soon-to-be retirees or investors that are weighing the market for these types of properties – even young families are increasingly determined to own a cottage or cabin and are willing to explore options to turn that dream into a reality.

This is primarily a reflection of real estate prices in areas of Canada remaining high, and as a result more of these prospective buyers are looking into unique financing options like fractional ownership in a shared property, purchasing a recreational property with a friend, or even selling their primary residence, downsizing, and putting the differential equity into a cottage or cabin.

Resourceful Millennials

Equally interesting to note is that recreational properties are goal for Millennials too. Yes, the thought of having a getaway isn’t exclusively appealing to the more secure generations, and while these young people may be facing much more in the way of career insecurities and the like they are still being smart and creative about how they can afford a recreational property.

The same Re/Max report pointed out above found 65% of Millennials are interested in purchasing a cottage, cabin, or chalet in the next decade, and 39% would use the property as an investment and list it on rental sites to help pay down the financing. Naturally, their interests are tied to locations that facilitate lifestyle more so than older buyers who are looking more for spots that are scenic and less busy.

For example, young Vancouverites who accept there’s no way they could get themselves a chalet in Whistler may be taking especial note of the upcoming redevelopment of Hemlock Mountain Resort just past Mission, about a 2 hour drive from Vancouver.

Boomers Want to Get Away Too

Not surprisingly, the baby boomer generation is tapping into equity to fund their own recreational property purchases. Large numbers of near-retirees and baby boomers nearing retirement are putting the equity they received from sold homes in cities like Toronto and Vancouver into the purchase of a recreational property. Significant price appreciation (and that may well be putting it mildly) in those regions has made recreational property ownership a relatively affordable option for many retirees. Accordingly, we’re seeing price appreciation in popular recreational property markets such as Whistler in B.C. and Haliburton in Ontario.

The Places to Be

Other hotspots for recreational property purchase in Canada from Coast to Coast include:

Tofino and Ucluelet, BC ‘Long Beach’
Squamish, BC
Whistler, BC
Kelowna, BC
Shuswap and North Okanagan, BC
South Okanagan, BC
Canmore, AB
West Lakes of Edmonton, AB
Sylvan Lake, AB
Turtle Lake, SK
Qu’Appelle Valley, SK
Lake Winnipeg, MB
Thunder Bay, ON
Manitoulin Island & French River, ON
Lake Huron, ON
Muskoka & Haliburton, ON
Laurentians, QC
Charlevoix, QC
Shediac, NB
North & South Shores, PEI
East Coast, NFLD

The priciest of those popular recreational property locations in Canada? Right there at the top of the list, with the median price for a waterfront home in Ucluelet or Tofino being between 580 and 660k. The most inexpensive vacation property in Canada? You’ll find that in Newfoundland’s East Coast, at an average of 175k for a waterfront property that – while much less expensive – is every bit as pleasant and scenic at the much more expensive view of the Pacific Ocean on the other side of the country.

All interesting to note, and particularly so for realtors who want to have their thumb on the pulse of significant changes to the buyer / seller cross-sections of the public. As always, being put in touch with these recreational property buyers and sellers is just an opportunity, and what you do with it is up to you. Signing up with Real Estate Leads here is a solid choice, as you’ll receive qualified online-generated leads delivered exclusively to you and for your specific protected region of the country.

Who knows, from there you might find yourself being the perfect matchmaker between homeowners and their new ‘fun time’ home away from the city. Summertime’s here, and we imagine you know what it’s like to be itching to get out of town. Make it happen!

Risky Reprieves: The Inadvisability of 2nd Mortgages to Avoid Bankruptcy

Published July 5, 2017 by Real Estate Leads

It’s well understood that one of the inevitable developments that come along with an extensively inflated housing marketing is having homeowners who are in over their head and very precariously perched when it comes to the mortgage they have on their home and the debt that’s assumed as part of it.

Those kinds of market conditions definitely exist in certain metro regions in Canada, and being ‘house poor’ puts you at risk of defaulting on your mortgage. That’s obviously going to be concern number one for homeowners who have gone in a little more head long than they thought, but it’s not the only decidedly unpleasant potential reality. It can also lead to bankruptcy, and certain people in certain areas and certain lines of work are more susceptible to it than others.

Here at Real Estate Leads, our online real estate lead generation system is proven valuable as a way for realtors to get more property listings, but we’ve also got our thumb somewhat on the pulse of trends and hot topics in the world of real estate and home ownership in Canada. So many of them are related to financing, and this one is really worth a long look.

First off, we’ll share what many of you may already know – there are not nearly as many bankruptcies declared in Canada as there are in nearly every other country in the world. However, does a lack of here mean the average Canadian consumer is doing better than their international counterparts? Much like the lack of mortgage defaults, there’s some foreboding facts to be unearthed if you’re willing to dig.

All it takes is a look at the Homeowners Bankruptcy Index, which is currently at an all-time low. That should be interpreted to be a positive, but it would seem there are fewer bankruptcies due to homeowners refinancing their debt by bundling it into 2nd (or even successive of that) mortgages.

Accordingly, that all-time low number is something of an artificial reality, and one that masks a very large potential problem for anyone who thinks a re-mortgaging of property is their way out of a financial failure.

More About The Index

Few if any of us are debt experts, so it’s entirely natural if you’ll need a little walkthrough of the explanation of the Homeowner Debt Bankruptcy Index. In their words, it measures the percentage of insolvent debtors who owned a home at the time they filed a bankruptcy or consumer proposal. Let’s now give you a quick walkthrough of the terms so that we’re on the same page.

To put it more simply, insolvent debtors are individuals that are unable to make scheduled payments to pay down their debt. When a consumer proposal is offered, it’s an attempt to negotiate them paying a percentage of their debt. Bankruptcy is when you state officially that you’re entirely out of means of paying that debt, and you – for all intents and purposes – ‘surrender’ to your debtors and seek an asylum from the bank if you will.

From there, a licensed insolvency trustee (LIT) liquidates your assets and distributes them to your creditors. Of course, that very rarely clears the entirety of the debt, but that’s where they start.

All-Time Lows

Interestingly, the Homeowner Bankruptcy Index is currently at an all-time low despite the very precarious situations so many homeowners are reported to be in. The number of people filing for a consumer proposal or bankruptcy that owned a home fell to just 7% at the end of May 2017. That’s a fairly significant drop from the 35% it was at in February 2011. If you look at the chart, you’ll notice that it’s dropped almost precipitously in 2016 and 2017. Further interesting is the fact that this was right when home prices across Canada began increasing exponentially.

Decline Is Due To Rise In Home Prices

The answer to why those two specifics add up when they really shouldn’t? It is because Canadians are using their homes much like a bank machine, withdrawing from the solidity of their equity. Homeowners with significant unsecured debt are now seeing being able to refinance this debt through a second mortgage or home equity line of credit as a viable option, albeit a risky one.

There’s 1.91 million Canadians with HELOCs (home equity lines of credit), and even more individuals and couples with a second mortgage. That’s not what you’d consider to be traditionally representative of booming incomes that would be the ideal reason to see delinquencies decline.

Monitoring agencies are warning that any softening of the market that results in a correction (see ‘bubble bursting’) of home values will almost certainly come with a sudden spike in homeowners who have no choice but to file for insolvency. The warning goes further to say that if this combines with a bumping up of interest rates, then the result could be the Homeowner Bankruptcy Index rising above levels that were experienced after the 2008 / 2009 recession.

Canadians have had no qualms about piling on record amounts of debt over the last 2 decades, and it would seem they’re now looking for every possible way to delay paying it back. Refinancing your mortgage to accommodate debt might work for now, but there’s no debating it leaves homeowners that take this option in a more vulnerable spot. A MUCH more vulnerable and risky spot. Bankruptcy or crushing debt aside, keep in mind as well that the less equity in your home, the less likely you are to secure good mortgage rate renewal terms. Worse terms mean higher rates, and you can be certain that it will definitely complicate your ability to pay your bills on time.

Part of being a reputable realtor is being frank with your customers about their purchasing power. You want to attract and retain clients, and in the interest of the first part of that we suggest you sign up for Real Estate Leads and begin receiving online-generated qualified buyer and seller leads delivered to you exclusively for your own area of the country.

Best Promotional ‘Swag’ Choices for Real Estate Professionals

Published June 13, 2017 by Real Estate Leads

In today’s super competitive market for real estate agents, you need to make every effort and really strive to get your name and brand front and center for prospective clients. Here at Real Estate Leads, we are enthusiastic about providing realtors to have success with our online real estate lead generating system, but we’re also keen to help you make smarter choices on your own.

Today, we’re going to discuss which promotional items are best for getting increased exposure and how you can allocate your marketing and promotion budget more judiciously as a result of having the understanding. No matter how you tend to disperse this ‘swag’ as these types of promotional items have come to be referred to, there is plenty of it out there to choose from.

The key is to find products that will generate buzz and leave a lasting impression.

Pens, keychains, notepads, business-card holders, USB sticks and more. But does distributing your promotional materials really pay off, and if so – how much, and which items are your best choice?

Well, for starters, research has indicated quite clearly that they absolutely do pay off. Now how much and which are best will vary, but let’s move now to discussing the types and then we’ll discuss some of the variances in how swag can contribute to you generating greater numbers of new clients.

Putting Your Name & Agency In Front of Buyers & Sellers

Swag used for marketing purposes falls into one of two categories. Promotional products include useful or decorative items imprinted with the real estate agent’s name, logo or message and then distributed free to would-be clients. Imprinted items that are offered as an incentive for a specific action are known as premiums.

Manufactures of promotional products like those listed above report a consistently strong demand for these types of products from real estate agents, and that’s true of every region in the country.

Here are some interesting findings regarding how effective it is for realtors to distribute promotional materials to prospective clients:

84% of people remember the advertiser shown on a product they’ve received
42% develop a more favourable impression of an advertiser after they’ve received a specialty advertising product
24 % report being more likely to do business with an advertiser they’ve been reminded of via items they’ve received
62% of respondents have done business with the advertiser listed on a product after they’ve received it and it’s been in their possession for more than 2 weeks

And this last one is HUGE. Take especial note:

The average cost-per-impression attached to an advertising specialty item is $0.004, making it less expensive per impression than nearly any other medium

Other research has indicated that 58% of those responding to a survey said they kept these types of promotional products from anywhere between one to four years. Consider that even if the recipient only uses the item once per week, that adds up to a minimum of 52 impressions over the course of a year plus the possibility of more than 208 over the next five years.

Further, promotional products foster positive regarding of a business by:

Increasing in positive overall image;
Increasing the positive perception of that business;
Creating a higher likelihood of recommending that business
Creating a higher likelihood of their patronizing that business

The Importance of Useful

Promotional products that actually add value to a customer’s life in some way are light years more effective than any type of impractical stuff they will likely end up throwing out before long.

Useful promotional swag items for realtors should improve the prospective clients’ life in some way, while still being relatively affordable for you to buy it in quantity. In addition, it should be personalized with your real estate info so you will be the first tome come to mind when they think of acquiring the aid of a qualified real estate professional.

Best Ideas for Promotional Items

Two particularly smart choices for real estate agent swag are a branded tissue box sleeve and a branded pocket hand sanitizer sprayer. The tissue box sleeve will slide over a store-bought square issue box, and for most people that box will sit somewhere in regular view for months upon months. The cost per sleeve shouldn’t be much more than $3, if that.

Those branded hand sanitizers typically go for about $2.00 each and also will last for a good long while. Further, they show you care about the recipient and by that they are intended to create a more personal, authentic connection

Other good ideas for realtor swag are:

Credit card RFID protectors
Jar openers
Fridge magnets
Calendars
Keychains
Fly swatters
Tape measures
Smartphone desk stands

While all of these above are good choices, we’ll conclude today by saying that when you are considering any of them you should go through a series of questions regarding the specifics of your relationship with the prospective client. You should ask yourself

What is the potential return on investment?
What season of the year is it?
Is it more likely to be left at the office, or taken home?
Is it a novelty item, or useful item with some practical value?
What are your competitors doing similarly?
What have you yourself received that made an impact on you?
What will the cost of distribution be?
How long is this particular item likely to last / be retained?
Is it too overtly ‘saying’ that you are trying to buy their business?

And the most important question for any marketing strategy – can you measure its effectiveness?

We hope this communication is helpful for any of you who’ve been wondering where to best spend your marketing budget funds when it comes to promotional swag items. Whatever you can do to make you visible as a realtor is beneficial, in much the same way that signing up for Real Estate Leads here is a huge plus too, with qualified online-generated leads delivered to you exclusively each month and for your exclusive region of the country. Make sure you get your locale by signing up without delay!

Don’t Wait Until It’s Too Late: The Need For Proper Insurance Coverage

Published May 15, 2017 by Real Estate Leads

Recent events in the Eastern part of Canada are a reminder that shifting global weather patterns and trends – likely prompted by global warming – are seemingly making extreme weather events a much more common seasonal risk for certain communities.

Here at Real Estate Leads, we aim to provide ways for realtors to increase their home seller and home buyer leads, but we also realize the value in having realtors be able to appraise their clients of wise choices when it comes to home ownership. In light of the aforementioned events, and others like the increase in wildfires in the west every summer, it’s important to remind clients of the need for home insurance that matches the specific risks they face based on the regional location of their home.

With regards to these floods, it appears that the majority of Canadian homeowners aren’t insured for flooding and could be left on the hook for at least part of the bill after heavy rains in several areas across the country, experts say.

A representative for the Insurance Bureau of Canada estimates that only 10 to 15 per cent of Canadians have overland flood insurance

. This type of add-on insurance policy is typically not included in the clauses of standard home insurance packages in Canada, and most notably it wasn’t offered prior to 2013, the last time severe flooding affected certain communities in Canada.

The reason for this was that it wasn’t until that time that flood risk maps were developed for the whole country. Keep in mind that the insurance industry needs to be able to quantify the risks so they can assess which premiums should be charged to which people. A risk-per-region determination was required before any type of coverage guidelines could be established, and that took time.

And so, many homeowners with policies negotiated years ago may be insufficiently covered after heavy rains left several communities in Quebec and Ontario struggling with rising floodwaters over the weekend and parts of New Brunswick and British Columbia also faced flooding.

Delayed Roll-Out Inevitable, But Unfortunate

Insurers began working on the overland flood insurance add-on as soon as they could following the establishment of those maps, but naturally it took time to roll the policies out. The add-on has been available for most policies since late 2015, but – as is so often the case – policy owners are often lax about revisiting their policies once they’ve obtained them.

It’s important to do this, and particularly so given the fact that climate change is making calamitous acts of nature much more common across North America. It’s highly advisable to appraise new homeowners you’ve worked with – and ones you’ve similarly worked with in the past and keep in touch with – that they should be having a look at the coverage provided in their policies at least once every year to make reassessments as necessary.

Then there is the fact that most Canadians only interact with their insurance broker when the time comes to renew their policy. Most people are not even aware that overland flood insurance is available, unless they have been directly in a conversation with their broker or agent when renewing over the past year.

Further, homeowners should be adamantly reminded to NOT be expecting to be able to rely on government assistance in the event of an emergency situation, for obvious reasons given the fact that the funds available to cover such incidences are at an all-time low. In addition, government assistance is often designed to compensate homeowners for core essentials only.

Out Of The Know

A study last year that surveyed 2,300 Canadians who live in high-risk flood areas found that the a 70% majority of those polled reported having not been contacted by an insurance company about newly available overland flood insurance. It also revealed confusion on the part of respondents about what is – and isn’t – covered by their insurance policies. The majority of those surveyed thought overland flooding was already covered under their insurance policies by default.

As a realtor, there is a real opportunity here to both further the connection and reputability you have with your clients, as well as ‘do the right thing’ in making them aware of the need to be especially critical when looking at their home insurance policies.

By being a real estate professional you have an inherent level of authority regarding subject matters related to home ownership, and as such your clients are more likely to heed to your advice and or urgings regarding home insurance coverage than if they were to hear it from someone else. Take advantage of this to further your professional capacities, and enjoy being regarded so highly!

Operating your real estate business ethically and responsibly is indeed rewarding, and of course having greater numbers of listings for both buyers and sellers is fortuitous for giving you these opportunities. Sign up for Real Estate Leads here and receive qualified online-generated leads delivered to you exclusively for your protected region of Canada each month. From there, you’ll have a foot in the door and chances to do what you do best!

Housing Craze Spilling Over Into Condo Market in Lotus Land

Published May 10, 2017 by Real Estate Leads

The Foreign Homebuyer’s Tax instituted in BC last year has no doubt cooled housing prices in the city as intended, but it would appear that some of that buyer focus has shifted from detached homes to condominiums. That’s likely both a direct and indirect result, especially considering that while condos have been a nearly as popular choice for buyers looking for an investment property in Metro Vancouver, they’ve also commonly been the standard entry-into-market choice for young professionals and working couples who have yet to start a family.

Here at Real Estate Leads, we’re eager to continue providing a valuable marketing resource for realtors but we’re also keenly aware of some of the challenges, risks, and – for lack of a better word – general craziness that are marked characteristics in Canada’s big cities at this time.

After a heated four months for condos and townhouse sales, the average sales price for a condo on the west side of Vancouver is now nearly $1 million. Condos have indeed been quicker to recover than single family houses in response to the 15% tax, but of course the trickle down effect is both frustrating many qualified potential buyers as well as forcing other prospective buyers further down the chain.

Recently, realtors have made note of incidences where ‘extreme bidding wars’ that they typically only saw with detached homes are now becoming common for Condos in downtown Vancouver and on the city’s desirable west side. Some condos are selling for in the vicinity of 100k more than listing price, and according to agent Darryl Shaburo of Park Georgia Realty, “what’s quite marked about this trend is that these buyers are quite willing – and able – to compete and continue to outbid their competitors to numbers that most people find quite staggering for 800 to a thousand square feet of real estate.”

April of 2017 saw the average price for a condo in Vancouver west of Commercial Drive rise to $969,579, compared to $572,000 for East of it. What Greater Vancouver’s REB prefers is to use a measurement called benchmark price, which the board says more closely represents a typical housing unit. The April benchmark price for Vancouver West condos would seem to be more relatively indicative at $718,400 and $480,300 for Vancouver East, but agents and insiders say that doesn’t take into account the new phenomenon of ‘super bidding.’

The Concern of House Poverty

Furthering the issue is the fact that demand continues to far outstrip supply, and that is one of the trends in real estate in Vancouver that’s unlikely to change soon, if ever. Shaburo states that market is picking up these days, however, as it “always tends to do during the spring season.”

The greater concern in the big picture, and both for individuals and for the Canadian economy, is that by paying such exorbitant prices for housing – condos and detached homes – they will become what is called ‘house poor’ and be put at significant detriment due to carrying such a large household debt. As this becomes more common, it of course lends itself to premonitions of the ‘housing bubble burst’ that occurred in America in 2008.

We’re a ways from that in our opinion, but there has to be concern here. Both on the national interest level, and in making housing affordable for the people who make cities breathe and not just those who have the finances required to make investment purchases. Balance is essential.

As realtors, we stand to benefit from a profitable housing market, but it must be a healthy housing market as well. Plus, a great many of us actually live in these cities too! You want business to be good, and doing good. In in the interest of the first part of that, we suggest you check out Real Estate Leads and enjoy qualified online-generated seller and buyer leads delivered to you exclusively for your exclusive region of any specific locale in Canada

Analyzing The New Nationwide Mortgage Regulations

Published April 19, 2017 by Real Estate Leads

One of the best pieces of advice you can give to help a realtor get more listings is to put in the time and network, network, network. For a prospective homebuyer who needs a mortgage to purchase their first home, one of the best things they can do is familiarize themselves with Canada’s new mortgage regulations and how they’ll affect their purchasing power. So feel free to pass this correspondence along if you know anyone it might benefit.

It was late last year that Canada introduced its new mortgage rules, and the term that was used for them was ‘promoting responsible homeownership’ – which in large part means more of buying a home to live in it rather than as as a speculative investment purchase. So while the changes were geared toward curbing foreign real estate speculation and, to a lesser extent, promoting low loan-to-value mortgages, for the majority of Canadians what matters first and foremost with the new regulations is how it will affect affordability for the average Joe or Jane.

More specifically here to put some parameters on our discussion, let’s say they’re a first-time homebuyer purchasing with less than 20% down. Or what’s called the interest rate stress test.

Let’s also preface somewhat by looking at how the affordability of Homeownership has been helped in recent years by low interest rates and the availability of high loan-to-value mortgages backed by mortgage insurance. What would be the result, however, if those rates jumped as they’ve been known to do? The government’s response to what could potentially be a bubble bursters was to introduce tougher interest rate stress-test criteria in the latter part of 2016, aiming to make perspective homebuyers aware of the potential for a future rise in interest rates.

So if you’re an average homebuyers with the on-paper means to afford a home – but not endlessly deep pockets – what does all this mean for you? The less-than-rosy answer is that you’ll likely have less money to work with. Here’s why.

Taking The Stress Test

Lenders and mortgage insurers will weigh two debt service ratios when qualifying you for a mortgage and mortgage insurance.

-Gross debt service (GDS)
These are the carrying costs of your home, such as mortgage payments, taxes, heating, etc., and how they stand in relation to your income.

-Total debt service (TDS)

The sum of your home carrying costs (mortgage payments, taxes, heating, etc.) plus your debt payments (credit cards, student loans, car loans, etc.), with all being measured in relation to your take-home income yearly.

To qualify for mortgage insurance, the highest allowable GDS ratio is 39%. The highest allowable TDS ratio is a little more accommodating, coming in at 44%.

Many prospective buyers will technically at least qualify for a fantastic five-year fixed mortgage rate from your bank (2.94%, for example), but it’s now important to keep in mind that the new rules use the Bank of Canada’s five-year fixed mortgage rate (4.64% at the close of 2016, for example) to make a determination on whether you can afford your mortgage payments.

The purpose of this stiffer affordability standard is to serve as a buffer to test whether you could still afford your regular mortgage payments if (and some economists state it’s quite likely) interest rates were to rise dramatically.

Bottom line is, the new rules mean you can afford less house for your income – approximately a 20% to 30% reduction in the mortgage amount most first-time buyers would qualify for.

Best Plan For Prospective Buyers

These new mortgage rules will likely not be reevaluated for many years now. However, many buyers will still be able to work within them. A revision of plans or timelines may be needed, but first-time homebuyers can still get into the real estate market.

Smart prep work in advance of buying your first home will be to lay the groundwork for this responsible homeownership they speak of: start by reducing your consumer debt, saving for a larger down payment (a big one!), and finding a way to boost your overall financial fitness.

Help your clients with their mortgage needs by recommending them to a mortgage broker you trust, and see to it you have more clients to refer in the first place by checking Real Estate Leads Availability here and having qualified online-generated leads in your area provided to you exclusively.

Hard to Argue Against Concerns Over Vancouver / Toronto Market Outlooks

Published April 14, 2017 by Real Estate Leads

There’s been a whole host of different opinions on the state of the markets in Canada’s 2 biggest cities, and ones where – not surprisingly – there’s the most demand for housing and the ever-increasing development of ‘bubbles’ of the same variety that proved to be the start of a major detrimental turn events in the USA nearly 10 years ago now. Here at Real Estate Leads, we have endless tips for realtors but we’re not exactly experts on the connection between the economy and housing investment in Canada

There was a recent interview with someone who most definitely has the credential to say he is an expert. Royal Bank of Canada CEO Dave McKay was one that didn’t see things as rosy (or perhaps ‘rosier’ would be more accurate) as others do, and considering he’s the head of a major financial lending institution you can imagine he’s got his thumb on the pulse of all this in a way most of us couldn’t even begin to.

An Unhealthy Combination

McKay attributed the rapid increase in housing prices in the two cities to an “unhealthy combination of factors” and went on further to cite an imbalance in supply and demand for residential properties, low interest rates, and speculative activity.

“All of these factors are mixing to push prices up to unsustainable levels, stressing household balance sheets and locking many people out of the housing market,” McKay remarked at the bank’s annual general meeting in Toronto on Thursday.

“More and more disposable income is going towards servicing those houses,” he said, adding further ” and more capital is getting invested in those homes. And the real risk for us as an economy is the long-term drag that has on the rest of the economy as so much of a person’s net worth and cash flow goes into servicing their home.”

As stated, this kind of precarious arrangement was a big part of what preceded and initiated the crash in the US in 2008, and the concern of course is that something similar could happen here.

More of the Up, Up, Up

McKay offered his observations a day after the latest data from the Toronto Real Estate Board showed the average price of a home in the Greater Toronto Area increased by 33% over the last 12 months concluding at the close of March 2017.

What’s come as a result is a whole array of responses about what can be done to rein in housing costs in the city, which are now spilling over to the rental market via exorbitant rent increases. After all, the operating principles of supply and demand never really change.

What’s Up Out West

While it is true that price increases in Vancouver have cooled off, Lotus Land has also seen runaway double-digit gains, month after month after month, until the implementation of a 15% tax on foreign buyers last year.

McKay believes one single solution being applied to the entirety of these problems is unlikely to be successful.

He said interventions from federal, provincial, and local governments to come up with a more nuanced solution to a very complex problem would have much more propriety.

“We would welcome any effort by the three levels of government to coordinate their interventions, and to do so reasonably quickly,” he said.

“But longer-term, I believe all parties need to come together — governments; developers; realtors; banks; community groups and others — to accelerate our progress in finding policies and solutions for this issue.”

2 Further Sobering Statistic Comparisons

In bearing out a good portion of what MacKay has alluded to, have a look at these 2 charts indicating average home prices in both these cities in comparison to others, along with what is required for a down payment on that home.

Purchase prices

Vancouver: $420,000
Calgary: $370,000
Toronto: $425,000
Montreal: $250,000
Atlantic: $185,000
*National median: $293,000

Down Payment

Vancouver: 20%
Calgary: 10%
Toronto: 21%
Montreal: 13%
Atlantic: 8%
*National median: 12%

Of course, that means business is good for realtors in Toronto and Vancouver, but the need for housing is a social issue and naturally we all take a vested interest in the well being of that.

Check Real Estate Leads Availability here and help yourself to a bonafide lead generation system for realtors that’s great for ANY region of the country, even the hotbeds of Vancouver and Toronto.