Sustainable housing and real estate in Kitchener-Waterloo Region


Local, national and international housing
December 7, 2010, 10:14 pm
Filed under: Judita Makos, Market Conditions, Uncategorized

 

LOCAL-KITCHENER – WATERLOO

According to Kitchener-Waterloo Real Estate Board, total of 484 homes were sold in area through MLS,  which is 7.8 per cent increase compared to October 2010 and 10.9 per cent decrease to  November 2009.

 122 condominiums sold in November, which is 22 % increase over November 2009
and average price for condominium was $209,094, which is a 5.5% increase compared to the same month
last year.
The average price of all residential properties sold through the MLS® System of the KWREB last month was $282,629, a 0.4 percent decrease compared to November 2009. Detached homes sold for an average price of $322,839 last month, a 0.6 percent decrease relative to one year ago.
The most popular price range was for home selling between $200,000 and 225,000,
Consumers  favoured more modestly priced homes in November, however on year to date basis, it is amazing how the higher priced properties are driving much of the local real estate market” says George Patton, President of KWREB.
The strength of this residential market has resulted in a record breaking dollar volume of sales through the KWREB’s MLS® System, with year-to-date results for 2010 currently showing a total of $1,753,664,113, a 9.6 percent increase over the same period last year,and easily surpassing the previous record posted in 2007 of $1,619,377,742.

“In terms of total dollar volume, 2010 is poised to go down in history as our best year ever,” notes Patton.
TORONTO
Greater Toronto REALTORS reported 6,510 existing homes sales in November – down 13 % from november 2009 and the average selling price for November transactions was $438,030 – a 5% increase compared to same month in 2009.
“The GTA resale market has tightened since the summer. Healthy market conditions continued to support growth in the average selling price,” said Toronto Real Estate BoardPresident Bill Johnston.
“Sales through the first 11 months of the year were down only marginally compared to the same period in 2009. We remain on track for one of the best years on record under the current TREB market area,” continued Johnston.
CANADA
Home selling price in Canada shows decrease of 0,3 per cent in the third quarter as the market has slowed quicker
than expected. However, yar over year, prices are still up by 7.9 per cent.
Canadian economy remains a problem though. The Canadian real Estate Association has downgraded their forecast
4 times this year already. Latest forecast calls for 1.6 per cent gain in average housing prices in 2011, down from
5.4 percent previously forecasted.

According to Stats Canada  Municipalities issued $6.2 billion worth of building permits in October, down 6.5 per cent from September.
Statistics Canada blames the decline largely on drops in both the residential and non-residential sectors in Ontario and Quebec.
The value of residential permits fell 11.2 per cent in November, after substantial gains in September and October.
The value of non-residential permits remained at $2.7 billion as higher commercial and industrial construction  offset a decline in the value of building permits for institutional projects.
The total value of permits decreased in half of the provinces, led by Ontario and Quebec.
Newfoundland and Labrador had the largest increase.
INTERNATIONAL

“There is growing evidence that the global housing market recovery may just be beginning to run out of steam,” said
Liam Bailey, head of research for London-based Knight Frank in a report.

After several quarters of rising prices globally, home appreciation has slipped considerably, especially in Europe where there are fears that some countries may default on their debt.

Ireland was in last place on the list at number 48, down by 1.3 per cent in the third quarter, or minus 14.8 per cent cent year over year.

Italy was in 37th place with minus 2.5per cent growth, Greece was in 38th place showing minus 3.1 per cent growth, and Spain was in 41st place, showing minus 3.7 per cent year over year growth.

The biggest global gainer was the Asia Pacific region, up by 9.9 per cent in the third quarter
. The weakest was Europe at 0.8 per cent

Hong Kong was in second spot, followed by China in third.

“China’s key cities may avoid a significant correction in prices as local government fine tune their land supply programs,” said Bailey.

However, Frank Knight analysts still expect that prices will fall by 20 per cent in major cities cities such as Beijing, Shanghai, Guangzhou and Shenzen next year.

Latvia was the surprise top gainer in the third quarter. It was in last place a year ago. But the country has been highly volatile. A new immigration law that relaxed residency rules for foreign investors has helped to boost house prices according to Frank Knight.

 In the key United States market, prices are up by 0.6 per cent from a year ago, with average prices dropping to 2003 levels.



REDEVELOPING BROWNFIELDS
April 9, 2010, 8:37 pm
Filed under: Judita Makos, Sustainability

Brownfield properties have always suffered from negative perception. They’re considered to be contaminated, difficult to deal with and fraught with delays, high costs, and red tape.

Time and familiarity is needed for this to change. The push for urban intensification in recent years, and new programs and technologies  are already making maNy stakeholders take a closer look at the development potential of brownfields.

Major projects like FILMPORT in Toronto and the Halifax Seawall redevelopment show what can be done to revitalize brownfields.

Term “brownfield” covers a wide variety of sites. According to NRTEE  (National Round Table on the Environment and the Economy)  brownfields fall into three categories;

  • Top tier about 15 to 20 per cent of brownfields . These sites’ market value far exceeds the cost of remediation, and these sites are usually redeveloped quickly.
  • Middle tier – 60 to 70 per cent . Cost of clean up and the potential value are high. These sites present a great deal of development potential, but are too expensive or risky to clean-up. This category stands to benefit most from incentives or regulatory changes that could tip the balance between cost and profit to encourage development.
  • Bottom tier – 15 to 20 per cent; these are sites where cleanup cost would far outweigh the value of the land after cleanup. These sites have few development prospects.

Well-located brownfields often have a lot of development potential. Besides being closer to the city core than any new development could possibly be, these sites are usually already served by infrastructure such as utilities and roads – saving the need to build these from scratch.  It also saves greenfield land on a city’s outskirts. In fact, it’s estimated that every brownfield redevelopment saves an area four-and-half  times larger from being developed in suburbs.

Brownfields redevelopment can also have a hugely positive impact on the neighbouring communities.  Sites tend to be in the older parts of cities. Experience has shown that redeveloping a brownfield reinvigorates  the surrounding communities, creating more economic and social activity in the area.

by Judita Makos

More information about brownfields in Ontario  http://www.ene.gov.on.ca/envision/land/decomm/brownfields.htm



MLS vs FSBO
April 9, 2010, 5:29 pm
Filed under: Judita Makos

FSBO or For Sale By Owner is a home put up for sale without the services of a real estate sales representative. It usually presents some unique challenges to the seller.
First of all, the owner needs to know local house market values and objectively compare like properties to his/her own property. Up-to-date pricing – the kind a local real estate agent knows – is a key to generating initial interest in the property for sale.
FSBO  sellers should also be aware that many potential buyers expect lower selling price if real estate agent is not involved.
Also education or realty legal matters is crucial for any owner thinking of selling a property. Disclosures, legal forms and contracts must be in place and real estate laws must be adhered to in order to avoid any vulnerability to lawsuits. Also owners must be prepared to answer many phone calls and/or emails,and to have their house ready for visits at anytime.
So, it is safe to say  that FSBO and Real Estate Sales Representatives are in competition. But as you can read in following article, FSBO got on CREA-MLS side against Competition Bureau. lol

 Garry Marr, Financial PostPublished: Wednesday, April 07, 2010

MLS rival joins battle against Competition Bureau

Reuters

The Canadian Real Estate Association now has a strange ally in its fight with the Competition Bureau the owner of an independent site that aims to compete with the Multiple Listing Service.

National FSBO Network Inc. has filed a motion for leave to intervene in the case before the Competition Tribunal involving the federal watchdog and CREA, the group that represents more than 100 real estate boards across Canada and the country’s 98,000 agents.

Melanie Aitken, Commissioner of the Competition Bureau, filed an application with the tribunal in February in which she referred to CREA’s practices as anti-competitive.

The two sides have been battling over access to the MLS system, which is owned in Canada by CREA and which the bureau says is responsible for about 90% of residential property sales.

Last month, CREA approved new industry regulations that would give consumers some ability to decide how much or how little they use an agent on a real estate deal. Ms. Aitken rejected the changes passed by CREA. Her plan would allow real estate agents to provide a multitude of a la carte services, including using an agent just to list on MLS.

Private sales by owners represent as much as 30% of all transactions in some centres, National FSBO says. Its application suggests the government watchdog’s plan would put them out of business, thus reducing competition instead of creating room for it.

“We are not quite sure what the commissioner is trying to achieve,” said Stephen Skelly, vice-president of operations with Ottawa-based National FSBO. “There is a discussion of a fee- for-service operation and that’s the kind of thing FSBO businesses already provide.”

Mr. Skelly’s worry is that if agents list property on the MLS for a one-time fee and provide no additional service, his members won’t be able to compete because the MLS has such a dominant position. He is trying to link various FSBO networks across the country and has six signed up, including GrapeVine Home Marketing Consultants in Ottawa, one of the largest in eastern Ontario.

“There is serious concern in the FSBO community that if the commissioner’s application is successful, it would be very difficult for FSBO businesses to compete with agents who would have full use of the MLS and ‘related trademarks’ and who would have all of the advertising and marketing recourses of CREA and its members. This could ultimately lead to the demise of FSBO businesses and the costeffective services they provide, and effectively [create] a monopoly situation,” the application states.

Neither CREA nor the bureau would comment on the application. Both sides can file a motion with the tribunal as to why or why not Mr. Skelly should be granted intervenor status.

The bureau has also received a request for leave to intervene from Lawrence Dale, the former owner of Realtysellers, which says it was prime target of CREA’s anti-competitive practices.

No date has been set for the tribunal hearing.



K-W Real Estate Update

INTEREST RATES
The Bank of Canada took its first steps this week  toward returning the country to more normal interest rate levels by signalling a more hawkish tone on inflation and acknowledging the economy is performing better than expected on “vigorous” consumer demand.

The messages were conveyed in the Bank of Canada’s latest interest-rate statement, which kept its record-low benchmark rate of 0.25% as is and pledged to keep it there until July.

The rate statement emerged a day after economic data indicated the Canadian economy grew at a robust 5% annualized pace in the final three months of 2009, blowing past market expectations for a 4% gain and the central bank’s original 3.3% forecast. Economists say the fourth-quarter performance has set the stage for another robust gain, of perhaps 4% or more, for the first three months of 2010.

Meanwhile, recent data indicate that both the headline and core inflation rates have moved much closer to the 2% level than the central bank had expected. Under the bank’s forecast, the 2% level would not be reached until the third-quarter of next year.

In the statement, the central bank acknowledged economic activity has been “slightly higher” than its own projections, with the 5% gain in the fourth quarter powered by “vigorous domestic demand” and a recovery in exports.

Low interest rates are doing their job in stimulating demand — perhaps, increasingly, too well.”

The consensus remains that the central bank will wait until July to begin raising rates.  There are two more scheduled rate decisions between now and then, with one April 20 and then June 1.
Economists believes rate increases will begin in the third quarter, but  the odds have increased that the first hike will be in July as opposed to September.

How much, and how rapidly, the central bank raises rates beginning in July is up for debate, with economists estimating increases of 100 to 150 basis points in the second half of 2010.Financial Post

HOUSING ACTIVITY IN  2010

According to CMHC housing starts rebounded in the second half of 2009 and will strengthen in 2010.

Following a total of 149,081 units in 2009, housing starts are expected to be in the range of 152,000 to 189,300 units in 2010, with a point forecast of 171,250 units.
 In 2011, housing starts will be in the range of 156,400 to 205,600 units, with a point forecast of 175,150 units.

“Canadian housing markets will benefit from improving economic conditions and low mortgage rates,” said Bob Dugan, Chief Economist for CMHC. “As well, measures recently announced by the Government of Canada to support the long-term stability of Canada’s housing market will help moderate housing activity as some potential buyers will have to save a larger down payment or consider a less expensive home.”

Mr. Dugan also noted that the existing home market has shifted from a buyers’ market, at the beginning of 2009, to a sellers’ market. The relative lack of new listings for existing homes has pushed some of the demand into the new home market, which helps explain the forecast for higher housing starts activity in 2010.

The strong pace of MLS®1 sales seen in the second to fourth quarters of 2009 reflects, in part, activity that was delayed in the previous two quarters. The pace is not likely to be sustained as pent-up demand is exhausted and financing costs increase with anticipated higher interest rates later in 2010. As a result, existing home sales will be in the range of 455,350 to 509,900 units in 2010, with a point forecast of 486,700 units, and then move slightly lower in 2011 to be in the range of 426,300 to 494,600 units, with a point forecast of 469,950 units.

With an improved balance between demand and supply, the average MLS® price is expected to remain close to the average in the last quarter of 2009, for most of 2010, and then rise modestly in 2011. CHMC 

KITCHENER- WATERLOO MARKET UPDATE – KWREB  OFFICIAL PRESS RELEASE 

KITCHENER‐WATERLOO, ON (March 3, 2010) – While Canada’s athletes were racing for Olympic Gold;Waterloo region’s homebuyers were racing to buy real estate. There were  553 homes traded  in February through the Multiple Listing System (MLS®) for a total value of $153,120,645, marking a 31.7 percent increase over January’s results.
This is the most residential sales we’ve seen in the month of February in over two decades.” said, Ted Scharf, President of the Kitchener‐Waterloo Real Estate Board. “It has been an exceptionally busy start to the year.”
February’s sales included 350 detached homes (up 43.4 percent from 2009), 99 condominium units (up percent from 2009), 52 semis (up 73.3 percent from 2009) and 49 townhouses  (up 63.3 percent from 2009).
There were a total of 75 properties sold in the $300,000 to $350,000 price range‐‐ the second most popular category last month—a 150 percent increase on a year‐over‐year basis.

The most active price range continued to be homes selling between $225,000 and $250,000, with 93 sales, up 50 percent over last year.
The average sale price of all residential sales increased 12.2 percent to $276,891 compared with February 2009. Single detached homes sold for an average price of $324,631, an increase of 15.8 percent compared to last year.

 In the condominium market the average sale price in February was$173,726, an increase of 8.3 percent from one year.
“The Harmonized Sales Tax (HST) which takes effect on July 1 is likely contributing somewhat to the increased sales we are seeing, “says Scharf.   But the biggest factor influencing strong sales during this traditionally slower time of year according to Scharf, is the historically low-interest rates. “Consumersare taking advantage of current interest rates now before they are predicted to rise this summer.”



Build wealth with investment property
January 14, 2010, 1:13 pm
Filed under: Judita Makos | Tags: , , , , , ,

Why  buy an investment real estate in Waterloo Region?
The communities of Kitchener, Waterloo, and Cambridge, known collectively as Canada’s Technology Triangle, are becoming known as a competitive area to build high-tech businesses. The area is so strong economically that the Real Estate Investment Network™ in its past research has dubbed it the “Economic Alberta of Ontario”. This continues to prove true as the region was once again selected as the number-one investment town in Ontario. Within a 24 hours drive, the Technology Triangle has access to more than 60% of Canada’s population and 40% of the U.S. population. The reinvention of the region’s economy in the last few years has led to investment in the information technology sector, a venture which has protected the Triangle from the steep increase in job losses experienced in many other Ontario communities. A commitment to infrastructure improvements and transportation projects will also help drive the economy and the real estate market in this area.

 Research indicates that there are more buying opportunities now than in the last few years, meaning more investment options and better yields” said Don R. Campbell, REIN™ President and author of the best-selling books Real Estate Investing in Canada and 97 Tips For Real Estate Investing.

“With today’s mixed market signals it is critical that investors and home-buyers complete that extra level of due diligence. An economic fundamental, not speculation, plays the key role in whether a property increases or drops in value. The years of skyrocketing prices are finally over; however, over the long-term the economic fundamentals of these key regions will help their property values dramatically outperform other regions of the province.”

The Top Ontario Investment Towns report list:
1) Kitchener, Waterloo, Cambridge
2) Hamilton
3) Simcoe Shores:Barrie- Orillia
4) Brampton
5) Durham Region – Whitby, Pickering, and Ajax
6) Ottawa
7) Brantford
8) Toronto
9) Vaughan
10) Whitchurch-Stouffville

Why isn’t everyone buying real estate? Most people don’t understand how to buy, how to evaluate and how to manage their investment. First basic rule is not to buy a property unless it can produce cash flow. When you calculate the rent and subtract expenses there shouldn’t be anything else to pay. If you have to add money every month to pay for this investment then stay away!

The second rule for buying an investment property is to be wary of listings showing a great rate of return on projected values. If you are looking at an investment property ask for the income and expenses for the past 24 month. Also, allow for reasonable vacancy rate and don’t forget maintenance per unit.

Next step is to calculate capitalization rate, also known as the cap rate.  It is not generally a great idea to have cap rate under 6-7.5% unless the property has some real upside. For example, it has additional land, it has been extensively renovated, or there is some potential for additional income.

Another factor to consider is the mortgage rate interest. For example, you buy an investment property at 6.5% cap rate, pay 25% down payment and pay 5% interest on remaining mortgage. On the money invested, you will earn 6.5%, but on the money borrowed you will earn the difference between cap rate and the interest rate. This creates increased return on investment (ROI).

Like all investments, buying and owning investment property poses a form of risk. Real estate investment is dependent on your management skills. People may end up selling, what would be the best investment for them in long run, only because they don’t have knowledge, patience and understanding of managing real estate.



KW REAL ESTATE UPDATE
December 11, 2009, 11:55 pm
Filed under: Judita Makos | Tags: , , , ,

A new record for residential sales was set by Kitchener-Waterloo Real Estate Board in November.  Mls sales reached 556 units, which is 87.8% increase from november 2008.

“For the third consecutive month we have seen a significant resurgence from the downturn that started last fall”  reports Ted Scharf, the new President of Kitchener-Waterloo Real Estate Board.

There have been 6,108 residential units sold, meaning sales will easily surpass 2008’s year-end total of 6,115 units.  Homes selling between $350,000 to $500,000 totalled 90 in November, and increase of 233 % compared with November 2008 and an increase of 67 % compared to last month.  Another bright sign for the local economy,  was the increase in the sale of builder product last month.  There were 85 new construction homes sold  in November, marking a 214.8 percent increase over the same month last year.

Kitchener – Waterloo Real Estate Market Update

September – November 2009

  SEPTEMBER OCTOBER NOVEMBER
Homes Currently for Sale 1917 1819 1696
Homes Sold 531 579 556
Selling Ratio 28% 33% 33%
Sale Price vs. List Price Ratio 98% 98% 98%
Average Days on the Market 47 46 51
Median Selling Price $239,900 $238,700 $252,900
Average Selling Price $255,400 $258,600 $277,600

Listings and Sales by Price Range

Price Range   Actives   Solds
  SEPT OCT NOV SEPT OCT NOV
$150,000 or less 190 167 137 66 61 53
$150,000 – $200,000 215 190 180 79 92 79
$200,000 – $250,000 328 293 300 153 168 137
$250,000 – $300,000 301 283 267 86 116 101
$300,000 – $400,000 434 441 386 103 93 120
and Over $400,000 449 445 426 44 49 66

 

For a detailed statistical report relevant to your specific property and neighbourhood please

JUDITA MAKOS, SALES REP

CENTURY21 HOME REALTY INC

DIRECT; 519-572-0765

EMAIL;  judita.makos@century21.ca



Plutonic, GE to resume work at Canada wind farm
December 11, 2009, 11:38 pm
Filed under: Judita Makos | Tags: , ,

Plutonic, GE to resume work at Canada wind farm.

NEW YORK — GE Energy Financial Services and Plutonic Power Corp will restart construction of a 300-megawatt wind power farm in British Columbia, after a court approved the companies’ purchase of the project.

GE Energy Financial Services, a unit of General Electric Co., and hydroelectric company Plutonic together paid $52.5 million to bankrupt EarthFirst Canada Inc for the planned Dokie Wind farm, which would be the largest in the Canadian province.

Read more: http://www.financialpost.com/story.html?id=2330325#ixzz0ZQV7nZJY
The Financial Post is now on Facebook. Join our fan community today.