April 14, 2009
Dual-Agent Roles Cloud Home Sales
Question: If a selling agent neglects to inform a homeowner that a higher bid has been made and chooses instead to sell the house to a person he’s also representing as a buyer’s agent, what rights do the seller — and the higher bidder — have?
Answer: Generally speaking, real estate experts caution buyers and sellers against using the same real-estate agent because of the conflicts it can create. Negotiating a final sales contract involves lots of give and take on both sides, and if your agent is also representing the other party in the transaction, that immediately puts you at a disadvantage. How will you know if the agent is doing more to serve your interests — or the interests of the other party?
Despite the potential for trouble, it’s still common for agents to represent both the buyer and the seller, especially since doing so greatly increases the agent’s commission. In Ontario, such arrangements are legal, though these so-called “dual agents” have to get a “multiple representation” consent of the buyers and sellers first.
The law gets trickier when two agents within the same real-estate company represent both sides of a transaction. In theory, that situation can lead to big conflicts if the two agents, who probably work in close proximity to one another, share information. Such arrangements are allowed without consent of the buyers and sellers, although the agents involved are not supposed to share information.
Although real estate agents have a fiduciary duty to their clients to give them the best possible service, if they’re acting within a sanctioned dual-agency arrangement, the agent is fulfilling obligations that you essentially agreed to in advance.
Obviously, it’s often wise to avoid a dual agency relationship from the get-go. No matter how you handle your sale, be sure to keep all the correspondence between you and your agent, and don’t be afraid to snoop around to learn more about other possible bids — and more about your agent’s reputation. In many cases, sellers don’t even know they’ve been taken advantage of, so it pays to know a lot about your local market, including the recent sales prices of nearby homes, before you get far along in the home-sale process. Doing some research on your agent and on recent nearby transactions can make you a more informed seller — and help keep the agent honest.
April 6, 2009
Toronto Real Estate Board reports:
March resale housing results show year-over-year sales down 7% and median price down 2.5%.
In March 2009, Greater Toronto Realtors reported 6,171 sales – down seven per cent from March 2008, representing the smallest year-over-year decline in the last five months. The average price for March transactions was $362,052 – down less than five per cent from the same month last year.
“The Greater Toronto housing market has stood up very well given the challenging economic times the world has experienced in recent months,” commented TREB President Maureen O’Neill. “In fact, over the past two months, the situation in the housing market has improved.”
“Sales in March increased at a rate over and above what would be expected from the normal spring-time bump,” said Jason Mercer TREB’s Senior Manager of Market Analysis. “A greater number of households have taken advantage of increased affordability in the housing marketplace.”
The seasonally-adjusted annual rate of sales increased to 65,600 in March – up 36 per cent from the ten-year low reached in January. Seasonally adjusting TREB MLS data removes recurring seasonal trends observed each year. For example, MLS sales are highest in late spring each year and lowest in the winter months. Removing the recurring seasonality, allows for the analysis of a meaningful trend reflecting actual changes in market conditions. By multiplying the monthly seasonally-adjusted figure by 12, creating an annual rate, we can compare how the current month relates to historical annual figures.
Median Price
The median price in March was $317,500 from the $326,000 recorded in March of 2008.
See the complete Toronto Market Watch report »
February 13, 2009
Canadian Real Estate growing bleaker
January home resales down 40.9 per cent from a year ago; prices sag 11.3 per cent.
Midwinter keeps growing bleaker for the economy, with the number of home resales in January sagging 40.9 per cent below a year ago. National average prices declined 11.3 per cent year-over-year, according to Canadian Real Estate Association data released Friday.
The association said seasonally adjusted sales through the Multiple Listing Service were down 3.1 per cent from December. “In seasonally adjusted terms, sales … now stand at the lowest level since the mid-1990s and barely half the heated pace seen in early 2007,” BMO Capital Markets economist Douglas Porter commented after the CREA release.
“While another particularly harsh winter may have played a small role in the dismal sales figures, there is little doubt that Canadians are hunkering down amid widespread job losses and sagging consumer confidence.”
The realtors group noted that the pace of seasonally adjusted monthly price declines eased in December and January compared with steep month-to-month tumbles of 14.9 per cent in October and 11.8 per cent in November.
It said that adjusted for weather and other factors January’s year-over-year volume decline was 37.3 per cent, while the adjusted price slump was 6.2 per cent.
The 11.3 per cent unadjusted national price decline was “skewed lower in large part by fewer sales in British Columbia, Alberta and Ontario, where homes are more expensive and demand has softened most,” the association stated.
By contrast, it said average prices were up from a year ago in St. John’s, N.L.; Halifax-Dartmouth; Quebec City; Regina; Saskatoon; Saguenay, Que.; Oshawa, Ont; Winnipeg; Thunder Bay, Ont.; Montreal and Ottawa.
The national seasonally adjusted dollar volume of $7.4 billion was the lowest since May 2003.
Many economists say the drop in house prices in many parts of Canada, as well as the stock market slump and rising unemployment are key factors in eroding consumer confidence to the lowest levels in more than a quarter century.
With ordinary Canadians feeling poorer, they’re more likely to save their money to cut debt and clamp down on spending, a bad sign for the retail sector and overall economy, the economists say.
Friday’s real estate report said that as house sales eroded, the number of listings also receded, posting the sharpest year-over-year decline on record, down 14.2 per cent from January 2008.
“The decline in supply to meet lower demand is expected to help stabilize the resale housing market balance and put a floor under prices,” CREA said.
BMO’s Porter was less sanguine. “The ongoing sharp drop in home sales points to further declines in prices as well as a deeper pullback in new home building,” he wrote.
“The deepening recession, which began in earnest among exporters, is now more forcefully dragging down the domestic side of the economy.”
Friday’s home-sales tally extended a dismaying series of dismal economic reports, and Prime Minister Stephen Harper said in Montreal that the government plans several more moves in the near future, building on last month’s budget stimulus.
Also Friday, Statistics Canada released its tally of December motor vehicles, down 14.8 per cent to 109,831 units. That was the weakest level since sales skidded in the monster Eastern Canada ice storm of January 1998.
A week earlier, Statistics Canada reported 129,000 jobs were lost in December, prodding unemployment to a four-year high of 7.2 per cent, a rate that is expected to rise.
Consumer bankruptcy filings in December were up almost 47 per cent from a year earlier, the Office of the Superintendent of Bankruptcy said Monday. The same day, Canada Mortgage and Housing Corp. said housing starts in January fell 10.9 per cent from December to the slowest pace since 2001.
On Wednesday, Statistics Canada reported the first trade deficit since 1976 in December, as the global economic slowdown hammered both the prices and the volumes of exports.
“The almost non-stop daily deluge of truly dismal data pouring in from across the globe is stunning even to those who have been through a few serious recessions,” BMO’s Porter wrote in a separate report.
He noted that recent data included a six per cent annualized plunge in euro-zone fourth-quarter gross domestic product, an 84 per cent year-over-year drop in Japan’s machine tool orders, a 74,000 rise in British joblessness and a 43 per cent drop in Chinese imports.
“There are also now daily indications that Canada is a full player in the downturn.”
Porter added sardonically that economic forecasting has become straightforward: “Whatever the indicator, and wherever the country, simply take the worst-case scenario your 21 models and/or your gut tells you, and then cut the figure by another couple orders of magnitude.”
Source: Canadian Real Estate Association
February 5, 2009
Toronto Real Estate Board reports:
Home resales down 47 per cent in January; average price off 8 per cent.
According to Toronto Real Estate Board president Maureen O’Neill, there are opportunities at any point in the housing market cycle. “Moderated housing prices combined with low interest rates could present excellent long-term investment and homeownership opportunities in the GTA housing market,” noted O’Neill. ”Realtors can help potential home buyers and investors identify value in today’s market.”
Greater Toronto Realtors reported 2,670 sales in January compared to 5,075 in the first month
of 2008. “Demand for existing homes in the Greater Toronto Area moderated as the housing market followed the broader economic slowdown in Canada,” said Jason Mercer, the Toronto Real Estate Board’s Senior Manager of Market Analysis.
The average home price in the Greater Toronto Area was $343,632, compared to $374,449 last January. The median price was $303,000 compared to $319,000 last year. “Current selling prices are a reflection of more choice in the existing home marketplace,” said Mercer. “At the same time, low mortgage rates have helped keep ownership housing an affordable option. Given that we are not facing an early-1990s-style affordability crisis, the rebound in the housing market will likely be quick once economic recovery takes hold,” added Mercer.
See full Toronto real estate report:
February 3, 2009
Americans Lose $3.3 Trillion in Home Values
American homeowners collectively saw $3.3 trillion erased from the value of their real estate in 2008. What’s all the more stunning is that $1.4 trillion, 42 percent of the annual 2008 total, was lost in the fourth quarter alone, due largely to the fact that more markets fell into negative territory as the year progressed and those already in negative territory just got deeper.
These are just two of the literally thousands of data points found in Zillow’s Q4 2008 Real Estate Market Reports released yesterday.