February 16, 2011 - The Toronto Real Estate Board today released it's mid-February market figures.
Member Realtors® reported 3,206 sales over the first 14 days of the month, up more than nine percent versus the same period last year.
New listings were up 13% over the same period.
Average sale price was $491,493, also up nine percent over the year-earlier period. Average Days on Market, or "DOM", was 25.
The full report is available by clicking here.
There were 4,567 properties sold via the Toronto Real Estate Board MLS® for the month of January, 2012, 8.8% higher than the same month last year.
The average sale price this January was $463,534, up 8.87% over the January, 2011 average.
Specifically, detached home in the 416 area code rose 15% year-over-year to an average of $743,993 while detached homes in the 905 area code rose 5% to $530,129.
There were 9,655 new listings reported by the Board during the month [all residential property types], bringing the total to 11,009 active listings – that total number was down 9.1% versus total active listings the prior January, though the new listings figure was actually up 8% year-over-year to 8,937.
To read the entire report [pdf], please click here.
The federal government’s ecoENERGY
Retrofits- Homes program is now no longer
accepting new registrants. This program enabled eligible homeowners to
receive grants of up to $5,000 to make their homes more energy-efficient.
Due to the popularity of the program, only registrations submitted prior
to January 28, 2012 have been accepted. To ensure registered homeowners have
time to complete their post-retrofit evaluations, the evaluation deadline has
been extended from March 31st to June 30, 2012.
Prior to undertaking any
renovations, homeowners must have first assumed an energy audit of their home by
a licensed service organization. The evaluation report provides customized
recommendations for renovations to improve the energy efficiency of the home.
Once the homeowner has completed the renovations, a post-retrofit evaluation
must be undertaken to determine the change in the home’s energy
efficiency.
Only products purchased on or after June 6, 2011, and
installed after a pre-retrofit evaluation are eligible for the grant.
All post-retrofit evaluations must be completed by June 30th, 2012.
For more information on the ecoENERGY Retrofit – Homes program,
please visit: http://www.ecoaction.gc.ca/ecoenergy-ecoenergie/retrofithomes-renovationmaisons-eng.cfm
Notify your clients, friends and family of the changes to the ecoENERGY
Retrofits- Homes program deadlines.
TORONTO, January 17, 2012 – Greater Toronto REALTORS® reported 1,506 sales through the TorontoMLS® system during the first two weeks of January 2012. This result represented a six per cent increase compared to the first 14 days of January 2011. New listings were also up on a year-over-year basis, but by a lesser 3.7 per cent...
Click here to read the full article...
From CBC News:
"All across the country, mortgage specialists and brokers are busy fielding calls from people who've just heard about this week's record low mortgage rates."
Hmmm. The banks maintain it's only a "limited-time promo". But, as pointed out in the article, banks - Central or otherwise - don't control rates in the bigger picture:
"It is the bond market that is the bigger driver of longer-term fixed mortgage rates, not the Bank of Canada's overnight rate, which directly affects variable mortgage rates and other floating loan rates."
So which is it? The banks offer record low rates for a "limited time", or the banks have little control over rates in the bigger picture?
We'll go with the latter.
Either way, "record levels" of anything don't last forever.
Read the whole article here, at CBC.ca
Beware future maintenance costs [and even re-sale issues??] if this is the problem that UofT Prof Ted Kesik believes...
"Toronto has more condominium towers under construction than any other
city in North America, but recently glass-clad towers have been in the
news for all the wrong reasons.
It started in the summer of 2011 when glass started falling from the shattered balconies of several downtown condo buildings..." Click here to continue reading...
Our resident Retirement Consultant, Jim Otar, answers...
This was
the question Rita, my better half, asked me 12 years ago. At first, I told her,
“Don’t worry, I am the financial planner in this family, leave it to me”, I
continued with confidence, “after all, our former financial planner gave us a
forecast in 1992. He was using a 12% average annual growth rate and look how rich
we would be according to his plan!”
Then
something unexpected happened: I threw away my financial planner’s hat. I found
my old engineer’s hat in the attic, dusted it off, and I started researching
this as an engineer. I could only find two articles about this topic. The first
one was about sustainable withdrawal rates by W. Bengen, a fellow engineer from
California. The second was an article called “Retirement Calculator from Hell”
by William Bernstein. Anything else, academic or not, was either too tainted by
the financial industry, or did not make any engineering sense to me. In 2001, I
wrote my first book on this topic, aptly titled “High Expectations and False
Dreams”. After reading it, Rita was not amused. Eight years later, I wrote a
more comprehensive version, “Unveiling the Retirement Myth”. Rita read only a
few pages from it; this time, she was busy getting ready to retire.
“Do we have
enough to retire?” There are two aspects to this question: The first part is
the cash flow, “how much income is enough each year?” The second part is the assets
required: “how much retirement savings do you need at the beginning of
retirement to finance your retirement”
The first
part of the question is simple: Add up all your expected annual expenses after
you retire. Then, figure out how much income can you expect from various
sources: CPP, OAS, GIS, company pensions, rental income, royalties, etc. Take
the difference: If your income is larger than your expenses -that would be likely
the case if you have government or university pensions- then don’t worry; you
have enough to retire. You are in the green zone.
However, if
your estimated expenses exceed estimated income then you have a shortfall. To
cover this income gap, you need retirement savings. This brings us back to our
question “Do we have enough to retire?” To answer this, we need to establish
some ground rules.
There are three
basic risks for retirement financing: 1. Longevity risk, 2. Market Risk, 3.
Inflation Risk.
Longevity
risk means the risk of outliving your money. In a retirement plan, make sure
that the survival rate is below 10%. Therefore, unless both you and your spouse
have a life expectancy five years or less, use age 95 as a minimum age of death
to cover the longevity risk properly.
Market risk
means adverse market conditions throughout your retirement. The concepts of
“time value of fluctuations”, “sequence of returns”, “inflation”, “reverse
dollar-cost-averaging” all have devastating effects on portfolio longevity. Make
sure that the probability of running out of money at the age of death remains
below 10%.
Inflation risk
means the necessity to maintain purchasing power throughout retirement. Make
sure that the purchasing power does not decline by more than 10% throughout
your retirement in your plan.
The final
step is to figure out your required savings. For that, find your asset
multiplier in the table below. Multiply this with the shortfall (i.e. the
income gap) you calculated above. The result is the required savings at the start
of your retirement based on actual market history; no assumptions, no forecast,
no simulations. If your actual savings are larger than this, you are in the
green zone, you have enough to retire. If you have less, then you are likely in
the red zone; you need to do one or more of the following to migrate to the
green zone: 1. delay retirement, 2. spend less, 3. work part-time during the retirement, 4. rent part of your home, 5. downsize your
home, 6. reduce the portfolio costs, 7. stop giving money away, 8. buy a life
annuity.
|
Retirement Age
|
Asset Multiplier
|
|
55
|
32
|
|
60
|
30
|
|
65
|
28
|
|
70
|
25
|
|
75
|
22
|
|
80
|
18
|
Finally, as of last month, Rita and I consider
ourselves sort of retired.
Jim
Otar, CMT, CFP, is a financial planner, a professional engineer, a market
technician and a financial writer and the founder of retirementoptimizer.com.
His past articles on retirement planning won the CFP Board Article Awards in
2001 and 2002. He is the author of “Unveiling the Retirement Myth – Advanced
Retirement Planning based on Market History” and “High Expectation and False
Dreams” Your comments are welcome: jim@retirementoptimizer.com
Hot off the press...here's an update of Canadian House Prices...
...prices were flat compared to the previous month in 2 of 11 major Canadian markets [Ottawa & Vancouver]; prices fell in 5 of the 11 markets [Halifax, Calgary, Quebec City, Montreal & Edmonton]; prices rose in Winnipeg, Hamilton, Toronto & Victoria.
Click this link if you'd like to view the full report...
Source: Teranet – National Bank National Composite House Price Index™
There are home buyers…and there are Bungalow buyers: After "location" - all else being equal - the # 1 concern of “home buyers” is “How many square feet for the money?” Living space is more important than style of house.
Bungalow Buyers, on the other hand, are concerned primarily with style. It's “Bungalow Lifestyle 1st" ...other factors are secondary. Maybe they want/need everything on one floor. Or they want the ease of maintenance Bungalows offer.
Bungalows are more expensive to build per square foot because you’re building a foundation and a roof regardless of house style – but only putting one level of floorspace in between in the case of a Bungalow. Bungalows are usually built on a wider lots, too, further increasing overall costs.
Bungalow Buyers will pay a premium in return for the lifestyle.
While the mainstream house style of recent decades has been the 2-Storey...with a few Split-Levels and Bungalows thrown into the mix... demand for Bungalows is already growing as Boomers begin to downsize, and people in general seem to be gravitating to more modest, energy-efficient houses.
Of course, everyone's entitled to their opinions..as evidenced by a recent National Post column. The NatPost writer figures Bungalows are a thing of the past since they're an inefficient use of space. Well, maybe so in the denser parts of the city...then again, maybe not:
Many people with pets, grandchildren, passions for gardening, etc., aren't prepared to trade in their yards for a condo balcony - not yet, anyway - so, as more knees begin to give out, more people will turn to Bungalows!