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Fundamentals Driving Demand in Canada’s Apartment Market

Published November 12, 2019 by Real Estate Leads
Follow That Line – Condo Development Tails Expanded Rapid Transit Infrastructure

Realtors and Civic Planners may have entirely different lines of work, but the decisions made by civic planners have a great deal of relevance for realtors and how they’ll be conducting their business. As it regards civic planning, it’s been said that if you’re a in a metropolitan area then having the majority of your inhabitants living in multi-family developments then you’ve done well in crafting the growth of your region. Not surprisingly, it is true that the majority of people in heavily populated urban centres in Canada are in fact living in condominiums or rental apartments.

Now no realtor will need to be convinced of the need for a healthy rental housing market, as it serves a very pivotal role in the progression from young people starting out in life to future qualified homebuyers. Without it fewer of them reach the point of being qualified prospective buyers and it’s true that there’s too few of them to begin with. Finding new clients for a real estate business is challenging for many reasons, and it’s for this reason that here at Real Estate Leads our online real estate lead generation system is such a good choice for those new to the business.

But back to topic, it’s good to see that the demand for rental housing in Canada is being identified and received in the manner it should be.

Challenges and Opportunities

Population growth, demographics and housing affordability are currently fuelling the strong demand for apartments in Canada. These factors, together with insufficient and constrained rental supply, are making existing housing challenges more severe. The fact that there is a growing imbalance between housing demand and supply shouldn’t come as a surprise, and neither should the apartment market in Canada remaining strong for the foreseeable future.

Apartments have always been a vital part of the housing solution for many Canadians. That’s true whether they are entering the rental market by choice, or out of necessity. It’s true that most immigrants who enter the country and do not have the capital to own a home remain in the rental market for 10 years or so  before home ownership becomes a viable option.

Demographics

What’s most interesting to note is that there is a trend in our population where people are increasingly opting for an apartment-rental lifestyle that is not related to affordability.

As the children of baby boomers move on, those aging baby boomers usually downsize from single-family homes.

This then factors into an increased demand for rental properties in familiar, desirable communities which provide convenient transportation and amenities. As millennials – the children of these baby boomers – come to reach the usual age for making their own independent households, more of them are now choosing affordable urban apartment rentals over purchasing houses in the suburbs.

A recent study indicated that there are about 730,000 millennials living in the Greater Toronto and Hamilton Area who may be planning to move on from living in their parents’ homes and from sharing a dwelling with roommates in the next 10 years. This has the potential to create 500,000 new households. Based on this stimulus we are likely going to see a significant housing shift in major urban regions, as this large wave of millennials start to look for a place of their own.

Then add the estimated 100,000+ new residents that come to the the major cities every year and we really do have the makings for different housing crises.

The challenge for millennials planning to move out of their parents’ homes and into the rental market will be in saving up enough for a down payment – while still paying current, escalating rental rates. In Toronto and Vancouver in particular, these rates are both exorbitant and debilitating for many people.

Housing Affordability

Across Canada, the provincial and federal government have made efforts to control housing prices, and these prices are expected to appreciate modestly throughout the last bit of the year here. The federal government has tightened rules for mortgages even further, implemented new restrictions on government insurance for low-ratio mortgages, and issued new reporting rules for capital gains exemptions on primary residences.

While the underlying objectives are appropriate for the present situation, these initiatives are probably not going to solve the housing affordability crisis on their own.

The cost of breaking into the housing market makes home ownership challenging and Canadians will continue to have to weigh an apartment rental as an affordable – and perhaps smarter – option. It’s interesting to note in relation to it that demand for rental housing is outpacing home ownership for the first time in many decades.

Municipal Governments need to be extremely proactive in developing rental housing on a very large scale, and there’s not time for delays and inactivity with this. It’s essential for the maintenance of a healthy housing market, which stands to benefit both individuals and those whose careers depend on it.

Sign up for Real Estate Leads here and receive a monthly quota of qualified, online generated buyer and / or seller leads that are delivered exclusively to you and for your privately-served region of any city or town in Canada. It’s your region, they’re your leads only, and you will be the one to benefit in a big way when it comes to building on your client base. Put the power of the Internet to work for you and build your business that much more effectively!

Creating Listing Descriptions That Draw Genuinely Interested Homebuyers

Published November 7, 2019 by Real Estate Leads

It’s been said that real estate is very much one of those professions where the expression ‘you don’t get a second chance to make a first impression.’ That’s very true, but it’s also true in regard to the way that interested homebuyers who are looking at homes on the market will make very quick and lasting judgments about any home on the market based on the listing description they see for it.

That’s obviously a disadvantage – even if the listing description is well written – and unfortunate as well, because there’s always so much about a home that can’t be conveyed right without seeing it and experiencing it in person. But in the same way people will draw conclusion on you as a realtor based on their first few minutes with you, they’ll do the same with your listing based on the first few lines of the description.

It’s true that some homes really do sell themselves, but the vast majority of them do not. It’s usually a challenge and that’s why your expertise as a realtor makes you worthy of their business. What is ALWAYS a challenge, however, is prospecting a sufficient number of clients so that your own real estate business continues to be a viable way for you to earn a living for yourself.

With that understood, our online real estate lead generation system here at Real Estate Leads is an excellent choice to put you in the those ‘pivotal first impression’ scenarios much more reliably. Harnessing the power of Internet marketing is rarely if ever a bad thing.

But returning to our topic of choice today, how does a realtor write strong listing descriptions that serve to further the readers interest in their listing, especially if that reader is a genuine prospective homebuyer?

It’s not that complicated, and you can do it too. Read on.

Experience, Relevance, and Smart Wording – The Best Formula

The first mindset that you need to take on in advance of beginning this task is to understand fully that this is someone’s future home, and not just another house. It may not be the future home of every single person that reads your listing description, and in fact that’s the most likely scenario. However, with the chance that it may be, you need to form your ideas with the understanding that someone who reads this may be doing so as the first part of the process that ends with them buying the home from your clients.

So you need to make sure your property descriptions attract attention and create a captivating scene, and do so even before potential buyers visit the home.

  • Focus on the Experience

It IS important to mention how many bedrooms and bathrooms a home has, but it’s even more important to showcase how lifestyle meets utility perfectly in this home. For example, if your client has a home with a great family room with a fireplace, your aim should be to make buyers feel like they will love that room long before they even see it. Another example could be if you the home is in a growing-family type of neighborhood and it’s most likely a couple with children will be buying the home then you can talk up the family bonding experiences that can happen in that superb living area.

Something like this – “This expansive family room features soaring 11-foot ceilings as part of an overall design creation that’s intended to promote families creating ever greater numbers of cherished family memories. Whether that’s piling the couch with pillows and blankets on a cold winter day, or enjoying a movie night by the fireplace, or hosting a lively birthday gathering filled with friends and family, this room will likely be the heart of the home.”

  • Keep it Relevant

Going overboard with descriptions is the most common misstep with listing descriptions. They shouldn’t be overly personal or customized to the current owners. The better approach is to keep statements more general, so that any type of buyer can relate to them. It may not seem natural, but you’re going to appeal to a much wider cross section of prospective buyers this way.

Have a look at this example – “This neighborhood has it all. Restaurants and entertainment are close, but not too close, and the peace and quiet of the neighbourhood is just as assured as it only taking you a short trip to enjoy shopping, dining, and entertainment. Whether it’s a night in or a night out, both are going to be very appealing based on how doable one or the other will be.”

  • Emphasize the Right Adjectives

There’s no getting around the fact that words like ‘charming’ and ‘cozy’ are used way too often in listing descriptions. They’re classics, but fact is they’re really just far to indeterminate and impersonal these days. They can sound appealing, and when you’re dealing with a bigger proper in the luxury space adjectives like these can actually make the house seem small.

The point here is that it’s best to cater to the appropriate crowd when you’re choosing your words, and based on the type of property you’ve listed.

Compare these examples – “This restored five-bedroom, four-bath historic Colonial has an opulent foyer that blesses it with the grand entrance you’ve been searching for”

“This charming three-bedroom cape, perfect for entry-level buyers, has a cozy sitting room where you can sip your coffee and read a good book.”

The majority of your buyers will be unassuming and not particularly receptive to flowery language, and surprisingly this is even true of most wealthy buyers. Definitely something to keep in mind. The principle here is that each description should be unique to the property, but still being neutral enough to entice a variety of buyers.

Keep may different types of prospective homebuyers in mind when choosing your words and you’ll likely find yourself naturally gravitating towards a communication style that’s much more conversational and natural, and much less pretentious and assuming of specifics related to them as people.

Sign up for Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads that are delivered exclusively to you once you’re signed up and have claimed your region of any city or town in Canada. The advantage – and a BIG one at that – is that once you’re signed up and have your region reserved for you, then you’ll be the only realtor to receive those leads!

We imagine the benefit of that is self-explanatory, but if you need more convincing please check out our testimonials page. We’re ready when you are, so how about you make a smart decision about building your real estate business, and do it today!

Recent Survey Suggest 1/5th of Homes in Canada Purchased by Buyers New to the Country

Published October 28, 2019 by Real Estate Leads

Canada has seen it’s highest immigration levels ever over recent years, and the role that these numbers have factored into the supply / demand element of the housing market has been covered at great length over the last while. Despite the fact that having nearly 70% of all new immigrants to the country soon residing in the Toronto and Vancouver areas IS a problem, there’s very understandable and relatable reasons for why that’s happening.

However, the housing crisis in Canada is most certainly not exclusive to these two areas. The reality – and one that has very real trickle-down effects for real estate professionals here – is that there are fewer homes being A) built, or B) put on the market than is necessary to meet the demand for housing in Canada. Newcomers of course add to the demand in an environment where it’s nearly impossible for new building starts to catch up.

A more-demand and less-supply orientation to this means that prices for homes will be boosted. There’s no getting around that. This means fewer ‘qualified’ homebuyers being out, and especially among multi-generational Canadian families who haven’t had the luxury of living and working outside of a country that taxes its citizens so extensively. Here at Real Estate Leads, our online real estate lead generation system is an excellent way for realtors to claim a larger slice of what is currently not the biggest of pies.

But looking at the subject here more critically again, it’s interesting to take note of a recent survey that suggests one in every 5 homes purchased in Canada is bought by an individual or family that is new to the country.

What can we read into that? Let’s look at that at face-value, and we’ll then shift away to consider what relevance that has for realtors.

Unique Residential Landscape, Unique Challenges

The study from Royal LePage, one of the more well-known and long-standing real estate brokerages in Canada, started by saying that it had polled 1.500 people who had arrived in Canada at some point over the last decade. The majority of respondents (54%) related that they chose to move to Canada because they see the country as a good place to live and work. Many stated further that they chose it over the United States because they feel more welcomed as an immigrant in Canada (31%), while others said Canada offers them a safer life (26%).

That many of these new Canadians see real estate as a strong investment (86%) won’t surprise anyone. Where this becomes a bit of an issue is in the fact that many of these people who have been approved for immigration have significant investment capital for their real estate purchases due to living and working outside of Canada. They’re able to make money and keep more of it as a result of not being taxed as disproportionately as those who grew up in Canada were.

Whether that’s right or wrong, it’s an ‘it is what it is’ situation regarding these individuals having the deeper pockets needed to purchase real estate, and particularly in desirable locales in the country. It must be said though that the fact our Constitution and Charter of Rights extends freedoms to these people in the same way it does for you means that no one should question the freedom these people have to buy homes with money they’re worked hard to earn.

That really needs to be said.

The reality, however, is that – according to the survey – 75% of these new Canadians arrived with enough savings to get them into real estate. It also found that, on average, newcomers waited approx. 3 years to make their first home purchase, with many choosing to rent or live with family or friends after first coming to the country.

No matter how you slice it, this ability to arrive with sufficient savings to buy pricey real estate does put longer-standing Canadians at a disadvantage, but again that’s something that is just a reality to be dealt with. The same thing happens in America, but in the US immigrants settle and buy homes all over the place, and not just in a handful of locations like here in Canada.

Detached Homes Preferred

In spite of those numbers, the survey also states that only 32% of the newcomers surveyed became homeowners, and that’s a disparity between the 68% home ownership rate for all of Canada. Of those who did buy, roughly half of them bought a detached house. Some 18% opted for a condominium, while 15% bought a townhouse and 13% bought a semi-detached house.

With the understanding that the detached homes are obviously the most expensive – and decidedly out of reach for many Canadians – it is easy to understand why these statistics are going to be a concern for some.

As realtors, however, there is need to have bigger-picture understanding and wherewithal related to this. In addition to supporting Canada’s economic growth, newcomers to Canada are vital to the health of the national real estate market. This isn’t something to be impeded in the interest of creating a ‘level playing field’, as it is crucial that housing supply keeps pace as the economy and labour market continues to expand.

This is especially true if projections that Canadian newcomers will purchase 680,000 homes over the next five years are realized, as is predicted if current international migration levels for Canada are maintained.

The demand for affordable housing for both younger and new Canadians can only be best and most soundly met through housing policies that encourage smart and sustainable development, and ideally ones that focus on protecting and developing green spaces in our urban centres. One of the biggest problems in popular metro regions is that the municipalities have so much in the way of red-tape regarding new housing starts that developers and builders are discouraged from moving ahead.

This would be a great place to start, and if you were to ask anyone working in the real estate business this is likely what they’d mention first as well. Balancing out supply and demand – as much as that’s possible – will be beneficial for both homebuyers and sellers and the realtors who serve them. Whatever that takes likely won’t be an easy solution, but it’s one we all need to see and sooner rather than later preferably.

Our hope is that there can be a balance found, and that anyone with either personal or commercial interests in real estate can be a part of the new reality. In all likelihood, however, we’re years away from this.

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 – and only you – for your similarly exclusive region of any city or town in Canada. Provided that you be the early bird and ‘get the worm’ here, you’ll have your area of your town reserved for you and from that point forward you’ll be the only one to receive leads for it. It’s a dynamite way to supercharge your client prospecting efforts.

Improving Your Listing Interviews with Potential Clients

Published October 21, 2019 by Real Estate Leads

People who are new to working as a realtor will quickly come to learn one thing. One of the most important moments you’re going to have early in your career is when you’re interviewing with homeowners looking for a realtor to help them sell their home. You’ll quickly realize that you need to put on a near-perfect performance if you’re going to secure their business. It’s not easy to do, but the good news is that you will almost certainly get better with it over time.

In the beginning, however, there’s a whole host of bumps in the road, and perhaps a few potholes too. Securing your first few clients is really empowering and an essential step towards building your real estate business, and when you have these types of opportunities you’re well advised to be bringing your very best. However, even digging up these opportunities can be a challenge. Here at Real Estate Leads, our online real estate lead generation system is an effective way to generate more of them for yourself.

So what we’re going to look at today is what you can do to maximize the chances of securing new clients by means of an excellent listing interview with them. We can start by emphasizing the truth of the fact that real estate agents market homes—they don’t ‘sell’ them. Instead, they sell themselves, and they should be asking questions of prospective clients as much as those clients will be doing the same.

Embracing this approach is front and center, and is very much a prerequisite for everything that’s to follow here.

  1. Determine What You Need to Learn in Advance

It’s important to have a fairly concrete idea of what you’ll be asking of prospective clients, and including in what order you’ll be asking these questions. Keep in mind as well that you should be rehearsing all of this in advance so you are NOT reference questions jotted down on a piece of paper. Needless to say, that will reflect badly on you. Here are standard questions, but note as well that they are not ‘in order’. You should be moving them up or down based on what you know of the sellers’ situation.

  • Ask about the clients’ reasons and urgency for selling
  • Get an idea of value and the approximate debt on their home
  • How would the sellers describe their home’s condition? Even asking them to rate it on a scale of 1-5 is fine if they would rather not go into detail
  • Ask to compare their homes with neighborhood competition
  • Establish their requirements for a listing broker/agent
  • Determine which marketing methods they think are most valuable and effective
  • Inquire as to previous good and bad experiences they might have had with agents or brokers
  • Ask what problems they might envision in selling their home
  1. Conducting the Interview

As mentioned, it is advisable to not be referencing your questions from a written list OR writing out the people’s responses in the same way. One approach that IS more acceptable if you’re not confident in your memory is to take an audio file of the discussion on your smartphone. Of course, you MUST inform them of your intention to record the conversation, but most people will have no problem with that. Once they agree, you simply begin recording and play your smartphone on the tabletop or somewhere similar where it can pick up the conversation well.

Approach it with the focus on you being the one who’s asking the questions, at least in the beginning. You SHOULD loosen up a bit and let them ask you questions, but in the beginning make sure it’s you who are leading the conversation that way.

Pair this with a solid understanding of what their home is worth based on current market values and you’re likely going to be getting off on the right foot.

  1. Be a Solution Provider

So far during the interview you will have not given the listing prospect any materials or made a presentation, asides from perhaps handing over your business card. The most helpful approach is to be formulating responses bases around which of your service capabilities are likely to be of most interest to them, based ongoingly on the response they have to your inquiries.

Your aim at this point should be to show them how you can resolve each of their problems. Try to address the most important or most troublesome issues first. Defer pricing (commission rate) to last if that’s going to be one of their consideration. Lay out how you’ll do the marketing they value, and show them other marketing approaches you’ll take that haven’t been specified or mentioned earlier in the interview.

  1. ASK for the Listing

This the most solid advice of all here. The best realtors ARE assertive, nearly all the time. They believe in themselves and they know they can meet and exceed the prospective clients’ expectations. They’re not hesitant to look them in the eye and ask if they’d be willing to list with them, and they ask with real conviction and self-belief in their voice. Further, they don’t hesitate to ask to discuss commission.

Of course, this assertion is only going to be effective if they preceding parts of the interview have been conducted well by you. It’s a sum of parts, but if you’ve led the way nicely then you can be very confident in assertively asking for them to list with you.

You’ll find that people are quite forthcoming with information when they’re asked for it, especially when you keep in mind that they have MUCH to gain or lose her with the sale of their home. You’ll probably also find that they appreciate it when the focus is addressing specific concerns instead of pushing services on them.

Sign up for Real Estate Leads here and receive a monthly quote of qualified, online-generated leads that are delivered exclusively to you. When you register with us, you’ll be able to choose a specific region of any city or town in Canada. Provided that region has not already been claimed, you’ll be able to claim it for yourself and from that point forward you – and only you – will receive the buyer and / or seller leads generated for that region.

If that sounds like a near sure fire way to get more out of your prospecting efforts, you’re that much closer to making a very smart decision when it comes to growing your real estate business!

Estimates of Over 1 Million Vacant Homes Across Canada

Published October 14, 2019 by Real Estate Leads

The housing crisis in Canada continues to grow, and the ramifications both a lack of available housing AND the lack of affordable housing are becoming increasingly apparent. Foreign speculation investment in the housing market in Canada IS a factor here, but it’s important to understand it’s not the only one. In addition, there are many different optics that can be seen related to the housing crisis, but vacant homes are definitely the one that sticks out most egregiously.

At a basic level, it’s not difficult to understand why a buyer who has bought a home as an investment may wish to not rent it out. If you’re not carrying a mortgage for the home and own it outright, but plan to sell it in the not-too-distant future, then the idea of keeping that home in near perfect condition is going to be appealing. On the other end of the spectrum, however, there is a shortage of homes across Canada and particularly in large urban areas.

Having a healthy rental market benefits realtors, even though it doesn’t do so directly. Many enters who are well and affordably housed will eventually become prospective home buyers, and this is especially true of young professionals furthering their careers in Metro areas. Without that process there becomes fewer qualified buyers down the road, and that’s not good for anyone.

Here at Real Estate Leads, our online real estate lead generation system is an excellent way for new realtors to get a leg up on their competitors and be fast-tracked to meeting your genuine potential clients – the likes of which there are fewer of these days! The reasons for that are varied, but as we’ve alluded to here, vacant homes actually play a long-term part in all of this.

6-Digits Plus Stat for Number of Empty Homes

As the title makes aware, recent studies have indicated that over 1 million homes are unoccupied in Canada. Not all can be grouped in with the absentee investor owner scenario, but you can be sure the majority do. As a more exact number, the report from Point2 Homes indicates that roughly 1.34 million homes across Canada lie empty or only accommodate temporary occupants.

It’s estimated that this represents 8.7% of the units available in the national market, and that stat is up 0.3% from the previous decade. Plus, it’s significantly larger than the 2.8% peak registered in the U.S. market during the same time frame.

Most will assume that Vancouver and Toronto are the two cities where this trend is most pronounced. That’s only half true, as Toronto does indeed have around 66K of those empty homes. Montreal comes second with 64K, and then surprisingly Vancouver comes a distant third with 25K of them. Why only one of the two most heated housing markets comes in high is interesting, but that’s another topic of discussion.

Despite all this, Vancouver still had the had the largest empty-to-occupied home ratio across Canada, at 8.2% of ones in the local market.

Other markets with more than 20,000 unoccupied dwellings include Calgary, Ottawa, and Edmonton.

And while Vancouver had a relatively restrained 25,000 vacant houses, it had the largest empty-to-occupied ratio across Canada, at 8.2% of the market’s homes.

The industry expert consensus is that investor speculation and short-term rentals are the main culprits behind high vacancy rates in places like Toronto and Vancouver, and not surprisingly it’s these two cities were foreign buyer taxes have been implement. Vancouver also has it’s vacant home tax, which is apparently set to deliver hundreds of thousands of dollars each year that the Provincial Government promises to earmark for social and affordable housing.

No matter where you stand on this, it’s hard to argue that unless you’re a real estate speculator then vacant homes aren’t good for anyone, from prospective tenants all the way up to those who serve the real estate industry, and realtors very much included.

Sign up for Real Estate Leads here and receive a monthly quota of qualified, online-generated buyer and / or seller leads that are delivered exclusively to you. You will be the only realtor to receive those leads provided through our service, and what’s more – you will also be the only realtor signed up and serving whichever region of any city or town in Canada you apply to have with Real Estate Leads. It’s first come, first served with regards to that, so don’t delay in getting onboard with this if you’re a new realtors who’s keen to get much more out of your prospecting efforts.

 

Greater Vancouver Seeing Marked Drop in Number of Realtors Working in City

Published October 8, 2019 by Real Estate Leads

The real estate market in Canada has been one of the most charged topics of discussion over recent years, and whether you would have sat on either side of the debate was by and large based on whether you were an existing homeowner or not. This of course applies to the entirety of the general populace, but for Real Estate agents the ‘way things were’ were for the most part better than the ‘way things are’ considering the current dynamics of the housing market.

What is meant by that is the way that across the country as a whole the market is considered to be ‘flat’, meaning most home are generally neither appreciating or depreciating in value. However, in high-demand urban metro areas like Vancouver, the market has actually take a significant downturn. Much of this has been attributable to measures taken by the current NDP government to cool the market and suppress housing market investment speculation.

For realtors working in the area, it’s not rocket science for us to understand that this is a negative for business. However, it seems that the market downturn is actually creating some good by means of reducing the number of active competition competing for the fewer clients out there to be had.

Here at Real Estate Leads, our online real estate lead generation system for Canada is an excellent way for new realtors to have the power of Internet marketing working for them and allowing them to get more out of their client prospecting. It’s always beneficial, and perhaps even more so when paired with the new reality of the industry we’re about to touch on today.

Far Fewer Realtors Now Practicing in GVA

It’s common knowledge that the Lower Mainland’s real estate market boomed between 2014 and 2017, and with that boom more and more newly-licensed realtors arrived on the scene. By the time 2017 had drawn to a close there more than 13,500 realtors working in the region. The age-old saying ‘only so much of the pie to go around’ was very apt, and in truth it still is – to a lesser extent.

Let’s set the stage for analyzing all this by going back nearly 20 years, to the year 2000. Back then there were fewer than 7,000 realtors operating in the GVA and the Fraser Valley in 2000. Over the next 17 years, the numbers of this increase massively outdistanced the increases in general population. A lot of people were aiming to get in a good thing, and many still acting on the belief that real estate was their ticket to ‘getting rich quick’

(If there’s one thing EVERY would-be realtor should know, it’s that THIS^ is never how it works)

But back to topic.

It’s quite natural for cities where housing is expensive to have a higher number of realtors than cities where housing is seen as being more affordable. The correlation here is simple; as home prices go up, so does the financial incentive to take advantage of higher commission prices.

The Downturn Effects

As most will know, over the past two years the Vancouver real estate market has seen a downturn. Lower median home values means many homeowners are postponing the sale of the home (a wise move) while would-be homebuyers are being influenced negatively by – among other reasons – the new mortgage stress test rules introduced by the BoC.

So it would seem that now that the allure of ‘easy money’ or accelerated real estate corporation growth is a thing of the past, for now at least, the number of real estate agents doing business in the GVA has dropped quite considerably.

The estimates are that somewhere in the vicinity of 1,000 realtors have dropped out of the picture in Vancouver.

This can be seen as encouraging for new realtors who understand the level of commitment required to succeed in this business, but it should also serve as precaution for anyone who thinks it’s an ideal time to make the same move Yes, there’s less competition, but the market is depressed and there’s still enough competition to make it so that those who don’t apply themselves 100% and work extremely hard are going to likely be a part of that former-realtor statistic sometime in the near future.

Giving Up Licenses

As the numbers of transactions in Vancouver have fallen, many realtors have chosen to give up their licenses and pursue another means of making a living. For many it’s a situation where once the fees associated with keeping the license start to outweigh the revenue generated by using it, it doesn’t become a worthwhile investment of time and energy and therefore not the best career choice.

For many realtors in this situation, it may be a reality where they realize they need to put more time and effort into building their real estate business, but they simply don’t have any more time to give to it.

Now to be clear, this is not a mass exodus from the realtor market, and it’s never going to be that. If anything we should see it as industry correction that is precipitated by the economic correction seen in the housing market.

We’ll conclude today with a listing of the number of realtors per capita working in major cities in BC, and then comparisons to a couple of spots well elsewhere in the country.

  • Langley, B.C., had the most agents – one realtor for every six residents
  • B.C. had the second highest number – one agent for every 31 residents
  • Metro Vancouver is third – one agent for every 61 residents

Now what if we compare this to Ottawa, Ontario, for example. There it is one agent for every 496 residents. Halifax, Nova Scotia? If you can believe it, it’s one agent for every 894 residents!

Perhaps Halifax is the best place to be a realtor in Canada! But all kidding aside, it makes it clear that event though there have been major declines in the numbers of realtors working in Vancouver it is still a REALLY competitive locale for working in this profession. We can safely assume the same is true of Toronto.

So long story short, while it’s an improvement at face value it’s really more of a shift from ultra-competitive to VERY competitive. Making a name for yourself in the real estate business is tough if you live in metro areas, that’s always going to be the reality.

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. Once you’re registered and your territory of any region of any city or town is assigned to you then YOU are the only realtor who will serve that region and YOU are the only realtor who’ll receive leads for it. Needless to say, it’s a sure-fire way to supercharge your client prospecting efforts and a quick view of our testimonials page will indicate just how many realtors are thrilled with what it’s done for them!

Too Much Paving? Low-Density Housing Means Tree Loss and Rise of ‘Impervious’ Surfaces

Published October 1, 2019 by Real Estate Leads

The construction of each and every home that all together make up the entirety of a city’s real estate is part of the greater umbrella that is the development and construction industries. As such, there’s much that comes along with the building of homes – and communities – that is beyond the scope of immediate understanding for people. This is especially true in major urban areas, where the extent of development often has far-reaching influences on the tertiary parts of what makes up a living space for hundreds if not thousands of families.

As a realtors, having more of a big-picture wherewithal of real estate as it relates to housing and urban development is always going to beneficial. This can be true when it comes to your ability to impress individuals and turn them into prospective real estate clients. All of which is increasingly important these days given how there’s seemingly fewer slices of the pie to go around. Here at Real Estate leads, our online real estate lead generation system for Canada is an excellent way to put your more directly in touch folks who are genuinely considering selling or buying a home near you.

But now to today’s topic related to all of this; with development comes paving, and a lot of it. We may have seen the decision to put down concrete and asphalt on earth as ‘no big thing’ – but apparently civic planners may need to rethink this.

So what exactly are we discussing here, and how is it related to real estate? Read on.

With their gardens and landscaped yards, low-density housing, particularly the single-family home, is often seen as green.

Low-Density Housing Development & The ‘Concrete Jungle’

Building low-density housing has been the norm for many different tangible and intangible reasons, and has been equally agreeable to developers, city planners, municipal zoning regulators, and – perhaps most importantly – the buying preferences of people buying real estate in major urban centres.

As much as that’s true, it’s also a fact that low-density housing contributes to urban sprawl very emphatically, and a very relevant trend that comes along with this is a decrease in the number of trees in the area and a loss of what they call ‘impervious’ surfaces – meaning natural earth that’s not covered in anything.

It’s true that the low-density housing trend appears to have shifted from a housing model that accommodated many trees to one that now accommodates increasingly fewer trees and more impervious surface due to expanding home sizes and the splitting of lots that occurs much more frequently these days.

Eco-Degradation

The problem with this – and one of the growing list of them that can be attached to the low-density housing predominance seen in the Lower Mainland of BC most notably – is that tree cover and impervious surfaces are measures of the ecological health of the region. Trees give shade, suck carbon dioxide from the atmosphere, and absorb storm water.

We can now add to that the fact that impervious surfaces like driveways and parking spots no longer take in rainwater for natural dispersal elsewhere in the local topsoil, and are associated with excessive heat in the summertime.

We read a report entitled ‘Regional Tree Canopy Cover and Impervious Surfaces: Analysis of Tree Canopy Cover and Impervious Surfaces in Metro Vancouver’ and it was such an eye opener to how popular development trends can have unintended and unfavourable consequences that we thought it would make an excellent ‘knowledge base’ topic for today.

It points out the decline in average percentage of tree cover seen for such developments being very consistent over 30 years, at 36% for those built in 1970 to 18%for those constructed in 2000. We can safely assume the trend has increased since that time.

Alternately, the expert consensus is that high-density housing development in recent years have greater tree canopy. The report also points to data indicating that there has been an overall increase in the number of trees planted or retained for high density housing over time.

Realities of Rapid Urbanization

With average tree canopy cover decreasing over time as a result of increasing low density housing builds there has been a resulting increase in impervious surfaces. Up until recently, most did not have an understanding of how more impervious surfaces equals hotter temperatures in the immediate areas. This is a negative, and for many economic reasons as much as for personal ones for residents living there.

The report also indicated the building types chosen also played a role, but that newer builds seen in the last 5 years or so seem to be taking all of this into account. Many new buildings are tall and slender, and use up little lot coverage while keeping abundant greenspace.

We’ll conclude here by saying that it’s worth noting that Vancouver’s climate committee anticipates growth in Metro Vancouver may likely reduce tree canopy from 32 percent of the urban containment boundary of the region to 28 percent over the next 20-30 years. This is going to necessitate wholesale changes at the municipal zoning level.

If you’re a realtor and you are friends with anyone in the development industry or in related offices at City Hall, this is definitely an excellent topic of discussion. It will have major ramifications for the types of homes that make up the bulk of the market stock, and especially in dense urban areas of the country.

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6 Must-Know Facts About Liberal’s New FTHBI Homebuyer Assistance Program

Published September 23, 2019 by Real Estate Leads

You’d likely have difficulty find even a few adults across Canada who haven’t been aware of the affordable housing crisis in the country. There’s no debating the fact that young people are having difficulty entering the market like never before, and emphatically so at that. Even though the markets in Vancouver and Toronto are not as hot as they were, it’s still a situation where the average entry-level house cost is simply beyond the means of a lot of people and despite the fact they’re gainfully employed.

Combine this with the new mortgage stress test regulations and there’s fewer first-time homebuyers out there. That’s not ideal for realtors of course, and here at Real Estate Leads our online real estate lead generation system is designed to give new realtors a little more clout when it comes to prospecting effectively in what’s essentially a smaller pool of prospective clients.

The Liberal Governments First Time Homebuyer Incentive (FTBHI) program is designed to help these people out, and from a realtor’s perspective that is of course going to be good news as it will mean more actually qualifying first-time homebuyers being out there to begin with.

However, it is always important for realtors to be responsible to their clients’ long-term best interests and as such it may be necessary for you to be something of the voice of reason for people – clients or otherwise – who are perhaps a little too uninformed about exactly how this assistance plan will work for homebuyers who tend to only see it as ‘my means of getting into home ownership.’

So for today’s blog here are 6 things you should know about the FTHBI Program:

  1. Shared Equity

The FTHBI I run by the country’ federal housing agency, and the first thing people should know is that this is a shared-equity mortgage program. Be very aware that the government IS going to share in the gains (or losses) of the home’s value as it fluctuates over time. The 10 per cent offered toward the down payment for a new home – or five per cent for resale homes, is interest-free but make your potential clients aware that the gains in equity on the property will also be payable at 10% anytime they sell the home in the future.

  1. Limited Numbers of First-Time Buyers Will Qualify

First-time homebuyers that have a household income of $120,000 along with the minimum five-per-cent down payment requirement are eligible to apply. However, the price of the mortgage plus the incentive amount must not exceed more than four times your clients’ household income.

The obvious correlation for this is that this means that the program isn’t going to be practical for folks who want – or need – to live in perennially-popular housing markets like Vancouver and Toronto. The median price of homes here is simply too high to make this equation work.

The consensus is that, theoretically, the maximum purchase price of a home under this plan would be $565,000. Needless to say, you won’t even find a condo for that price in these cities, and a detached home will be at least twice that. Most first-timer buyers will qualify for far less under this program, and if you’re a realtor working in a major urban centre then this program may not be the good news that both you and your would-be clients may have been hoping for.

  1. It Won’t be ‘Doable’ for Buyers in Every Market

This is related to the second point above, but it can’t be stated strongly enough that buyers in some markets may find it challenging to find a home selling for a price that qualifies for the program. A recent report that analyzed average home prices from July 2019 in 25 markets across the country found that buyers with the maximum qualifying income and the required five-per-cent down payment would qualify in 19 of those cities.

Where are they? Eastern Canada, Quebec, the Prairies, along with smaller urban centres in Ontario. And the 6 markets where the average home buyer would fail to qualify for the FTHBI include Toronto and several markets elsewhere in the Greater Golden Horseshoe along with Greater Vancouver and neighbouring Victoria and Fraser Valley out west.

Again, no surprises here. One of the things realtors may have to do it they work in these areas is but brutally honest with prospective clients and explain that buying a home here is not in their best interest. Being ‘house poor’ is a very real condition and majorly problematic for far too many people in these locales.

  1. They’ll Be Paying It Back – Guaranteed

A common misconception that’s already been attached to this program is that the monies will be paid back only when the home is sold. Not true – borrowers must pay the CMHC back after 25 years or once the home sells. Borrowers can also pay back the loan early without penalty. The amount borrowers owe may vary depending on how the value of the home changes over time.

Should the home’s assessed value rise, the loan repayment will increase concurrently with that number. The same will occur if the home has lost value by the time it is sold or the mortgage matures. The loss-sharing end of this equation should not be comforting to would-be buyers, however.

For ones with little equity, selling after a big price correction and covering costs like realtor fees, paying out the mortgage, and assuming closing costs can be very challenging. Finance experts specializing in mortgage lending say it is fairly unlikely the government will actually absorb part of a buyer’s losses if home prices take a dive.

  1. $ Savings Can Extend Beyond Mortgage Payments

Now for some better news; the government estimates the program could save buyers as much as $286 per month, or in excess of $3,430 per year, in mortgage payments on a $500,000 house. Depending on when the home is sold, those savings can be even greater. Selling before their five-year mortgage term is up will likely save money with the FTHBI, as the interest and default insurance premium savings will likely outweigh what’s surrendered in equity.

  1. How Well is the Program to Be Received?

The Feds say the program is expected to help 100,000 families purchase their first home over the next 3 years, but we have to imagine that the extent to which it’s utilized may be less than that given many different factors and some of the risks that buyers are likely becoming more aware of.

Should the program not be as enthusiastically received as expected, it’s possible that it may not have the shelf life some would expect it to. To conclude here, it’s not wise for prospective homebuyers to assume this program is guaranteed to be there even a few years down the road.

 

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Revisiting the Vendor Take-Back Mortgage

Published September 17, 2019 by Real Estate Leads

Nearly every reputable realtor will have long since established ties with a mortgage broker to whom they’ll recommend clients who are going to need financing assistance from a lender in place before they’re able to purchase a home. In much the same way it’s beneficial for a mortgage broker to understand the workings of real estate investment and transactions, it’s helpful for realtors to understand mortgages AND the history of ways people have found the means of financing homes in Canada.

As we always insist, being knowledgeable makes you more appealing to prospective real estate clients and furthers your reputation as a ‘good’ realtor in your locale. Finding new clients for whom you can flex your muscles in this regard is a challenge, but here at Real Estate Leads our online real estate lead generation system for Canada is a proven effective way to be fast-tracked towards meeting real people who are genuinely considering buying or selling a home in the near future.

What Is It?

A vendor take-back mortgage is a unique kind of mortgage where the home’s seller extends a loan to the buyer to secure the property’s sale. They’re also called seller take-back mortgages, and it’s true that both the buyer and seller can benefit if the circumstances are right. It creates the possibility that the buyer might be able to purchase property above their financing limit, and conversely the seller is potentially able to sell the property at or above asking price more quickly.

Born in the Days of High Interest Rates

Vendor take-back mortgages were common in Canada some 25 to 30 years ago, and the reason they were so frequently taken was because interest rates were sky-high back then compared to today. Vendor take-back mortgages were very common in the ‘80s and ‘90s when interest rates were well over 10% and sometimes even moving up to as high as 20% in the early 80s.

Some have suggested that the new B-20 mortgage stress test that’s been in place for a few years now might make vendor take-back mortgages start to become a ‘thing’ again. That might be so, but industry and broker experts say that would only be the case if applications have other qualifications that extend beyond the 200 extra basis points as they’re detailed in the B-20.

It’s true that sellers could benefit by having a vendor take-back mortgage as it could earn interest on money in ways standard lenders wouldn’t offer and in a more secure environment due to the financials being leveraged against real estate.

Industry consensus is that vendor tack-back mortgages be something of a fix for those lacking purchasing power due to the B-20 stress test, but we’ve been warned not to expect them to be resurfacing in the residential real estate market anytime in the near future. This is primarily attributable to the growth of private lenders and mortgage investment corporations, and then there’s the fact that sellers usually redirect finances earned from the sale of homes to purchasing new ones.

This, of course, is true of both inhabitant homeowners and property investors.

Tempered Enthusiasm

We can understand that vendor take-back mortgages are not as commonplace in the market today because people need money to purchase their own homes, but these types of mortgages would really only work well if that homebuyer was planning to exit the market sometime shortly thereafter.

On this, one industry expert was recently quotes as saying “If you sell your property and you have this equity on hand and you’re then unsure of what to do with it, it’s pretty common to then look to invest it with a mortgage company or lender.”

We’ll conclude today by mentioning that despite all these forewarnings and the fact that vendor take-back mortgages represent less than 1% of the traditional residential real estate market, they can be more appropriate in the commercial real estate sector. On the commercial side – where the rate of return is a bit more attractive for the investor – an operating business may also be part of the transaction and this changes the assumption of risk factor for the buyer.

Will vendor take-back mortgages ever return to the residential market? They may, but it’s unlikely they’ll ever be as commonplace as they were 20-plus years ago.

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Realtor Best Practices with Electronic Signatures & Exchange of Documents

Published September 9, 2019 by Real Estate Leads

We try to make a point of keeping this blog as a nice balance between real estate market news and industry developments along with tips for realtors that allow them to be better in what is an extremely competitive career field. As we continue to stress, knowledge and industry-savvy is very much power when it comes to retaining clients and building your personal real estate corporation. Today we’re on that side of things, and hopefully making you more aware of some of things new realtors may be not be aware of after finishing their licensing course.

Prospecting new clients isn’t easy, and that’s a part of what makes our online real estate lead generation system here at Real Estate Leads so valuable for those who are new to the business. It harnesses the power of Internet Marketing (and Internet surveys more specifically) to put you more directly in touch with people who are genuinely considering making a move – either buying or selling – in your local real estate market.

Today we’re going to look at what are the best practices when it comes to electronic signatures and exchanges of documents. Something that’s a fairly regular occurrence nowadays, and so it makes sense to be as in-the-know as possible with this stuff.

E-Signatures

When it comes to e-signatures or wet ink signatures, it is best to have someone be witness to the signatures. One of the benefits of e-signatures providers is that they provide the ability to identify the exact time and location for when the signature was placed on the document, doing so with security certificates. However, be aware that not all e-signature software suites provide security certificates when applying a signature to a document.

Further, programs and apps such as PDF Expert are not set up to provide digital security certificates when documents are signed. They are beneficial in the way that they properly flatten and embed signatures into documents, but they’re not as secure as a digital certified software like – among others – DocuSign.

It is important to note that the real estate regulatory bodies in most Provinces have legislation requiring that every service agreement must be in writing and executed in the presence of witnesses. This applies to agency agreements and offers to purchase, and means that any security certificate provided by credible e-signature providers are not recognized as the witness to the e-signature – at least not yet.

This is something you’ll need to determine for the Province you’re living and working in.

Hand Drawn vs. Stamp Signatures

A hand drawn e-signature – or ‘wet’ signature as they’re also referred to – is created when the signer’s handwriting is entered electronically on a touch screen. This is done with either your finger or a stylus pen. Each signature will be different, and they look very much like what your actual ‘real’ ink signature would.

The stamp e-signature is very common these days. You pick your signature and an initial style from a list of fonts and then place them on pre-defined areas of the document by dragging and dropping with your mouse or cursor control pad on a notebook. The click is then digitally recorded with a security certificate.

Mandatory & Standard Forms | Different Rules

Here, again the different Provinces will have different mandatory forms required of realtors when conducting and registering property transactions. One constant is that commission forms are mandatory for use by all registrants and treated differently than standard forms signed by realtors in Canada.

In most provinces the policy with mandatory forms is that only a hand drawn e-signature is permitted. Where the Real Estate Act requires an agreement to include a written signature, the signature requirement usually needs to be an electronic signature that is:

  1. a) A digital representation that can be seen to be an authentic representation of the individual’s handwritten signature; and
  2. b) Digitized and embedded permanently in the written agreement being submitted.

Either hand drawn e-signatures or a stamp e-signature can be used on standard (non-mandatory) forms in most Provinces, but again it’s best to confirm this on your own.

Electronic Signatures & Exchange of Documents

Generally speaking, electronic signatures (e-signatures) are no different from wet signatures. You and/or your clients will be affixing your name to an agreement in order to provide tangible proof that you are hereby agreeing to the terms set out in the document. Choosing to do this with ink, with a stylus, or with a digital signature serves the same purpose.

Bear in mind as well that when there are multiple parties to a contract (spouses, more than one individual on title, etc.), all parties must sign individually, although they can wet ink signatures or if you or e-signatures providers like Authentisign, DocuSign, Faltour, and more that are currently out there.

Precautions when Authenticating Signatures

It’s true that whether it’s a wet ink signature or an e-signature, there is always the possibility of fraud. Experienced realtors will always take precautions to check the identity of the clients. Asking questions about the content of documents to both spouses separately can help you confirm that both parties are aware and agreeable to the contents of an agreement.

And yes, this lack of certainty applies for wet ink signatures as well. In instances where you may not be physically present when the documents are signed it is best to keep a record ofthese conversations in your notes.

e-signatures and exchange of documents are a new development in the real estate practice, but overall the steps to take to ensure agreements are signed properly do not differ much from ‘original’ wet ink signatures – meaning the types with ink from a pen held in hand. Use common sense and you’ll be fine 90+% of the time.

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