All posts for the month August, 2015

Thoughts on predicting the next correction…

Published August 24, 2015 by Real Estate Leads

Market Trends Balance

Various economists, the news media, and some economists, have been diligently anticipating corrections, some like to use the word “crash”, in house prices every year since at least since 2010, about 5 years so far.

But each year so far, the market has continued to go up, to many of the bears – defying gravity. Those who fear the end is near have been and are, at the time of this writing of this article, relied by this summer’s surge in home prices.

Economists like to think that bubbles are inflated by irrational behavior. How irrational are Canadians being by buying homes for these unprecedented prices? Simply, folks have only been doing what makes sense to them: borrowing money as borrowing has been cheap.

The Toronto market has been hot, and the detached home category has been exceptionally hot. Around downtown Toronto, the average sale price is about $1.1 million, or 19% higher than 2014. We have heard stories of old termite-infested homes selling for $200K above the asking price. Bidding wars are the norm. Hardly anybody asks for an inspection before signing contracts. Those of you who old were around to remember the big 1989 Toronto housing crash, you might sense it all eerily familiar.

Vancouver, continues on a tear, and the BC, Real Estate Association said in the spring that demand for homes has been the highest since 2007.

Similar stories are playing out across the country. Across Canada, the CREA reported that resale home prices rose by 9.5 per cent the past year.

For the bears, all of this is only more evidence that a crash is coming. But looking around, it’s still hard to see from where or how the sky is about to fall.

Toronto’s Real Estate Board’s “affordability index” reflects that the share of average family income which goes to mortgage, property tax, and utility payments is around 36%; the highest it has been in 2 decades. Even at that level though, we’re not anywhere near where we were in 1989, when carrying an average home for sale took about per 50% of a family’s income (source: TREB).

The biggest threat to the housing market isn’t an interest rate increase. This past summer months the overnight rate has been about 0.75 per cent. And you can get an 18-month mortgage from one southern Ontario credit union for 1.49 per cent. We began 2015 with expectation that rates would be going up soon. It is clear now that they haven’t. Of course, rates will inevitably go up, but that looks still over the horizon.

When interest rate increases eventually come, they are anticipated to not be dramatic. The U.S. Federal Reserve has pretty much promised that its interest rate increases will be low and slow, whenever they happen. We can expect the same here in Canada. Not that the BoC’s job is to protect house prices, but let’s face it: it serves nobody’s interests to choke the one segment of the economy that is building wealth for Canadians.

The real threat to the housing market is the dreaded word, “recession”. And that is often interpreted as a fuzzy word. If there is a change in this year’s trend so far with increased job creation, then there could be some downward pressure on housing values and sales. If that does become the case, the BoC still has a collection of tools at its disposal to stimulate the economy by freeing up money; which, logically, would be supportive of home prices.

Also high real estate prices are not completely a good thing. High home prices are creating a real problem for some families, because those of us on the lower end of the income ladder simply are unable to afford a home. The market we serve will correct, some day, some month. That’s the thing about bears. Bears are excellent at predicting that a downturn will happen; they are just very uncertain at letting us know precisely when.

Coming to a Province near you? About Ontario’s new rules about how real estate agents process offers. How might this affect how your clients buy homes?

Published August 17, 2015 by Real Estate Leads

Bid auction
”Bidding wars” or, competing offer scenarios/situations, are commonplace in various areas of Ontario.

From July 1st, 2015, in Ontario, real estate agents are under new rules governing how to handle offers. The provincial government has enacted these rules to create more transparency in the overall real estate law. There are a few particular pieces of information that a seller agent’s brokerage are required to provide to prospective buyers in the midst of a competing offer scenario:


1. How many offers in total have been submitted.

2. Whether any represented buyers are represented by the same brokerage as the seller.

3. Whether the selling agent’s brokerage has a reduction of commission agreement for buyers who are being represented by a certain brokerage.

Sellers who are represented by Ontario-based real estate brokerages take offers in a closed bidding environment; so you & your client won’t know how much other buyers are offering, or any special terms included in their offers.

In making a bid, you as the real estate agent puts together your clients’ best offer – and then must hope for the best. Then the seller chooses to accept the offer, completely reject it, or reply back with a counter offer. The Seller will sometimes give one or more of the interested buyers a chance to ‘improve’ their offer, but typically your client only gets one chance.

When there are more buyers than sellers, when the market is hot – it is understandable that buyers can become frustrated; especially if they already submitted unsuccessful offers on several homes. Buyers may want to know how many other offers the seller actually received. The new rules that recently came into effect, on July 1st 2015, enable a way for buyers to receive such information.

The Ontario government has decided that all offers: 1) need to be in writing and signed, and 2) the seller’s brokerages now needs to keep records of all the relevant offers on file for 1 full year.

How can that be helpful to you and your client? Well if you are involved within a competing offer scenario, RECO – The Real Estate Council of Ontario can be contacted to make sure that the offer process was conducted fairly. You or your client can request RECO to find out how many offers the seller’s brokerage received.

RECO will contact the seller’s brokerage for you, and may also ask them for documented particulars for each offer. When RECO has determined the number of offers, as soon as possible, they will send you that information. You will not find out any otherwise secret details about the offers – only the total # of offers received by the seller and their brokerage.

This new rule provides some measure of extra assurance to buyers, but our advice for multiple offer scenarios is: 1) carefully think before waiving conditions such as a home inspection, and 2) plan ahead so you know how much your client can afford. Knowing you client’s maximum price and sticking to it, makes for less chance of regret later.

Some more agent tips from the field for consideration in your career

Published August 11, 2015 by Real Estate Leads

May I Help You Colorful BlocksOther agents can provide good tips for new agents, but the tips noted below are taken from a client perspective.

Here are some qualities clients say make for a good agent:

A. Good agents communicate a lot
As a house seller, or buyer, it is more stressful working with an agent who isn’t a strong communicator. The real estate market is time sensitive, so prospects and clients need an agent who lets them know quickly where they stand with their current selling or buying situation, and often. One of the biggest frustrations for people is a lack of communication from their agent. It is so important that agents stay in constant contact with their clients. What seems like insignificant information to an agent who has been in the business for years can be really important to clients who are new to the real estate game.

B. Good agents are proactive
An agent should be proactively calling potential buyers, communicating with existing customers, and constantly chasing new leads. A key element of being proactive is keeping the client well informed. If your clients keep calling you, you’re not calling them frequently enough or giving them enough information.

C. Good agents listen
Prospects and customers might grow wary of an agent who talks too much. If a client has a difficult time getting their thoughts conveyed to you when communicating with you, then you will likely experience subsequent problems. The client or customer is the one who should be doing most of the talking; make sure that you as the agent understands their special requests and needs. A good agent should be asking all the questions not the other way around.

D. Good agents are client motivated
Simply, if your customer gets a good a deal, you get a good deal; which is why it’s so important a buyer or seller chooses an agent, hopefully you, who puts their needs first. A good agent will always have their clients’ needs as their top priority. Buying and selling houses can be stressful and it’s important for the agent to make sure that the client is feeling supported and happy.

E. Good agents adapt to their clients’ needs
It’s important it is for an agent to be able to “read” their client. Some clients like to communicate via email, some prefer a quick text message, and others like to receive a phone call when they want to talk about what’s happening with their sale. It’s the responsibility of an agent to sense and verify the clients preferred method of communication; so your clients don’t feel either ignored by silence or pressured by too much communication. Simply ask them or mirror the client’s communication style so the client feels more comfortable.

F. Good agents know their clients time frame
Timing awareness is essential to a good client/agent relationship. You need to know if the client is in a hurry to sell. If they need to settle soon, the agent should know this and should be working to a tighter time frame. If the client isn’t in a rush the agent can shop around and advise the client to wait for a better market possibilities so they can get a better value for their purchase.

G. Good agents return calls and emails at lightning speed
These are the people that get a lead and don’t let it go. They immediately make contact and they follow up. They answer any questions and are happy to stay on the phone with nervous clients. They are the warriors of email, text, and phone and they keep that rhythm right up through the whole transaction, even using Skype. This is a good way to make clients feel like they are very important to the agent.

Overall, great customer service is about two things, knowledge and authenticity. The agents that succeed are able to treat each client’s purchase as vitally important. They are able to steer the client through any hiccups in the process and leave the client feeling that the whole process was as easy as possible.


Published August 4, 2015 by Real Estate Leads

send icon post signDo you often feel neglectful for not sending your prospects and clients emails to strike up more business?

You’ve worked hard all day, made dozens of calls, drove around showing homes, reviewed your current leads, and also did dozens of other things that are essential to your life. And now you have to sit down and reinvent another email? It all can often feel too difficult.

Here are some basic ideas for email scripts that you can save in a text file and tailor as you wish to keep in touch with prospects. Also here is a site that offers attractive html email templates for free:

Here are three email scripts you can save, modify and use (as you see fit) to keep in touch with leads, prospects, and possible referral sources.

Listing Info Request : ( To Send to a Buyer Prospect )

Hi there ( prospects name )

Just emailing to see if you were able to review the listing information you requested?
If you had any problems opening it, I would be happy to resend it another way or deliver
it to you personally. I’m am curious to get your thoughts on the home[s]. Did it, or any
that you saw appeal to you? Did you get a good idea of what is now available? If you
decided to inspect any home in person, just let me know and we can set up a time for
a tour. I have access to these listings, or any, as soon as they come on the market. Please
feel free to call me, or email or text, for help or with questions about the buying process.
Helping you locate a home that matches your dreams is what I love to do! – (Name)

Neighborhood Sales Activity ( To Send to Past Clients )

While reviewing comparable sales activity in your neighborhood, I noticed that some homes
have recently been listed for sale. Some of the properties that have sold recently may
have an affect on the the appraised value of your home.

It is a good idea to always know the value of your home. Some common reasons you
should have a current home valuation on hand include:
• Refinancing
• Making a move
• Insurance purposes

Since I can easily keep you informed about such facts concerning your home, would you like
me to print out a free market evaluation for you? For a more precise evaluation, I would love
to meet with you. Just let me know!

As always, if you know of anyone else who could benefit from a home evaluation (or who needs
help finding a property), feel free to share my contact info with them. I would be happy to help
anybody who asks of me.

Selling Tip Note : ( To send to Seller Prospects )

(Their name), Thank you again for (calling/emailing/chatting) with me about selling
your home. I would love the opportunity to help you navigate this process efficiently
and successfully.

I thought I’d pass along some resources to make your home stand out to potential buyers;
while you sort out your time-line and what you [and your spouse] are looking for in a new

These articles and links should help you out:
• { insert link to to your agent website }
• { insert link to an article on your real estate blog }
• { insert link to one of your an article you found on the internet }

Dressing up your home’s curb appeal can also help your home sell faster and for more.

I happen to work regularly with some great landscapers, contractors, and home staging
experts. Just let me know if you want any recommendations in those regards. If you have
any question(s) about the selling process, you can reach me anytime by phone, email or
text. I’m here to help!

P.s. Also don’t forget to add a personal greeting and your signature, of course!