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Ontario hints at measures to cool real estate market in the budget

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Real Estate Professional | 27 Mar 2017, 02:58 PM Agree 0
Finance Minister Charles Sousa says the upcoming spring budget will include a package of measures dealing with housing affordability
  • Real Estate Broker of 30+ years | 27 Mar 2017, 04:06 PM Agree 0
    Greedy Builders are fueling this market wherein they are escalating the price of the home build to the value they believe it will be at time of completion instead of, as before, the Buyer paid today's pricing and reaped a little benefit in equity upon taking possession, instead the builder reaps all the reward and the new home owner has zero equity upon occupancy as it has been eaten up with high C.M.H.C. insurance rates.
    Investment in real estate is NOT the problem, investment is a good thing as those people take the home and improve upon it by doing work the previous owners never did and making the home very attractive for them to resell and yes, they make a profit and they should, as a lot of the homes speculators buy are very run down and they bring them back to a high standard. Should the profit be as lucrative as it is at the moment, of course not, but again they are only keeping up with the prices being set by greedy builders.
    Now the government and Mr. Sousa in particular want to stop the one area of free enterprise available to those who have the knowledge & fortitude to take on such projects and revitalize neighborhoods that would otherwise see one home after another fall in to a state of disrepair. .Generally when an investor improves a home, others in the neighborhood decide it is time to fix up their own property and therein the entire neighborhood looks better.
    The reason still remains that young couples choose to buy renovated properties at inflated prices, It is because it is easier for a young couple to pay an extra hundred or two hundred a month on a mortgage than come up with the $50,000 - $100,000 or more it will cost to renovate the home and they don't have to worry bout doing it.
    If the Government really wants to help keep home ownership alive in Ontario for first time buyers then another "HOME PLAN" should be introduced. This could be dome in outlying areas where the Land is cheaper. The government buys it, puts it on lease at 3% or 4% for 50 years and they can buy it out after 25 years at a price set in today's value ( not escalated- it is called a Frozen Land Lease)).
    The young couple or any couple for that matter should be able to buy a home in one of these communities, get a mortgage for the value (true value) of the home only and therefore affordability is increased.
    Area's that could be considered are Orangeville, Dundalk, Shelburne, Grand Valley, Whitby, Cambridge, Clearview Township, Wasaga Beach to name a few, there are hundreds of areas where growth is possible.. Any area where a drive to the GTA is about an hour or less. People did not want to live so remotely before but now, they are moving there anyway, in the hope of affordability so why not build up these communities and services will flood to the areas. You only have to look at Brampton to get an example of what could be, The entire area was established by immigrants who bought affordable housing under the HOME PLAN of the late 60's & early 70's and the small farm & flower town became a beautiful City.
    Mr. Sousa is off base here, he should talk to the people in the industry, we know what our clients and customers need and we know how far they are willing to go to get it. It's time to start building for the future, it's time to help Ontarian's get out of the rat race called renting and it's time this Government gave something back for a change instead of taking and taking and taking. House prices will stabilize, they always do but if you want to look at the real culprits and those who should be held accountable for this debacle then look to the builders and reign them in with imposed penalties if they sell homes above true market value, tax them heavily on their ridiculous profits and make them offer affordable "homes" in every community as a percentage of the houses they are building, not boxes in the sky!
  • Max | 27 Mar 2017, 04:50 PM Agree 0
    It's not only the Builders, but also Real Estate Brokers/ Agents that are "low balling" Listing Prices in the hopes of creating Bidding Wars. Easiest way to stop this practice- Federal Government needs to pass Legislation that will only permit Lenders to Finance the lower of 10% above List Price or Purchase Price. That would stop the "price escalation" in a heartbeat. it's a pretty simple solution that everyone except greedy Realtors would be happy with. I'm a Realtor and a Mortgage Broker and my opinion is if this "craziness" doesn't end soon, our Housing downturn will make the 2007 U.S. bubble/burst look like child's play.
  • e.harold | 28 Mar 2017, 09:29 AM Agree 0
    always, always, always, The Consumer-Buyer gets shafted by Realtor and Developers Fees they charge should be realistically pre-set at hourly rate like a worker:no bullshit hours mkake 'em really work and no spend hours on golf corse
  • | 28 Mar 2017, 12:54 PM Agree 0
    A realtor is hired by a client to get the highest market price and terms for their client, we don't control the market we adjust to it, economics 101, lots of demand and little supply causes the prices to spike and visa versa, low demand prices drop. Most realtors prefer a balanced market, unfortunately this one is not.
  • Eileen | 28 Mar 2017, 09:30 PM Agree 0
    The Government of Canada just hit harder the young generation and the middle class when the new measurements were implemented (qualifying rate and CHMC insurance) trying to stop these ridiculous high prices of houses and cool real estate market…

    1. The foreign buyer’s tax must be implemented immediately,
    2. Forbid the multi offer rule, which is a speculation of stealing more money and is not controllable at all.

    All the rules DID NOT DO NOTHING...they wanted this way, prices are higher and higher and the salaries are not in balance at all, we live in a very bad historical time.

    Also, I do not know if it is a law in Canada to ask the foreigners or everyone who bring hundreds of thousands of dollars and millions to Canada – from where these money are coming from???

    The hundreds of thousands of dollars brought to Canada before and presently are these earned and saved honestly or stolen from their government or for any kind Money Laundering sources?
  • Mozart | 02 Apr 2017, 02:37 PM Agree 0
    Right now bids on multiple offers situations are completely closed. Only the buyer, his agent, the seller and his agent knows what price is on the offer. The competition does not know what price he is offering and this leads to speculation and sometimes the winning bid is tens/hundreds of thousands of dollars more than the other closest offer. This "closed bid" system is also contributing to these insane prices. Open up the bids - let the buyers know where their offers stand and make it more like an "open auction". This way, if you really want the property, you know what it will take - you are not picking numbers out of the sky.
  • Masood Khan MVA, Broker | 02 Apr 2017, 02:55 PM Agree 0
    Buyers have no faith in Tarion, it is considered as an association to protect builders, today's
    builder will sell to any one without taking caution if the the buyer is able to close the deal or
    not, they just want to sell it with 5% deposit.

    Builders are also charging tomorrow's price today but I blame the buyers also. I lost a deal
    yesterday or a multiple offer situation because one of the buyer offered $ 251,000 more than
    the asking price and it did not happen in Mississauga, Brampton, Milton or Calendon, it happened
    in the town of Mono.... crazy buyers paying way more than the value of the property
  • | 09 Apr 2017, 03:48 PM Agree 0
    Max, e.harold and anyone else who cries and whines or so ignorantly cuts up someone else or the value they offer regardless of what they do. Likely when you this is because you are simply jealous of your co-worker, a friend, a neighbor or anyone else being better at what they do or because they earn more than you do. True professionals pay for value of someones knowledge and service because they understand their value and what they do is worth.
    So, I speak as a seller who has just in the last 3 weeks sold a home and "YES" got top dollar. I have used the same agent for the last 16 years. Yes, he makes his recommendations (what I expect him to do), but it is ultimately my decision on the price to ask and the price I want to accept when an offer or offers are received.
    Do I want more? YES. Always! I didn't twist any arms or threatening anyone. Buyers wanted my house and freely paid what they felt it was worth to them.
    Likely, Max & e.harold you don't have a house and are simply envious or jealous of others good fortunes. Or you are a buyer who unfortunately isn't able to get into the market. As my agent puts it - "This is a "foolish & stupid market" and he hates it." He also feels for the buyer wanting to purchase their first home and it being out of reach.
    SO, for those who point fingers at everyone or their worth. Why are you worth what you are? Why?
    What would you do if you were selling a home? Likely not take the lowest offer!
    I wish you all the best.
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