Tuesday, September 8, 2015

Area Real Estate Sales Reach a New High For August

 While real estate activity typically slows somewhat during July and August due to family vacation plans and other summer activities, the demand for area real estate has nonetheless remained very strong.

 MLS® sales as reported by the Southern Georgian Bay Association of REALTORS® (SGBAR) in August totalled $76.5 million a 13% increase over August 2014 setting a new high water mark for the highest dollar volume ever during the month of August.  Conversely, new listing activity in August was down as has been the case all year.  New MLS® listings coming to market in August reflected a 25% decrease over August 2014 with 350 listings reported compared to 469 last year. The only threat to the ongoing strength in area sales appears to be the lack of available housing inventory coming onto the market.  While we have seen significant sales increases every month during 2015, since the first
quarter these increases have continued to get progressively smaller
each month.

 MLS® dollar sales year-to-date of $546.6 million reflects a 22% increase over last year while year-to-date unit sales are up 15%. New listing activity has decreased 16% from 2014 with 3,247 new MLS® listings coming to market in 2015 compared to 3,880 last year.  The market has decidedly shifted more in favour of sellers with those listing their properties for sale finding themselves with far fewer competing listings for potential buyers to choose from.

 Year-to-date MLS® single family home sales are up 16% with Wasaga Beach posting the strongest demand out of all area municipalities. Single family home sales in Wasaga Beach through the end of August are up 30% compared to one year ago. Results in other parts of our market are mixed, with home sales in the Municipality of  Meaford up 14%, the Blue Mountains up 11%, and Clearview Township ahead 6% over 2014.  Single family home sales year-to-date are down roughly 2% in both Grey Highlands and Collingwood. Please keep in mind these results are for MLS® listed properties most of which are re-sales and do not include sales made by developers for new homes in the area.

  Area MLS® condominium sales are up 14% through the end of August with 324 sales reported in 2015 compared to 285 unit sales in the first eight months of 2014.  The demand for vacant land has made a strong resurgence in 2015 with vacant land sales up a hefty 32% over 2014's sales.

  As per the accompanying chart, sales in every price range are showing gains over 2014 but this is especially true from $300,000 to $500,000 where sales are up 35% from one year ago.  As area prices continue to rise, we are seeing fewer and fewer annual sales in the lower price ranges.  This speaks to the demographics of the buyers coming to this area with many coming from somewhere in the Greater Toronto Area in search of a secondary property for weekend use or those that are coming here for either a lifestyle change or to retire.  The 12-month average price for a single family home in our market has risen to $342,800 in 2015 compared to $324,900 this time last year an increase of 5.5%.  This increase in average price is being driven not so much by inflation but by the significant increase in the number of sales taking place in the upper price ranges of the market.

 Heading into the fall market and with another ski season approaching, I expect we will see further sales gains but at a slower rate than what we have experienced during the first 8 months of the year. As stated earlier, the only negative aspect affecting sales right now is not the alleged presence of a nation-wide or global recession, the uncertain outcome of the upcoming federal election or other far reaching factors but the sheer reduction in available housing inventory to meet the seemingly insatiable demand for Southern Georgian Bay area real estate.

  General market statistics such as those contained herein do not always tell the full story as it may pertain to your particular real estate situation.  For a no obligation discussion and review of your particular real estate goals please feel free to Contact Me.    


Wednesday, July 29, 2015

CMHC Announces New Changes For Financing Rental Properties

With the Province of Ontario pushing the concept of intensification and the rising cost of home ownership especially in places like Toronto, many would-be buyers are looking at an accessory apartment in their home as being a way to help make higher mortgage payments.  Canada Mortgage and Housing Corporation (CMHC) has just announced new rules that will make it easier for homeowners wishing to rent out a portion of their residence to obtain financing.

Effective September 28, 2015, homeowners will now be able to use 100% of their rental income when qualifying for a mortgage, prior to this just 50% of the rental income was allowed. In order to qualify for this new CMHC financing option the following conditions must be met.

  • The property must be owner-occupied.
  • The property being insured can have only two units (i.e., a duplex or a single home with a legal secondary suite). 
  • Rental income cannot be used if the suite is “illegal/non-conforming” but “legal non-conforming” is okay. (Non-conforming means that the suite was grandfathered in before zoning/regulations restricted such units. You can check with the city to confirm if a suite is legal.)
  • The suite must be self-contained with its own entrance.
  • Property taxes and heat must be factored into the borrower’s debt ratios (which is currently not the case when using rent from legal secondary suites).
  • For existing units, there must be two-year history of rental income from the suite. The maximum rental income allowed for qualification is a two-year average of the unit’s rent.
  • For new units, a market rent appraisal can be accepted if an appropriate vacancy rate has been applied to the estimated rental income.
  • Mortgage applicants must “demonstrate a strong history of managing credit” with a minimum credit score of 680.
  This new changes offer some great benefits for consumers.  Borrowers will now have easier access to mortgages when looking to buy a property that contains an accessory apartment.  This will make home ownership more affordable while also potentially increasing the number of rental units available for tenants.  As with every positive there is a potential negative.  Easier financing for properties with rental units could further heat up markets such as Toronto but overall I would have to say that this is a good example of public policy making.

 Locally in our market there is a strong need for good quality rental units.  As of the end of June, the 12 month average price for a single family home in our area was $338,000.  Being able to use 100% of any rental income you might have from a basement apartment etc. can go a long way in helping a buyer qualify for a mortgage while hopefully over the long term, providing for an increase in much needed rental units.

Tuesday, July 14, 2015

Area Real Estate Sales Up 22% In June

 The seemingly insatiable demand for and brisk pace of area real estate sales shows no signing of slowing down even as we head into the summer vacation period.

  MLS® sales in June as reported by the Southern Georgian Bay Association of REALTORS reflected a 22% increase over June 2014 with 275 properties sold during the month representing $89.1 million dollars in total value.  Year-to-date MLS® unit sales for the first six months of 2015 are 20% higher than last year with 1,145 sales reported compared to 952 during the same period in 2014.  Dollar volume for the year now stands at $384.5 million which represents a 27% increase year-over-year.

  Conversely to the sharp increase in sales activity that we have seen thus far in 2015 is not being mirrored when it comes to listings and available inventory.  The number of new MLS® listings coming onto the market in 2015 is running well below last year. For the first six months of 2015 there have been 2,518 new listings input to the local MLS® system compared to 2,917 new listings in 2014, a reduction of almost 14%.  Similarly, the number of expired listings has decreased 27% year-to-date stemming from (a) increased sales activity, (b) fewer listings coming to market.  Some sellers whose price expectations were overly aggressive had have elected to take their properties off the market which in turn has reduced the number of listings overall.

  MLS® single family home sales through the end of June are up 20% with 763 sales year-to-date versus 633 last year.  The demand for area condominiums has also continued remain strong with year-to-date sales of 227 units representing a 16% increase over 2014.  After a couple of years of weak demand, MLS® vacant land sales have rebounded quite strongly in 2015 with 89 sales through the end of June reflecting a 41% increase from the first six months of last year.

MLS® Single family home sales in most area municipalities are running well ahead of 2014 with one exception, Grey Highlands where sales are down 12%.  Sales in Wasaga Beach reflect the largest increase year-to-date up 37% from 2014 followed by the Blue Mountains up 16%, Clearview up 15%, Collingwood sales are up 13% while the Municipality of Meaford shows a 9% increase year-to-date.

  Properties in the $350,000 to $$500,00 range are in the greatest demand with year-to-date sales up 46% over last year.  Sales between $800,000 and $1 million are also very strong with 26 sales in 2015 reflecting a 44% increase from 2014 while sales between $200,000 and $350,000 are up 18%.  We have in fact seen multiple offers on some properties with a home in Collingwood selling for $295,00 versus a $259,000 list price while a chalet near Georgian Peaks sold for almost $60,000 over the $799,000 asking price.

  As we head into the second half of 2015, the biggest threat to a slowdown in our market may very well be the lack of available inventory to meet demand, only time will tell if that proves to be the case.

Contact Me

Royal LePAGE Locations North (Brokerage)

330 First Street, Collingwood, ON L9Y 1B4


Direct: 705-443-1037

Office: 705-445-5520 ext 230


My Profile

Rick relocated to Collingwood from Toronto in 1985 through a transfer with Goodyear Canada. In 1987 Rick was recruited by a major client of Goodyear’s, managing their Canadian business based in Barrie before moving to Chicago in 1992 as Vice President of Sales & Marketing. Upon returning to Canada in 1996, Rick ran an industrial products manufacturing company in Stratford, Ontario. In 1998 Rick returned to Collingwood with his two children. Rick is a licensed real estate Broker with Royal LePAGE Locations North in Collingwood and holds his MVA designation (Market Value Appraiser-Residential). He is an active volunteer in the community serving several years on the Board of Directors with the Collingwood Chamber of Commerce as Treasurer, 6 years on the Board of Directors for the Southern Georgian Bay Association of REALTORS® of which he is the Past President (2008) and currently serves on a committee with the Ontario Real Estate Association. Rick is a diverse executive manager with extensive experience in strategic planning, manufacturing, finance, human resources and quality assurance management.