The Ontario government has introduced a bill outlining new rules for the province’s real estate profession that centre on discipline and enforcement, improving professional standards and consumer protection as well as providing greater autonomy for real estate professionals as to how they manage their businesses.

The bill would give the Real Estate Council of Ontario (RECO) more powers to fine realtors and suspend licences for unprofessional conduct and unethical behaviour, as well as allow it to consider a broad range of factors including the public interest when considering registration eligibility.

It also gives realtors more independence in how they conduct business with the ability to incorporate and to be paid through the corporation. This provides them with tax write-offs and new ways to manage their flow of income.

For real estate consumers, the bill allows realtors the discretion as to whether or not they disclose competing offers in a bidding war scenario. Currently, purchasers in a multiple buyer situation are not privy to the monetary value or conditions of competing offers.

“This bill has been a long time coming and we’re thrilled to see the Ontario government is determined to put buyers and sellers first, while ensuring realtors have the tools and training needed to do the best job for their clients in today’s modern marketplace,” Ontario Real Estate Association president Karen Cox told REM online.

It has been nearly 20 years since the province updated its rules around the real estate industry. The 2002 Real Estate Business Brokers Act (REBBA) is being renamed The Trust in Real Estate Services Act.

The bill comes on the heels of public consultations in early 2019 and closely follows what the Ontario Real Estate Association had been campaigning for.

Ontario is home to more than 86,000 registered real estate salespeople, brokers, and brokerages in Ontario.

The real estate industry in Ontario has undergone dramatic changes since the act was initially passed two decades ago, Government and Consumer Services Minister Lisa Thompson told the Toronto Star. “Economically real estate is booming. Between 2005 and 2015, the total value of all residential properties more than doubled in Ontario.”

Sources: www.torontostar.com, www.remonline.com, www.chroniclejournal.com

By virtue of its name alone, a bully offer doesn’t sound particularly appealing.

After all, who likes a bully?

In fact, just last month, the Ontario Real Estate Association (OREA) proposed that the province place a ban on the practice of bully offers.

Bully offers, also known as pre-emptive offers, are submitted ahead of the seller’s scheduled offer date. They are typically valid for a short time frame, a move that is intended to circumvent competition from other potential buyers and to place pressure on the sellers.

OREA believes the practice crowds out other buyers, making the process unfair and that it puts undue stress on sellers. The recommendation is one of 28 submitted to the province, which is currently reviewing the Real Estate and Business Brokers Act.

The main reason why buyers make bully offers is to avoid other offers.  The bully buyer is hoping that interest will be relatively low early in the listing timeline before consumers become aware of the property. They jump in with their offer and the buyer just might take it. And even if other buyers are interested the bully offer is hoping they won’t have time to pull together financing or get a home inspection.

Should you accept a bully offer? That depends. If the price is right, why not? That means no more home showings and rushing home from work to stack dirty dishes in the dishwasher or stash unsightly items out of sight. If you are happy with the price, want to be done with the process of selling your home and tend to be a straightforward-thinking seller, this may be for you.

Bear in mind, that for a bully offer to be especially attractive, there should be no conditions. So sellers should expect a firm offer with a sizable deposit. It’s not a bad idea to consider ahead of time what price would prompt you to close the deal.

If, however, you are often uncertain and regretful, this move may not be the one to take. You could end up wringing your hands over what kinds of offers you would have received on offer night. This shoulda-coulda-woulda scenario may haunt you and your finances for months and years. But know that there is also a down side to holding out and that is that, just maybe, that bully offer is your best bet in terms of price and conditions.

Sources: www.cbc.ca

Owning real estate in Toronto can price many out of the market so it’s no surprise some would consider buying a home with a virtual stranger.

That’s the thinking behind co-ownership, a buying concept that is on the rise among non-intimate partners because it helps people get a foothold in the city’s prohibitively pricey market. Of course, your buying partner need not be someone you hardly know. Siblings, cousins, buddies and even co-workers might want to consider this communal approach to housing.

Buying with likeminded family members, friends or acquaintances is made much more feasible given the skyrocketing cost of real estate. But co-ownership also serves another need that’s not often talked about and that is the need to connect with others. Ideally, co-ownership set-ups fill social and practical needs that serve both sides. For example, an elderly single woman provides child care for a young couple, while the young couple oversees outside maintenance such as snow shovelling and lawn care. Or perhaps one owner walks the other’s dog, while the other oversees minor home maintenance issues that inevitably arise.

Naturally, it’s important to have meaningful conversations with your co-owner before jumping in. You will need to know about each other’s personal finances, future plans and make provisions should one decide to opt out of the arrangement at some point down the road.

Among banking institutions and the legal community, co-ownership is a concept that is in the process of being normalized. A few years ago, Meridian Credit Union, for example, launched its friends and family mortgage, which allows up to four people to be placed on title at no extra cost. And DUCA Financial Services Credit Union launched its More Together mortgage, which allows up to six individuals on title.

Communal or co-op living arrangements have existed in one form or another for years. Alternative living arrangements are what many single, divorced or widowed baby boomers seek as they grow old and reject the notion of large institutional retirement and nursing homes. Many seek companionship and a sense of community and find shared accommodations to be the ideal setting as they age.

Saving up for a down payment on your first home can seem like a goliath task these days. With the average house price in the GTA fluttering around $700,000, the notion of making a dent in your savings on a down payment may seem daunting, if not insurmountable.

If you’ve already been saving your nickels for retirement, there is some help to be had thanks to a federal government program known as the Home Buyers’ Plan (HBP). The HBP lets first-time home buyers withdraw up to $25,000 from an RRSP to put toward the down payment on a house. Since a couple can each withdraw funds they can pool their assets and withdraw as much as $50,000. How that benefits first-time home buyers is that the funds withdrawn from the RRSP are not immediately taxed as long as you meet the deadline to return the funds within a specified time.

Do you qualify?

You do if you or your partner did not own a home that was your principal residence in the four calendar years prior to purchasing a house with an HBP.

Pay back

It’s an unfortunate reality but under this Canada Revenue Agency program, the RRSP funds have to be paid back within 15 years. The good news is that you don’t have to start paying back your RRSP until the second calendar year after the withdrawal. So if you used the HBP in 2018, you have until 2020 to start paying back your RRSP.

No tax benefit

Because you are paying back what you originally contributed to an RRSP, there is no tax relief as you would have experienced the first time around.

Expectations

You are expected to make payments every year under the HBP and the repayment expectations are far from onerous. Annual repayments are 1/15 th of the withdrawal total so if you borrowed $15,000, your annual repayment would be $1,000 per year for 15 years.

If, for some reason, you can’t meet the yearly repayment or can only manage a part of it, then the payment or the part that you couldn’t pay is added to your taxable income.

The HBP has been in place since 1992 and though some critics say it should be scrapped because people need to save for retirement, others say its absence would harm the housing market.

There is so much to learn about buying a home, and let’s face it, dry and boring finances can easily be cast aside as you explore the features of HVAC systems, paint chip shades and new schools for the kids.

But the type of mortgage you choose is an important step forward in how to properly finance your future. Let’s take a look at the difference between a closed and open mortgage.

Closed

These types of mortgages are appealing because the interest rate is always lower than an open mortgage. They also offer longer terms as well. If you’re looking to save money on your monthly loan payments this may be your best bet. Usually, those who select a closed mortgage are homeowners whose income is relatively set. Borrowers who pick this type do not plan on paying off their mortgage in the short term.

This is not the type of mortgage you would take if you were expecting a big inheritance or other significant increase in your income. The reason for this is because you will face a penalty if you try to pay off a portion of or your entire mortgage. And the penalties can be high. If you can, you’re best to wait until the renewal term of your mortgage comes due before making any changes.

To be fair, most lending institutions are not as severe as they once were when it comes to paying off or paying down your mortgage. Most permit some kind of allowance that lets you pay off a certain portion or percentage of your mortgage without penalty.

Open 

This type of mortgage offers a higher interest rate and shorter borrowing terms but it has a kind of flexibility that is important to some borrowers. The beauty of this kind of mortgage centres on the fact that it lets the borrower pay back the mortgage or part of it without penalty. An open mortgage is perfect for those who plan to sell their house or who are soon anticipating a significant infusion of money and planning to pay down their mortgage debt with it.

These mortgage rates tend to be variable, which is another benefit. You can move into another mortgage product at any time if you decide a variable open mortgage is not suitable for you.

Sources: www.creditfinanceplus.com, www.youngandthrifty.ca, www.lowestrates.ca

Next to January and February, November might just be one of the year’s most hated months.

Its drab and rainy weather does little to endear us, as does its call to winter with cooler temperatures, unwelcome snow and dreaded ice. There aren’t even any terrific holidays this month to buoy us out of our seasonal-related misery. And for some of us, it’s a time to start stressing about the coming holiday season and all the excessive consumption that entails.

But November is not all doom and gloom. When it comes to real estate, in fact, it may be one of the best months to sell your house. Here’s why:

Quick sale

If you’re looking for a transaction that is fast November is a good time to list your property. People who are looking now are likely more serious and motivated. As a result, they tend to have more urgency so a quick sale that can get you out of your current home before, say, Christmas might just be possible. Know this: if buyers are trudging through snow, ice and generally crummy weather conditions, they mean business.

You’re an introvert

You don’t really like people very much so the prospect of having hundreds of potential buyers traipsing through your door is enough to send you over the edge. Selling your home in November definitely means you’ll have to contend with strangers but the numbers will be far less than in the spring market.

Less competition

Real estate inventory shrinks from about November to January and while that sounds like an unlikely scenario for successful sales, just the opposite is true. You may be even more so in the driver’s seat as a seller with less competition during this time. In fact, sellers might find they can get prices they could not command previously.

Seasonal splendour

Not everyone hates fall and winter. Each of those seasons showcases a unique and remarkable beauty unto its own. Don’t let cooler temps or drizzle get you down. As a seller, play up the loveliness of fall and winter. Adorn your front door with a seasonal wreath or favourite decoration. Let your garden spotlight the charm of the season with fall and winter blossoms and the changing colour and shapes of foliage. Your efforts will be appreciated.

Sources: www.time.com, www.ctvnews.ca,

A hard-fought and lengthy battle between the Toronto Real Estate Board (TREB) and the Competition Bureau ended in late August with a Supreme Court of Canada decision that will permit TREB’s 50,000 Ontario agents to publish home sales data on their websites.

The country’s top court refused to hear an appeal from TREB, Canada’s largest real estate board, which wanted to put an end to members posting sales numbers on websites. But the court dismissed TREB’s application.

The board wanted to keep the data in the hands of realtors as it believed publishing the numbers violated consumer privacy. However, critics say TREB was not concerned with issues of privacy but rather market control and ensuring that only realtors with access to the MLS would know the full story behind home sale prices.

What this decision means for consumers is that they will be able to have greater access to information, such as finding out the selling price of homes in certain neighbourhoods or on specific streets, the history of a house and property market trends. This will only serve to make decisions about buying and selling real estate much easier.

Before the only way to access sales data was through real agent requests. And those requests had to be made via fax, email or in person. Others would also look to online property value services or local land registry offices, which charge a fee.

Those who supported removing the restrictions say this has been the case for some time in the U.S. and rather than hinder the real estate market, some say it has actually fueled home sales there and enhanced transparency.

“Today’s decision will allow greater competition and innovation in the real estate services market in the Greater Toronto Area, and concludes seven years of litigation in the bureau’s case against TREB,” the Competition Bureau said in a news release.

“The order requires TREB to remove restrictions on its members’ access and use of real estate data – including restrictions on the display of historical listings and sale prices online through virtual office websites.”

Sources: CBC.ca, Financialpost.com

Do headaches and hassles come with owning student rental units? Of course, but there are also plenty of opportunities that might just make investing in student housing worthwhile.

Let’s look at some facts. The number of domestic and foreign students drawn to Canadian universities and colleges is not going away. In fact, it’s growing.  In 2017, Canadian universities were home to more than 1.7 million students. About 370,000 international students attended universities and colleges in 2017. And they all need a place to live.

Industry insiders have long been aware of the investment opportunity in student housing. They say the Baby Boom Echo, which is essentially a second explosion of babies born thanks to the original boomer demographic, has grown up and is looking to further their education, thus making student housing a solid niche for investors.

You’ve likely at least heard of friends of friends who decided to purchase a house, townhouse or condo for their post-secondary-bound son or daughter. While that may sound a bit extravagant to some, it’s actually a clever way to invest your money. Living expenses add up quickly, whether they are on campus residences or co-op living arrangements in off-campus housing. Residence fees can range from $7,000 to as high as $15,000 or $20,000 per year. Living off campus is likely cheaper. But why not invest your money in a rental property? Your son or daughter can keep an eye on the day-to-day operations of the unit, especially if you live far away.

You can rent a 3-bedroom Toronto condo for $3,400 to $4,500 per month. While that is a lot of money to hand over each and every month, the hit is softened as it is divided among three tenants who share the condo’s common living space, which includes the kitchen, bathrooms, living room and balcony.

Another advantage to investing in student housing has to do with late or absent rent payments. When a single tenant is late paying his or her rent, the financial setback can be quite a blow for the landlord, who typically needs prompt payments in an effort to pay mortgage fees, condo fees and other bills. Withstanding the loss of rent money from one student renter is easier to swallow as the remaining renters help ease the shortfall with their rent payments.

So there are certain benefits to investing in student housing and the biggest one is that cash flow is usually higher than with single-family rentals. Of course, tenant turnover is higher so there is that to contend with. Just be sure to do your due diligence when vetting potential tenants and don’t forget to insure your property so it reflects that you are renting your space to students.

A common lament in the world of Toronto real estate is that the housing market is in short supply.

So when we hear that and then also learn that two per cent of homeowners own properties that are currently vacant, it makes you stop for a minute.

Though two per cent might sound like peanuts, it’s not. If you are looking at sales over the past 12 months, that translates to nearly 1,857 properties added to the bundle of already vacant homes in the GTA, an indisputably significant number, according to Better Dwelling.

In 2017, numbers from Statistics Canada showed that Toronto was home to over 99,000 unoccupied homes.

The survey of 2,501 homeowners was released earlier this year by the Toronto Real Estate Board and Ipsos.

It also appears that the inventory of empty homes has risen quite substantially from 2017. According to the CBC, 28 per cent of GTA property listings are vacant, a number that has increased over last year from 17 per cent.

Large numbers of vacant homes has been a controversial issue particularly in the GTA and Vancouver, where real estate prices have made the prospect of owning a home impossible for some. In fact, many industry insiders and economists have suggested that a vacancy tax would ease housing supply shortages. While many proponents of affordable housing support a vacancy tax believing that it would unlock Toronto’s supply of rental units, there is also some evidence that shows a vacancy tax may just help the buy-and-sell housing market.

The TREB-Ipsos survey supports this view. Results show what these homeowners of secondary properties would do if confronted with a vacancy tax. Nearly 38 per cent said they would sell their property, while almost 37 per cent claimed they would rent their properties to tenants. This would clearly go a long way toward building the city’s housing supply.

Some observers say higher numbers of empty homes are the result of foreign investors and speculators, who are simply waiting for the right time to sell. Still, others blame the growth in vacant housing stock on short-term accommodations services such as Airbnb. Any which way you approach the issue, there’s no doubt that the high number of empty homes poses some level of threat to the GTA’s economic health.

There’s a time-worn saying in real estate that location, location, location is everything but anyone who has bought and sold property once or twice knows that success in the market also hinges on timing, timing, timing.

If you missed the hot spring market, you’re in luck as fall runs a close second in terms of being the most desirable time to buy or sell your home. Here’s why:

Buyers are serious

It’s true that there are fewer buyers in fall, no doubt, but those that are out there tend to be more serious about the practice of purchasing a home. Not to discredit spring buyers, but when the real estate market heats up into a whirling frenzy you invariably end up with buyers who are simply caught up in the tumultuous trend. A number of them enjoy touring homes and kicking tires. Fall buyers aren’t as affected by the whirlwind of activity as they otherwise would be joining their counterparts in spring.  These home buyers are ready to put their money where their mouth is and they are interested in investing in a home or property instead of merely checking out how well or poorly a home is staged.

Fewer irons in the fire 

We all know competition can be fierce during a spring market. That’s when the majority of sellers list their homes in order to accommodate summertime moves thanks in large part to school-aged children and other family needs. Perhaps one of the biggest advantages to selling your home in the fall is the fact there is far less inventory available, which puts your property in greater demand.

Before the snow flies 

If you buy or sell early enough in fall, you could be settled into your new home before any inclement weather begins knocking or just in time for the hustle and bustle of the holiday season. In addition, a fall move will likely go easier on your wallet than a move in spring or summer.

Families aren’t the only buying demographic 

It makes sense why families with children choose to buy or sell in the spring. Their kids need not be uprooted during the school year and moving in summer is simply easier and less disruptive for little ones. But there are plenty of childless consumer groups who buy and sell real estate. Young professionals, seniors and empty nesters, to name a few.

The beauty of autumn 

It’s true that one of the reasons the spring market is so popular is because that’s when properties are at their most captivating. Flowers are blooming, trees are budding and lawns look lush and green. But the fall is clearly no runner up in the home beauty pageant department. Trees display a magnificent variation of colour in fall. Certain flowers are still in blossom or just emerging then. Add to your exterior’s curb appeal with a beautiful wreath or door swag. Given that Thanksgiving and Halloween occur in October, there are plenty of visual cues from which to draw inspiration for outdoor decorating.