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who we are Peng Hock Tan Senior Real Estate Broker & Real Estate Advsior
When it comes to providing excellent real estate services, Peng Hock Tan always puts the interest of his client’s at heart first. Creativity and patience are the substance of his ability to provide the necessary guidance and clarity in assisting his clients during their crucial decision making process. Aside from real estate, Peng Hock Tan enjoys sharing his passion for food and love for gardening!
Kai Min Tan
Ola Akinyemi
Representative
Representative
Being passionate about doing the things you enjoy is important, for Kai Min Tan, one of those things are real estate. His client’s are fond of his refreshing, insightful and positive demeanor which we are sure you will also appreciate. Outside of real estate, Kai Min Tan enjoys following up on the world of cutting edge technology and intriguing mixology.
Ola is looking forward to making customers and clients love Royal LePage Meadowtowne as their #1 Real Estate Brokerage. He brings a wealth of financial industry experience to the team having worked with Senior Executives at several leading Financial Institutions in Canada at various capacities in delivering value to customers for more than a decade.
Real Estate Sales
enjoying what we love doing The TanTeam provides you with an unparalleled level of service and attention when it comes to an important decision such as buying and selling your home. Our passion and knowledge of the area and commitment to making a difference has helped us build a name for offering the highest level of customer service possible. Call The TAN Team now if you are planning to buy or sell your next home.
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Designer: Kai Min • Cover: Milky Way by Den-Belitsky • Source: Stock Photo's • Advertising: Kai Min | support@tanteam.com Royal LePage Meadowtowne Realty™ is a licensed franchise to Royal LePage and is Independently Owned and Operated. Whilst every care has been taken in preparing this magazine, Tan•gazine and all vendors, corporations, business’ and affilliates give no warranty for the information contained herein. Potential purchasers shall satisfy themselves as to all matters and seek independent advice, if necessary. The views expressed in the article(s) throughout Tan•gazine are those of the author and do not necessarily represent the views of The TAN Team and its affiliates. The information contained herein does not form any part of any contract, offer or representation. Additionally, this magazine is not intended to solicit properties currently contracted and/or already listed for sale.
table of
CONTENTS
august - september 2018 volume 05 issue 10 JULY REAL ESTATE INDEX
GTA DETACH AVG PRICES (2018 • $ 782,129 | 2017 • $ 745,971 | +4.84%) SALES (2018 • 6,961 | 2017 • 5,869 | +18.60%) 1 YR MORTGAGE (2018 • 3.49% | 2017 • 3.14% | +11.14%)
04-05 ................... Higher Interest Rates Will Hit Younger, Middle-Income Households The Most: Analysis 06 ................... Toronto Housing Market Shows Signs of Firming 07 ................... Toronto Region Home Sales, Prices Rebound In July 08-09 ................... 2018 Summer - August-September TanTeam Listings 10 ................... July 2018 GTA REALTORS® Release Monthly Resale Housing Figures 11 ................... Wine And Beer Lovers Rejoice! Grand Opening Saturday, August 18, 2018 between 2PM-6PM! 12-13 ................... Craft Wine For Every Occassion. Start Crafting Today!
The secret of getting ahead is getting started. -Mark Twain
Higher Interest Rates Will Hit Younger, Middle-Income Households The Most: Analysis ANDY BLATCHFORD GLOBE AND MAIL JULY 30, 2018 Younger, middle-income households will be among those that feel the biggest financial sting from the Bank of Canada’s gradual move toward higher interest rates, says a newly released federal analysis.
The Finance Department explored factors such as income, age and region in an effort to pinpoint the types of households that will be most affected by the central bank’s ongoing rate-hiking trajectory, which follows years of extremely low interest rates. Officials put a particular focus on how rising rates will start to squeeze “highly indebted households,” which the document described as those already carrying debtto-income levels of at least 350 per cent. Debt loads of this magnitude are held by 12 per cent of all Canadian households. Combined, the burdens concentrated in this category account for nearly 50 per cent of the country’s total household debt, said the memo prepared for Finance Minister Bill Morneau last fall. The document sought to answer another question: who are these stretched households? They most likely consist of households led by middle-income earners, Canadians under 45 years old, mortgage holders, the self-employed, and those in Ontario and British Columbia, it said. “The expected increase in interest rates over the next few years will have various impacts on Canadian households, including an increase in the cost of servicing debt,” said the document, which noted that about 70 per cent of households carry debt. “Naturally, households with high debt levels would see the largest increases.”
A closer look at the numbers showed that mortgages were the main factor for highly indebted households because they accounted for 85 per cent of their total debt burdens. The briefing note pointed out that younger households are more likely to have higher debt because a larger share of older households have paid off their mortgages. The analysis, obtained by The Canadian Press under the Access to Information Act, was based on 2012 numbers and was created in September 2017, shortly after a pair of Bank of Canada hikes. The reasons for using 2012 data are blacked out. In recent weeks, the central bank raised its trend-setting interest rate for the fourth time in a year to bring the benchmark to 1.5 per cent – its highest level since December 2008, but still very low by historical standards. Governor Stephen Poloz has signalled more rate increases will be necessary over time thanks to the economy’s resilience, but he has stressed the process will be gradual. His officials have estimated the bank’s normal or neutral rate – the preferred level when the economy is operating at full capacity and inflation is on target – is between 2.5 per cent 3.5 per cent. With this neutral rate in mind, analysts expect Poloz to introduce several more quarter-point hikes and many believe the next one could arrive before the end of 2018. The central bank raises its interest rate as a way to help keep inflation from climbing above its ideal target range of one to three per cent. The Bank of Canada says it’s closely watching how the economy adjusts to higher interest rates and has noted that household credit recently slowed to the
Nicholas R. Harrison,
Hon. B.A., B.Ed.
Freedom 55 Financial Security Advisor
Mississauga Financial Centre
point it’s now below the growth rate of household income. For years, however, Canadians have amassed significant piles of debt, including mortgages, during the extended era of low interest rates. With some measures showing household debt loads are still close to record levels, the Finance Department document underlined possible developments that could help offset the rising costs of debt payments. The memo said income growth, if high enough, could absorb the entire increase in debt-servicing costs. It also said greater returns from interest-bearing assets, like savings accounts, could provide a smaller amount of support for some households. If necessary, there are less-appealing financial strategies that heavily indebted households could turn to, the memo said. The suggestions include prolonging the duration of existing loans or cutting back on how much money households set aside for a rainy day. The document noted, however, that highly indebted households already have some of lowest savings rates, which suggests there’s a limit to how much cash they can redirect to manage higher debt payments. As a last resort, officials said households could sell off some of their liquid financial assets. “In the absence of income growth, households could likely employ a combination of responses to fully offset the rise in debt payments (i.e. extending amortization, reducing savings rates or selling financial assets),” the memo said. “At the same time, these responses would worsen a household’s financial position over the longer term.”
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Toronto Housing Market Shows Signs of Firming CAROLYN IRELAND GLOBE AND MAIL AUGUST 2, 2018
On a recent July night in East York, real estate agents in their cars sat outside a semi-detached house listed with an asking price of $849,000. The scene, said Rochelle DeClute of Union Realty Brokerage Inc., was more reminiscent of Toronto-area real estate in the spring of 2017. By the end of the night, the sellers received 10 offers and the house sold for $1.06-million. Ten used to be a small number of bids for a house in that price range, but by 2018 standards it’s a strong turnout. Ms. DeClute sees it as one signal the market is firming. In the past couple of weeks, Ms. DeClute’s firm has sold two houses above $4-million. One had been on the market for nearly four months and the other for about one month. “The higher end had been very much at a standstill, but now it seems to be moving again.” Ms. DeClute said she had noticed more hits to the website and more appointments booked for both properties in the past couple of weeks. The house that had been on the market for a few months was attracting new interest, but the purchaser was a buyer who first looked at it some time ago. “We did have more showings at the end for sure and one buyer who did come back.” In all price ranges, the Toronto market feels more typical of late June, when buyers who have been biding their time will often make a decision before they settle into summer vacation, she said. Usually by the beginning of August, the
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market is drowsy. “It’s usually our quietest time ever, but we’re seeing it pick up.” After a spring market that sputtered and stalled, Ms. DeClute figures cautious buyers are feeling a little more confident the market does not have further to fall. She has also seen a return of investors who had been sitting on the sidelines for the past year or more. In recent weeks, she has heard from potential buyers who are looking for an income property. They’ve decided to buy now before the market goes on another tear, she said. The real estate portal Juwai.com says overseas investors from China are still interested in Canada and other countries, but there’s not the hysterical rush to invest overseas that happened in 2016. Carrie Law, chief executive at Juwai. com, said China-based investors feared the country’s currency was facing rapid and possibly repeated devaluation amid unprecedented capital outflows in 2016. There was also serious concern about the potential for a significant slowdown in economic growth, she added. Today, the psychology of Chinese international property investors has changed and most are more confident Beijing can manage economic growth and the yuan, Ms. Law said. She predicted relatively slow but steady growth in Chinese buying of overseas real estate in the coming 12 months. She added that prices for real estate in Canada may appear more affordable to Chinese investors than U.S. real estate because the U.S. dollar has strengthened more dramatically against the Chinese currency. The most popular destinations for
Chinese buyers are Toronto, Montreal, Vancouver, Calgary and Ottawa, according to searches on Juwai.com. Ms. DeClute, who specializes in the Beaches and other east-end Toronto neighbourhoods, pointed out the median price for a detached house in the E02 buying area is currently around $1.289-million. At the end of July, 2017, it was $1.295-million. “We seem to be where we were last year at this time.” The Toronto Real Estate Board’s E02 area stretches from Danforth Avenue to Lake Ontario, between Coxwell and Victoria Park Avenues. It includes the Beaches and Upper Beaches.
in at $25,000, $50,000 or $100,000 more. “In our industry, we’re having to be more accurate in our pricing and that’s a good thing.” Ms. DeClute said recent increases in mortgage rates have not deterred many buyers. Some who have preapprovals for mortgages are inclined to buy more quickly before rates possibly rise again, she said. In addition to seeing offers conditional on the buyer lining up financing, she’s also seeing offers that are conditional on the property being appraised at the sale price.
Currently, there are 44 active listings in E02, compared with 59 at the end of July last year, Ms. DeClute said.
Banks are also tougher in making sure an appraiser deems the property to be worth the negotiated price, she added.
The scarcity of listings helps to keep prices firm. It discourages more listings, however, because potential sellers are afraid they won’t be able to find another property to buy.
“The banks are being a little more cautious,” Ms. DeClute said.
Ms. DeClute was seeing lots of conditional offers in the spring – including some buyers inserting a clause making the deal conditional on the sale of an existing property. Most years, Ms. DeClute said, she would advise homeowners against listing in the somnolence of summer. But this year, the buyers are circulating, she said. “We’ve traditionally said, ‘Don’t launch in August, no matter what.'” However, her team recently listed another two homes above the $4-million mark. “There are buyers out there and they’re willing to pay the money.” One change Ms. DeClute has noticed is that potential buyers expect properties to be listed close to market value, even when multiple offers are expected. The appetite for seeing a house listed with a lowball price has diminished, she said. While bidders were lobbing offers $500,000 or more above the asking price in 2017, that kind of eye-popping premium is rare these days, she said. A more typical scenario is that properties are listed with a fairly realistic asking price and the winning bid might come
Talking to real estate lawyers and mortgage brokers, she has heard of deals where the bank’s appraiser declares that the buyer paid too much. In those cases, buyers sometimes have to scramble to find another source of funding to close the gap, she said. In other instances, the buyer will try to get a second opinion with another appraiser. “People do sometimes.”
dispute
appraisals
And in another twist, lenders have been known to insist on a second appraisal just before closing to make sure the property’s value didn’t fall between the time the deal was inked and the closing date several months later. However, Ms. DeClute thinks the recent stability in the market will make those nerve-racking scenarios less likely. If prices remain strong, sellers who pulled their listings in June will return after Labour Day, she predicted. She is also receiving calls from homeowners who are considering a sale in September. “If right now is any indication, I think we’re going to have a very busy fall market.”
Toronto Region Home Sales, Prices Rebound In July LAURA PEDERSEN FINANCIAL POST MARCH 1, 2018 Home sales climbed almost 19 per cent in the Toronto region in July and average prices rose across all housing categories as buyers continued to return to the market after absorbing the impact of tougher new mortgage-qualification rules imposed at the start of the year.
The Toronto Real Estate Board (TREB) said 6,961 homes were sold in the GTA in July, up 18.6 per cent from July last year. The improvement came off a particularly weak base a year ago, however, when sales were down 40 per cent following the province’s introduction of a foreign-buyers tax as part of its Fair Housing Plan. The average GTA home sold for $782,129 in July, an increase of 4.8 per cent from a year earlier, and a jump of 3.1 per cent compared with June, based on TREB’s preliminary seasonal adjustment. TREB said July’s average sale price was the highest since May, 2017, on a seasonally adjusted basis, while the number of homes sold in July was up 6.6 per cent over June after seasonal adjustment. TREB said the number of sales in July was the highest this year on a seasonally adjusted basis.
to the psychological impact of the Fair Housing Plan and changes to mortgage lending guidelines have reentered the market.” Sale prices in July climbed for all categories of homes in the GTA, including detached houses, where sales had been especially weak. TREB said the average detached house sold for $1,004,647 in July, up 0.5 per cent from July last year. The number of detached homes sold in July climbed 27 per cent compared with the same month last year, which was the strongest sales growth of any home category.
to 46,834 homes from 60,620 in the first seven months of 2017, with the improvement in sales in July not enough to offset large declines earlier in the year. Shawn Zigelstein, a Royal LePage real estate agent in Richmond Hill north of Toronto, said the market feels stronger than last summer, but that was a particularly weak period to use as a comparison. He said the recovery in his region is still spotty, and there are pockets where prices are still dropping and the ratio of inventory to monthly sales has reached 12 months – which means there are many listings sitting on the
market without a buyer. “Some areas only have two to three months [of inventory] so there are drastic comparisons,” he said. He said the perception that the market is improving may bring more buyers off the sidelines, but he isn’t confident prices are set to rise significantly. His clients also have a lot of new listings coming in the next four weeks, which could flood the market and keep prices from rising significantly. “If you’re looking at York Region and Richmond Hill specifically, we’re seeing a lot of inventory coming up,” he said.
TREB said semi-detached home prices rose 6 per cent in July from a year ago to a GTA average of $746,843, while townhouse prices climbed 4.1 per cent to $633,993; condominium prices were up 8.9 per cent on a year-overyear basis to $546,984. New listings have not picked up as quickly as sales, however, with 13,868 homes put on the market in July, down 1.8 per cent from 14,122 homes a year ago.
“We have certainly experienced an increase in demand for ownership housing so far this summer,” Jason Mercer, TREB’s director of market analysis, said in a statement.
Toronto’s market cooled sharply earlier this year after the federal government introduced a new stress test on mortgage applications, requiring buyers to show they could still afford their mortgages even if interest rates were significantly higher.
“It appears that some people who initially moved to the sidelines due
Total sales for the first seven months of the year were down 23 per cent
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July 2018 GTA REALTORS® Release Monthly Resale Housing Figures TORONTO REAL ESTATE BOARD AUGUST 03, 2018 Toronto Real Estate Board President Garry Bhaura announced strong growth in the number of home sales and the average selling price reported by Greater Toronto Area REALTORS® in July 2018. "Home sales result in substantial spin-off benefits to the economy, so the positive results over the last two months are encouraging. However, no one will argue that housing supply remains an issue. The new provincial government and candidates for the upcoming municipal elections need to concentrate on policies focused on enhancing the supply of housing and reducing the upfront tax burden represented by land transfer taxes, province-wide and additionally in the City of Toronto," said Mr. Bhaura. Residential sales reported through TREB's MLS® System for July 2018 amounted to 6,961 – up 18.6 per cent compared to July 2017. Over the same period, the average selling price was up by 4.8 per cent to $782,129, including a moderate increase for detached home types. New listings in July 2018 were down by 1.8 per cent year-over-year.
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Preliminary seasonal adjustment pointed to strong month-over-month increases of 6.6 per cent and 3.1 per cent respectively for sales and average price. Seasonally adjusted sales were at the highest level for 2018 and the seasonally adjusted average price reached the highest level since May 2017. The MLS® Home Price Index (HPI) Composite Benchmark for July 2018 was down slightly compared to July 2017. However, the annual growth rate looks to be trending toward positive territory in the near future. "We have certainly experienced an increase in demand for ownership housing so far this summer. It appears that some people who initially moved to the sidelines due to the psychological impact of the Fair Housing Plan and changes to mortgage lending guidelines have reentered the market. Home buyers in the GTA recognize that ownership housing is a quality long-term investment," said Jason Mercer, TREB's Director of Market Analysis.
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Wine & Beer Lovers Rejoice! BY THE TANTEAM EDITORIAL
As some of you may already know, The TanTeam is quite enthusiastically proud to announce our co-ownership of local Craft Wine Maker, Carafe Meadowvale! We are conveniently located at 6400 Millcreek Dr, Mississauga L5N 3E7, just 3 minutes down the street from our Mississauga real estate office!
Grand Opening set to take place on Saturday, August 18th, 2018 between 2PM-6PM.
There will be on site music, snacks and refreshments along with supple socializing and of course The TanTeam will be there! Kindly RSVP so we know we can expect you! FOR MORE INFORMATION OR TO REGISTER FOR CARAFE MEADOWVALE GRAND OPENING CONTACT THE TANTEAM TEL: 905-821-3200 SUPPORT@TANTEAM.COM
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