By Erica Alini - Wednesday, March 13, 2013 - 0 Comments
January home sales data had us all wonder whether the downward trip the housing market had embarked on in mid-2012 was already over. After four consecutive months of declines home resales rebounded in the first month of the year from December. Had we already hit bottom?
We hadn’t. February home sales numbers, due out on Friday, will almost certainly show that housing has resumed its southbound trajectory — and at a faster pace this time.
Though figures published by the Canadian Real Estate Association will give us a more refined and complete picture, we can already tell from numbers posted by the major local real estate boards that it isn’t going to be pretty.
By Erica Alini - Thursday, November 15, 2012 at 11:11 AM - 0 Comments
The Canadian housing market continued along its gradual downward trajectory in October, with sales of existing homes lower compared to both the previous month and year-over-year levels, as prices registered the smallest increase since May 2011, the Canadian Real Estate Association said today.
Home resales dipped 0.1 per cent in October from September and actual, non-seasonally adjusted, sales were down 0.8 per cent from October 2011. Prices were still growing, but moderately, up a modest 3.6 per cent from September, the sixth consecutive month of slowing gains. The price increase for townhouses and condo units was even smaller, at 1.2 per cent and 1.5 per cent respectively.
And in a further sign that supply is adjusting to weaker demand, the number of homes that went up for sale in October was down 3.8 per cent after a jump in September, with the Vancouver and Toronto areas leading the way. Calgary, on the other hand, bucked the trend, topping the charts of local markets that saw year-over-year sales increases and registering faster growing prices as well.
All told, after a strong showing in the first half of the year, the level of home sales in 2012 will likely come in roughly in line with the decade’s average.
By Tamsin McMahon - Tuesday, February 28, 2012 at 10:50 AM - 0 Comments
Why is everyone ignoring this unfolding disaster?
Back in the heady days of 2005, America looked like an awfully nice place to buy a house. Home prices were marching ever upwards. Home ownership was at record levels. Mortgage rates were at historic lows. Unemployment was falling while the economy was growing at a healthy clip.
Home sales had started showing their first signs of slowing that year, but that didn’t sway the National Association of Realtors from its persistently sunny view of the country’s housing market. “We’re confident that housing is landing softly,” David Lereah, the association’s chief economist, wrote in a November 2005 report just before house prices started a descent that would eventually wipe out nearly $30 trillion in global wealth.
Looking back, the signs of a country burying its head in the sand about a housing bubble seem obvious: the well-told tales of tricky teaser rates, of mortgage fraud and of gigantic home loans handed out to buyers with no income or assets. Household finances were even sketchier. In 2005, the average American owed $1.30 in debt for every dollar of income. Home equity was eroding as Americans pulled more than $900 billion out of their homes to buy cars, granite countertops and put their kids through college.
By John Geddes - Wednesday, September 28, 2011 at 12:10 PM - 1 Comment
Melanie Aitken has taken on everyone from the real estate industry, to credit card companies, to airlines
In Stephen Harper’s Ottawa, it’s not often that a public official makes a sustained splash. The Prime Minister prefers his bureaucrats quiet, diplomats discreet, and even high-level appointees, like Governor General David Johnston, unobtrusive. In this circumspect climate, Melanie Aitken, the commissioner of competition, stands out. As head of the federal Competition Bureau—the independent agency that enforces laws on anti-competitive behaviour—Aitken has taken on everyone from the real estate industry, to credit card companies, to airlines. The bureau has gone from largely invisible to impossible to ignore. “We are trying,” Aitken says, “to increase the accountability of companies that have taken advantage of Canadians, and show that there are consequences.”
Those consequences hit home for many last year when she pressured the Canadian Real Estate Association into opening up its Multiple Listings Service to brokers who don’t charge full-service fees. She is taking Visa and MasterCard before the quasi-judicial federal Competition Tribunal to try to end their practice of forcing merchants to accept all cards, including premium plastic that comes with higher transaction fees. In the telecom sector, Bell Canada agreed to pay a $10-million penalty after Aitken accused the company of advertising lower prices than were available, and she is pursuing Rogers Communications (owner of Maclean’s) over what she calls “misleading advertising” involving a discount cell service.
When was the last time the bureau was fighting on so many fronts? According to John Rook, a competition lawyer at the Toronto firm Bennett Jones, never. “It’s unprecedented,” says Rook, who worked closely with Aitken when she was at his firm, and sometimes takes on cases for her bureau.
By Jason Kirby - Thursday, August 19, 2010 at 3:00 PM - 0 Comments
Realtors say: blame it on the sunshine
Across Canada the housing market took a beating in July, but the only thing more prevalent than the “for sale” signs gathering dust everywhere were excuses for why buyers have suddenly vanished.
In Toronto, July sales fell 34 per cent. They were down by 42 per cent in Calgary. And in Vancouver and the lower mainland sales plunged by around 45 per cent. If those watching the housing market thought sky-high prices were to blame, though, realtors were quick to correct them.
By By Jason Kirby and Chris Sorensen - Thursday, April 1, 2010 at 11:01 AM - 180 Comments
High fees. Hidden data. It’s the realtor racket.
From the moment Robert Peden chose to sell his Victoria home, he was adamant not one penny would go to a full-service real estate agent. Instead, Peden is doing what a small but growing number of Canadian homeowners have opted to do—handle the sale on his own. “I’m not prepared to pay full-service real estate commissions because they’re totally out of whack,” he says. “No realtor is worth that kind of money.”
Tough words. But Peden isn’t just any aggrieved home seller. Thirty years ago he worked as a real estate agent himself. And he’s disturbed by what he’s seen happen over that time. Then, as now, commissions amounted to about five to seven per cent of a home’s sale price. But because the typical 1970s house sold at a fraction of today’s eye-popping levels, real estate commissions were around $2,500. Today, with Peden’s home worth an estimated $460,000, the commissions might easily hit $25,000. Even after factoring in inflation, realtor’s fees have exploded in size, and it’s left him wondering: what exactly do real estate agents do now that they didn’t 30 years ago to warrant such a staggering increase in pay? “The problem with realtors today is they’re more order takers than salesmen,” he says. “Honest to God, I think a used car salesman works harder at selling a car and earns a fifth of what these people make.”
When it comes to Canada’s other favourite pastime, real estate, griping about realtors is right up there with gossiping about house prices at cocktail parties and picking out marble countertops. But in recent weeks, the backlash against real estate commissions has taken on a more urgent tone. The Canadian Competition Bureau has set its sights on the way realtors have, for decades, operated and charged for their services, and in February it filed charges with the Competition Tribunal claiming realtors are engaged in anti-competitive behaviour. The Canadian Real Estate Association (CREA) has fought back, labelling the accusations “fundamentally misconceived.” But however the battle plays out, don’t expect realtors to give up the outdated and expensive system for buying and selling homes without a fight. Critics call it a monopoly, and it’s made many in the industry very well off.
By Colin Campbell - Friday, June 26, 2009 at 12:11 PM - 17 Comments
There are plenty of signs that the Canadian housing market is still on some very shaky ground
Judging by the latest real estate data, the Canadian housing market could scarcely be better. Average home prices are up more than 16 per cent this year, and in May they hit an all-time monthly high, according to the Canadian Real Estate Association. By those numbers, Canada didn’t just sidestep the housing market crash that continues to plague the United States, it sailed right through it virtually unscathed. And yet, there are plenty of signs that the Canadian housing market is still sitting on some very shaky ground—and even the potential that Canada’s big housing crash is yet to come.
There is one particular statistic that suggests trouble could be brewing. Unlike in the U.S., Britain and most European countries, household debt in Canada is, incredibly, still growing. That rising debt is being driven largely by record-low interest rates. Canadians have been buying homes not so much because they can afford them, but because many believe there’s never been a better time to buy, with lending rates so low. “There is no doubt that record-low mortgage rates have juiced Canada’s housing market,” wrote BMO economist Sal Guatieri, in a recent newsletter. Houses are barely more affordable now than they were during the market peak. And as people keep buying, houses may only become less and less affordable. Continue…