My Blog

The National Housing Market is Rebalancing; It's A Good Thing!

4/24/2019

March is traditionally the harbinger of the busy home buying and selling season. Last month followed that annual tradition but at a much slower pace than in recent years, according to the latest RE/MAX National Housing Report.

Home sales this past month were 8.6 percent lower than sales during March 2018. But should home sellers be concerned? RE/MAX CEO Adam Contos has said the current rebalancing of the national housing market is healthy for the industry since the demand among buyers and sellers is slowly equaling. The report also found that the average months supply of inventory — the amount of time it would take for every home currently on the market to sell if no other homes are listed — was 2.7 months. A balanced housing market is inventory of 6 months or more.

Here are some highlights of the latest data found in the RE/MAX National Housing Report:

  1. Homes sales in March were the slowest start to spring homebuying in five years.
    From 2015 to 2018, the housing market’s spring sprang to life with an increase in sales from February to March averaging 37.0 percent. March 2019’s month-over-month increase of 28.8 percent was the smallest since 24.6 percent in 2014.
  1. Inventory is up. Transactions are down.
    March was the eighth consecutive month of year-over-year sales declines and the sixth straight month of year-over-year inventory growth, with a 5.3 percent gain.
  1. Most homes are increasing in value, but at a slower pace.
    Housing activity in the report’s 54 markets nationwide also saw the Median Sales price grow by 3.4 percent year-over-year — notably smaller than the year-over-year increases in February (5.5%) and January (4.6%).

You can find more data in the RE/MAX National Housing Report. Ready for the spring selling season? Contact a RE/MAX agent today.

Is Real Estate a Good Investment?

4/8/2019
ClockThat is a question that real estate agents get asked a lot. In general, real estate tends to be a good investment as, in most cases, real estate appreciates in value over time. However, how much you pay for the property, how much it increases in value, and how long that takes varies greatly.

Here’s the breakdown on investing in real estate to help you decide if it’s right for you.

What is the Average Rate of Return on Real Estate Investments? 

We expect to see modest house price increases in 2019, at 1.7%. We have just come out of some wildly high housing prices, especially in Toronto and Vancouver areas. However, although prices have stabilized, investment in properties outside some of the major cities can see some excellent gains.

In 2018, some good examples of growth include 13% in Chilliwack and Windsor, 17% in London, and 11% in Charlottetown. Combine this with general rising rent costs across Canada, which are predicted to rise by as much as 6% in 2019, and that could translate into a great investment opportunity.

Is Real Estate a Safe Investment?

As long as you are buying property at the right price in an area where the value is sure to rise, real estate is safe and lucrative. If you aren’t smart about your budget and location, you could end up like many Toronto property owners who purchased at unrealistically high prices in 2017. Those homeowners will have to pay down their mortgages for a while before they can make a profit, especially if they made lower down payments.

There tends to be less volatility in real estate when compared to something like stocks and bonds. With real estate, you can minimize risk by holding on to your property longer should there be a drop from the price you paid. That way, you can continue to build equity. As well, with real estate, as you pay down your mortgage, you also see your equity grow. Later on, your property will be easier to leverage as capital as it is a “tangible” asset.

Real estate is a safe investment because:

  • It has a high tangible asset value
  • It will almost always increase in value over time
  • It provides diversity to your portfolio to help reduce risk
  • It comes with tax benefits


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Do the benefits outweigh the risks?

4/1/2019

Pocket listings are more popular than ever among high-profile sellers. People with privacy concerns often prefer the anonymity of listing off-MLS. And some use it to gauge what a buyer might pay before they make the listing official.

While pocket listings can be beneficial for sellers, they do pose potential risks for listing agents. 

Consider these factors if a seller asks for an off-MLS listing:

1. Remember your fiduciary responsibilities. 
By limiting the property’s exposure, you could be risking dual agency and compromising your fiduciary responsibilities. 

Remember, you need to protect and promote the best interests of your clients. 

2. The seller should be the decision maker. 
An off-MLS listing should always be the sole, voluntary decision of a well-informed seller. 

Never recommend pocket listings to avoid splitting the commission, and always provide a clear definition of potential limitations in the listing agreement. 

3. Notify your MLS. 
You may be required to file a seller-signed certification that says the listing should not be distributed through the MLS. Failure to submit within a specified timeframe could result in a fine.

4. Be wary of fair housing and antitrust violations. 
Using off-MLS listings to screen legitimate buyers or limit access to a select group of brokers and agents could violate local and federal fair housing and antitrust laws. 

Currently, NAR has no official stance on pocket listings. However, NAR’s General Counsel notes that actively discouraging MLS listings is inconsistent with the Code of Ethics. Off-MLS listings should only occur with the best interests of the seller in mind. 

It’s okay to turn down the listing if you’re not comfortable with it.

Reach out if you have more questions about pocket listings. 

Prices Still Rule the National Housing Market; Inventory Catches a Break

3/21/2019

Six straight months of declining home sales have resulted in one of the largest year–over–year inventory increases in at least 10 years, according to the most recent RE/MAX National Housing Report.

What does that mean to the average homebuyer and seller? If you’re a buyer, it’s good news — you potentially have more homes to choose from! It’s been a while since the National Housing Report has reflected a rise in inventory, especially in popular metro destinations.

If you’re a seller, there’s good news for you too. According to January data, the price of homes continues to rise across the country. That said, now more than ever, sellers must be in tune to their local housing market and aware of prices, along with trends that are selling homes faster. For guidance, turn your local professional real estate agent.

Here’s a simple breakdown of the latest data found in the RE/MAX National Housing Report:

    1. Price is still king
      The median sales price jumped to $234,000 — an increase of 4.6 percent over the same month last year and the record for a January report.
    2. Inventory is on the rise
      Inventory grew year-over-year by an average of 6.4 percent across the report’s 54 U.S. metro areas. January marked the fourth consecutive month of year-over-year inventory growth — reversing a decade-long trend of shrinking inventory.
    3. Home sales are declining
      Year-over-year home sales dropped 11 percent. As noted, that’s good news for buyers because inventory is growing. And for sellers, it’s a good idea to work with an expert agent to determine the best list price suited to your local housing market.

Texting Your Agent

2/26/2019

The website announced that mobile users will now be able to click on a "text" button to reach out to agents.

Homeowner Mistakes

2/21/2019
4 New Homeowner Mistakes
You just closed on your new home—your signature sealed the deal. Now that you have the keys, don’t get ahead of yourself. After closings, I always offer the same advice to new homeowners—it’s time to take a minute, slow it down and strategize before making any big financial moves. It can be tempting to bust out a credit card to furnish your new space in style. However, taking on more debt after making one of the biggest purchases of your life can be a mistake. Here are the top four mistakes a new homeowner can make and my advice on how to avoid them.
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