Numbers may not lie, but they can certainly tell different versions of the truth.

Take the year-to-date sales numbers released by the Building Industry and Land Development Association (BILD) for new homes and condos sold across the Greater Toronto Area between January and May. During that time, 8,924 new high-rise units were sold — down 22.4% from last year. Low-rise sales during the same period, though, were up 1.6%, at 8,040 sales.

All of that would seem to signify a bad year for the new high-rise market, and a good year for low-rise — except that’s not the case, says George Carras, president of market analysis firm RealNet Canada, which provided the data to BILD. “It’s down [from last year], but relative to the last 12 years it’s the second best year,” he says of the high-rise market. “In fact, when you do the average of the last 12 years, you’re about 37% above average. You’re still seeing on a relative basis very strong sales over the long term.”

Low-rise, though, is a different story. Though sales of new low-rise homes were higher than last year, they were down 25% compared to long-term averages, Mr. Carras says.
Put low-rise and high-rise sales together, though, and what do you come up with? A pretty average year so far, he admits — down 12.7% from 2011’s record numbers. Overall, sales from January to May were at 16,964 units sold, compared with long-term average sales of 17,293 during the same time. “You’re almost right on average in total,” he says.

“The main difference, of course, is the shift in the kind of housing. And that’s continuing.”

Another difference is price. With supply down in the low-rise sector, prices are rising there. RealNet calculated the average index price for a low-rise home at $607,893 in May, “the first time it’s ever gone beyond $600,000,” Mr. Carras says. In the high-rise sector, meanwhile, prices have been levelling off in general, though did rise in May to $439,549. “You usually look at a price gap between low-rise and high-rise, and in the long-term it tended to be about $78,000,” he says. “This is the widest gap on record.”

Affordability continues to drive the high-rise market, adds Jasmine Cracknell, partner with Toronto real-estate consulting firm N. Barry Lyon Consultants Limited. The June 21 announcement by Finance Minister Jim Flaherty, reducing the maximum mortgage amortization period to 25 years from 30 years, will see that trend continue, she predicts.

“Affordability will be much more critical … now somebody who qualified for a 700-square-foot condo before will have to get a 600-square-foot condo,” she says. “Some people’s expectations might have to be lowered in terms of what they can afford.”

The result, she adds, will be a market slowdown — the very intention of the change. Did Toronto, specifically, need it, though? Ms. Cracknell doesn’t think so. “It was slowing anyway,” she says.


Toronto Condos

Lisa Van de Ven, Special to National Post Jul 10, 2012 – 8:00 AM ET | Last Updated: Jul 5, 2012 6:04 PM ET

On July 1, Canada Day, Canadians awoke to a startling, if pleasant, piece of news: For the first time in recent history, the average Canadian is richer than the average American.
According to data from Environics Analytics WealthScapes published in the Globe and Mail, the net worth of the average Canadian household in 2011 was $363,202, while the average American household’s net worth was $319,970.
A few days later, Canada and the U.S. both released the latest job figures. Canada’s unemployment rate fell, again, to 7.2 percent, and America’s was a stagnant 8.2 percent. Canada continues to thrive while the U.S. struggles to find its way out of an intractable economic crisis and a political sine curve of hope and despair.
The difference grows starker by the month: The Canadian system is working; the American system is not. And it’s not just Canadians who are noticing. As Iceland considers switching to a currency other than the krona, its leaders’ primary focus of interest is the loonie -- the Canadian dollar.
As a study recently published in the New York University Law Review pointed out, national constitutions based on the American model are quickly disappearing. Justice Ruth Bader Ginsburg, in an interview on Egyptian television, admitted, “I would not look to the United States Constitution if I were drafting a constitution in the year 2012.” The natural replacement? The Canadian Charter of Rights and Freedoms, achieving the status of legal superstar as it reaches its 30th birthday.
Canadian Luck
Good politics do not account entirely for recent economic triumphs. Luck has played a major part. The Alberta tar sands -- an environmental catastrophe in waiting -- are the third-largest oil reserves in the world, and if America is too squeamish to buy our filthy energy, there’s always China. We also have softwood lumber, potash and other natural resources in abundance.
Policy has played a significant part as well, though. Both liberals and conservatives in the U.S. have tried to use the Canadian example to promote their arguments: The left says Canada shows the rewards of financial regulation and socialism, while the right likes to vaunt the brutal cuts made to Canadian social programs in the 1990s,
which set the stage for economic recovery.
The truth is that both sides are right. Since the 1990s, Canada has pursued a hardheaded (even ruthless), fiscally conservative form of socialism. Its originator was Paul Martin, who was finance minister for most of the ’90s, and served a stint as prime minister from 2003 to 2006. Alone among finance ministers in the Group of Eight nations, he “resisted the siren call of deregulation,” in his words, and insisted that the banks tighten their loan-loss and reserve requirements. He also made a courageous decision not to allow Canadian banks to merge, even though their chief executives claimed they would never be globally competitive unless they did. The stability of Canadian banks and the concomitant stability in the housing market provide the clearest explanation for why Canadians are richer than Americans today.
Martin also slashed funding to social programs. He foresaw that crippling deficits imperiled Canada’s education and health- care systems, which even his Conservative predecessor, Brian Mulroney, described as a “sacred trust.” He cut corporate taxes, too. Growth is required to pay for social programs, and social programs that increase opportunity and social integration are the best way to ensure growth over the long term. Social programs and robust capitalism are not, as so many would have you believe, inherently opposed propositions. Both are required for meaningful national prosperity.
Orderly Fairness
Martin’s balanced policies emerged organically out of Canadian culture, which is fair-minded and rule-following to a fault. The Canadian obsession with order can make for strange politics, at least in an American context. For example, of all the world’s societies, Canada’s is one of the most open to immigrants, as anyone who has been to Toronto or Vancouver will have seen. Yet Canada also imposes a mandatory one-year prison sentence on illegal immigrants, and the majority of Canadians favor deportation. Canadians insist that their compassion be orderly, too.
This immigration policy is neither “liberal” nor “conservative” in the American political sense. It just works. You could say exactly the same thing about Canada’s economic policies.
Canada has been, and always will be, overshadowed by its neighbor, by America’s vastness and its incredible versatility and capacity for reinvention. But occasionally, at key moments, the northern wasteland can surprise. Two hundred years ago last month, the War of 1812 began. Thomas Jefferson declared, “The acquisition of Canada, this year, as far as the neighborhood of Quebec, will be a mere matter of marching.” The U.S. was comparatively enormous -- with almost 8 million people, compared with Canada’s 300,000. The Canadians nonetheless turned back the assault.
Through good luck, excellent policy and even some heroism, Canada survived the war. But it has taken 200 years for Canada to become winners.


(Stephen Marche is a novelist and columnist for Esquire Magazine. His most recent book is “How Shakespeare Changed Everything.” The opinions expressed are his own.)
Read more opinion online from Bloomberg View. Subscribe to receive a daily e-mail highlighting new View editorials, columns and op-ed articles.
Today’s highlights: the editors on good news from Guantanamo, why Jamie Dimon’s bonus should be clawed back and how to put more electric cars on the road; William D. Cohan on Romney’s magical IRA; Albert R. Hunt on the candidates’ need to spell out debt-cutting plans; Anthony Luzzatto Gardner on Bain Capital under Romney.
To contact the writer of this article: Stephen Marche at stephenmarche@gmail.com
To contact the editor responsible for this article: Mary Duenwald at mduenwald@bloomberg.net



For information on Toronto Condos

What's Becoming of Toronto's Yorkville District

The city’s condominium market experienced a “miraculous” rebound during the third quarter of this year, new data shows, just as luxury home sales also edge higher.
More new condos were sold during that period than in the first two quarters combined, said Ben Myers, executive vice-president of Urbanation Inc., which tracks the Toronto condominium market. And on the resale side, numbers hit a record high.


Mr. Myers called the rebound “nothing short of miraculous,” a sign the recession’s grip on the condo market has eased dramatically.


“It was quite shocking to us,” he said yesterday. “We certainly didn’t anticipate this type of increase because there hasn’t been a lot of new site openings, but the market kind of caught up to where pricing was. People that had been sitting on their hands for a long time finally got into the market.”


New unit sales jumped by 56% from the last quarter, at 4,617, which also marks a 16% increase over the same period last year. On the resale side, 4,854 units sold, representing a 29% increase over the third quarter of 2008, and an all-time high.




The optimistic numbers come after months of depressed activity, and are spurred, experts say, by lower pricing and historically low interest rates.


Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada, says agents have been seeing a “very busy” market, and many of the buyers are young Torontonians.


"Usually the first step in home ownership is to purchase a condominium. What a lot of young people are realizing is they really can’t rent for less than they can own for,” Mr. Polzler said.


The average price per square foot for new condos, which has remained relatively flat over the past year at about $475, slid closer to $430 for new projects launched in the third quarter, Mr. Myers said.


A substantial portion of the sales were at existing sites, he said, noting the number of new condo units opening in the third quarter this year was significantly lower than last year — about 1,750 compared to about 4,500.


In addition to setting a new sales high in the resale market, Mr. Myers said, this quarter also marked the highest sales-to-listings ratio on record.

“Most of the stuff that’s being put out there is getting sold,” he said. Units are taking about 27 days on average to sell within the Toronto census market area, data from Urbanation shows.


In the luxury home market, a new report from Re/Max shows a steady acceleration in sales in most regions of the Greater Toronto Area.

The year-to-date figure for 2008 stood at 1,687; this year, it is up to 1,706, and Mr. Polzler said that difference will increase as the year continues, particularly since the final quarter of 2008 was exceptionally poor.


Mr. Polzler said the numbers have taken realtors by surprise, especially after a slow start at the beginning of the year.


“Nobody would have anticipated, especially in luxury properties, that the demand would be as high as it is, and that we would actually outpace last year.”




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From the Financial Post

Canadians who are considering purchasing their first home are primarily motivated by lower home prices and very low interest rates, but some require confidence in the economy and their employment prospects before they will enter the market, according to a report released today by Royal LePage Real Estate Services. Eighty-six per cent of potential first-time buyers say low interest rates make them more likely to purchase a home; 81 per cent cite lower housing prices as a motivating factor; while 76 per cent cite job security and 64 per cent say a stable economy is an important factor in their decision to buy.

Potential buyers were asked to rank their top incentives for purchasing a first property. While home prices and interest rates took the number one and two rankings, respectively, the third most popular incentive was the First-Time Home Buyers’ Tax Credit. The recently introduced Home Renovation Tax Credit for 2009 was cited by 42 per cent of potential first-time buyers as either ‘very likely’ or ‘somewhat likely’ to impact their purchasing decision.

“When first time buyers stepped out of the market in the fourth quarter of 2008, at the height of the global recession, their absence was profoundly felt. Without significant volumes of entry-level homes trading hands, the entire market limped through the winter months. First time buyers are back in force this spring, and with them the beginnings of a market recovery. While these consumers appreciate government incentives such as tax credits, greater RSP deduction limits and rebates on home renovations, it is markedly improved affordability that is proving to be the powerful drawing card," said Phil Soper, president and chief executive of Royal LePage Real Estate Services. “Our survey demonstrates how important affordability factors such as interest rates and house prices are in stimulating demand."

Across the country, potential first-time homebuyers agreed that affordability was their top consideration, however the survey also revealed differences amongst buyers in various regions of Canada. In provinces such as British Columbia where high housing prices have kept some buyers out of the market in recent years, 92 per cent of potential first-time buyers are now motivated by low interest rates and 96 per cent say lower home prices are likely to prompt them to buy.

In Atlantic Canada, where local economies have been resilient in the face of a worldwide recession and housing markets remain stable, 43 per cent of first-time buyers say they that job security is a factor in their decision to buy, while 84 per cent of buyers in British Columbia and Alberta said job security will influence them.

Atlantic Canadians were less motivated than other Canadians by declining interest rates, with only 72 per cent saying it will likely prompt a buying decision, compared to 86 per cent of Canadians overall. Buyers in Ontario and Quebec rated the Home Renovation Tax Credit as a bigger factor in their buying decision, compared to the Canadian average.

Mr Soper continued, "The significant response differences from region to region show how closely the residential real estate market is tied to broader economic trends and consumer confidence. Buying your first home is a major life decision, and people are more likely to purchase a home if they feel comfortable about the state of the economy and confident that they will have a job to support their new mortgage obligation.”

In the first two weeks of October, Greater Toronto REALTORS® reported 3,631 sales – up 34 per cent compared to the first two weeks of October 2008. The average price for these transactions was up 17 per cent year-over- year to $414,479.

"While demand for existing homes has remained strong, it is important to recognize the context of current statistics. We are now making comparisons to the fall of 2008 when we experienced a marked decline in sales and average price," said TREB President Tom Lebour.

Year-to-date sales, at 69,964 are up six per cent compared to 2008. Average price, at $389,687, is up by two per cent.

"Tight market conditions throughout the GTA will continue to exert upward pressure on home prices in the fourth quarter," explained Jason Mercer, TREB's Senior Manager of Market Analysis. “Expect more listings in 2010 as home owners react to the price gains experienced in the second half of 2009.”

The Toronto Real Estate Board (TREB) released its September results earlier this week. I am happy to report that September sales totalled 8,196, representing an increase of 28% compared with the same month last year. The growth in the average selling price was even stronger, coming in at 10%, pushing the average price to almost $407,000. The year-to-date totals are also positive, with sales and average price through the first three quarters of the year up 4.5% and 1.5% respectively. This is encouraging, given this past year's economic challenges.

I asked Jason Mercer, TREB's senior manager of market analysis, if he thought we would continue to see positive results in the fourth quarter.

"The number of existing home sales in the fourth quarter will be well ahead of the volumes experienced during the last three months of 2008," he told me. "I am confident that the number of transactions will push through the 80,000 mark and perhaps be hovering around 85,000 when all is said and done this year. That will put us in line with the level of sales experienced in the 2004 to 2006 period - some of the best years on record under the current TREB boundaries."

It is also Mr. Mercer's opinion that the average selling price will be above last year's as well.
"The resale home market has tightened up substantially since the spring. Sales, our measure of demand, have risen strongly relative to listings, our measure of supply. The result has been an increasing rate of price growth. The average price for 2009 will be hovering around $390,000 - up by approximately 2.5% compared to 2008."

Interest rate decisions by the Bank of Canada over the past year clearly played a role in keeping the housing market buoyant in the face of a recession. Interest rates moving to record lows only served to help an already affordable GTA housing market. Enhanced affordability served to attract a broad array of home buyers. This is why we have seen more transactions in virtually all price ranges and all major housing types across the region.

In September, low-rise home sales (including single-detached, semi-detached and townhouses) grew by 25% compared to last year. High-rise condominium sales were up an impressive 34% over last year. The average annual rate of price growth for both high- and low-rise home types was more or less the same.

The fact that the recovery in the GTA housing market has occurred in all sectors of the housing market - from housing types and prices catering to first-time buyers through to higher-end properties selling for more than $1-million - suggests that the housing market is once again firing on all cylinders after a relatively short downturn. This speaks to the fact that consumers have remained confident in ownership housing as a solid long-term investment.

- The National Post

The Canadian government has just announced a sweet incentive to renovate your home. Through Feb. 1, 2010, every homeowner is eligible to receive a tax credit of as much as $1,350 for renovations costing up to $10,000.

If you were already considering getting work done, this could nudge you over the edge. It's not a bad idea. These days, your money goes further than at any time in recent memory; in addition to the incentive, general contractors, trades and vendors are dropping their prices to keep sales up.

In the coming weeks, I'll be making lists of the hard questions you should ask any professional coming into your home. This week, let's look at interior designers. Before engaging the services of one, check out a few. And when they come around, don't let them leave without first getting answers to these questions.

Can I see your recent projects?

First things first — make sure you like the person's approach. There are two kinds of designers: the kind with a "signature look" (homes get decorated in one style — his) and the kind who is "client-driven" (homes are inspired by your own style and needs).

The benefit of a signature designer is that you know what you're getting; the benefit of the client-driven designer is that the home will better reflect you. As Voltaire said, all styles are good except the boring.

Whatever your choice, request Web links and photos of the designer's recent jobs. Be sure, too, that the images you review are examples of rooms that you're thinking of addressing.

How much does your initial consultation cost? What will I get out of it?

A reputable interior designer will not show up at your home, gratis, to discuss a renovation. Designers want to know you're serious about a project, so they charge for their time. In Vancouver, the tariff for a two-hour consultation runs from $250 to $1,500.

The designer should make an impression — in addition to ideas, you'll want to hear vital questions about your project and straight talk about potential troubles and the designing/building process. During this meeting, the designer should be assessing the project's scope, timeline and budget.

As the client, make the most of your time by having your questions prepared in advance and presenting a stack of images that illustrate the style you're looking for.

Will you write an initial proposal? What will it include?

You need a road map from here to there. After the initial consultation, the designer should prepare a proposal. A good one will include four things: an overview of the project, an outline of the designer's process (and key milestones), a declaration of the fee structure, and a detailed list of the documents and drawings you'll receive.

Keep in mind, this is the first document you're receiving from the designer — it's an opportunity to judge how organized and methodical he is. Also, ask for a copy of his standard contract — his forthcoming proposal will likely refer to it.

How will you assess what I need?

It's a crucial question: Can the designer identify your needs and create an environment that addresses them?

In the first phase of meetings, the designer should ask questions about how your family lives. He'll likely take photographs of your home and belongings, and, if architectural drawings don't exist, conduct a site measure of your house. Afterward, expect to receive a brief that itemizes your requirements and highlights challenge areas. Done properly, this document is the key to the rest of the design process.

How do you present your plans?

A design presentation is one of the most exciting parts of the process — the first moment that you get a concrete idea of what is to come. Renderings, three-dimensional models and material presentation boards provide the best illustrations of the designer's ideas. Keep in mind, though, these services are time-consuming and costly.

Work out in advance with the designer the level of detail you require and how this will affect your overall service charge.

Do you prepare working drawings and a specification package?

As important as the designer's great ideas is his ability to communicate them to a general contractor. A spec package identifies every material, lighting and plumbing fixture, and hardware piece in the project — and it should include colour, series, size, finish, manufacturer, vendor, contact, price and lead time. The more detailed this document, the easier it is for your contractor to give you accurate budget numbers and timelines.

You also need a set of working drawings — to-scale, dimensioned illustrations that show the design of your cabinetry, fireplaces, vanities, showers and so on. These plans identify the location of every item — and save you the time and stress of communicating this to the contractor.

Don't hesitate to ask if you can see examples of both items before you make your final decision.

How do you bill for your time?

Most designers bill by the hour for themselves and their staff — fees range from $65 to $350 an hour.

On small projects such as a bathroom reno or kitchen upgrade, a designer may be willing to provide you with a set fee. But when a project gets to $100,000 or more, most designers will only make an estimate of their time. The reason is that unexpected changes (and, often, client indecision) can lead to late redesigns that are nearly impossible to account for.

However the designer charges, put away a 15-per-cent contingency fund to cover any late-in-game cost overruns or changes of mind.

What are the additional expenses?

In addition to his time, a designer often makes money on furnishings. If he purchases furniture at a discount, he'll mark it up 10 to 30 per cent; if he has it custom made, he'll mark it up 40 to 100 per cent. Ask in advance if this information will be disclosed to you. Ask also if the designer (and not you) will manage all the orders, tracking and deliveries.

Disbursements for items such as such as printing, shipping and couriers are usually charged at cost or with an administration fee. These are above your service fees.

May I have three client references?

However brilliant a designer's interiors, he may be a nightmare to work with. Ask for three references from recent clients and follow through on calling them. Ask them how of the above questions were satisfied, and whether they feel that the designer was organized, whether he listened and whether the project came in on time. Oh, and whether they love the final design.

Now that you're fully armed, go take advantage of that renovation incentive.

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