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Real Estate as it Happened in November 2017

KITCHENER-WATERLOO, –– Last month a total of 425 residential properties sold in Kitchener-Waterloo and area through the Multiple Listing System (MLS® System) of the Kitchener-Waterloo Association of REALTORS® (KWAR). Home sales in November were down 20.1 per cent compared to the same month last year, but on par with the previous 5-year November average of 424 sale; a typical November.

Compared to November 2016, the average price of all residential properties increased 8% to $445,363. Detached homes averaged at $515,721, up by 8.9%. An apartment style condominium was $277,660 for an increase of 30.7%. Townhomes and semis sold for an average of $369,678 (up 19.3 per cent) and $376,677 (up 15.1 per cent) respectively.

For detailed information on your property, contact me, Denis Pellerin at (519)577-8181

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An interview with Terry O’Reilly by By Diane Slawych

Why do real estate agents, perhaps more than people in any other service industry, so often use their photos on business cards and other advertisements?

O’Reilly: My research told me that this practice started in the late 1800s/early 1900s. People were moving to cities from the country and unscrupulous conmen would meet these people at train stations and sell them non-existent property. These land sellers were called “land sharks” and took advantage of good people looking to start a new life. The term “swampland in Florida” was coined in this period.
Legitimate real estate agents wanted to distance themselves from these scam artists, so they began to organize by creating real estate boards and they established standards of practice. Using a face in their marketing and opening offices with fixed addresses suggested accountability. No conman would ever advertise his face and they certainly didn’t want offices where they could be tracked down. In other words, the use of a face in real estate marketing was the ultimate sign of trust.

In your show you mention a fascinating study done by three American universities that looked at physical attractiveness as it relates to a real estate professional’s success. Could you elaborate?

O’Reilly: It was an interesting study because this is an industry that relies on faces. Essentially, it said that attractive agents had listings with higher selling prices and higher commissions. The study confirmed that physical attractiveness is an asset. But, there was an interesting side note: Less attractive agents had lower selling prices but more listings and more sales. Which I interpret to mean, they worked harder. Attractive people use their beauty in place of other work skills. Less attractive people must work harder and they do.

You discovered that real estate played an important role in the evolution of the advertising business. How so?

O’Reilly: To begin with, the very first advertising agency in North America was started by a Philadelphia real estate agent named Volney Palmer around 1837. Second, the very first radio commercial ever aired was for a real estate development. It was broadcast in 1922 on radio station WEAF in New York. Close to $14 billion is spent on real estate advertising in North America annually, so it is a powerful marketing sector.

See the full article here: http://www.remonline.com/cbcs-terry-oreilly-world-real-estate-marketing/

fn: Do to my years of business to business work I have never had my photo on my cards. However, if you’re interested in some good old down to earth real estate talk, give me a call, I hope to pleasantly surprise you. Denis (519) 577-8181

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October Residential Sales

Under the umbrella of the KWAR, for the month of October sales were above the previous 5-year October average of 464 sales. So we are seeing good activity but sales fell 16.6%compared to September’s activity.
VALUES
The average price of all residential properties sold last month increased 11.4% to $454,398 compared to October 2016. Detached homes sold for an average price of $541,368, an increase of 13.1% compared to October 2016. The average sale price for an apartment style condominium was $249,993 for an increase of 11%, Townhomes and semis sold for an average of $349,316 up 13.7% and $354,668 – 8% respectively.

MORTGAGE CHANGES
Last month the Office of the Superintendent of Financial Institutions Canada (OSFI) revised it residential mortgage underwriting practices, which come into effect on January 1, 2018. The change will require the minimum qualifying rate for uninsured mortgages to be the greater of the five-year benchmark rate published by the Bank of Canada or the contractual mortgage rate +2%.
Those effected by this change may be first time buyers and the marginally qualified.

For more information or for property valuation contact me, Denis Pellerin at (519) 577-8181 or by email dpellerin@coldwellbankerpbr.com

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Final Guidelines for Mortgages Released

Canada’s banking regulator has published the final changes to its guidelines for residential mortgage underwriting, including a financial stress test for buyers who don’t need mortgage insurance.

The Office of the Superintendent of Financial Institutions said Tuesday the changes will come into force by Jan. 1, 2018.

Even homebuyers who don’t require mortgage insurance because they have a down payment of 20 per cent or more will have to prove they can continue to make payments if interest rates rise.

Other changes include restrictions on co-lending, or bundled mortgages, aimed at ensuring financial institutions do not circumvent rules that limit how much they can lend.

The final guidelines are generally similar to what OSFI had proposed in July, when the regulator put out a draft for public consultation.
The proposed changes, however, have been criticized for including potentially increasing costs and limiting access to mortgages for some home buyers.

“These revisions to Guideline B-20 reinforce a strong and prudent regulatory regime for residential mortgage underwriting in Canada,” said Superintendent Jeremy Rudin in a statement on Tuesday.

The Canadian Press

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Toronto area sees 35 per cent drop in home sales from year ago: real estate board

Home sales in the Greater Toronto Area were down 35 per cent in September compared with the same month last year, although prices generally continued to increase.

The Toronto Real Estate Board says sales of all major types of residential property were down but the biggest decline was a 40.4 per cent drop in sales of detached homes.

The average selling price for all types of property sold in September was up 2.6 per cent from a year ago, rising to $775,546.

The board says high-priced detached homes accounted for a smaller share of sales than in September 2016 and that the average price for that market segment was flat.

Meanwhile the average price for condos was up 23.2 per cent to $520,411 and average prices for semi-detached houses was up 7.4 per cent at $752,379.

TREB’s benchmark price index, which adjusts for different property types, was up 12.2 per cent from the same time last year.

The Canadian Press

 

How will this effect KW, stay posted in the next few days you’ll get a better picture.

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Celebrate Fall

Don’t miss the opportunities during this Fall real estate season!  Your calls and emails regarding the local real estate market are always welcome.

And, if anyone you know is ready to buy, sell or refinance, your referrals mean more than you know.

Denis Pellerin, (519) 577-8181, dPellerin@coldwellBankerPbr.com

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The Summer Market moving to the Exciting Fall Market

Residential sales for the month of August experienced a year-to-date total of 4,876 units, an increase of 3.7 per cent compared to 2016.

There is an indicator that stability is returning to the market.  I did not like the way the market had been going with record setting sales and prices that seemed unsustainable and created an unfavorable real estate market.

In August 2017, comparing August 2016, 286 detached homes were traded, down 18.8 per cent and 105 condominium units down 30.9 per cent which includes all properties regardless of style such as semis, townhomes, apartment, detached and so on.

The good news is that values were not lost. The average sales price of all residential sales increased 10.1 per cent to $441,992 year over year. Detached homes sold for an average price of $519,910 for an increase of 5.9 per cent, while the average sale price for an apartment style condominium was $294,787 for an increase of 26.5 per cent. Townhomes and semis sold for an average of $338,191 up 13.4% and $351,233 a 17.3%.

With a continuing low two-month inventory that benefits the seller, the signs seem to be trending to a more balanced market.

The savvy have said and continue to tell us that there is no best time to get involved. It’s always a good time keeping in mind that with the upwards pricing trends now seems to be the best time to shop for a home or an investment property.

Wishing more info or wish to shop, contact Denis at (519) 577-8181, dpellerin@coldwellbankerpbr.com. Want to see “Hot New Listings” for nearly all of Ontario, visit http://denispellerin.ca/property-listings

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Housing bubble has already burst says BMO’s Porter

THE KW MARKET has undergone such changes as in the GTA in the last few months. Are we moving away from a sellers market to our normal balanced market? Many believe so as I do. Now as the fall market begins to heat-up is a great time to begin your search. – dP

ARTICLE

Not everyone agrees that Toronto has been in a housing bubble but BMO’s chief economist is in no doubt.

“By any traditional definition, we were in the grips of a full-on bubble earlier this year,” Doug Porter told CBC’s Metro Morning on Friday. He backed that up with stats on house prices rising 40% in around 15 months, a situation last seen in the late 1980s which was widely accepted as a bubble.

Porter continued that the Ontario government’s measures to cool the market helped burst the bubble.

Although prices remain elevated in the GTA, there has been a 13% drop in four months and Porter expects softening to continue with a “full-blown buyer’s market ahead.”

He believes that further interest rate rises will continue to affect affordability even as prices ease, with first-time buyers still facing challenges to home-ownership.