Be careful when making a home purchase offer without a Financing Condition 

- Couple ordered to pay $470,000 after reneging on Ontario home deal



A recent Toronto Start article highlighted the risk of not including a Financing Condition on your house purchase offer.  Back in late 2016 and early 2017, it became customary to see buyers making home purchases with no conditions, i.e., not conditional on financing. Many buyers subsequently bought homes, and then were unable to close, as the price of their existing feel with the market correction.  Many of those buyers are now in court attempting to recover their deposits.  The first of those cases in Ontario has now reached a conclusion, with the defaulting buyers now obligated to pay damages of $470,000!



Damages associated with backing away from a firm (no conditions) house purchase can be quite extensive, as they include the drop in price of the subject home, in the time from the initial deal (housing price peak) to the sale price when the house was later relisted and resold at a lower market.  As an example, if a house sold with no conditions in the spring of 2017, for $1.0 million, and then had to be relisted and resold after the market correction, for 15% less at $850,000, the damages would include the price reduction of $150,000.  Legal costs could also be awarded.


We’re likely to see many more of these stories as these many cases work their way through the Ontario courts.    


Firm buyers often win in competition, and although the market is fairly balanced now, we still see competition for some properties.  Should buyers go firm on house purchases?  It’s obviously risky.  In some cases the seller will not resist giving the buyer the deposit back.  In others, the seller is willing to go to court for damages.   If you’re dealing with a mortgage broker, he/she should help you figure out.  If not, call us and we’ll connect you to our mortgage broker – she’s outstanding and has helped many of our clients.


#LindaMaguirerRE #Burlington #Oakville #BurlOak #BurlON



GTA Home Pricing is far better than most reports imply.


From a pricing standpoint, the spring GTA Housing Market is better than many publications imply.  To understand why, we need to put the current market in context.  It’s a unique time in the history of housing in the Greater Toronto Area (GTA) as a result of the previous three successive years (2016, 2015 and 2014) in which we saw unprecedented annual price increases, first 10% then 20% and then a 35% jump! That three year backdrop makes it easy to misunderstand, and easy to be misled by, current announcements of real estate market statistics.  Most year-over-year reports on PRICE are indicating a 15% drop March 2018 over March 2017, along with speculation about the reasons (government intervention, mortgage qualification rules and interest rate fears).  But if you’ve owned a home for the last four years, even with this latest 15% price drop, you’ve made a spectacular and rare return on investment, and its tax free for most people.  Home equity has increased dramatically in that time. 




Is a 15% PRICE DROP good or bad?  Obviously if you’re planning to sell soon, a small portion of your recent equity growth has been eroded. But the price drop is also a good thing in some ways.  Market speculators are leaving the housing market since flipping a home is no longer a safe bet. Speculators represent a false element of home demand, so it’s a good thing that the market is now less driven by their activity.  Also, the price drop over the last twelve months is a long-expected correction of a previously unsustainable price surge.  The market is now returning to a balanced position, where neither the buyer nor the seller has a consistent upper hand.  Balanced markets are good for all consumers, as it reduces the likelihood of catastrophic mistakes by those who cannot afford them (like the homeowners who bought not-yet-built homes at the highest price points of the market, hoping to sell their current home later at a market-peak price, only to discover that they are now in real trouble because they overpaid for the new build and cannot afford to sell their existing home at current prices.)


Click the link to read economist Derek Holt’s view, written by Sarah Niedoba





If you have followed the last couple of years of “developments” in downtown Burlington, you’ll be well aware that residents have an increasing feeling of being left out of City Hall’s planning process.  In one recent example, signs went up announcing a 23 storey condominium covering most of a large block on Brant St. south, right across from city hall, in the heart of old downtown.  Residents had already been feeling as though City Hall had been secretly allowing developers to run roughshod over Burlington’s zoning and official plan, so this episode, along with several other recent baffling high rise announcements, has really angered many residents.  Whether its actually City Hall’s intent to mislead, or just its inability to communicate, inform and gather input from residents, is anyone’s guess.  But the sense that it’s the former is growing stronger.


Now Marianne Mead Ward, downtown Burlington councilor, has announced that she plans to join the October race for Mayor.  Marianne has demonstrated over her term as councilor, that she’s a very good communicator.  She has a background in communications, and has employed current technology to provide information in the ways that people like to consume it: email and video.  In my opinion, she’s really stood out among Burlington City Hall councilors in that she provides updates, listens and openly shares her “take” on important issues.  And she provides her views as though she’s a concerned Burlington resident, rather than as distant politician.  This may be the mix of skills that would help to enable residents to be informed, heard and involved.  Have a look at her Youtube video. 




Consumers don’t care about housing VOLUME statistics: they care about PRICE


Real estate publications (real estate boards, national newspapers and various associations) write their reports in a way that confuses consumers. Consumers of their analysis cannot easily interpret the reporting of SALES VOLUME from the reporting of PRICE CHANGES.  Homebuyers and sellers care about PRICE, and yet the reporting typically starts with an inarticulate reference to the market TRANSACTION VOLUME, not PRICE.


GTA housing prices


Here’s a recent example:

According to data released by (…a real estate board) last week, sales were down a whopping 39.5 per cent year-over-year in March (2018).


Homeowners read this and think the worst – that their home is now worth 39% less. That's not true. 


These reports start by confusingly highlighting something that most consumers really don’t care about and don’t want to learn about – TRANSACTION VOLUME. The word “Sales” means transaction volume.  It’s the number of homes that changed hands.  Who cares about VOLUME?  Economists, newspapers and market analysts.  To them it implies something about the evolving state of the economy. 


The thing that consumers care about is home PRICE.  When consumers read most reports on the housing market, the reader must diligently wade past the confusing “Sales” mentions, and get to the portion on PRICE.  I look forward to the point when these publishers recognize the consumer need and clearly state their findings in capital letters, with the most important topic first.  Here’s what that would look like:


Housing PRICES are up/down by X% in the last year-over-year period.

Housing TRANSACTIONS are up/down by Y% in the same period.


That is actually what these publications are trying to communicate, but as a homeowner/homebuyer reader, you need to be careful and clear minded to distill most reports down to those two points. 


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Linda Maguire from Royal LePage is known for her kindness and energy.  These two characteristics cause her to do a lot of little extra things for her clients.  She deeply cares about her clients and helping them get to their life goals, and she understands that selling or buying a home is just a step toward those goals.  Because of her undying energy, she readily jumps in and helps out in ways that often surprise clients.

As an example, in one recent case, Linda’s client was concerned that a dead tree in the back yard of her home, was detracting from the open back yard of a home that Linda was listing for sale.  Linda thought, “lets just cut it down”.  She went home, picked up a “sawzall” and extension cord, and on a cold day, in the midst of a heavy rain storm, Linda got down in the muck in her jeans and Burberry coat, and started cutting.  Down came the tree.


On another occasion, Linda’s client was concerned that, with a small dog in the house during the day, showings would be difficult to arrange.  Linda volunteered to temporarily adopt the dog, and look after it at her own home. She happily transported the dog to her home and set it up with its own bowls and a few walks per day, and showed the dog where it would sleep – in bed with Linda. 


Linda’s kindness and energy propel her to naturally jump into client situations and do the things to help smooth the client’s otherwise stressful process.  No wonder Linda’s clients become such close friends.  



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