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Archive for the 'Real Estate Trends' Category

geo2Many Canadian economists have speculated that the Canadian economy is at risk of being in a recession. This would appear to be very scary news considering that it has been widely reported that Canadians are carrying record levels of debt.

The question many have had is will this end up having a negative impact on the real estate market?

Look at urban centres like Toronto where it was recently reported that the average sale price of a single detached home has exceeded 1 million dollars. Will these markets stay hot?

Some speculate that urban centres may cool off while the “burbs” will heat up. One thing is for sure, when the economy falters and Canadians are struggling to maintain their housing payments with their other bills like payments to debt, some will look at downsizing. This may include moving a little bit further away to be able to buy more for less.

When Canadian families are struggling financially there may be less lower income families coming into the housing market, but folks moving to put cash flow back into their households can more than offset this.

In a strained economic environment you have to be even more diligent when pre-qualifying new clients. Why?

  1. Pre market-crash of 2008 – mortgage financing rules were more lax so there are a high volume of people walking around who took out mortgages at 90-95% the value of their homes, amortized over 35 years and so have less equity.
  1. People in debt generally turn to debt consolidation as a first measure before making the difficult decision to sell their home. This can result in 1 very large mortgage refinance or perhaps 2 or 3 additional mortgages behind the first mortgage.
  1. When people have financial problems they can fall behind making monthly payments to things like property taxes, condo fees, income taxes and other bills leading to property liens – the homeowner may not even know is one has been registered.

What do the above 3 scenarios have in common? They can all result in there not being enough equity to pay you!

You can mitigate this occurrence by doing a basic preliminary background check on new listings:

  1. Validate that your client is the legal homeowner
  2. Look at the sales history of the property
  3. Estimate the value by reviewing comparable sales
  4. Review financial encumbrances like mortgages
  5. Check for liens

An unstable or underperforming economy doesn’t necessarily mean a negative impact to the real estate market but what it does mean is that you have to be agile to adapt in conditions that may emerge as a result.

If you would like to be able to access a tool that enables you to perform the due diligence discussed in this article and more please visit www.geowarehouse.ca.  

 

 

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5 Year Canadian Real Estate Trends

Author: GeoWarehouse
November 4, 2013

Real Estate TrendsIt comes as no surprise to most Canadians that, as the country continues to put the last few years of financial instability behind it, housing sales continue to rise. This graph, recently released by the Canadian Real Estate Association (CREA), demonstrates this, outlining some of the different trends that have impacted both spikes and declines. As the graph illustrates, sales in 2013 have been strong and continue to increase, signaling good things for the future. Even with CMHC guideline changes, criticized by some as a bad move as far as future home sales, Canadians are still purchasing and the real estate industry continues to thrive.

Sales right now are the highest they have been in almost three years, but how can you, as a real estate sales professional, work to keep them high? It is simple. With a few real estate tools that make finding the perfect home for your clients trouble-free, you can ensure that those sales are ending up on your desk and the commissions in your wallet.

–        Property Details Report: use this tool to access information regarding MPAC data, ownership, sales history and property images.
–        Neighbourhood Sales Report: use this tool to gauge market value by comparing recent sales in a given neighbourhood.
–        Neighbourhood Demographics Report: use this tool to find out about age distribution, family statistics, average income, etc.
–        Aerial Imagery: use this tool to determine the desirable (and undesirable) features of a neighbourhood.

Get the information you need to find your clients the home they love and close the deal from the comfort of your office.

For more information about GeoWarehouse real estate tools please contact us at 1-866-237-5937 or visit www.geowarehouse.ca.

 

 

 

 

 

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