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James Metcalfe's Real Estate Update January 2013

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This month we look at house prices in 2012, how to test for Radon gas, whether it is your responsibility to disclose noisy neighbours and of course the ever popular pearls of wisdom.

This month we look at house prices in 2012, how to test for Radon gas, whether it is your responsibility to disclose noisy neighbours and of course the ever popular pearls of wisdom.

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  • 1. JANUARY 2013 REAL ESTATE UPDATE The average selling price of a resale home in the GTA during A total of 85,731 homes were sold in the GTA during 2012, 2012 increased by another 7% to $497 ,298 and resulted which represented a 4% decrease versus 2011’s volume of in an increase of about $32,000 in equity for the average 89,096. The first half of the year was characterized by very homeowner. Using 2007 as a base year, the average price strong year-over-year growth but this increase was more of a resale home in the GTA has increased by 5.7% per year than offset by across-the-board sales declines in the second during the past five years and has provided homeowners with half. Stricter mortgage lending guidelines for government a gain of over $121,000 in equity. Considering that primary insured mortgages (implemented in July) resulted in some residences are capital gains tax exempt, in order to get an households postponing their home purchase. In the equivalent rate of return, another investment would have City of Toronto, the dip in sales was compounded by the had to average 8.8% per year during the same time frame additional Land Transfer Tax which buyers must pay upfront. (assuming a 35% income tax rate). The month of December Notwithstanding the weak second half of the year, annual also saw the average price increase by 6% versus December volume was actually quite strong from a historic perspective. 2011. GTA AVERAGE RESALE PRICE GTA RESALE HOME SALES 8 9 10 11 12 8 9 10 11 12 $550,000 100,000 $500,000 95,000sale Home SalesGTA Resale Home Sales $450,000 90,000 $400,000 85,000 $350,000 80,000 $300,000 75,000 $250,000 70,000 $200,000 65,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 for more detailed GTA statistics: REALTYSTATS.CA/5A2X James Metcalfe BROKER 416-931-4161 Royal LePage Real Estate Services Ltd. Johnston & Daniel Division, Brokerage 477 Mount Pleasant Rd., Toronto, ON M4S 2L9 www.OurHomeToronto.com | Service@OurHomeToronto.com 1
  • 2. LEGALLYSPEAKING MUST YOU DISCLOSE NOISY NEIGHBOURS?A teenager playing basketball on his family driveway in nuisance caused at least a $10,000 reduction in the value of herPeterborough made national news  when the neighbour unit.complained about the noise.  A backyard hockey rink can createthe same amount of noise. Should a seller be required to In 1990, B.C. judge Bruce Cohen ruled that the fan interfered withdisclose these types of situations when they sell a home? Kenney’s enjoyment of her condo and reduced her resale value. The judge said the test was whether the use of the land by theA British study found that one of the  top 10 reasons people neighbour interfered substantially with the enjoyment of the othermove  is because they want to get away from problem unit and was the interference unreasonable.neighbours, either those who are aggressive, or those who arenoisy or messy. REALTORS® say the top reasons people move in He also said that “Not every smell, whiff of smoke, sound ofOntario has more to do with upsizing, downsizing, getting closer machinery or music will entitle the affected person to recover. It isto good schools, jobs or their families. impossible to lay down precise standards, but the invasion must be substantial and serious. ”It has been demonstrated that in some cases, the nuisancecaused by noise or smell can affect real estate values. In a In this case, he awarded Kenney $25,557 based on $10,000 for the1983 Vancouver case, Sharon Kenney bought a condo that was loss of value of her unit, $7,500 for the gross interference with herabove two restaurants. Before buying, she made sure that these comfort and enjoyment of her condominium and repayment of therestaurants only served light meals and no foods were cooked or real estate commission of $8,057 that she had to pay.deep fried. In 1987 one of the restaurants installed an exhaust ,fan directly below her patio. Most lawyers will tell you that neighbourhood conditions do not need to be disclosed to potential buyers. However, sellers doThe noise from the fan and the smell were a constant nuisance have to respond truthfully if you ask them direct questions.and she sold her condo as a result. It took seven months to selland though she listed it for $119,000, she eventually dropped the Sellers should first try and settle things amicably. Taking the timeprice and sold it for $105,000. An appraiser gave evidence that the to get to know them could lead to an effective resolution. You may also suggest a mediator to try and reach a reasonable solution. If all else fails, you can report the noise to the local bylaw enforcement department at city hall or if more serious, to the police. Suing for damages should be a last resort, but then again, no one should be forced to move because of a problem neighbour. Buyers should walk around any neighbourhood that interests them and talk to the neighbours. Come around at different times of the day or night and see and listen for yourself. Also ask the sellers point blank if they know of any neighbourhood conditions that could affect the market value. Being prepared in advance is the best way to avoid a problem later. 2 This article was contributed by Mark Weisleder, a Toronto-based real estate lawyer. Please visit him at markweisleder.com.
  • 3. HOUSE SMART HOW TO TEST FOR RADON GASRadon gas is a radioactive gas that is colourless, odourless andtasteless. It is formed by the breakdown of uranium, a naturalradioactive material found in soil, rock and ground water. Whenradon escapes from the ground into the outdoor air, it gets dilutedand is not a concern. But when it seeps from the ground intoan enclosed, unventilated space like a house, it can sometimesaccumulate to high levels and contaminate the inside air.Back in the 1970s, Health Canada surveyed the radon levels of14,000 homes in 18 cities across Canada. A small but significant months. The detector is exposed during the measurement period,minority of homes in some locations were found to have high allowing radon to diffuse through a filter-covered opening into thelevels of radon gas. In Canada, the Radiation Safety Institute says chamber. Results can be read in the home using a special analysisthat long-term exposure to radon causes about 2,000 deaths per device, or mailed for laboratory analysis. This type of detector canyear and is the leading cause of lung cancer among non-smokers. be deployed for 1 to 12 months.In addition, it can greatly increase the chances that a smoker livingin a contaminated house will acquire lung cancer. This detector plugs into a standard wall outlet much like a consumer carbon monoxide detector, and continuously monitorsAll homes contain some radon gas. The question is whether your for radon. It allows the homeowner to make radon measurementshome’s radon level presents a danger that can be avoided? The in different areas of the home. After being plugged in for anamount of radon gas present in your home will depend on various initial period of 48 hours, the device displays the average radonfactors such as soil characteristics, geographic location, a home’s concentration continuously. This convenience comes at a priceconstruction type, foundation condition and weather. though: continuous monitors are generally more expensive than other radon-testing devices.It’s almost impossible to predict your home’s radon level based onthese factors, but the good news is that a simple test can tell you Like most testing kits, charcoal detectors need to be exposed toif you’re in the safe zone or not. There are a number or testing kits home air for a specified time period. Charcoal detectors consistingavailable to the Canadian public. Health Canada recommends that of a charcoal-filled container covered with a screen and filter arethe radon test performed in a home or public building be a long- exposed to a home’s air for two to seven days. They are thenterm measurement for a minimum of 3 months. sealed and sent to a lab for analysis.These detectors use a small piece of special plastic or film inside You can find Canadian radon testing service providers via aa container with a filter-covered opening. Air being tested diffuses simple web search or by going directly to the Canadian Radiation(passive detector) or is pumped (active detector) through a filter Protection Association (CRPA) website at: www.crpa-acrp.com/covering a hole in the container. At the end of the test period the biz_directory/radon. You can also find out more about radoncontainer is sealed and returned to a laboratory for analysis. The at Health Canada’s website, www.healthcanada.gc.ca/radon.testing period of an alpha track detector is usually 1 to 12 months. Finally, you can also download “Radon - A Guide for Canadian Homeowners” from CMHC’s website at www.cmhc-schl.gc.ca/Two versions of this detector exist: one for short-term tests of odpub/pdf/61945.pdf. This 47-page guide is loaded with usefula few days or weeks and another for tests of several weeks or information about radon gas. 3 This article was contributed by Calum Ross, a leading Toronto-based mortgage consultant. Please visit him at calumross.com.
  • 4. Skiing, skating, snowmobiling, snowshoeing, tobogganing alarm is not enough; install them on every level of your homeare just some of the many winter activities that we Canadians and outside all sleeping areas. Only working smoke alarmsenjoy. But winter all too often also brings us preventable can give you the precious seconds you may need to escapetragedies that are caused by gas, fire and smoke. Here are a fire.some winter safety precautions to take heed of: Combustible materials: Do not store combustible materialsFireplaces: Do not use your gas fireplace if the glass panel such as gasoline, propane, paper, chemicals, paint, rags andis removed, cracked or broken. Glass panels and frame cleaning products near your gas furnace. Gasoline or propaneassemblies should only be replaced by a qualified service cylinders must be stored outside the home. Never useprofessional. Remember to keep pets and children away from gasoline or other flammable liquids anywhere near your gasfireplaces (and other hot surfaces). furnace or water heater. Have a qualified heating contractor perform a yearly maintenance check of your furnace andCarbon-monoxide alarms: Install at least one carbon- venting system.monoxide (CO) alarm near bedrooms. Use more than one COalarm if sleeping areas are located on different levels of your Let’s have a safe, fun winter! As usual, your client referrals arehome. Follow the manufacturer’s instructions for installing both highly valued and much appreciated, during the winterand maintaining your CO alarms. months or any time of year! Until next time, take care!Smoke alarms: Test your smoke alarms monthly. One smoke James Metcalfe BROKER “YOUR REFERRALS ARE SINCERELY APPRECIATED! THANK YOU!” 416-931-4161 www.OurHomeToronto.com | Service@OurHomeToronto.com Royal LePage Real Estate Services Ltd. GTA Res Johnston & Daniel Division, Brokerage 477 Mount Pleasant Rd., Toronto, ON M4S 2L9 “It is such a pity that youth is wasted on the young. – George Bernard Shaw ” “Don’t keep a man guessing too long - he’s sure to find the answer somewhere else. – Mae West ” “I had the right to remain silent...but I didn’t have the ability. – Ron White ” “Those are my principles, and if you don’t like them...well, I have others. – Groucho Marx ” In accordance with PIPEDA, to be removed from this mailing list please e-mail or phone this request to the REALTOR ® Not intended to solicit buyers or sellers currently under contract with a broker. The information and opinions contained in this newsletter are obtained from sources believed to be reliable, but their accuracy cannot be guaranteed. The publishers assume no responsibility for errors and omissions or for damages resulting from 4 using the published information. This newsletter is provided with the understanding that it does not render legal, accounting or other professional advice. Statistics are courtesy of the Toronto Real Estate Board. Copyright © 2013 Mission Response Inc. 416.236.0543 All Rights Reserved. K0191