October 2009 Edition: Toronto Real Estate Market Views
PREFERRED CLIENT NEWSLETTER OCTOBER 2009
Market rebound continues in September Magda Mo
The rebound in the GTA resale home The average price for September resale
market further accelerated in September transactions was $406,877 which was
with 8,196 properties changing hands up by 10% versus the September 2008
(an all-time high for the month of average price of $368,549. This marks
September). That figure was up by a only the second time that the $400,000
whopping 28% versus September 2008 barrier has been eclipsed (the other
and brought year-to-date sales volume being this past June when the average
to just shy of 68,000 units sold, up 4% price reached $403,972). Continued
versus the comparable year ago period. low inventory (15,894 active listings,
Considering that year-to-date sales down 42% versus September 2008) is Mortgage
were down by 20% after the month helping to propel prices as well as to
of April, the market comeback has dramatically reduce the average time Rate Watch
been nothing short of astounding. Low required to sell a property (i.e., average
interest rates and growing consumer days on market in September was 27,
confidence in the economy continue to down a full 9 days or 25%, from the Posted Rates – Oct 6/09
be the two key factors driving market year ago figure of 36 days).
performance in recent months.
1 year 3.70%
2 year 3.85%
3 year 4.35%
Units Sold GTA Resale Home Sales - September 4 year 4.94%
9,000 5 year 5.49%
8,000 Open Mortgages
6 month 6.35%
1 year 6.35%
The above rates are accurate at the specified date and
have been supplied by a major bank. There may be
Avg Price $349,142 $380,132 $368,549 $406,877 variations in rates between different financial lending
institutions, and rates are negotiable with individual
lenders. To obtain up-to-date posted rates for all financial
2006 2007 2008 2009 institutions, please consult www.cannex.com.
Benefits of title insurance
The Law Society of Ontario requires all lawyers, when acting well as other matters more specifically outlined in the policy:
for purchasers, to inform their clients about title insurance and
• defects that would have been revealed by an accurate
its advantages. Title insurance is an insurance policy covering
up to-date survey
the condition of title or ownership of real property at the
• survey errors or illegibility of survey
time the policy is issued and is used to provide ownership
protection for a purchaser against losses or damages suffered
• contravention of municipal zoning by-laws
as a result of title problems. Title insurance is obtained prior
• unmarketability of title
to closing a purchase for the benefit of the buyer.
• defects in the title
Although title insurance has been standard in American real • invalidity or unenforceability of the mortgage on title
estate transactions, such insurance has only recently gained • liens
popularity as part of the typical Ontario residential real • easements (other than usual easements for utilities, etc.)
estate purchase transaction. Traditionally, Ontario purchasers • contravention of subdivision, development and other
have relied solely on their lawyer’s “legal opinion” that agreements
they have “good and marketable title” (to confirm a clean • priority of certain construction liens
title). Unfortunately, no lawyer can completely assure a • priority of unregistered easements and rights of way
purchaser that there is absolutely no chance of an error in the • fraud or forgery
government records, that there are no undisclosed claims, or • solicitor error, omission or fraud
that what appears to be the signature of the prior owner or In addition to policy coverage, the insured also receives:
consenting spouse is a true signature, there having been no
prior fraud or forgery on title. Title insurance can satisfy such indemnity for actual loss or damage for the amount of the
“gaps” in a lawyer’s opinion. policy (being the price paid for the property and increasing
with inflation and rising value over time to a coverage
Title insurance does not replace the role of the lawyer. It which can be double the price paid)
simply provides an added level of protection for the purchaser. • payment of legal fees and costs to defend title
Ontario lawyers still must search title and certify the status of • a “no-fault” method to resolve title problems
title before a title insurance policy can be issued.
Typical Residential Policy Coverage For residential real estate transactions with a purchase price
For a one-time premium, the policy protects the lender or of less than $500,000, a policy can be purchased for $250-
purchaser against losses suffered from matters set out below as $300 (depending on the type of residential property).
Fire safety in the home
House fires kill more people in Canada than in any other
industrialized country. This is due partly that most Canadian
including the bedroom. If you leave a room, snuff the candle.
Tall candles can fall over or out of their stand. Keep them way
homes are built with wood and heated bone dry during our from curtains and other items that burn.
The basement is often that area where we put things when
Homeowners can easily reduce the fire danger by being we’re tidying up the house pending the arrival of guests.
fire safety conscious. The most obvious first step is to make From a fire safety perspective, basements are not ideal
sure you have at least one working smoke alarm on each storage areas. Down there is the furnace, hot water heater
floor. Many people who ignore this step may not wake up and electrical panels. The ceiling is often the exposed wooden
when a fire starts. You need to know how to evacuate your underside of the main floor. Add to this cleaning solvents, oily
home in pitch-black darkness on your hands and knees rags, papers and we have a dangerous combination. That
and with the main stairwell blocked. All occupants should wood paneling that is all too common in basements, if not
rehearse this procedure and work out an alternate escape backed by plaster or drywall is a real fire hazard. It readily
route from anywhere in the home. If you live in a two-storey burns like crumpled loose papers. Keep the basement tidy,
house, consider a roll-up escape ladder, one with wooden throw out, give away or sell items you no longer require, store
rungs (metal rungs could be too hot to grab). When you are rags in a closed container. Keep all flammables at least three
outside the building, make sure everyone is accounted for feet away from the furnace, hot water heater and electrical
and call 911 from a neighbour’s home. panel.
The trick is not to have a fire start in the first place. Cooking, Have at least one fire extinguisher (multi-purpose ABC type)
smoking and faulty wiring are the major causes of house fires, by the exit of the kitchen and another in the basement near
in that order. Keep kitchen counters clean, flammable items the stairs. They should be wall mounted, serviced annually
away from stovetops, toasters and other cooking appliances. and you should know how to use them. Fire fighting is best
Have a tight fitting lid or cover available for each pan or pot left to the professionals, so only attempt to extinguish a small
being used to heat oils, butter or fats which can be quickly fire when you are sure you and everyone else can escape
used to snuff out a fire. Do not use flour to douse a fire, unless easily and never attempt it when the fire is between you and
you want an explosion. If you must smoke in the house, keep the escape route.
it away from the bedroom or the sofa and never smoke when
Ask yourself these questions: are the smoke alarms working
drowsy or drinking. Better yet, give up smoking. Don’t run
right now, do all occupants know how to get out in total
electrical cords under rugs, replace damaged or old cords and
blackness and then call 911, is there anything in the house
if the cord is hot, know you’ve got a problem.
that could start a fire, and finally, do I always think (and act)
Candles are popular again and are ending up everywhere, “fire safety” in the home.