Andre Smit's Real Estate Round-up

Tuesday Jun 14th, 2022


Hi Folks,

I recently had to sell some Euros after having to purchase some Euros exactly a year ago, and was shocked to find that I had lost 10% of the value in Canadian dollars! So, in 1 year we Canadians have become poorer comparatively, without even realizing it. One shudders to think what the real loss would have been over the last 7 years of rule by the current federal government!

The bank of Canada (BOC), has now committed to raising interest rates at an alarming rate over the next 6-9 months in a desperate attempt to reduce the current inflation rate that is threatening to reach double figures before the end of the year. As an economics major in the early 70's, we were taught that inflation was caused by too much money chasing too few goods, and that in a pure capitalist economy, higher interest rates in the short to medium term, would reduce the inflation rate and return the economy to a state of prosperity. However, that theory did not account for political interference. While the BOC is doing the right thing in the short to medium term, they are working against the government, which is trying to stimulate the economy through it's uncontrolled spending! This can only result in a recession, which I sincerely hope, will be very short lived. What we drastically need now, is a responsible government to stop printing money and to support the efforts of the BOC to resolve this self induced inflationary problem before it drags our entire country into a very painful long term recession!

So, a lot has happened in the real estate market, over the last month. Rising mortgage interest rates are definitely having a dampening affect on our market. The actual sales to new listing ratio has continued it's downward trajectory, and now sits at 38%, putting it firmly into a buyers' market.

According to the Toronto Real Estate Board, (the largest in Canada), compared to May last year, total new listings for all homes were down by 0.5%, while total actual physical sales were down by 39%! However, the average price for all homes, still managed to increase by 9% from the same month, the year before. The average days that listings spent on the market, before selling, had increased from 11 days to 12 days, or by 9%, for the same period.

Average detached house prices have increased by 10%, compared to May, 2021. The number of total new listings stayed the same compared to the same period, last year. The average days that listings spent on the market, before selling, has increased from 10 days to 12 days, or by 20% for the same period. Actual physical sales, in this category were down by a whopping 41%!

However, average condominium apartment prices have increased by 13% for the same period, while new listings increased by 5% over the same month last year. The average days that listings spent on the market, before selling, has increased from 13 days to 15 days, or by 15%, for the same period! Actual physical sales, in this category were down by 32%.

What do I see in the next 4-6 weeks? Homes will take longer to sell, and buyers will become more discerning. There will be a lag between prices still increasing and the eventual decrease cycle. My strong advice to clients looking to up size or downsize, is to sell now with a longer closing period, in order to take advantage of the current still stronger selling prices and then the expected softer prices in 8-12 weeks' time. My younger buying clients should use this time to solidify their mortgage approvals and home in on potential homes and areas, so that they can strike when the market fully changes to a buyers' market.

For those of you who would like to recession proof your current investments, please contact me for property investment ideas, with individualized scenario spreadsheets, which I prepare for all my clients.

With all this in mind, sellers have to once again ensure that their homes stand out from the crowd.

There are two areas of a home that trigger the most buy decisions – kitchens and bathrooms. This month, I will be looking at kitchen renovations, in order to increase the value of your home.

The first things that potential buyers see in a kitchen are the cupboards. It is normally not necessary to replace them, which can be a very expensive exercise. Often, they can be significantly upgraded by removing the doors and painting them, and / or replacing the handles with a more modern, stylish design. Handles cost from $2 to $5 each. However, if you do need to replace the cupboards, you should check out Ikea's range of kitchen cupboards. They are easy to assemble and hang, and are a fair quality at a great price. They also provide free kitchen design services.

The next item that needs to be reviewed, is the lighting system. Halogen track lights are very popular, and can be independently set to spotlight certain features in the kitchen. They sell for between $80 and $200. Halogen, ceiling mounted, pot lights are also becoming fairly popular, and retail for $20-$30 each. An average kitchen, should only require 8-10 of these.

Back splashes have now become staples in the modern stylish kitchen, and can consist of coloured glass or tumbled stone or marble. These retail for between $15 - $30 per sq. ft.

Counter tops fade and scratch over time. The rage at the moment is to have granite or quartz, but one has to be careful what quality is installed. The lower quality can scratch and even shatter under certain circumstances. Granite, being a natural stone product, is porous and needs to be sealed every few years in order to repel moisture. Quartz, on the other hand, is a man made product with a stone base and is not porous. However, quartz appears to be less heat resistant than granite. From an aesthetic point of view, quartz has a more stable colouring and uniform patterns. Some home owners, however, prefer granite's more natural veins and diverse colouring. The granite or quartz raw material costs anywhere between $40 and $60 per sq. ft., with at least another $30-$45 per sq. ft., to be budgeted for installation labour cost.

On the other hand, the new Formica type counter tops are now very durable, with a vast array of colours and textures. If well installed, these will continue to look good for many years. They sell for between $25 & $40 per linear ft.

Sinks and faucets are normally the last items to be replaced in a kitchen. However, if you are replacing the counter tops, it may be feasible to put in a modern under mount sink, with a stylish faucet set. Polished stainless steel is still the most durable. These sinks can set you back anywhere between $200 and $1000. Faucets cost between $80 and $300.

Appliances normally last for many years. However, home style magazines will tell you that you have to have stainless steel appliances, in order to function properly, in modern day North America! However, replacing your stove, refrigerator and built in dishwasher with stainless steel models, can set you back up to $5000!

Painting the walls in a good steam and moisture resistant paint, in a neutral colour, will also enhance the warm feel of the kitchen.

The final item to consider replacing, is the flooring. This will cost between $4 and $10 per sq. ft., plus labour of $4-$7 per sq. ft. for a good ceramic tile. However, if the floor tiles are not cracked, chipped or outdated, merely cleaning the grouting with a grout cleaning paste, will renew them. More and more home owners, are now moving over to luxury vinyl plank flooring in kitchens. They are fairly inexpensive and water resistant, and they come in great modern designs and colours.

The prices that I have quoted, are a guide for the raw materials only. Labour is extra, and needs to be negotiated with a competent installer. I work with a small of team of excellent handymen, who handle these projects on a daily basis. If you are contemplating such a project, I can always give you their contact details. However, please take into account the current inflationary times we live in and add at least 10-15% to the above mentioned prices.


With the weather improving, now is the time to reclaim your garage for the use it was designed for. Organize a trip to your local dump or welfare depot, to get rid of all the items you have been storing for years, hoping to find a use for them one day. Your car will be most grateful, especially when winter raises its ugly head again!

If you, your friends or family have any questions regarding real estate, or indeed, require the services of a great realtor, please do not hesitate to call me at 416-898-2852, at anytime. Remember, that I run a referral cash payment scheme, for any referrals, that result in a completed buy or sell deal, with me!

Until next month,

Enjoy the start of, hopefully, sizzling summer weather, and stay safe out there!

Kind regards,


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