Andre Smit's Real Estate Round-up
Thursday Nov 12th, 2020Share
Well, with the weather change, to a more expected single digit daily average for this time of the year, the real estate market has finally started calming down!
However, last month still showed us a solid sellers' market. According to the Toronto Real Estate Board, (the largest in Canada), compared to October last year, total new listings were up by 36%, while total actual physical sales were up by a whopping 25%. This increased activity resulted in the average price for all homes, increasing by 13.7% from the same month, the year before. The average days that listings spent on the market, before selling, has decreased from 23 days to 17 days, or 26%, for the same period.
Average detached house prices have increased by 14.9%, compared to October, 2019. The number of total new listings increased by 6.9% for the same period. However, active listings decreased by 30% from the same month, a year ago.
Condominium apartment prices, however only increased by 0.67% over the same month, a year before. This is largely attributed to the current oversupply in the Toronto apartment market, as more people are working from home and looking for larger more private home work spaces.
The 2021 Spring market is going to be eagerly awaited by buyers and realtors, who missed their sales opportunity this year. Will we return to a sellers' market? That all depends on the economy at the time, and how government reacts to the so-called second wave of the virus. Shutting down the economy again, will definitely remove a large buyer group from the market. It may also result in mortgage repayment difficulties for those affected by these draconian control measures. The federal government would then have to continue printing money, in order to keep the unemployed fed. The total effect of this scenario is very uncertain! However, immigration into Canada, will be accelerated once again with obvious housing demand benefits. I expect the real estate market to be more balanced in the Spring but with a slight leaning towards a sellers' market.
One of the necessities, in our harsh Canadian winters, is good, reliable home heating. Twenty years ago, an efficient furnace was one that effectively used 50-60% of the gas consumed. Now this efficiency has been increased into the late 90%, with the current batch of units available. This has reduced gas consumption by about 40%. More focus is now placed on quietness and greater indoor comfort, with less temperature fluctuations. The most popular furnaces are now 2 stage models with variable speed, direct current motors. The 2 stage furnaces now offer an immediate level of performance. Demand determines the operational level between first and second stage.
Most of the components for these newer models are produced in two factories around the world. So the name label on the unit is not that important. What is important, is the company who will be installing and maintaining the unit. It is a very competitive field and one needs to negotiate very hard, to get the best price and the best warranty. Prices for a 2 stage variable direct drive, 96% high efficiency furnace, with a 25 year warranty on the heat exchanger, and a 10 year parts and labour warranty on the rest, installed, vary between $3200-$3800, plus HST.
Air-conditioners have also increased in efficiency by about 60% over the last 20 years. Air-conditioner efficiency is measured in seasonal energy efficiency ratios, or seers. The government's minimum rating for new units is 13 seer.
The current focus is on at least a 15 seer unit, which is quiet with great indoor comfort and less temperature fluctuations. Prices vary between $2100 and $2900, plus HST.
Government rebates, for both furnace and air conditioner replacement, are available, after having a home energy audit conducted and implementing 2-3 additional energy saving opportunities identified, and can return you a rebate, after installation, of $500.
It is also a good idea to install, at the same time, a new flow through, waterfall type humidifier, which recycles any unused water. These cost about $400, and are very durable with very low maintenance.
Related items to consider replacing are smoke alarms, on every floor and a carbon gas alarm on every floor with bedrooms. All these have an effective life of about 5 years. Batteries, where applicable, should be replaced annually. It is now mandatory, in Ontario, to have a carbon gas alarm and smoke detectors in every home.
The final item to consider replacing, is your thermostat. If you do not have a programmable digital thermostat, then, for about $100 you should get one. With these new models, you can set the temperature to be lower in the winter or higher in the summer, while the home is not occupied during the day, or in the case of winter, while everyone is safely and warmly tucked up in their beds. This saves a great deal of energy, and of course, money as well.
I have dealt with an excellent HVAC installer for the past 6 years. His name is: Ed Ghobrial of Evam Canada, and you can call him at 416-876-0911, for any furnace or air conditioner advice or prices.
Smit's Tip of the Month:
Shut off the water supply to outside plumbing, before the first freeze, and open outside taps, in order to drain water from the pipes. Leave the taps in the open position throughout the winter.
Please remember, that if you, your friends or family, have any questions regarding real estate, or indeed, require the services of a good realtor, do not hesitate, to contact me, at 416-898-2852, at anytime. I also run a cash referral system for any referrals to me, that result in a buy or sell transaction.
I now have my ever popular 2021 wall calendars in stock again, and will start distributing them in the next few weeks. If you did not receive one last year, and would like to have one, please call or message me, and I will rush one to you.
Bundle up and get acclimatized to the cold, and stay safe out there!
Until next month,