Toronto Income Property Newsletter: December 2010
Happy Holidays everyone. I would like to wish all of you, your friends and family a very merry Christmas, Hanukkah, Kwaanza, Festivus (or whatever you celebrate) and a happy and prosperous new year. May all your hopes and dreams come to fruition in 2011. If you are travelling over the holidays, please be safe. Try not to eat too much holiday junk food and enjoy this time of year where we all get to see those who we care most about. I’ll be back to you on New Year’s Day where I’ll give you my forecasts for the Toronto residential income property market in 2011. All the best!
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In last month’s newsletter I talked about the new CREA agreement with the Canadian Competition Bureau and how this was going to open the door to more diversified buyers’ and sellers’ services in our industry. The time has come to re-examine commission based structures for those sellers who feel that they do not need the full-service approach that we all offer. These new MLS rules allow do-it-yourself sellers the opportunity to put their own contact information on their property listing and be contacted directly by interested parties as in a traditional “for sale by owner” model. The general public will not be granted access to MLS for the time being. All postings to the MLS system will still have to be entered by a licensed realtor.
I am pleased to announce that today we are launching a new flat fee $999 listing service. We will list your property on MLS, ensuring its accuracy and integrity and then you take care of everything else from that point on. You show your property, deal with potential buyers (and their agents) directly and ultimately negotiate and execute a contract.
A flat fee listing is ideally intended for those who have had some direct selling experience. Do-it-yourself sellers often have flexible schedules and ultimately feel that they can do honestly do the same (or better) job than a realtor who is going to charge them 2 or 2 ½ % of the sale price. My investor clients are always financially oriented and many tend to possess business and marketing backgrounds, so it will be a natural fit for some of them.
This service isn’t going to be the best selling alternative for everyone. Many sellers (especially of tenanted properties) will continue to need the full service approach, having all duties professionally performed from beginning to end by an experienced real estate professional.
For more information, please visit www.999dollarlisting.com. If you or any of any associates would like to chat more about how this service works in more detail, please feel free to send me an e-mail and I’ll be back in touch with you soon.
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The Toronto Real Estate Board reported 3,076 sales through the Multiple Listing Service during the first two weeks of November 2010. This represented a 16 per cent decrease compared to the 3,666 sales recorded during the same period in November 2009. Year-to-date sales amounted to 78,526 – up slightly from the 2009 total.
It is interesting that even though the number of sales declined, prices didn’t drop. In fact, they went up slightly. In the downtown core it seems like there is hardly any investment inventory at the moment, but that’s only because a year ago we were at the top of the market. When you have record breaking months, as we saw a year ago, where everyone is selling because the market is strong, eventually this has to subside. There are only so many people out there with duplexes to sell. Now a lot of sellers are being cautious and are waiting. There are still plenty of buyers out there though. When I start seeing cap rates that aren’t five point something, then I’ll believe that the demand has started to drop off. In the mean time, many buyers will still have to be patient for the right opportunity.
