John Lavin Realtor Mississauga - Toronto Real Estate

A bold statement to be sure in these dark and gloomy times. However, as author, politician and former Governor General of Canada, Sir John Buchan said "Those who cannot learn from history are doomed to repeat it". So let's look at a little recent history.

The 1970's

Back in the beginning of the 1970's, Pierre Elliot Trudeau was Prime Minister of Canada and you could buy a house for an average price of $30,000 *. The first big oil price shock happened in 1973-4 and people lined up around the block to gas up their cars. A recession quickly followed. The government turned on the taps of spending, lowered interest rates and the average price of a house spiked to $44,000 *.

By the late 1970's Joe Clark very briefly became Prime Minister of Canada and the average price you paid for a home was $69,000.

The 1980's

The early 80's gave us another oil price shock and interest rates reached the lofty heights of 21% in 1981 resulting in a very severe recession. It was heard said that "no one will ever buy a house again". $90,000* was the average price of a home in 1981. Government again turned on the spending taps and eventually lowered interest rates and increased the money supply.

By the mid 1980's, Brian Mulroney was the Prime Minister of the country and average home prices climbed to $109,000 *.

Boom times followed and lasted until the end of the 1980's. The average home price in 1989 had risen to $273,000 *.

The 1990's

We entered the 1990's with increases in interest rates to choke the supply of money and bring inflation under control. Add the GST and Free Trade into the equation and a severe recession followed.

As the recession lingered interest rates were reduced, the supply of money increased and the spending taps of government were turned up full throttle again.

Jean Chretien became the Prime Minister in 1993 and by 1996 the average price of a house had actually fallen to $198,000 *.

The 2000's

The easing of interest rates began to work their way through the economy and by the new millennium in the year 2000 average prices had recovered somewhat to @229,000 *.

In the early 2000's the shock of 9/11 and the stock market tech bubble had central banks reducing interest rates and increasing the supply of money. December 2008 saw the average price of a home sitting at $316,000 *.

Inflation Will Be Back

With each shock to the system Government response has been to reduce interest rate and increase the money supply. When the supply of money is increased ultimately inflation will increase. To keep up with devaluation of the currency the price of fixed assets will rise.

History shows us that with each reduction in interest rates and increase in the supply of money house prices have ultimately recovered and surpassed their previous high's to keep up with inflation.

That's what is happening today. Interest rates are at their lowest levels in decades, home prices have fallen and Government all over the world, including our own in Canada are turning on the spending taps big time. Inflation is sure to follow.

So if you are a first time home buyer looking for Mississauga Real Estate or Toronto Real Estate, you can take advantage of lower house prices and cheap mortgage rates and remember the words of Sir John Buchan ""Those who cannot learn from history are doomed to repeat it"

* source: Toronto Real Estate Board

Asked is not entirely accurate. Gouged is more apt.

This week the City of Toronto council will introduce and approve it's new budget, one with a provision to hire 1300 more employees and hike property taxes 4%.

One of the positions they intend to create is a "Blackberry Specialist" to look after the burgeoning number of city employees who have Blackberry's. The salary proposed for this Specialist is $84,000 per year. I would suspect a generous benefit package is also attached to this figure.

There are approximately 2000 Blackberry devices amongst city councilors and employees. A Blackberry support specialist would handle problems users are having or will have with the handheld devices.

"There is no boss of all Blackberry's" says Toronto City councilor, Shelley Carroll.

Like many realtors I have a Blackberry also. Mine came with a manual and telephone support from the manufacturer as well as telephone support from the service provider. I'm almost certain that those same support features would have been provided with the 2000 City of Toronto Blackberry's.

I would first of all question why the city needs so many Blackberry's?

Do they really need such a sophisticated device or did someone decide it would just be really "cool"?

Should Toronto Real Estate owners be expected to pay for something the city already has access to, and for free?

What do you think?

Perhaps "killed" is an exaggeration but the patient has been severely wounded. In February 2008 the City of Toronto introduced a Land Transfer Tax payable on all Toronto Real Estate sales. This is in addition to the already punishing Provincial Land Transfer Tax. The result has been a crippling effect on Toronto house and condominium sales as well as lowering average prices.

Recent Study

A recent study entitled "Sand in the Gears - Evaluating the Effects of Toronto's Land Transfer Tax" says that the Toronto land transfer tax is responsible for a 16% drop in the number of single family homes sold after January 2008 and a 1.5% reduction in the value of a house, which works out to an average of $6400 per house.

The study also estimates that approximately 3500 families stayed put, in houses that are too big, too small or too far from their place of work or school requirements.

The Toronto real Estate Board stated that if condominiums in Toronto were added, 5000 plus resale transactions were lost in the first year of the tax.

You could say the tax resulted in a loss of freedom for some.

Local Politicians Opinion

Budget Chief and City Councillor; Shelley Carroll said that taxing the sale of homes takes money "only from those who can afford it, when they can afford it"

What do you think home buyers and home sellers?

Can you afford this tax on top of all the other costs associated with putting a roof over your head and that of your family?

We often hear politicians proclaiming peoples " right to a roof over their head".

Does this tax act as a deterrent to that right?

Let us know what you think.

Do you agree with the City of Toronto Land Transfer Tax?

Do you disagree with the City of Toronto Land Transfer Tax?

Or do you simply not care?

If you are thinking of buying or selling Toronto Real Estate why not put my 24 years of experience to work for you. Stop by my site at www.johnlavin.ca and get to know me.

An offer to purchase real estate will usually contain a clause asking the seller to warrant all appliances included in the sale, be in good working order on the day of closing. This warranty usually specifies that it will not extend beyond the closing date.

What Do You Do If Appliances Need Repair?

Most buyers' of Mississauga Real Estate, Toronto Real Estate or Oakville Ontario Real Estate don't normally discover a problem with appliances until after the home has closed and you have handed over all your money owed to the seller. Since most closings seem to take place towards the end of the day and you are busy moving, a call to your lawyer on this problem usually doesn't happen for several days. The seller at this point can argue the warranty does not extend beyond the closing date. And they now have all your money making your only option small claims court. Who needs or wants that hassle?

How To Avoid This Costly Mistake

An experienced real estate agent and one looking out for your best interests will include a clause in the original offer providing for a least 2 additional visits to the property before closing day. If your real estate agent is truly looking out for you they will advise you to exercise one of those visits the day before the closing date. At this time, you check to see all included appliances are in good working order. If repairs are needed you can address this with your real estate lawyer before you hand over the balance of money owed to the seller the following day. Your real estate lawyer will arrange for one of 2 things at this point: a reduction in the selling price or a holdback sufficient to cover any necessary repairs.

If you are thinking of buying Mississauga Real Estate, Toronto Real Estate or Oakville On Real Estate why not put my 24 years of experience to work for you. Stop by my site at www.john-lavin.com and get to know me.

The changing market in Mississauga Real Estate, Toronto Real Estate or Oakville Ontario Real Estate has led to the realization that you will need the services of an experienced real estate agent if you want or need to sell your Mississauga Condominium, Toronto Condominium or your Oakville Ontario Condominium.

Ugly and Costly

A recent condominium sale in the Greater Toronto Area turned ugly and costly for the seller on closing day.

This condominium was sold with a parking spot that was stipulated in the Agreement of Purchase and Sale as owned by the seller. As it turned out the parking spot was in fact not owned by the seller. The seller had exclusive use of the parking spot and could not sell it with the unit.

What Happened on Closing Day

On the closing day the buyers' lawyer demanded and successfully secured a reduction in the purchase price because the seller did not own the parking spot and therefore could not sell it with the unit.

Inexperienced Agent

The real estate agent handling this sale assumed the parking spot was owned because the seller told him so. He is obligated to verify this with the Condominium Corporation but failed to do so. This real estate agent advertises 15 years experience. He has in fact had his real estate license for 15 years but warehoused it for over 10 years while he was involved in some other unrelated occupation.

Changes take place over time and his long absence meant simply, he did not have enough experience to handle this condominium sale.

So the next time you interview a real estate agent for the job of selling your Mississauga Condo, Toronto Condo or Oakville Ontario Condo ask them how long they have been licensed and if they have been continuously selling real estate full time for the time they claim.

If you are thinking of selling Mississauga Real Estate, Toronto Real Estate or Oakville Ontario Real Estate why not put my 24 years of experience to work for you. Stop by my site at www.john-lavin.com and get to know me.