Ryan Hodgson

Are you currently renting in London, Ontario and would like to purchase a home but don't have the necessary down payment to make a purchase? Now is your chance. The City of London has extended and ammended it's no money down program for renters. Details can be found HERE

The major changes are the sale price of a home can be up to $140,000 and purchasers have to have an annual income of less then $55,000. $140,000 might not seem like a good price range to purchase, but there are homes available in that price range including townhouses, condo's and semi's which are of good value. The purchaser is still required to me able to qualify for a mortgage with a financial instituation, and the city will provide the 5% downpayment and 1% for closing costs.

For a list of homes that would qualify for this program, please contact me. This program expires March 31st.

The London Free Press wrote an article on the increase of foreclosed homes in the area. It's not really that surprising, the main reason for the increase being the huge job losses in the manufacturing sector. St. Thomas in particular, as well as other small towns have been hit very hard. Job losses equal home owners not being able to pay their mortgage payments. London also hurts from this as some of the laid off manufacturing jobs were of people living in London and working in St. Thomas etc.

If you are looking to purchase a home in 2009, perhaps you would like a free list of all the foreclosed homes for sale and power of sales in the London area. Can be found HERE.

Here's the Free Press Article:


With the economy limping, London process servers have been racing to keep up with a slew of foreclosures, the likes of which they haven't seen since the early 1980s.

"It's unfortunate that when times are bad, we are busy," Doug Russell of London and Western Ontario Process Servers said yesterday.

Russell has served notices of foreclosure in London since 1983, first as a deputy sheriff and later for his own firm.

Back then, the culprit was interest rates that soared toward 20 per cent. But now foreclosures seem driven by an unemployment rate that's grown to 6.9 per cent, with thousands of manufacturing job losses in the region alone.

Another process server, Bill Armstrong, estimates the number of foreclosure notices he's delivered has more than tripled in the last year.

"I've never been this busy and I've been in the business 20 years," he said.

As busy as it's been in London, it's been even busier in neighbouring centres such as St. Thomas and Aylmer, he said.

"Some smaller communities are hurting more," he said.

While the number of foreclosure notices soared in November and December, this week and last have been slow, as lenders often don't proceed during the holidays.

But Armstrong fears it will get even worse this month because of a global recession whose effects have yet to be fully felt. "The economy is going to get much worse. I just don't see any signs of a turnaround," he said.

That risk was highlighted in a December report by the Bank of Canada

While central bank officials believe the housing sector is holding up so far, they warn foreclosures may increase this year, in part because household debt as a percentage of income is at an all-time high.

"With the economy expected to slow, conditions are already in place for an increase in default rates among highly leveraged households over the coming year. The risk is that the increase in default rates on household borrowing could prove more substantial if a more severe economic downturn (with significant increases in unemployment and weaker incomes) materialized," the bank wrote.

Also on the upswing among the local process servers are legal claims for unpaid loans and credit cards, Armstrong said.

And it's not just low-income earners who are struggling -- both Armstrong and Russell say they've delivered foreclosure notices to impressive homes.

"It can happen to anyone. It's really sad and I think it's going to get sadder and that's unfortunate," Armstrong said.

Results are in for October Real Estate sales for London and surrounding area. The number of home sales are down from last year in October. The information can be found HERE. Judging by the activity in November, it looks like the number of homes sales will be down when compared to November of 2007.

Some of the reasons for this are obvious. Some home buyers are sitting on the sidelines to see what happens after the turmoil in the world financial markets the previous month. Some are no longer in the market due to the economy. We had a record number of sales in September - some of this was because of people rushing to take advantage of the no money down program from federal government which expired in October, and nice weather helped too. So those people who might have normally purchased in October or November, already bought. And finally, the overall numbers have to be less then 2007 - 2007 represented a record number or real estate sales for the year. There was no way the market could duplicate it. Overall scope, the number of real estate sales have been very encouraging.

It's a great time to buy a house now. There is inventory for buyers to look at, and buyers are finally again able to negotiate - sometimes in very favourable terms. Once a few months past and we get into March and April of 2009, people are going to realize that the London economy is going to be OK, and 2009 should prove to be a good year for real estate. Low interest rates, good inventory, and affordable housing are very attractive things. I'm going to predict a 2009 which will include historically strong sales numbers and average sales price which will remain constant throughout the year. Considering the alternatives we've seen in other markets thoughout the world, we should consider ourselves lucky.

I haven't commented too much on the current state of the economy in Canada or London. The media and it's entourage have managed to blow things out of proportion again, which is normal. It's created a lot of unknown, uncertainly, and panic amongst the public. Most of it's needless, but you can't avoid it.

The United States' "give anybody who breathes a mortgage" financial problems have come back to haunt them (along with such things as poor fiscal responsibility of the government ie racking up huge debt over the past 5 years) and have thrown the world for a loop. I'll be the first to admit, I'm very glad I don't live in some of the US markets or sell real estate there. It must be tough.

The US economy definitely has an effect on Canada and the world. However, this doesn't mean Canada is going to fall down the same path as the US economy and blow up. We are not close to having the problems they have, our economy is on stable ground to weather any downturn and the banking system is in great shape (thank you Canadian government for your policies and not succumbing to US pressure of deregulating the bank system post 911).

I would be worried if inflation is high, governments were running debts, and the economy was poor prior to this fiasco. But it's not the case. Government is in a position to cut interest rates, which they are doing (hello mortgage rates!) and help the economy maneuver through things tough times. I'm not saying all is rosy, but the sky is not going to fall. The economy will slow down in the next 6 months or so......which is normal.

Which brings me to the dreaded word. Recession! People treat this word like the Ebola virus. I think it is because it's been over 15 years since our last recession started. A recession is defined to be a period of two quarters of negative GDP growth. It's not a depression, it's not a life changing event. It's a period of negative economic growth for the country. If it happens to Canada in 2009, we will get through it. In saying that, the outlook for the economy is not even that bad.

As per Bank of Canada article:

The United States may be sucking the global economy into recession, but Canada's economic strengths will keep us on safe ground, the Bank of Canada says.

In yesterday's monetary policy report, the bank predicted slow growth for Canada while its governor, Mark Carney, warned the media not to overstate the downturn.

"Newscasts overshoot just like markets overshoot and the sky is not falling, the sky is still there, the sun is still coming up every day and the Canadian economy is still functioning," Carney said. "Be careful on overshooting on the pessimism."

Carney's report said the American economy was already in recession and the global economy was headed toward a mild recession.

Canada, Carney says, would squeak through this mess with "sluggish growth."

That means annual economic growth of 0.6 per cent this year and next, before increasing to 3.4 per cent by 2010. Carney said the reasons we'll escape the downturn are Canada's strong banking system and the low debts loads, compared with other countries, carried by consumers and governments in Canada.

"We don't have the imbalances in our economy that other economies have going into this time of difficulty," Carney said. "It's very important to stress that unlike in a number of other countries, we have a financial system that is functioning."

Carney said the big taxpayer-funded banking bailouts we are seeing around the world are an effort by countries to bring their banks up to the safe level Canada currently enjoys.

For Canadian consumers, there were some positives. Inflation, specifically with respect to the cost of goods we buy, was expected to hit a new low by the middle of next year.

"In terms of pricing, in the near term, we are going to see some softening of prices," Carney said.
The other good news in the short term, says Carney, is the plunging loonie will help manufacturers and exporters deal with a U.S. downturn expected to hit that industry hard over the next year.

Carney also applauded the government for announcing the creation of the Canadian Lender Assurance Facility yesterday, which will provide loan insurance to banks.

"We think it's a sensible thing to have done," Carney said. "With all other jurisdictions introducing some form of guarantee -- it makes sense to ensure our institutions are not at a competitive disadvantage."

The insurance would allow Canada's banks the option of paying from 1.6 per cent to 2.1 per cent of the money they borrow to buy a government-backed guarantee that what they borrow will be repaid should the bank be unable to do so.

What does this mean for home sales in London Ontario? Things are going to remain decent over the next year. We won't see record sales, but a very healthy real estate market. The economy is decent - even with the terrible manufacturing sector suffering. Homes are affordable and interest rates will remain low. People are buying houses. There is more selection now (thanks to more available listings) then in the past 5 years. It's a great time to buy, buyers are now in a position to negotiate price and find the home they want (much easier then 3 years ago). And there is not going to be any bust in homes prices. Things will remain consistent.

And once the dust settles, in 6 months people will find that life in London is no different then it was 3 years ago.

London Ontario's real estate market continues to produce strong numbers. September 2008 was the best September ever for the real estate board in terms of number of sales. See the News Release below.

For where the economy is, and where it is headed, London, Ontario is in a good position to withstand any major negative impact from the economy. It will be interesting to see how sales go for the next 6 months. Sales will likely slow down, but there is no bubble to burst so we shouldn't see any noticable decrease in prices. In fact, if interest rates are reduced as is predicted, I have a very optimistic view for real estate sales in 2009.


Last month, 769 homes exchanged hands in the jurisdiction of the London and St. Thomas Association of REALTORS® (LSTAR), including 625 detached homes (up 19.3% from September 2007) and 144 condos (up 14.3%). Year to date, 5,664 detached homes and 1,449 condos have been sold - down 6.7% and 8.3% respectively compared to the same period in 2007.

"This has been the best September ever for home sales in our area," says Bruce Sworik, LSTAR President. "The next-best September was in 2005, when 746 homes were sold. In September of 2007, 650 homes were sold. We are very pleased with these figures - so far, 2008 has been a great year." In 2008, the area has seen its third-best February, its second-best May (also its third-best month ever) and its second-best July on record.

"Year-to-date sales are at 7,113, which is just 7.1% below the same period for 2007, which was an outstanding year," says Sworik. Year-to-date sales are just below the five-year average of 7,269 but well above the 10-year average of 6,597.

"Also, St. Thomas had a great month, with a 10.6% increase in sales. The good news continues for St. Thomas because, year to date, the average price of a home there stands at $188,472, up from $171,990 in the same period last year," says Sworik.
The best-selling house style in LSTAR's jurisdiction for the month of September was the two-storey, followed by the bungalow, the ranch, and the townhouse condo:


Homes in LSTAR's jurisdiction continue to maintain their affordability compared to other major Ontario and Canadian centres. According to the Canadian Real Estate Association's Major Market Release for August 2008 (the most current available), the average price January 1, 2008 - August 31, 2008 year to date for:

􀂃 London and St. Thomas was $213,171;
􀂃 Calgary was $411,510;
􀂃 Durham Region was $274,116;
􀂃 Edmonton was $337,399;
􀂃 Hamilton-Burlington and District was $284,951;
􀂃 Kitchener-Waterloo was $273,185;
􀂃 Ottawa was $292,181;
􀂃 St. Catharines & District was $222,941;
􀂃 Toronto was $385,035; and
􀂃 Greater Vancouver was $606,088.

"The number of new listings of homes for sale was 1,448 in September 2008, an increase from 1,283 in August and 1,241 from last September," says Sworik. "And our active listings - the number of listings which were active at the end of the recording period, in this case, September 30, 2008 - currently stand at 3,669, up 24.6% over the same time last year, which means great selection and choices."

"While jurisdictions elsewhere may not report such positive numbers, it is important to keep in mind that the national housing market is made up of different communities. Every area is different in terms of trends and pricing, and in London we are seeing a great year," says Sworik. "It goes to show that local consumers feel very positive of our housing values here."