The notion of a contract is as old as time.
The latest report released by the Realtors Association of Edmonton shows the 2020 market didn’t end up so bad.
The statistics show in December, single-family home sales were up 26.44 per cent compared to last year, while condos jumped 34.09 per cent.
That, in spite of a September forecast by Moody’s Analytics Inc. saying there was a “dangerous” oversupply of new, single-family homes in several major Canadian cities, including Edmonton.
At the end of 2020, the realtor’s association said the average cost of a single-family home was $428,000 — a 4.24 per cent increase.
The findings may come as a surprise considering Edmonton’s struggling economy.
“2020 was my second-busiest year ever”, MaxWell Progressive realtor Bill Bowers said.
Those probably are not the words one would expect hear from a realtor selling homes in the midst of a pandemic.
“There is a lot of consumer saving right now, especially because the people aren’t taking that trip to Disneyland or Hawaii,” Bowers said.
He added low interest rates have also helped with sales.
Interest rates were thought to have hit rock bottom in Canada after they were slashed last March to a record low of 0.25 per cent. But in November, Bank of Canada Governor Tiff Macklem said a lower floor could allow Canada’s central bank to ease further if the economy weakens.
The BoC, which is due to make a policy decision next week, has ruled out negative interest rates, so further easing would likely be a so-called “micro rate cut” of less than 25 basis points.
That’s an increment the central bank has not used since the target for the overnight rate became its main policy tool in February 1996.
When it comes to who’s buying homes in Edmonton, the realtor association said it is people who have managed to keep working through the pandemic.
Shortly after the first lockdown in the spring, buyer Jae Kim said that’s when his family wanted to move into a home with more space, but he was skeptical with so much uncertainty.
“(Our realtor) took us through the pros and cons, and we said, ‘If there’s ever a time, this might be… the time.’ And for us as a family, it did work out,” Kim said.
Kim said the overall experience was positive, despite the fact there was less to choose from with fewer homes for sale.
The association said that is probably due to sellers feeling wary about where the market was heading, but added consumer confidence grew compared to the spring, and that the good news in December will likely continue.
“Despite all the things that have happened in our region, I think we’ve seen a real stable real estate market and I think that Edmonton will experience stability in the future too,” said Tom Shearer, the chair of the Realtors Association of Edmonton.
“I don’t foresee a major spike or a major drop happening.”
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Fetters Mark T & Everhart Christine F from Jogerst John, 111 Park St NW, $60,000.
Karahuta Johnny M & Smith Donna J from Hollinger Donald L, 65 Ohio St SW, $15,000.
Thayer Brandon & Ashley from Dudek Kimberyly S & Timothy J, parcel 1100668 Safari Trl, $3,800.
Winkler Michael from Hartzel Cindy & Gerstenberger Robyn, parcel 1101000 Tanganyika Trl, $20,000.
Caudill Dylan M & Amber M from Jones Martin L & Karen B, 128 High St SE, $228,000.
Lyman Matthew R & Stephanie J from Bankers Guarantee Mortgage Company, 576 High St NE, $90,000.
Company Andrea M from Adb Properties Ltd, parcel 1619701 Armandale Ave NW, $99,000.
Dawes Tyler S & Kayla from Savu Adrian & Stela, 8912 Ontario St NW, $255,000.
Evans Brandon from Bolon Enterprises Limited Inc, 5553 Whipple Ave NW, $1,062,000.
Frank Isaac from Miller Timothy D & Rachana D, 2564 Blue Ash Ave NW, $288,100.
Haymaker Tree & Lawn LLC from Jems Holdings LLC & C.a.s Materials Inc, parcel 1628043 Wales Ave NW, $15,000.
Hendricks Sean Tristan & Mekenna Spring from Hartzell Mark E & Denise R, 5022 West BLVD NW, $568,750.
Hutsell Randall A & Jill L Ttees from Nicodemo John L Trustee of the James, 3656 Barrington PL NW, $175,000.
Leary Amanda from Leary Adam & Tamara, 4039 Columbia Ave NW, $230,000.
Migliore Amanda Paige from Seemann Michael D, 4549 20th St NW, $134,900.
Parsons Lena A Ttee from Wang Adlai, 8963 Clubview St NW, $584,900.
Paugh Stephen Edward & Kelly Ann from Mikhail Mounir N & Salwa S, 6710 Scarborough Rd NW, $525,000.
Prochaska Alan & Riise from Regal Construction Co, 5932 Freitag St NW, $378,800.
Rohrbaugh Cynthia L & Arras Leonard D from Skacal James S & Barbara L, 8795 Candleberry St NW, $196,361.
Schwiemann William Christian IV & from Grosschmidt Andrew J & Debra L, 5275 Schario Rd NW, $255,000.
Staley James A & Sherrie K from Evans II Henry A & Denise R, 4349 Forest Glen NW, $220,000.
Taggart Tucker D from Miller Mark D & Amanda J, 4790 Amherst Ave NW, $145,000.
Lake Paul R from Boch Robert C & Helen M, 8775 Fairpark Ave NW, $75,000.
Bentley Rachel L from Evans Patricia J, 1328 Forest Ave SE, $94,000.
Busby Conner M from Reiman Emily E, 1220 Amherst Rd NE, $120,000.
Holland Wayne & Wilson Alyssa from Sugar Bay Properties LLC, 1008 Medill Ave NE, $175,000.
Horvath Tiffany M from Hudson Shelley D, 637 Wallace Ave SE, $110,000.
Kasunick Tracy L from Singer Rachel, 2133 Winslow Ave NW, $125,000.
Perkins Kayla M & Lightfoot Seth S from Brunckhart James R, 2045 Tremont Ave SW, $91,000.
Rash Mckenna L from Bush Jerry W & Debra L, 1059 State Ave NE, $98,400.
Skeen Gage M from Barkheimer Realty Ltd, 626 Perry Ave SW, $100,000.
Slentz Joshua D & Jennifer K from Stoner Dustin A, 420 Joshua St NW, $260,000.
Soehnlen Carol A Ttee from Rhodes Mary M, 27 8th St NE, $50,800.
Barnes Shirley A from Dougherty Diane, Brian P, Kevin C, Etal, 1051 Knollwood Dr NW, $350,000.
Buckeye Communities Homes LLC from Marion Joshua, 3454 Hilton NW #17B, $4,000.
Crosier James A & Ginger from Floyd Brent M & Amanda L, 5548 Baycrest St SW, $278,000.
Hansford Logan Michael & Danielle from Newman Joshua R & Kimberly L, 5984 Wentworth Rd SW, $245,000.
Howington Six LLC from 8225 Associates LLC, 8225 Navarre Rd SW, $625,000.
Jackson Andrew E from Copeland Linda E, 2335 Southway St SW, $169,000.
JBSM Investments LLC from Fagus Mark, 313 Whipple Ave NW, $22,500.
Lamielle Andrea M from Stafinski John J, 1236 Brooklyn Ave SW, $85,000.
Manalakos Anthony from Huntsman Cyndi, parcel 4302294 Prosway Ave SW, $206,250.
Manalakos Anthony from Huntsman Cynthia M, 6633 Klick St SW, $206,250.
Manalakos Anthony from Huntsman Cynthia, parcel 4305935 Knolls Ave SW, $206,250.
My Choice Rentals LLC from Scavelli Gina Louise, 317 Westland Ave NW, $145,000.
NVR Inc A Virginia Corporation DBA from Dehoff Agency Inc, 6015 Lavenham Rd SW, $60,000.
NVR Inc D/B/A Ryan Homes from R L Deville Holdings Ltd, 6972 Gauntlet St SW, $47,895.
SFR3-030 LLC from Wise Rodney D & Penelope L, 1310 Saratoga Ave SW, $75,000.
Tanbin Ashif MD Mostafa & Sultana Sabiha from Barcus John C & Sheila F, 4865 Menloughwood Dr NW, $182,500.
the Aem Services LLC from Williams Marilyn J, 130 Rowmont Rd SW, $10,000.
Hartman Arthur J from Pleasant Valley Columbiana County, LLC, 460 W First St SW Lot #6, $5,000.
Shepherd Christopher M from Fogle Jason M, 244 4th St SW, $182,500.
Yoder Elson & Jaunita from Miller Jonathon J & Rosie M, 123 Redwood St SW, $75,000.
Fogle Jimmie Richard II & Miranda from Patterson Timie R, 10405 Wooster St NW, $85,000.
Hogan Timothy C from Albright Craig & Rayelle, 12975 Wooster St NW, $236,000.
After more than a decade in commercial real estate, John Zinati had settled into a comfortable career as a leasing manager at a well-known locally owned Ottawa firm and could have simply counted down the days until retirement.
Instead, he chose a different path. In 2016, he launched Zinati Realty, a boutique brokerage that serves mainly owners and landlords in the office, retail and industrial sectors.
Since then, Zinati has brought on two more brokers and is looking to expand his team further as the industry slowly works its way toward a post-pandemic future. Looking back on his decision to leave the security of an established firm for the uncertainty of life as an entrepreneur, he has no regrets.
“I was just faced with too many limitations, so I made the decision to go out on my own,” Zinati explains.
“Being nimble and quick and working closely with these owners to get their spaces filled or get their buildings sold is really rewarding.”
Zinati is one of a growing number of local real estate executives who’ve left comfortable, secure jobs at established big-name companies to start their own brokerages and advisory firms.
Many of these owner-brokers point to the freedom of being able to make their own decisions and do their own deals without having to answer to corporate bosses as a major factor in making the leap.
“I think commercial real estate brokerage in the boutique setting is one of the last few places where you can just earn more with a little bit more elbow grease,” says Darren Fleming, the CEO of Real Strategy Advisors. “There’s so much upside.”
Before launching his own firm, Fleming spent seven years as managing director of Cresa’s Ottawa office. His lengthy real estate resume also includes four years as a sales representative at Colliers International and a one-year stint as a leasing agent with Montreal-based developer Canderel.
In 2016, Fleming sold his shares in Cresa, left the company and enrolled in the Executive MBA program at the University of Ottawa’s Telfer School of Management.
The following year, he launched Real Strategy Advisors, which provides advisory and brokerage services to office tenants in the tech, professional services and not-for-profit sectors.
He’s never looked back. Too often, Fleming says, strict corporate policies at bigger firms put entrepreneurial-minded brokers in a straightjacket. He points to an example from early in his career, when an employer told him he was storing too much sales data on a company server.
“I think I’m addicted to being an entrepreneur and being my own boss,” Fleming says. “Are there days when you wish someone would sign off on payroll other than you? Yeah, but it’s worth it in the end.”
Graeme Webster is a partner at Ottawa’s KOBLE Commercial Real Estate, a firm that brokers mainly off-market and unlisted office and industrial transactions for buyers such as entrepreneurs and well-heeled professionals looking to build up their investment portfolios.
He and fellow partner Marc Morin founded KOBLE seven and a half years ago after cutting their teeth for more than a decade at large, well-established firms. Webster says he thrives on the feeling of satisfaction he gets from navigating clients through deals that can set them up for retirement or attain assets that can be passed on to future generations.
“Our focus is to help people establish that family legacy,” he says. “Real estate is really just the tool to allow them to do that.”
Now at six employees, KOBLE recently brought Ottawa commercial real estate veteran Richard Getz on board as a senior adviser. The firm is also looking to hire someone to oversee its business operations as it continues to expand.
Webster says that despite the overall uncertainty facing the industry at the moment, KOBLE is thriving. The firm has more deals in its pipeline than at any other time in its history, a development he attributes largely to the city’s reputation for being a safe haven in times of economic turmoil.
“It’s a place where when there’s volatility, people want to jump in (the market),” he explains.
The notion of a contract is as old as time.
Two parties make a promise to one another, they settle on the terms and compensation, then they shake hands to bind the agreement.
I will give you this if you give me that; I will do this if you do that.
Should one party to the agreement fail to come through, the contract is breached and the other party is entitled to legal remedy.
A contract is a contract.
Of course, this is a wild oversimplification — contract law is actually quite complex and nuanced — but fundamentally we all understand the concept.
For example, when deciding to purchase a home, a buyer signs an offer and usually accompanies that offer with a healthy deposit cheque. If and when that offer is accepted by the seller, they then have a firm and binding contract that clearly outlines the obligations of both parties and a date upon which the deal is to be transacted.
What happens if the buyer wakes up the next morning with cold feet? What if they can’t obtain financing from the bank? What if the following week they find their dream home and want to bail on the first deal?
Well, they would be in breach of the contract they signed. Their deposit would be forfeited. And the other party would be entitled to pursue damages against the other.
You’d be shocked at how often this happens.
You may have read this week about a 250-year-old heritage tree at the centre of a whole legal brouhaha in Toronto. Long story short, on a fairly random lot up in North York sits a house. And but inches from that house sits a red oak tree that pre-dates Confederation.
So glorious and significant is this tree that in 2019, after the community rallied to protect and preserve it, the City of Toronto entered into an agreement with the homeowner to purchase the property with the intention to demolish the house and turn the lot into a parkette. They settled on a price, which was agreed to be fair market value at the time. The deal was contingent on the city putting up a portion of the money with community donors responsible for the rest. Hence the lengthy gap between signing and completion to allow for fundraising, which was fulfilled.
Nearly two years later the seller has changed his mind, citing the substantial increase to market value for the property. If the city wants the deal to go ahead, he’d like more money.
Hopefully someone has told him he signed a contract; the simple fact of no longer liking the terms of that contract does not make it invalid.
It will be settled in court in October.
It’s the classic case I have seen a number of times. When one party realizes the terms they agreed to could be more favourable and wants a do-over.
The thing is, that’s not how contracts work, even if it’s something that parties to real estate transactions have been getting away with for years.
As the Toronto market has been on its upward climb for most of recent memory, if a buyer wanted to bail on a deal, you could usually count on another buyer being ready and willing to step in, grateful for the opportunity.
With prices rising month-over-month, by and large the seller wouldn’t suffer much of a loss so rather than dragging it out into a protracted battle, typically both parties would simply sign a mutual release, the deposit would be returned and everyone would move on.
The problem with all of that is that it appears to have given the impression that real estate contracts are flexible. Contracts by definition are not flexible.
Especially now that we are starting to see prices coming down from the highs of March. A buyer refusing to close on a house purchased at the top of the market will result in a substantial loss for sellers who will be unlikely to hit the same number now that the market activity has slowed.
That’s a financial loss suffered by one party as a result of the other’s breach of contract. That party would be entitled to pursue damages against the other, and based on recent cases, it’s a near certainty the courts would side with the aggrieved party. Courts are in the business of upholding contracts.
The moral of the story? A contact is a contract. You are bound to the terms you agreed and signed on. And if you wish you hadn’t? Think long and hard because bailing is surely going to cost you.
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