Guildwood house with pool gets eight offers
81 Regency Square, Toronto
Asking price: $1,299,000 (February, 2023)
Selling price: $1,450,000 (March, 2023)
Previous selling prices: $1,179,000 (June, 2020); $713,500 (June, 2012); $550,000 (October, 2008); $329,900 (November, 2000); $253,000 (October, 1996)
Taxes: $5,276 (2022)
Days on the market: Six
Listing agent: Tommy Lioutas, Re/Max Hallmark Realty Ltd.
Options were few for homes in the Guildwood area this February and eight offers quickly came in for this roughly 60-year-old side-split.
“Originally, we were going to come out after March Break, but I saw an opening, so we moved as quickly as we could and luckily, we didn’t have any competition when we came out,” said agent Tommy Lioutas.
“Given how the week was progressing, and how many people came through the open house, I knew we’d have some action on the offer night, but I wasn’t expecting eight offers.”
The best bid came in $151,000 over asking.
What they got
Although snow covered the home’s newly landscaped gardens and fenced-in pool, photographs taken in the fall reassured buyers of its summer potential.
“With COVID, because there was less to do, people fell in love with pools again, so it was a helpful feature to showcase to the home, especially one of this size,” Mr. Lioutas said. “It’s a very large pool compared to what I see in new builds these days.”
The house spans four levels, including a finished basement. Two bedrooms fill out the floor above the double garage.
The west wing contains a living room with a gas fireplace and a dining area with access to a wide deck.
The agent’s take
“People love Guildwood because it’s fantastic for families,” Mr. Lioutas said. “It’s a beautiful, safe place with great schools.”
“From this home, you can walk to the GO train in ten minutes, which is a huge selling feature, and also the Guildwood Inn and its beautiful gardens.”
The shortage of houses is hitting some people and areas harder than others – CNBC
Even in a housing market that has slowed significantly due to rising mortgage rates, the supply of homes for sale is about half of what it was in 2019.
The shortage is hitting some buyers more than others.
The popular 30-year fixed mortgage rate hovered in the high-6% range in May. At that level, buyers with an annual income of $100,000, slightly above the national median, could afford a house with a maximum price of about $341,000. But just 39% of the homes for sale were listed at or below that price point in May, according to a new report Thursday from Realtor.com with the National Association of Realtors.
In a balanced market of supply and demand, 64% of homes should be affordable to buyers who make $100,000 a year, given the size of that population. As a result, the market currently lacks about 285,000 of those listings.
Just five years ago, those same earners could afford two-thirds of homes for sale. Home prices and mortgage rates were significantly lower.
The lack of affordable homes heated up competition in the market this spring, which reversed the cooldown in home prices that started last summer.
“It’s almost a tale of two cities where we have houses under $500,000, they’re absolutely selling incredibly fast. Under $350,000 and $400,000, there’s multiple offers,” said Noah Herrera, a real estate agent in Las Vegas, during an open house in mid-May. “Over $500,000, it slows down a little bit.”
At the higher price ranges, too many homes are for sale for the number of Americans who can afford them. In fact, for every home listing above $680,000, the market is lacking twice as many homes under $341,000.
“Ongoing high housing costs and the scarcity of available homes continues to present budget challenges for many prospective buyers, and it’s likely keeping some buyers in the rental market or on the sidelines and delaying their purchase until conditions improve,” said Realtor.com’s chief economist Danielle Hale.
The pricy existing home market is pushing more buyers to new construction, which, ironically, used to come at a price premium. Homebuilders have been offering incentives such as upgrades or temporary mortgage rate buydowns. Those, however, are decreasing as builders see more demand and gain more pricing power.
As with all else in real estate, location is everything. The areas that have the biggest deficit of affordable homes are El Paso, Texas; Boise, Idaho; Spokane, Washington; several Florida markets; and of course, Riverside and Los Angeles, California, which are some of the priciest housing markets in the nation.
Areas in the Midwest continue to have the highest number of affordable homes. The four cities with the largest supply of affordable homes are all in Ohio. They are followed by Syracuse, New York; Pittsburgh, Pennsylvania; and St. Louis, Missouri.
The supply situation does not appear to be improving. New listings of homes for sale in the first week of June fell 25% year over year to their lowest level of any early June on record, according to Redfin.
That lack of new listings has pushed the total number of homes on the market down 5% from the same period a year ago.
Treasury Secretary Yellen warns of commercial real estate 'issues' that could strain banks – MarketWatch
Treasury Secretary Janet Yellen, in her first interview since the U.S. debt-ceiling was lifted last week by Congress, warned on Wednesday about the potential for banks to feel strain from their exposure to weakening commercial real estate valuations.
Yellen was asked by CNBC “Squawk Box” host Andrew Ross Sorkin about if she’s worried about the state of estimated $20.7 trillion commercial real-estate market, particularly the office, and if weakness in the sector could potentially spark more bank failures.
“Well, I do think that there will be issues with respect to commercial real estate,” Yellen said. “Certainly, the demand for office space since we’ve seen such a big change in attitudes and behavior toward remote work has changed and especially in an environment of higher interest rates.”
Major landlords from Blackstone Inc.
to Brookfield Corp.
have been bracing for a significant drop in office property values, as the Federal Reserve’s inflation fight puts an end to an era of abundant and cheap debt.
While the final word on wobbling property prices won’t be known for some time, PGIM Fixed Income, a key investor in commercial property debt, recently said they expect office values to fall 20%-50% from peak levels, while multifamily values could drop as much as 22.5%, in part because financing has become more expensive and scarce.
See: Commercial real estate’s debt machine is broken down
Office property woes and the ‘doom loop’
Researchers at the NYU Stern School of Business and Columbia Business School recently estimated there has been a $506.3 billion decline in office values from 2019 to 2022 nationally in the wake of the pandemic which could feed a “doom loop” in some big cities.
They estimate banks own 61% of U.S. commercial property debt. They also see potential for the value of New York City’s office stock to drop 44% from 2019 to 2029 due to stress in the sector from flexible work arrangements.
“I think banks are broadly preparing for some restructuring and difficulties going ahead,” Yellen said, adding that the overall level of liquidity at banks looks strong and that stress tests of the largest banks show they have adequate capital to withstand fallout from the commercial property market.
She also said banking supervisors will continue to closely monitor “a range of banks to make sure that they are adequately prepared to deal with it.”
Yellen also said that, “while there will be some pain associated with this, that banks should be able to handle the strain.”
Related: Blackstone wrote down its stake in this Chicago office building to $0. Now it’s talking with lenders on the debt coming due.
South Okanagan residential real estate market sales picking up speed – Penticton News – Castanet.net
Buyer activity and real estate listing activity are gaining momentum again in the South Okanagan, as residents have adjusted to the current late spring market.
“The market is doing really well,” Association of Interior Realtors Past President Lyndi Cruickshank said.
“I think a lot of people felt really shell shocked when the interest rates started to rise, understandably so, as we often feel that resistance when there’s a dramatic change in our lives. And is often the case, people settle into what our new reality is, and our interest rates are certainly significantly higher than they were. But people are finding ways to manage.”
There has been a bit of a decline in the average home price, which is helping buyers. And as more homes come on the market, it ultimately helps the consumers looking to purchase.
“I talked to so many people last year that really wanted to be able to sell their home, but there was such a fear as to where they were going to go. So now that we have seen the inventory start to open up quite a bit. It’s allowing them more choice.”
Home inventory has increased by 38 per cent in active listings.
In the South Okanagan, the benchmark price for a single-family dwelling dipped 6.6 per cent, to $772,200. Townhouses ($558,100) and condominiums ($427,700) also dropped in May compared to this same time period last year.
“We’re certainly more into a buyer’s market than we have been over the last year. Previously, we were very predominantly held by a sellers market. And we’re seeing a lot more strength on the buying side now,” Cruickshank said.
She added that this is typically the time of year that people start to look for homes and that people really traditionally look to put their homes on the market.
“That plays a big role, obviously, in that increase in activity that we’re experiencing right now.”
The more balanced market will give buyers more of an opportunity to do their due diligence before purchasing.
“We’ve got a long way to go. We came from such an extreme market this time last year. And then we had that real hit with interest rates and things really slowed down very dramatically. So it’s really nice to see things starting to just move forward in a more normalized way again.
Still, finding homes in the South Okanagan remains to be a challenge as vacancy rates remain low, even as developments continue to grow.
“It’s going to take years, years before we’re ever at a place where our inventory is going to meet demand unless we see something really dramatic. And that’s right across the country when we look at what the demand is, and the current supply. So I don’t see that changing.”
Advice for first-time home buyers remains the same: finding a realtor and figuring out what time to buy is best for you.
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