Wynne Not helping Sellers Win!
The non resident buyers tax is really a measure to try and eliminate speculative participation in the residential real estate market in Ontario. Sousa said that they estimate foreign buyers account for approx 8% of purchases being made. This may account for a reduction in offers from these sorts of individuals but the government is trying to funnel the foreign investment into commercial real estate and large multi family projects. This pushes it from speculation to investment. As such much like BC they are likely to just pivot their money into other areas. Luckily people who are here on Work Visas are not being charged this tax from my reading of the releases. It would be an unintended effect to not allow these people to buy, same goes for people buying for their children to attend school. The collecting of citizenship data will help with this. But much like in BC people will look for a way around this. It will likely increase the incidence of Straw Buyers where someone uses a Canadian to buy the home in their name with a joint venture agreement behind it that is not registered. This is something people do to avoid capital gains as well. Its not something that occurs a lot right now but it will certainly rise.
The rent control measures now including properties built after 1991 is something that should be expected. A fair market rent can be established everytime a property is vacated. Until then it is fair and just to keep the monthly rent costs in line with a reasonable annual increase. Landlords will always be able to apply to have an increase higher than the prescribed amount if they have done substantial renovations. If the landlord is buying a property that already has a tenant there is no legal obligation to retain that tenant if the property will be used by the owner for their own purposes. Owners will likely use this loop hole to remove low rent tenants and re fill the property at market value.
Another really interesting thing that came out of today was the review of the multiple representation process in real estate sales. Multiple representation is not the actual issue here, its blind bids. A seller is often inclined to take a multiple representation offer because it usually saves them at least 1% in total commissions. The realtor is motivated by making 4% versus 2.5% on their sale. So you can see how the invisible hand may lead to some misappropriation here. But if other participating realtors are made aware of the offers received they are more likely to advise their clients to make a more prudent offer versus some of these deals that are being done today, where the winning bid is 100k plus over the closest competing offer. Until there is bidtransparency we cant expect people to not make uneducated offers. Home buying is an emotional transaction where emotion often takes over. The transparency of offers would make it much more likely that a home is sold at or near its market value. Not its future value.
For future value what a lot of people are doing is making an offer for what they believe the home may be worth 1 or 2 years from now, the way they look at it is that the market will catch up to what theyve paid for it. This is a very dangerous practice and could be avoided by having a transparent buying process.
Cheers, id be happy to expand on any of my opinions here.
Professionals who can help you with home buying
Because purchasing a home is probably the biggest investment you will ever make, youll definitely want a team of professionals working with you throughout the process.
The Real Estate Agent
Helps you find the ideal home
Writes an Offer of Purchase
Negotiates on your behalf
Gives you important information about the community Can help you plan the home inspection
A lawyer (or a notary in Quebec) protects your legal rights. He or she will review all contracts before you sign them, especially the Offer (or Agreement) to Purchase. Remember that a lawyer/notary should:
Be a licensed, full-time lawyer/notary
Be local and understand real estate laws, regulations and restrictions Have realistic and acceptable fees
Be able to explain things in plain language
The Home Inspector
Performs an inspection of the visible components of the home
Tells you the condition of the house; what is working properly; what needs to be changed; what is unsafe; and what repairs need to be made
Can tell you where there may have been problems in the past
Usually belongs to a provincial or industry association
A good credit report and credit score are important factors in determining whether or not you will be approved for a mortgage. Here are some simple steps you can take to maintain a good credit history, and improve your chances of being approved.
What is a Credit Score
Your credit score is a number that illustrates your financial health at a specific point in time. It also serves as an indicator of your financial past, and how consistently you pay off your bills and debts. This is one of the factors mortgage professionals consider in qualifying you for a mortgage.
How to Check Your Credit Score
To find out your credit score, contact Canadas two credit-reporting agencies: Equifax Canada at www.equifax.ca and TransUnion Canada at www.transunion.ca. For a fee, these agencies will provide you with an online copy of your credit score as well as a credit report a detailed summary of your credit history, employment history and personal financial information on file. You can also obtain a free copy of your credit report by mail. If you find any errors in your report, notify the credit-reporting agency and the organization responsible for the inaccuracy immediately.
If You Do Not Have a Credit Score
Its important to begin building a credit history as early as possible. You can begin to build one by applying for and responsibly using a credit card. Your financial institution or mortgage professional can help.
How to Improve Your Credit Score
Demonstrating your ability to manage credit is key to maintaining a good credit score. There are a number of things you can do to improve your credit score. These include: Always pay your bills in full and on time. If you cannot pay the full amount, try to pay at least the required minimum shown on your monthly statement. Pay off your debts (such as loans, credit cards, lines of credit, etc.) as quickly as possible. Never go over the limit on your credit cards, and try to keep your balances well below the limits. Reduce the number of credit card or loan applications you make. Once your credit score has improved, work with your mortgage professional to obtain a mortgage that works for you.
Find Out More
To find out more about credit scores and reports, visit the Financial Consumer Agency of Canada website and download or request a free copy of their guide, Understanding Your Credit Report and Credit Score. This guide provides practical, straightforward information on how to obtain and understand your credit report and score, as well as how to build and maintain a good credit history.