Get your photo taken with Santa!

Bring the kids down to the Gardener’s Cottage in Kew Gardens Park just off Lee Avenue on Saturday December 9th! Santa and his helpers will be there bewtween 10am and 2pm. Hot chocolate will be served, photos will be taken! This is a great Beach holiday tradition and a real family favourite! See you there!

That Autumn Feeling

As proud Canadians, many of us appreciate the change of seasons and the opportunity autumn gives us to ease into the cooler temperatures, although so far the heat waves have kept us far from the reality of cooler temperatures. I for one am ready to put away the patio furniture and close up the pool. Along with anticipating the beauty of the changing leaves, I really enjoy open windows at night and listening to the sound of crickets. I do enjoy the change seasons.

I always think of fall as though it’s a beginning, a new year. We reset our goals at the office — both professional and personal goals — and we all get to work.

The fall is a time to reset our staging inventory. Our combined DeClute and Wright Sisters design team restocks all the beautiful toss cushions, throws and area rugs with fresh, seasonal fall colours. This is the time to pick up those new sofas, occasional chairs and area rugs. This year our team acquired some gorgeous pieces and the most beautiful selection of artwork yet.

It is our fall staging reset. We donate all of the gently used items which are a little dated and no longer the best to show current design trends. Lucky for our clients we have a 12,000 square foot warehouse so we can rotate our stock quite easily and keep everything clean, organized and fresh. This is the fun part for the designers, they can add beautiful rich colour and interest when preparing for our listings and now that our staging companies are combined, we have more stock and selection than you could imagine.

The real estate market typically has a fall reset as well. We often see a big influx of new listings hit the market as people return from their cottages and get the kids get settled back at school. Different things motivate different people. For some of us the thought of having to prepare, serve and entertain our large families over the holidays is enough to get us moving to a bigger space. On the flip side, with the kids all gone to school or finding their own new homes, the house can seem quiet and empty and the time may be right to downsize.

Many of us went into the fall market feeling a little uncertain about where our Toronto market was going to go after a decline in both the number of sales and prices over the late spring and summer. There was a lot of speculation about a really big influx of new listings hitting the market based on the slowdown of the spring and summer markets. Many of us expected this to slow the market down even more. I am happy to say that so far this has not been the reality, at least not in the east end.

So far our fall market is feeling more like a spring market. It has been fast moving in terms of sales and we are certainly seeing many multiple offers on properties again. The influx of new listings that were anticipated has not come into fruition so far. We find that once again we have more buyers than sellers and the days that a house stays on the market is declining. This is good news for many.

Whether you have the design bug and you are looking for a new space to update and claim as your own or, like me, you are both almost an empty nester and you have a huge extended family to entertain during the holidays. If you are thinking about a move and wondering about timing give us a call. We can help you with every single detail. Our combined staging and project management team can look after all of the details. They will get everything ready for you from start to finish.

If you are wondering about timing the market or if you have any real estate questions – ask us, nobody knows it better.

Major Mortgage Policy Change

We are happy to share with you the most recent mortgage news via one of our preferred mortgage brokers, Joanna Lang of the Lang Group. Fresh off the presses from Joanna: “While the details are still trickling in, the Office of the Superintendent of Financial Institutions (OSFI – the bank regulator) has once again used its powers to tighten mortgage qualification rules. These changes are effective as early as today for some lenders, but no later than January 1, 2018 and will impact anyone looking to purchase a home with a 20% + down payment (or looking to refinance).

As this is a federally initiated change, our credit union lenders, which are provincially regulated, may not be impacted initially which could provide potential solutions on a case by case basis.

We will continue to monitor this closely as the various banks and lenders issue their responses/implementation dates and guidelines.  We hope you find the information below helpful, and we are available at any time to discuss specific client questions or scenarios you may have ,or the changes in general.

What’s Changing? 

While a number of changes were announced today, the most significant is with respect to setting a new minimum qualifying rate, or “stress test” for uninsured mortgages (i.e., mortgages with 20% or more down payment).

As a recap, currently, if you have 20% or more for a down payment and you select a 5 yr fixed mortgage term, you can qualify for a maximum mortgage using your actual monthly payment in the calculations.  A typical 5 yr fixed bank rate is around 3.24% right now, which is called the “contract rate” or “actual rate”.  Going forward, while your actual mortgage payment would still be based on your contract rate, you would need to qualify using a much higher monthly mortgage payment based on the new “stress test” rate requirement which is the HIGHER of:

  • The 5 yr benchmark rate published by the Bank of Canada (currently 4.89%), or
  • The contract rate plus 2.0% (i.e., if the contract rate is 3.24% the qualifying rate would be 5.24%)

In the above example, this change would significantly reduce the maximum purchase price or refinance amount that a person could qualify for as it would require them to qualify based on a stress test rate of 5.24% vs. the contract/actual rate of 3.24%  – please refer to the impact section below for examples.

When is This Changing?

The banks/lenders have yet to comment, but it is anticipated some may start implementing the new rules as early as today, but no later than January 1, 2018.  As noted, this is a federally regulated change which will impact the banks, but it is expected most mono-line lenders will follow suit.  Credit unions are provincially regulated, so there may be gaps of opportunity that become available over the coming months and into the new year.

What is the Potential Impact?

While every case is different, we have included a sample max purchase price impact calculation for a 20% down buyer:

Impact Example #1 (Max Affordability):
Total household salaried income = $200,000
Down payment available = 20%*
Mortgage Product Chosen = 5 yr Fixed
Purchase Style / Location = Freehold / Toronto
Debts = limited debts (i.e., credit card, car, etc.)

Current Max Purchase Price = Approx. $1,550,000*
Max Purchase Price After New Stress Test Rules = Approx. $1,320,000*

(Note: the above is for illustration only.)


Impact Example #2 (Max Affordability):
Total household salaried income = $100,000
Down payment available = 20%*
Mortgage Product Chosen = 5-year Fixed
Purchase Style / Location = Condo / Toronto
Debts = limited debts (i.e., credit card, car, etc.)

Current Max Purchase Price = Approx. $720,000*
Max Purchase Price After New Stress Test Rules = Approx. $620,000*

(Note: the above is for illustration only.

*For the above examples we convert the 20% down payment to a $ amount that is the same in both the contract rate and new stress test rate qualifying scenarios.  Many media reports on the subject appear to be using a straight 20% down payment for both scenarios which would make the decrease in affordability appear larger.

What to do next?

Have you been on the fence about buying a new home? Now is the time. If you have any questions about the changes or what the market has to offer to you, feel free to contact us today.

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What is the Media Saying?

While additional details are expected to be published throughout the week, we have included a link to the OSFI announcement as well as a few relevant articles that have been recently released:

OSFI Announcement Posted on Government of Canada Website – Oct 17, 2017 

The Globe and Mail Article – Canada’s banking regulator raises bar for uninsured mortgages Article – OSFI finalizes new mortgage rules, including stress test for even uninsured borrowers

Financial Post Article – Canada’s banking watchdog sets tougher rules for mortgage lending

BNN Article – OSFI sets new rules for mortgage lending

Mortgage Contact 

Joanna Lang
The Lang Team

The Power of Collaboration

I want to share with you an open letter from our inspiring Coach Dave, something that is not directly related to real estate however it touches on why surrounding myself with such a talented team is so important to me, it also applies to the importance of family/friends, support and happiness, sometimes it takes a village and that is a good thing. I hope you enjoy it.

Enough People

It’s a wonderful time to reflect on my life story and think about which single habit, thought, idea, belief, or value is the secret to having a rich life. There are so many to discuss. But one thing about being a human being is that we can only fully invest our attention in one thing at a time. Each day, we are confronted with a simple fact: we are frantic and unhappy when we try to multitask—which means we’re bad at it. As powerful as the tools available to us are, there are limits to our attention that we cannot surpass.

Our limits are real. Our response to them is the key to our success or failure. That truth is a powerful one, and it’s what I’d like to talk about in this newsletter. The long and short of it is that our nature as limited individuals is a blessing in disguise, and a profound one, at that.

Not Enough People

As a sociology student, the Midwestern writer Kurt Vonnegut studied the history of humanity enough to know that we were traditionally happiest, for thousands of years, living in large, extended family groups, with plenty of people nearby to visit with, complain to, and seek assistance from. Writing about Americans in small, suburban households in the 1960s, he once said that every argument between a modern husband and wife has, at its heart, a simple, elemental complaint: “You’re not enough people.”

By this he meant that two adults tasked with everything involved with providing for and raising a family, without a supportive group of grandparents, aunts and uncles around them, were bound to run into their limitations. Add to this that blame is just an aggressive way of asking for help, and you begin to see the everyday truth in this statement.

Usually I talk about goals above and beyond daily necessities. But here, on the level of daily obligations, we see something about how we often cope with running into our limitations. In Vonnegut’s analysis, we hear something of the solution, too.

Diversified Portfolios of Individual Limitations

We are social creatures. We’re born into families and raised in communities. As adults, we each specialize in a limited area of expertise. When we want to do big things, we organize into groups to help cover each others’ limitations. This is the wisdom of humanity. In this wisdom, we each inherit an insight that tells us that our limitations are best understood as prompts to reach out to others, share our vision, and work together. Frustration with our limitations is how we signal to ourselves that we’re not enough people.

Permission to Be What You Are, Opportunities to Share an Accomplishment

So much of what a person needs to solve a difficult situation boils down to granting themselves permission to feel okay about only knowing what they know, doing what they can do, and handling what they can handle. Last month I shared a saying I find powerful for this purpose: “Beyond your limitations is a place you are not meant to go alone.” This insight has helped me and countless others accept that, although many of us start out only considering what we can do by ourselves, ultimately, our greatest successes, whether they are families, businesses, or revolutionary changes in how the world works, are all collaborations. We all live in a state of ongoing, complex collaboration.

When we no longer feel our individual limitations to be signs of imminent failure, we are free to do whatever success requires of us. When we pause to take a breath, let it out, and recognize where we are and remember how we got here, we sense how incredibly interrelated our lives are with others. We feel powerful gratitude towards everything that has led us to this moment, where our biggest problem is learning to let go of the false belief that there is something shameful or wrong about being one person instead of many. Gratitude reminds us we have never strayed far from a deep and nourishing well of capability and support. We have always been beneficiaries of help beyond even what we could have thought to ask for.

So, as I look at turning another year older, and I allow myself to be present in the moment, it doesn’t take long to be overwhelmed by gratitude. I see how miraculous my life has been at every turn. Knowing that my life has been anything but a solo show, a tale of one man’s triumph over challenges, or any of the stories I’ve told myself for cold comfort in moments of isolation, crisis, doubt or difficulty, I see the future in a much warmer light. The possibilities are inviting. Because my limitations will draw me again and again to the capability of others, the challenges I will encounter will bring me yet more gratitude. I can respond to my limitations in a useful way. I’m ready to face them with openness.

And that is what I wish for you. So take a moment. Take a breath. Let it out. See your individual limitations as opportunities to collaborate. Hear blame—in yourself and others—as a call for help. Allow your life to be the group effort it always was. Find strength in your gratitude for the support that has always been there and always will be. When it’s your turn, support someone else, knowing full well how much it can mean.

Thank you Coach Dave for this great read and to my talented team, family, loyal clients, thank you for being a part of the group effort of my life. I’m proud to be a part of yours.