National resale housing market activity returned to pre-recession levels in May 2009. The rebound in activity is being led by an increase in transactions in some of the most expensive markets in the country, which is skewing the national average price upward.

According to statistics released by The Canadian Real Estate Association (CREA), actual (not seasonally adjusted) home sales via the Multiple Listing Service® (MLS®) of Canadian real estate boards totaled 49,521 units in May 2009. This is less than one per cent below activity in the same month one year ago. Year-over-year declines have been shrinking since the beginning of the year.

The seasonal increase in activity continues to be stronger than normal. As a result, seasonally adjusted home sales rose eight per cent to 37,649 units in May compared to April. This marks the fourth consecutive monthly increase in seasonally adjusted activity. Seasonally adjusted activity in May was 43 per cent above where it stood in January 2009.

Seasonally adjusted sales were up on a monthly basis in about 70 per cent of local markets. Monthly activity gains in Toronto (nine per cent), Calgary (25 per cent), Montreal (10 per cent), Vancouver (eight per cent), and Edmonton (12 per cent) contributed most to the overall increase in monthly activity.

The national MLS® residential average sale price in May 2009 reached the highest monthly level on record. At $319,757, it was up fourth tenths of a percentage point from the previous record set in May 2008. Over the past four months, the national MLS® residential average price has recovered 16.4 per cent from the low in January. The average price for MLS® home sales climbed to new heights nationally, and in Saskatchewan, Ontario, Quebec, New Brunswick, and Nova Scotia. New records were posted in only 15 per cent of local markets in May, none of which are among the most active or expensive. The strong rebound in sales activity, not price, in Canada’s most expensive markets is driving up average prices nationally and in some provinces, just as a sharp decline in activity in these markets pushed average prices lower in late 2008.

The supply of homes coming onto the MLS® market continued to decelerate in May. Seasonally adjusted MLS® residential new listings edged lower by eight tenths of a percentage point to 65,070 units, the lowest level since December 2005. Seasonally adjusted new residential listings in May were 19 per cent below the peak reached one year ago.

With the number of sales rising strongly and new listings trending downward, the balance between supply and demand is firming up in British Columbia, Alberta, Saskatchewan, Ontario, and Quebec. This resulted in national sales activity as a percentage of new listings reaching the highest point since December 2007. Residential dollar volume for MLS® sales climbed 10 per cent from the previous month to reach $11.4 billion in May. This is more than 50 per cent above the low of $7.5 billion reported last January.

“Sales activity is now closer to the pre-recession peak than it is to the recent low point reached last January,” says Regina Broker Dale Ripplinger, President of The Canadian Real Estate Association. “Strengthening consumer confidence, low interest rates, and improved affordability are drawing buyers to the housing market across Canada,” he added.

“Fueled by a string of monthly increases in activity, the number of transactions in May reached the highest point since July 2008,” said CREA Chief Economist Gregory Klump. “Inventory levels are still high in many markets, but fewer new listings and rising sales activity suggests that the selection of homes available for sale may shrink as the year progresses. The supply of homes up for sale needs to be drawn down further before average price increases become more widespread among local markets.”

All the talk these days seems to be about Twitter, and I don’t see that changing anytime soon. A new application for real estate agents has been released called Tweetlister . This is a free application that allows you to create, manage & schedule Twitter friendly property listings. The site allows you to track contacts as well as download them as an Excel report.

As a part of your social media strategy, this could be a handy tool, however there is more to using and being succesful on Twitter and other sites than just promoting your product or listing. I can name a number of real estate groups that are just promoting listings and as a result have virtually no followers on the social sites. To make this work for you, you need to build a strategy around the engagement of the on line social media user, not just promote product. It’s about sharing information, about providing support and advice for people as they go on the journey of looking and searching for a home or investment.

Use sites like Tweetlister  as part of your overall plan, but remember, the best way to  create a successful social strategy is engage & interact with your followers.

MoneySense magazine recently published its fourth annual list of Canada’s best places to live. According to the report the top 10 best places to live in Canada are:

1. Victoria, B.C.
2. Ottawa, ON. - Ottawa Apartments
3. Kingston, ON.  - Kingston Apartments
4. Burlington, ON.
5. Vancouver, B.C.
6. Moncton, NB.
7. Frederickton, NB.
8. Winnipeg, MB.
9. Peterborough, ON.
10. Brandon, MB.

For more information and rankings please see below:

Moneysense - Canada’s Best Places to Live

Source: Scotiabank Group

Canada’s housing market is showing signs of emerging from its winter hibernation. The Canadian Real Estate Association reported a healthy pickup in home sales nationally in both February and March, beyond the typical seasonal bump, albeit off decade lows in January. Preliminary reports suggest this firming trend continued in April. Buyers, especially firsttime, are being lured by historically low mortgage rates, greater affordability and increased supply.

The rise in demand, combined with fewer new listings, has restored a better balance to the market. The national new-listingsto-sales ratio averaged 2.2 in March, down from a cycle peak of 2.7 last November (about 2.0 is considered balanced). Average home prices steadied in February and March, though were still down almost 8% year-over-year (or 5% on a regional salesweighted basis).

These ‘green shoots’ are encouraging. On an annualized basis, average home prices in early 2009 are running about 6% below last year’s levels, while sales volumes are down 16%. This is tracking a slightly better performance than our forecast for a 10% decline in average prices this year, and at the low end of our forecast for a 15-20% drop in sales.

Nonetheless, we still feel there is more downside than upside risk to home sales and prices. The significant deterioration in domestic labour markets in recent months suggests little prospect for a major resurgence in demand near-term. Meanwhile, a still-high level of active listings relative to underlying demand will continue to pressure prices. In contrast to the pickup in home sales, residential construction is being reined in even faster than anticipated, with builders quick to respond to falling new home prices, rising inventories and greater resale competition. Housing starts slumped to a decade-low of only 139,000 annualized units in Q1. Residential permit demand has slipped even further to around the 125,000 unit mark.

While exacting a heavy toll on domestic demand and employment, the correction is nonetheless a necessary cyclical adjustment to an extended period of overbuilding. We now expect Canadian housing starts to total only 140,000 units this year, down from our February forecast of 155,000. The longer-term sustainable rate of housing starts, taking into account population growth and depreciating stock, is around 175,000 units annually.

For the full report from Scotiabank click here

May 13, 2009 - Globe and Mail:  Buyers, Sellers Keep Close Eye On Fine Print - As boom turns to bust, lawyers are being kept busy by clients who have turned much more cautious.

May 13, 2009 - Globe and Mail:  New Home Price Declines Led By Western Provinces - Prices for new homes fell 0.5 per cent in March from a month earlier, with the biggest dips in Calgary, Edmonton, Vancouver and Victoria.

May 12, 2009 - YourHome.ca:  New-home Price Drop Moderates - Canadian new-home prices fell for a sixth-straight month in March.Prices declined 0.5 per cent from February, following a 0.7 per cent drop over January.

May 12, 2009 - National Post:  Condo Sales Hit Low - Despite a record number of construction cranes gracing the horizon, Toronto’s once-thriving new condo market hit a dismal sales low in the first quarter of 2009.

May 8, 2009 - Vancouver Sun:  Toronto Condo Prices: Best Bang For Your Buck -”At the upper end of the market, Toronto condo prices continue to represent the best bang for your buck, relative to major markets in the United States and around the globe”.

May 8, 2009 - Toronto Star:  Simple Home Staging Steps Can Up A Home’s Appeal - Not everyone should invest in fancy upgrades and fresh coats of paint. But all homeowners can benefit from reorganizing and beautification.

Source: CBC News

Ontario Energy Minister George Smitherman has backed down from a plan to require energy audits each time a house is sold. A new amendment to the province’s Green Energy Act will allow home buyers to waive their right to the $300 audit, as long as they do so in writing.

The change will provide more flexibility in cases where the buyer intends to knock down the property or do major renovations, Smitherman said. But he said he’s not anticipating that many buyers will opt out of an audit.

“I rather suspect as people are making the most important investment of their life, they’re going to find that to be very valuable and important information,” he said. “But we could see some scenarios where the home at question really isn’t worthy of an audit, if you will.”

Ontario realtors have complained the additional costs would hurt homeowners in what are increasingly difficult economic times. The Liberal government is backing off from the audits because it’s afraid of the public backlash, said interim Progressive Conservative Leader Bob Runciman.

Many homebuyers will also be hit with additional costs when the province merges its eight per cent sales tax with the five per cent federal GST, he said. “They know that this is a problem for them and they have to back away, and this is one area where they can make some adjustment,” he said.

The legislation will also be amended so residents will have an easier time objecting to wind turbine projects near their homes.

I am sure most of you have heard about Twitter, but what exactly it is and why are so many people flocking to Twitter? Evan Williams, Twitters CEO has the answer:

Twitter lets people know what’s going on about things they care about instantly, as it happens, In the best cases, Twitter makes people smarter and faster and more efficient.

A survey of Twitter users from MarketingProfs, a US based research company, backs Mr. Williams’ views. On a scale from 1 to 5 (with 1 for strongly disagree and 5 and for strongly agree), the phrase “I find it exciting to learn new things from people” averaged a score of 4.65 and “I value getting information in a timely manner” averaged 4.58.

“Above all, people on Twitter are truly motivated by learning new things and getting information real-time, as it’s developing,” said Ann Handley of MarketingProfs.

With Twitter growing at over 1,086% per year, it’s expected that Twitter will have over 18.1 million users in the US by this time next year and at that rate, the entire Australian on line audience will be using Twitter, ohh just imagine the noise then!!

Of all the social networking sites out there, such as Facebook, Linkedin, etc., I would say twitter has the potential to offer the most value to real estate agents. The majority of twitter users do not have protected profiles so within minutes of signing on you can start following industry and technology leaders, other real estate agents and people from your local communities. These are the connections that will have the best long-term value.

If you want to learn more, check out Twitter How-to Guide for Real Estate Agents

The 2009 Swanepoel Trends Report came out last month. The Report is widely acknowledged as the most comprehensive Report covering change in the real estate business.

This is an annual report, authored by Stefan Swanepoel, which summarizes the preceding year and details the most significant trends, innovation and new business models impacting the real estate business.

Although, there is a price for this report, you can check out a great video below of Mr. Swanepoel describing the latest social networking and web 2.0 tools available for today’s real estate agent.

The 2009 edition discusses the following top 10 real estate business trends.

Real Estate Trend #10 - What if Your E&O Insurance No Longer Existed? What a Nightmare. This trend discusses what happens in the event of a sale of the company where you are working and provides suggestions on how to protect yourself.

Real Estate Trend #9 - This trend discussed which factors are shaping housing values and future property developments and what are impact urban adjustments could have on real estate.

Real Estate Trend #8- As the green movement gains more grassroots support, green buildings and green mortgages are starting to influence the job of a real estate professional.

Real Estate Trend #7- Web traffic has increase so much so over the last few years that we now have an information highway congestion. Learn ho to establish a legitimate marketing channel and take a strategic approach to online marketing.

Real Estate Trend #6- Real estate may be local but buyers no longer need to be. In The Foreign Factor the Trends Report discusses new non-US based companies expanding internationally as well global networking, IDX, transactions and social media.

Real Estate Trend #5- MLS has been and remains one of the most discussed, debated and controversial topics of the last few years. Now that NAR has settled with the DOJ interest is swelling for a national MLS.

Real Estate Trend #4- Major new NAR initiatives could fundamentally change the real estate industry. Learn about their four most important second century initiatives.

Real Estate Trend #3- Greed and stupidity caused the largest real estate, foreclosure and financial meltdown in living history. This has led to an overall business recession and a multi-billion trillion dollar bailout by government. Where do we start the path to recovery?

Real Estate Trend #2- The power has shifted. Never before have so many people had the opportunity to connect with so many other people, voice their opinion and shape history. This trend discussed social networks, wiki’s, micro-Blogging and the rising power of the individual.

Real Estate Trend #1 - Yes, we are in a depressed real estate market, but for those of us that have been around a few decades, we know cycles are part of the real estate journey. This trend discusses the changing real estate paradigm and the recommended steps for brokers and agents during a down market.

The president and CEO of Royal LePage Real Estate Services announced yesterday that Canada is half-way through the current housing slump which believes began in late 2007.

“Starting back in the end of the third quarter of 2007 we saw unit sales peak in Canada and we’ve been in a downhill slope ever since,” said Royal LePage’s Phil Soper. “We’re in the fifth quarter of correction now.”

Soper said he expects unit sales to flatten towards the end of this year or early 2010.

“With homes, (consumers) have a tendency to look at home prices because it hits them where they live and their personal financial health is tied up in their homes,” Soper said.
“To determine the health of the industry you need to look at industry revenues, which is determined by the number of homes that sell (multiplied by) the prices they sell at.”

He explained that unit sales are a leading indicator of price changes, so the slowdown in volume that began in late 2007 didn’t begin to be apparent in prices until last year.

Soper said the longest “contemporary correction” in Canada’s housing market lasted seven quarters, or 21 months, from 1989-90. He believes the current correction will last only a bit longer and that there are many incentives in the market today to bring back buyers.

“When we look at year-over-year changes, and we look at how we believe the economy and the housing market will respond to the fiscal stimulus packages out there, to very low interest rates, to cheaper home prices, we think unit volumes will flatten on a year-over-year basis sometime in the third to fourth quarter” Soper said.

He said house prices may continue to decline after that time, but that there will be “positive unit price change prices,” later this year or early in 2010.

“Which will bring the overall industry into a growth stage again,” he said.

Soper also said first-time buyers will be the engine that drives Canada’s housing market in the months to come.

“When first-time buyers don’t buy, it’s really like sand in the gears of the real-estate market,” he said.
He pointed to estimates that first-time buyers represented 70 per cent of all real-estate transactions in Canada around the time the market peaked. That percentage has since dropped to about 40 per cent.

Soper’s comments come the day after rival real-estate firm ReMax released a report Wednesday saying first-timers are being lured into buying homes in recent weeks thanks to falling prices, lower interest rates, more selection and new government incentives.

Ottawa recently announced new tax credits of up to $1,350 for home buyers to renovate their house or cottage. It also increased the amount first-time home buyers can withdraw from their RRSPs from $20,000 to $25,000, and implemented a tax credit for first-timers of up to $750 to help cover closing costs.

ReMax said 22 of the 32 markets in the survey, or 69 per cent, “remain firmly in buyer’s market territory.” Scotiabank economist Adrienne Warren said there was a 17 per cent drop in unit sales across Canada in 2008, compared to 2007.

In 2007, a record approximately 524,000 units sold, which dropped to 434,000 in 2008. Based on January 2009 data, homes are selling at an annualized rate of about 317,000 in Canada. However, January was considered a dismal month for home sales and early indications across Canadian real-estate boards show a significant pickup in many markets in February.

For instance, sales in Toronto rose 54 per cent in February to 4,120 units, compared to January. That’s still down from record 6,015 sales recorded in February 2008. Official national figures for February are due to be released in the coming days.

Warren said Soper’s longer-term forecast is consistent with hers, but that current economic conditions will dictate when a recovery will come in housing. “What you need to see is better demand conditions,” Warren said.

Source: Toronto Star.

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