By Warren McNeil

So with the “R” word looming I am finding that alot of the buyers that I am working with seem to be a little reluctant to make the big decision of buying a house. I am actually very surprised by this. Buyers should be more motivated to buy now then ever before. Houses are well priced and there is more inventory then this time last year to choose from. Smart investors buy when the market is soft. That’s how they make the huge profit in later years. If a buyer waits for for the market to bottom out, they might miss the boat. By the time the market hits bottom, it has already started to go back up again. Another big advantage for buyers is the interest rates are still very low. I am also reading that the Bank of Canada may lower the prime lending rate again. This is really good news. Good news just like the 79 cents I paid for gas today

For sellers, if you sell for less but are moving up, you may take a bit of loss on the sale of your house but when you buy you might be able to regain some of that loss. Besides, in 10 years after you have received a consistent 5% appreciation per year, does it really matter if you took a $5000-$10000 loss on your current house. It might not be a bad idea to look further out if you are faced with the decision to reduce the price if you haven’t sold yet. I heard a story recently that an indivdiual sold their house at a loss of around $30,000. It gets better!! The next house they bought they paid over asking price…. When they sold this house years later, they ended up selling it and making over $100,000 profit. Therefore they didn’t lose anything… There are probably many success stories like this and I am sure you have heard them before. All I am trying to do is illustrate a point. That point being, you need to decide how badly you want to sell. If it means reducing the price, then you might have to make that tough decision. If you are unable to sell at the lower price, then you might need to look at some alternatives. Those alternatives could be staying put or renting.

Here is a little snippet of an email I received today from Re/MAX:

Real estate in the Greater Toronto Area has faced many challenges over the years but continued to experience steady growth. In 2009, there are some announcements that are expected to have a positive impact on the housing market and they are as follows:

1. The Bank of Canada has indicted that lending rates may fall further in 2009.

2. Federal government intervention in the form of a $75 billion mortgage purchase from the CMHC will free up additional credit.

3. Measures will be introduced by both the Federal and Provincial government to bolster the economy. In Ontario, that could mean a bailout package for the ailing manufacturing sector.

4. A lower Canadian dollar – hovering at 85 cents American – may provide a much–needed boost to manufacturing.

5. Job employment rates continue to hold steady in the GTA, despite upward momentum at the provincial level. The unemployment rate was 6.8 per cent in October, down from 6.9 per cent in September.

6. Population in the GTA continues to grow through migration, with 60,000 plus households expected to form in 2009.

In summary, with the lower interest rates, higher volume and aggressive pricing, now is a great time to buy. Take advantage of this softer market now because in 10-15 years you can look back on this time and say, I bought during the recession of 2008-2009. Real estate has historically appreciated by 5% per year on average. Sure there were years when it was lower but it always came back. I feel strongly that real estate is one of the best investments you can make. You don’t need to be Donald Trump to make alot of money in real estate.

Thanks for reading!

Warren McNeil | Sales Representative, Team McNeil | Re/Max Twin City Realty, Brokerage
( 519.579.4110 | *  Click Here to Email | www.clickthathouse.com, www.teammcneil.com/blog

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