Finally, Google Street View has gone live in Canadian Cities: Toronto, Calgary, Montreal, Halifax, Quebec City, Kitchener, Waterloo, Squamish, Ottawa and Whistler. This service has been made available to several other countries showing close up of street views.
With Google Wave in the works, these new services are going to make information more accessible to consumers as well as the real estate industry.
This is one of those posts where I wish I didn't have to write it, but felt it was so important to my readers that I would be remiss not to at least talk about it.
Everyone out there probably knows somebody who is behind on their mortgage payments, looking for alternatives and likely also just finding out that their home's value has dipped below what their loan amount is. I know some within my own personal circles. It's a tough situation for me to advise them as a professional because it's such a personal challenge to their pride and self-worth, not to mention their plans and dreams for the family. The question we're asking is "when is this going to stop and where are we heading?"
I'm going to put up a few graphs that show the trends nationally with regards to mortgage delinquincies:
This chart is by quarter - Single-family mortgages set a new record delinquency rate in the second quarter of 2009, according to a quarterly survey by the Mortgage Bankers Association. Those of us in the real estate business see the foreclosure process (just visit the local Sheriff Sale docket to see the current numbers) but the looming delinqency-to-foreclosure issue is far, far larger.
The Wall Street Journal on 8/3/09 reported the following quote: “While subprime mortgages sparked the first round of housing problems two years ago, now "troubles are lurking further up the food chain," says Joshua Shapiro, chief U.S. economist at MFR Inc. White-collar job losses have accelerated while more adjustable-rate loans to prime borrowers are resetting to higher payments. ‘You put all that together, it leads me to believe that the next leg down on home prices is going to come from the top,’ he says.”
The first objection someone may have would be to say "yes, but historically those who are delinqent usually get their act together and come current on the mortgage after a while". That WAS true, but not anymore! We call that the "Cure Rate", that is the rate of delinquencies that go back to current. The Wall Street Journal reported on 8/24/09 about a Fitch analysis that found that the Cure Rate from 2000-2006 was 45% (which means about half of people fix their delinquency). However, as of July 2009 the rate had dropped to just 6.6%! That means that over 90% of delinquent customers are going to foreclosure. Take a look again at the above chart...
The next thing someone will say is "well, that's the 'sand states' and not my area". Here's the chart for all 50 states showing the same breakdown of delinquencies and foreclosures. Guess what - most states have a significant problem, especially compared to historical figures.
Now the next thing someone may say is "aren't those loans going to get 'fixed' by a loan modification?" I know several people right now who are applying for a Lancaster County loan modification but are waiting and waiting. I hope it works out for them...
In reality, loan modifications are hardly making a dent. To me, that's a burning question. Why arent banks being more aggressive in giving customers the option to extend their loan and/or reset to a lower rate? Why are they being SO difficult? The people I know don't want to be foreclosed. They CAN make payments. They just need the terms redrawn to allow them to catch & keep up. Loan modifications are not helping us get this crisis under control.
What are the causes of all these delinquencies? Here's a chart that is enlightening:
Keep in mind, this post is not intended to give us "good news". You may be experiencing good things in your market and that's great. My intent is to get us thinking about the challenges that aren't going away and how we're going to address them as homeowners, agents and professionals. I'd love to hear your ideas!
How simple planning strategies convert this 1950s bungalow into a great small space
BEFORE
AFTER
H2O
In an effort to maintain the integrity of the streetscape in this neighbourhood at the foot of Moss Rock Park [Victoria, B.C.], the existing house was renovated, and then expanded with a significant addition towards the back of the property.
The renovation was extensive, and included new plumbing, new wiring, new exterior walls and new roof, allowing for a more comfortable 9' ceiling and unobstructed open floor plan. Changes to the original layout were dramatic - the main entrance and stair were relocated to the new breezeway which provided a connection between old & new. A patio was added to the front of the house to establish a relationship with the street.
The "pod" addition became the new workspace for an accomplished graphic designer, housing studio on the main level, master bedroom and ensuite on a second, mezzanine level and roof deck on a third level, with views south to the water & mountains.
In the summer of 2004, SOS Design opened the door to its new "storefront" office in Vic West, demonstrating a commitment to responsible design by incorporating many green building techniques.
This particular project faced restrictions relating to small lot subdivision. Therefore, every effort was made to create a feeling of spaciousness, enhanced by an abundance of natural light within a very small building envelope.
By blasting rock on the site, they were able to create an 800 square foot office space which is entered at street level, keeping the private entrance tucked away at the back of the house, one level up. To help offset the small lot, they developed a roof deck which has views over the harbour to the Olympic Mountains beyond.
Bloordale Village, along Bloor Street West bordered by Dufferin and Lansdowne, has often received a lot of negative publicity in the past. Being so close to the Annex, recently new art galleries, film studios and new developments nearby are slowly revitalizing the area. With real estate prices climbing in areas like Parkdale, Beaconsfield Village, The Junction and Trinity Bellwoods, not too many neighbourhoods in the central core along the subway line are affordable anymore.
Bloor-Gladstone Public Library emphasizes community and openness, offering a nice face-lift to the street front.
A group of representatives from a spectrum of different neighbourhoods got together in 2007 with a vision to form an ad hoc committee in 2007 called People Plan Toronto. The group invites the public to identify problems with the planning process in the City, consider alternative models, and create an action plan for positive change.
Public consultation is often inadequate in new development planning process, leading to decisions which often leaves the public baffled.Recently, PPT came up with the concept to create a Community Planning Resource Centre. PPT proposes to take planning beyond design and architecture, and place more emphasis on development relative to the urban context, addressing issues such as marginalization, transportation and infrastructure, and community building, all of these through collaboration of citizen involvements in Toronto.
As the initial vision, the Centre will provide clear and useful information about planning, design, and Toronto's planning process to citizens and community groups; facilitate the provision of professional assistance to communities who are seeking to respond constructively to development proposals; help with pro-active community planning initiatives; and enable communities to share information and build relationships amongst each other. They have provided a survey to invite the residents of Toronto to voice their suggestions on what the objectives of Community Planning Centre should fulfill.
Pre-approvals and rate holds have been a standard offering with most lenders. I recently received a newsletter from a mortgage broker I work closely with in Toronto [Rosanna Younan from Premiere Mortgage Centre], informing me that two big lenders, TD and FirstLine have decided to stop pre-approvals within the broker channel. The big question is whether the majority of lenders will follow the lead.
pre-approvals frequently don't close (less than 1/3 of pre-approvals close)
pre-approvals are expensive to process and the return for lenders is debateable. The lender is tying up human resources to process applications, as well as capital to hedge rates.
The next few weeks/months may see the trend continuing or lenders may start charging a rate premium on pre-approvals (presently the policy with a few).
Many good lenders are currently still offering preapprovals and more the reason for anyone considering a purchase or refinance, within the next 4 months, to arrange for a rate hold.
Would mortgage pre-approval/ rate hold become extinct?
We often see on MLS listings "Seller or Agent do not warrant retrofit status of basement", and if there is no mention that the unit is legal, it's probably not . The legality of basement apartments or converted rental units (i.e. granny flats, in-law suites, accessory apartments, non-retrofit units) are often in question, considering there are tens of thousands of basement apartments currently in the City of Toronto.
Under certain zoning by-law, basement apartments are permitted in single family homes as long as it meets certain requirements. In order to assist home owners, the City have a kit which will explain "how to create a legal second suite" through Access Toronto at 416-338-0338 or can be obtained at the desk. There is also an alternative site which provide a more detailed explanation of the physical requirements to meet building codes at Carson Dunlop Home Inspection and Consulting Engineers.
For anyone thinking of buying, selling or retrofitting a home with a basement apartment, These are the typical 4 questions to ask:
1. Does the zoning by-law in your area permit a basement apartment unit?
2. Does the retrofit meet fire code and minimum building code requirements (i.e. minimum ceiling height, fire rated walls, entrance sizes, egress, provision of parking spot etc.) ?
3. Does it meet the basic electrical safety requirement?
4. Has the unit been registered with the City and has a certificate of compliance?
We are all aware that human population growth in particular at urban centres will impact future supply of food, our environment and the ecosystem. According Census, the Greater Toronto area grew by over 450,000 people between 1996 to 2001 to over 5 million people. How can we utilize the concrete jungles of urban centres to grow food?
The idea of doing intensive hydroponics agriculture in urban hi-rises, where the buildings recycle their own water, and produce their own power.
The concept of Urban Vertical Farming and Skyscraper Farming may soon change the concept of urban food production, where we will live and work close to inner city urban organic farm. The idea may seem far-fetched right now, but maybe it's time to get serious to turn vision into reality.
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Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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