Are you a buyer or seller trying to navigate the rollercoaster that is the current Canadian housing market? With the real estate landscape constantly changing, keeping up with all the new decisions, announcements, and resultant market changes can be challenging. Not to mention understanding how these changes affect you and your home. Though there are many reasons why the Canadian housing market has been experiencing these fluctuations, the good news is that house prices are currently recovering – but how could that happen considering everything we’ve experienced over the last several years? Well, today, our experts at Soni Chachad Real Estate are going to break down everything you need to know about the current Canadian housing market so that you can make an informed decision regarding your next real estate transaction.

BoC Rate Hikes

By now, you’re likely well aware of the rate hikes implemented by the Bank of Canada (BoC) over the past 12 months or so. With the prime interest rate spiking from 0.25% to 4.50%, this was the biggest percentage increase in Canadian history. In the real estate world, we would expect that a prime rate jump like this would trigger a significant economic contraction and unemployment within 12-18 months, and yet, there has been no increase in unemployment in Canada so far. Furthermore, home prices should have been skyrocketing, but they, in fact, have been falling until just recently, at the start of Q2 2023. So, the question becomes, why?

Real Estate Landscape

In order to understand the ‘why,’ we need to turn back to the beginning of the pandemic to understand the build-up that has resulted in what we’re experiencing now. Phil Soper, President and CEO of Royal LePage, stated, “There has been nothing ‘typical’ about Canada’s housing market since the start of the COVID-19 pandemic. Lockdowns brought the housing market to a grinding halt in early 2020 before the work-from-home revolution catapulted it into a two-year, all-season frenzy of record sales volumes and aggressive price growth. As markets do, this market overshot, and the inevitable correction was triggered when the Bank of Canada began to rapidly raise interest rates. The downturn came swiftly, and the real estate industry remained depressed for twelve months, a longer correction than the aftermath of the financial crisis thirteen years ago. We have turned the corner, and the housing economy is growing again.”

Sidelined Buyers and Low Inventory

With this foundation in mind, let’s examine a few reasons that the Canadian real estate market is on such a rollercoaster. Beyond this rebounding (which is a contributing factor, but certainly not the entire story), the BoC rate hikes also sidelined many buyers who were anxious about locking in at such a high rate. With buyers less active, this is when we were seeing home prices falling, like in Q1 2023, for example. But now, in Q2 2023, the housing market faces a different problem – low inventory. One reason is inflation, which has increased the cost of materials and labour for new builds, coupled with a lack of skilled tradespeople. The result is a chronic shortage of housing supply in Canada. However, there’s one more factor that has blunted the effects of this massive prime increase and contributed to lower inventory, and that is emergency re-amortization.

Emergency Re-Amortization

We need to ask ourselves: how did a quadrupling of mortgage rates not completely kill buyer demand? And what happened to all the distressed listings that were expected to flood the market from people who can’t meet their higher mortgage obligations? Well, the answer is simply that the banks, with the support of regulators and the federal government, quietly changed the rules to prevent a mortgage crisis. As mortgage rates sore alongside the BoC interest rate hikes, lenders and mortgage providers are using emergency loan-modification options that allow some struggling homeowners with a variable-rate mortgage to extend their amortization periods up to 40 months in an effort to reduce their payments. Some homeowners have even secured amortizations of 70 years or more! In these types of cases, homeowners will be paying much more interest while paying off little to none of the principal amount (or, in other words, their actual debt). Although it’s excellent to see these homeowners get the opportunity to keep their homes, one obvious issue with extending the mortgage period to this length is that it can create multi-generational debt. It also means there is far less pressure to sell these houses, which contributes to this lack of inventory and could potentially spark yet another price spike for Canadian homes.

BoC Rate Pause

So, what’s the good news? Well, following the March 8th and April 12th rate decisions, the BoC opted to hold its overnight rate steady, announcing a ‘conditional pause’ on rate hikes as long as inflation continues to drop in line with their forecast. The less good news? They have left the door open to further rate hikes if inflation and economic growth don’t ease as much as expected. So now, regarding the real estate industry, the question becomes: will supply or demand outpace the other, or will they be balanced in the coming year?

Final Thoughts

Although with many of these questions, only time will tell, there are some things we know for sure. For one, the Canadian housing market is experiencing a strong recovery (against all odds), and most provinces saw their provincial average home price increase compared to last month. Specifically in Ontario, the average home price was $881,946 in March 2023, which was a drop of 16% year-over-year but an increase of 8% month-over-month. Furthermore, the next BoC rate announcement will come on June 7^th, 2023, which is one of the eight scheduled dates each year that the BoC releases its rate decision. As long as economic growth remains strong and inflation is tamed, there would be no reason to assume we’ll see yet another increase (though this we can’t say for certain). Ultimately, the factors affecting the housing market are complex and multifaceted, and it will be interesting to see how the Canadian housing market continues to evolve over the coming months.

If you’d like more information regarding the current Canadian housing market or if you’re searching for an experienced, reputable realtor in the Golden Horseshoe region to represent you as a buyer or seller in your next home transaction, be sure to check out my featured listings and do not hesitate to reach out to me directly! 

Although the housing market has seen its fair share of ups and downs over the past few years, no doubt in part thanks to the pandemic, investing in real estate is still a great opportunity to earn higher-than-average returns while diversifying your portfolio. It’s one of the safest investments you can make with your money since homes generally only appreciate over time, whereas something like a vehicle depreciates over time. So, today, our experts at Soni Chachad Real Estate have compiled 7 ways to invest in real estate in 2023 to help you decide how you’d like to break into the real estate market this year.

1. Buying Your Own Primary Home

First up on our list is buying your own primary home. Though you may not think of your first residence as an investment, it’s actually one of the best ways to begin investing in real estate and offers numerous benefits. For starters, you can build equity in your home from your monthly payments rather than paying rent and, in essence, paying someone else’s mortgage. Plus, your mortgage payments will generally stay the same for the entirety of your mortgage and won’t be affected by inflation like if you had rented. Beyond this, banks will often treat owner-occupied residents more favourably, giving borrowers a lower mortgage rate and requiring a lower down payment. Not to mention, the Canadian government offers a variety of tax breaks and credits for homeowners that you can take advantage of.

2. House Hacking

A second way to invest in the real estate market in 2023 is to try house hacking. House hacking is an excellent strategy for an investor who wants to generate income while living in their investment property. Essentially, it involves buying a multi-family property (such as a duplex or triplex) and living in one of the units while renting out the other units. In this case, the investor is able to generate rental income to help cover the cost of their mortgage, taxes, and other expenses while also building wealth over time. However, with house hacking, you do need to be prepared to become a landlord and should always be knowledgeable about the rules and regulations surrounding landlordship in your area.

3. Flipping Homes

One of the most popular methods of investing in the real estate market is to begin flipping homes. This involves buying a property that needs some work, fixing it up, and then selling it for a profit. However, there are a few things to keep in mind with house flipping. For one, you need to be deliberate about the area you choose to invest in; in other words, do your research before making a move on a property. Second, remember that you need to have the financial resources available to buy the property and make the necessary repairs. And finally, depending on your level of expertise, you may want to hire a contractor to help you do the work, as they will ensure it’s completed at a professional level, ultimately making it much easier for you to sell in the end.

4. Buying Land

If buying your own home, becoming a landlord, or flipping houses doesn’t sound like the right option for you, you might consider buying land. To begin, there is often less competition for raw land since many people are looking for a home, not just the land. This works to your advantage though because land will always be in demand and will increase in value over time. Not to mention, you could see exponential profits if a developer wants to buy your land for a future development. But what if the land you’re buying is more rural? In that case, you might think about renting out the land to local farmers for cattle grazing or crop growing. Either way, buying land can be an excellent opportunity and holds a high potential for a great return on investment (ROI).

5. Short or Long-Term Rental

Arguably the most classic way to get started with investing in real estate is to buy a property and rent it out. Once you have a property, you might lease it to a long-term tenant or decide to place it on a short-term rental platform such as Airbnb or Vrbo. Similar to the house hacking suggestion, this tactic will help you generate income to cover things like your mortgage payments, taxes, insurance, and other relevant expenses. Here, the main thing to consider is whether you want to be a landlord or just a short-term rental host. Of course, both have pros and cons, so be sure to think about all the different factors that apply to your situation before making a decision.

6. Look into REITs or REIT ETFs

Another option to get into real estate investment is investing in a REIT (Real Estate Investment Trust) or an ETF (exchange-traded fund). With a REIT or REIT ETF, you don’t actually own property but rather trade stocks and participate in the running of a trust that owns real estate, such as office buildings, rental spaces, hotels, and other types of non-residential properties. So, why is this a strategy you should consider? Well, not only can you invest in many REITs at once instead of just one at a time, but they’re basically dividend-paying stocks, meaning they may provide some hedge against inflation. 

7. Real Estate Limited Partnerships

Finally, a real estate limited partnership (RELP) allows you to invest in a diversified portfolio of properties alongside other investors who pool money to buy, lease, develop, and sell properties together. There are several benefits of this strategy, such as the real estate tax benefits are similar to outright ownership, passive investments require no investor involvement, and the liability is limited to the amount invested. However, one thing to keep in mind is you should know who you’re partnering with to minimize the potential for conflict and ensure that a disproportionate level of involvement doesn’t occur.

Final Thoughts 

So, now that you’re aware of the various different types of real estate investments available to you, it’s time to decide which one sounds like the right fit. You might opt for a more traditional route with something like purchasing your own home, house hacking, flipping homes, or looking into short or long-term rentals. On the other hand, you might be more interested in something like buying land or looking into REITs or RELPs. No matter what you decide, an investment in the real estate market is always a great choice as it helps diversify your portfolio and offers opportunities for cash flow, tax breaks, equity building, and a hedge against inflation.

If you’d like more information regarding any of these real estate options or are searching for an experienced, reputable realtor in the Golden Horseshoe region to represent you as a buyer or seller in your next home transaction, be sure to check out my featured listings and do not hesitate to reach out to me directly!  

Agents: take a moment to think about what your current real estate marketing strategy looks like. Now ask yourself, when was the last time you reviewed your strategy and implemented new tactics? As real estate trends and technology evolve, so should your real estate marketing and promotional strategy. But what are the emerging trends of 2023? And which one should you integrate into your strategy first? Well, our experts at Soni Chachad Real Estate have compiled 3 real estate marketing trends to try in 2023, along with tips on implementation, to help you capture more clients’ attention and level up your listing game.

Focus on Branding

In 2023, it’s more important than ever to create marketing materials and content for your listings that not only stand out against your competitors but are uniquely ‘you.’ This focus on branding helps current and prospective clients immediately recognize your posts without getting confused or thinking you’re a different brokerage. To execute flawless branding, we recommend a few things when designing your content.

For starters, you’ll want to have a few brand colours that are distinctive to your brand – incorporating two to four colours is a good range to start, as too many brand colours can become messy and confusing. At Soni Chachad Real Estate, our brand colours include black, white, gold, and red, to give you an example. Beyond colours, you’ll also want to choose two to three different fonts that you can use across your branding. Our designers use one handwritten font, one serif font, and one sans-serif font. Finally, you’ll want to integrate your logo or watermark into your materials wherever possible to help further brand your content and make it recognizable to clients.

Pro tip: If you use a platform like Canva to design your promotional materials, you can save your brand colours, fonts, and logos within the platform for easy access.

Drone Footage

Over the past few years, drone footage has become an increasingly popular way to get dynamic videos and photos of real estate properties. Although there is a growing demand for drone footage, not every brokerage or agency has access to one, meaning if you’re able to harness this technology, you can get ahead of the curve. Here’s what you need to consider with drone photography and videography.

Photography and videography have always been an integral part of marketing real estate, but advances in drone technology will take it to the next level in 2023. For example, at Soni Chachad Real Estate, we like to utilize drones in our marketing materials to show prospective buyers the location, yard size, property lines, and more. These photos help our clients envision the area and see how close they are to their neighbours while generally providing a more comprehensive ‘birds-eye’ view than professional photos taken at ground level can. We also use drone technology to create dynamic videos that we can share across our social media platforms.

Pro tip: If you don’t have access to a drone, you might consider renting one to get the footage for your marketing and promotional materials.

Virtual Tours & Staging

Another way to utilize innovative technologies in your marketing strategy is to use virtual tours and staging to your advantage. It’s 2023, which means that prospective buyers want to be able to envision themselves living in a home sometimes before they even book an in-person tour. Here are a few things to consider with virtual tours and staging.

When it comes to virtual staging, 3D rendering technology has only got more sophisticated over the last few years. Now, you can take the professional interior photos and create mock staging that will intrigue and inspire your prospective buyers. This is a tactic we like to use, especially when a space is beautifully renovated but has no furniture or décor, to help show the true potential of a space. Beyond staging, the demand for virtual tours has increased immensely, with many people wanting to be able to view the home in its entirety from the comfort of their couch. At Soni Chachad Real Estate, we do virtual tours in a few different ways. For one, we will get our professional videographer (working in tandem with our drone videographer) to create virtual tours of the home’s interior and exterior that we post on YouTube and our other social media channels so people can orientate and familiarize themselves with the listing. Our second tactic involves collaboration videos with other real estate agents who come to our listing and create walk-through videos. If you’ve ever seen the ‘this is what $825,000 will get you in Stoney Creek’ types of videos (for example), then you know what we’re talking about.

Pro tip: Get creative! It’s all about capturing the attention of your prospective buyers, and one of the best ways right now is through virtual tours and staging.

Key Takeaways

With the real estate market heating up as we head into Q2 2023, it’s important to be aware of new trends that you can add to your existing real estate marketing strategy to make it even more effective. However, keep in mind that the suggestions we’ve explored here might not align with your strategy, and that’s okay! For example, if you don’t have access to a drone and don’t want to rent one, then that method may not be for you. On the other hand, some strategies are easier to incorporate, such as adhering to your brand guide with specific colours, fonts, and logos when you create promotional materials. Besides branding and drone technology, our experts at Soni Chachad Real Estate would definitely recommend looking into the opportunities that virtual tours and staging can provide for you and your clients. Giving your clients multiple ways to view a home only helps to speed up the process and increase your chances of a quick sale. In the end, although it’s important to stay up to date on trends in the real estate industry, the tactic(s) that you decide to integrate into your own marketing strategy will depend on what works best for you and your clients!

If you need an experienced, reputable realtor in the Golden Horseshoe region to represent you as a buyer or seller in your next home transaction, be sure to check out my featured listings and do not hesitate to reach out to me directly!  

Owning a home is a dream for many people, but what happens when that dream suddenly turns into a nightmare? Well, that’s exactly what will happen if you become a victim of real estate fraud. But what is real estate fraud, and how can it affect you? And more importantly, how do you protect yourself from becoming a victim of real estate fraud? We’re here to break down everything you need to know about real estate fraud, starting with an in-depth look at its various forms, discussing how it can affect you and your property, and outlining what to do if you think you’ve become its latest victim.

What is Real Estate Fraud?

When it comes to real estate fraud there are three main types: title fraud, foreclosure fraud, and mortgage fraud.

Title fraud occurs when the title to your home is stolen, and the fraudster then attempts to sell or apply for a new mortgage against your home. In order to steal a property title, a fraudster must commit identity theft first, which can be done by using data stolen from an organization or getting the information directly from the victim. Phishing attacks, phone scams, and mail or email interception are just a few of the methods that con artists use, and they’ll typically target homeowners with little to no remaining balance on their mortgage. Once they have the information they need, they will make fake IDs and forge documents, and some may even go as far as trying to sell the property.

Foreclosure fraud usually happens when you’re having problems making your mortgage payments and fraudsters approach you with non-traditional financing options. They may try to trick you into transferring your property title to someone to help you ‘make your payments’ with the ultimate goal of getting you to sign an additional mortgage or adding a lien to your property, thereby allowing the fraudster’s name to appear on the title. After that, all the con artist needs to do is instigate a loan default on the pretense that the victim failed to comply with some vague clause, and the mortgage foreclosure process begins. 

Mortgage fraud can come in several forms, but it’s essentially tricking a financial institution into lending money when it otherwise wouldn’t. In some cases, a fraudster may try to make a profit (as outlined above in the title fraud section), whereas, in others, it could actually be the homeowner or the broker committing mortgage fraud. Unfortunately, not everyone is always honest when applying for financing, meaning some buyers may be tempted to lie on their mortgage applications to try and secure financing for a home they can’t afford. On the flip side, a broker can also commit mortgage fraud if they forge documents or alter credit details to get loans approved.

How Can Real Estate Fraud Affect Me?

Since there are many ways to execute a fraudulent real estate scam, the outcomes will vary from case to case. With mortgage fraud, since the numbers were manufactured to suit the loan (and not based on real values), you may become unable to make your payments and potentially face foreclosure from the lender. However, with foreclosure and title fraud, you could stand to lose complete control of your home and property. Nobody knows this better than a Toronto couple who returned from vacation to find that fraudsters had sold their house. In January 2023, Toronto police warned the public that two people had impersonated the homeowners, hired a real estate agent, and listed the home for sale. These con artists were actually able to complete the sale, and new homeowners took possession of it before the old homeowners came home to the discovery – not a great way to top off a vacation, now is it?

How Can I Protect Myself From Real Estate Fraud? 

So, what can you do to ensure this doesn’t happen to you? Ultimately, knowledge and prevention are the best methods to help protect yourself from real estate fraud, so here are some of our top tips. For starters, you should never sign documents that you don’t fully understand or that could be later filled in with falsified information. Pay attention to your billing cycles and review your financial statements on a regular basis, noting any discrepancies. You’ll also want to keep your mortgage information in a safe place and shred old documents rather than throwing them in the trash. Do not knowingly submit falsified information when applying for a loan, and research any company or individual that reaches out offering financing. If you find that you’re having issues making your mortgage payments, the first person you should contact is your mortgage lender before seeking alternative options. And finally, you may want to consider buying title insurance to protect against title fraud, which will protect you from losses related to title fraud.

What Should I Do If I Think I’ve Become a Victim of Real Estate Fraud?

If you think you’ve become a victim of real estate fraud, there are several actions you should take immediately. Begin by writing down when you first noticed the fraud, including the actions you took, the names of the people you spoke to, and the date of communications. Next, you’ll want to file a report with your local police, reach out to your provincial land registry’s office, and contact the Canadian Anti-Fraud Centre to let them know what’s happened. You may also want to speak with your lawyer, get in touch with your financial institution, and alert Canada’s two credit rating agencies, TransUnion and Equifax, and ask them to put a fraud alert on your file.

Key Takeaways

When it comes to preventing real estate fraud, employing vigilance and common sense is critical because, unfortunately, if something ‘seems too good to be true,’ it probably is. For example, if someone is promising to help you with your mortgage payments without giving you the information you need to make a proper decision, you need to be equipped to recognize and report this scam sooner rather than later. In other words, it’s better to do your research, investigate your sources, and ask questions if you’re ever unsure. Ultimately, by understanding how real estate fraud can occur, being able to identify these red flags, and by taking preventative measures, you can ensure that you don’t become a victim of real estate fraud yourself.

If you need an experienced, reputable realtor in the Golden Horseshoe region to represent you as a buyer or seller in your next home transaction, be sure to check out my featured listings and do not hesitate to reach out to me directly!