My Agent Mike

Hi! I'm Mike Rapkoski.

Sales Representative, Keller Williams Referred Urban Realty Inc., Brokerage

I have spent the past 18 years assisting clients build their wealth through making wise choices with their real estate buying and selling. I am passionate, dedicated and committed to providing world class service to my real estate clients.

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It could become easier for single income and first time buyers in Toronto.

It might soon become easier for first time buyers to enter the hot Toronto real estate market.

With an election looming and the government needing a distraction away from ‘Yogi Trudeau’ and the fiasco currently at hand, the government is considering bending on it’s toughened housing policies.

I’ve spoken previously how in its attempt to cool an out of control housing market in Toronto, the government put restrictions in place which mainly affected first time buyers and buyers with single incomes.

What’s going on in Toronto’s rental market and Toronto Mayor Tory now ready to tackle city affordable housing speak to how unaffordable its become to be a single income or first time buyer in Toronto.

But this soon could change. With pressure being applied from numerous organizations, the federal Liberals are contemplating an easing on the stress tests and amortization lengths that have along with rent controls, pretty much made it impossible for only the super wealthy to own property.

If implemented correctly (meaning its target is to help those mentioned above and not deep pocketed investors) I think this could be a good thing for buyers.

Afterall, there really should be more than one choice when it comes to living accomodations. For some it’s better to rent, and for some it’s better to buy. Let’s let the consumer decide which they prefer.

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Sellers – Do you know that you need to sell your home three times?

If you are one of the lucky few who are selling a property these days, be prepared for the potential for some hiccups along the way until closing day.

Now before any anxiety starts to set in, I will note that almost always, hiccups can happen along the way between the day you have excitedly sold your property in a crazy bidding war right up until the lawyer hands you over your money on the scheduled day of close.

Working feverishly behind the scenes are both the real estate agents representing the Buyer and Seller, as well as both parties Lawyers. All are committed to mutually making a seamless process and satisfied clients.

When I’m on the selling side I will tell my clients, we need to sell your home three times in total. This is where a smile turns into a curious frown most of the time. What do you mean three times??

Well, the first time will be when we receive an offer on your home. The second time will be when the lender for the Buyer sends in their appraiser. The third time is actually on the close date.

All three are tied together and almost always, we have a smooth landing come the closing date. Some turbulence will happen along the way, it always does, and if you are working with professionally committed Realtors and Lawyers, in the end we will have two satisfied parties.

So rest comfortably knowing that while you are out shopping for new furniture or window coverings, behind the scenes your team of competent professionals are working tirelessly to ensure a smooth landing.

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It’s sizzling hot in Toronto’s South Riverdale neighbourhood!

Multiple offers are back in full force in the downtown east side neighbourhood of south Riverdale. The freezing temperatures haven’t seemed to scare off hordes of buyers and their agents.

At least that’s the case in the house price range between $839,000 – $1,200,000.

Last week there were 5 sales with listed prices of $839,000-$999,000 and all sold with at an average 118% above the listed ask price.

It seems there are plenty of buyers looking for this price range of property, as some of the listings had upwards of 13 registered offers.

Demand for 3-bedroom homes is strong in the area so if you were contemplating making a move, and if your house is in ready-to-sell condition, I would put it on the market pronto.

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Highlights from the Toronto Real Estate Boards 2019 outlook

Every year the Toronto Real Estate Board provides a market outlook on the upcoming year. TREB recently released their 56 page report. In this annual report a host of topics are covered, a few of particular interest to me stood out.

Of course I’m always interested in the forecast on the number of sales transactions and average prices. But this year I was really excited to read about the “missing middle” on housing and what is going on in the crazy the rental market.

In 2018 we ended the year with 77,375 sales (down from 2017’s total of 92,624) and the average sales price declined -4.3% to sit at $787,195. These stats are for the GTA and not Toronto proper only.

In 2019, TREB’s putting the sales volume at 83,000 transactions and a sales average $820,000, which is close to the 2017 average ($822,000). To be noted, the transaction prediction is based on the 5yr interest rate being more affordable then it was in 2018.

In summary, average prices will increase +4.5% and sales activity to increase +7.8%. This would be positive overall if it were to come true as we’ve been experiencing declining sales over the past two years and 2018’s numbers were the lowest in the GTA since the recession year of 2008.

The “Missing Middle” a term TREB states as: “includes housing unit types
that fall between a single-detached or semi-detached house and a high-rise apartment building (defined as five or more storeys). These types include ownership and rental townhouses, duplexes, laneway homes and low-rise apartments (triplexes, quadraplexes, stacked townhouses and garden
apartments).”

These types of properties are hopeful in that they will bring desperately needed affordable housing to the city, which I’m all for. Relaxing zoning laws so that laneway housing, triplexes and quadplex’s can be built would provide much needed affordable housing options. We have enough high rise rental units and adding mid rise and low rise options would also add to the communities that they are built in. I really hope we start to see major headway in this regard.

Onto the rental market outlook. Outside of the report that rental rates for 1 and 2 bedroom units across the GTA, had increased around 10%, and the negative affects on the rental market brought on by the housing policy changes put in place by the Liberal Government in 2017, the thing that rocked me the most, were results from a November 2018 Ipsos survey.

In Its survey of homeowners they “suggest that many investment property owners are seriously considering whether or not they  will continue to hold on to their investment beyond the next year. The majority of investment property owners in the GTA currently have their properties tenanted or their properties are available for rent. In other words, they are actively providing rental stock in an extremely tight GTA rental market. However, the survey results also suggest that almost two-thirds of investment property owners in the region are likely to list their investment property for sale over the next year, including 22 per cent  of these  investors  who are very likely to list their property for sale.”

WOW! That is a potentially huge hit on the availability of available rental housing already in place. What does this mean for the sale of new condo investments (most of which are targeted towards investors)?

It makes sense as the gap between carrying costs and rental income, especially in a world of rent control, make it difficult to actually turn positive cash flow. Yes, appreciation in values have helped investors but if that is all you are banking on, then to me you are more of a speculator than an investor.

It looks like 2019 could turn out to be a very exciting year in the real estate market. I’m really excited for the advancement of laneway housing and hopefully an influx to building triplexes and quad units.

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Why looking for a home right NOW will save you money

Snowstorms, ice storms and even rain, all make for a good time to be a smart buyer and out looking at homes. The problem is, most buyers want to hibernate during bad weather times.

What makes it a good time? January and February tend to be two of the slower months sales activity wise for starters. Yes, there may be fewer choice listings to choose from, but there are also fewer buyers competing, and pushing up the sales price as well.

You also tend to get better motivated sellers. As a seller coming out against less competition on the sale side might be an advantage. But when bad weather hits, and buyers slip into hibernation mode, and fewer showings are happening, maybe that motivation gets a tad higher. Maybe?

We often follow the herd mentality which is why springtime often brings out both a peak of sellers and buyers. But when all it takes is one buyer in competition to pony up a higher price, potential savings are wasted.

Take for instance an actual savings of twenty thousand dollars ($20,000) in a purchase price. With many houses hovering around the million dollar mark ($1,000,000) and if you were using a down payment of 20%, you would actually be saving the equivalent of one (1) years worth of equity pay down by paying a paltry $20k less. The return to you the buyer is huge!

So if purchasing a house or condo is on the horizon for you this year, become a smart buyer and get out there now and buy something. The savings are worth any inconvenience of being out looking at properties in the inclement weather.

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Toronto Mayor Tory NOW ready to tackle city affordable housing

A few days back I came across some tweets that Toronto Mayor John Tory had been retweeting (from his own tweets from December 2018) regarding our city wide affordable housing problems.

Shortly after, the Toronto Real Estate Board backed him in support of the cities ten year housing plan, which if you had asked anyone buying or renting in Toronto, is oh, about maybe ten years too late!

So we have a two-term Mayor, whose been around Toronto city politics for the past fifteen years, and also former Leader of the Ontario Provincial Conservative party, now saying, let’s fast track surplus city land for affordable housing. We need it now!

And then you have largest real estate board in the country, TREB, who have political clout and access to the housing data, agreeing, let’s do this. The time is now. Or at least it is over the next ten years.

I realize that better late than never can be applied here, but it pisses me off that politicians play politics too often, even when there is a real live affordability crisis going on in front of them.

Why act now? Because one-bedroom condo rentals are nearing $2500/month to rent? Why didn’t you act two years, three, four years ago even? Rent was increasing like mad then as well. And you were the Mayor then! And yes Mr. Mayor, I voted for you both times. So I don’t hate you.

Rising rental rates have helped push up the cost of entry level condos, making it impossible for first time buyers to own, and then force them into renting what should have been their rite of passage into their cities housing market.

Instead, rich foreigners and well to-do locals (full disclosure, I was one of them) were able to snap up multiple properties due to restrictions that were brought in and that made it almost next to impossible for the average twenty and early thirty year old, to become a home owner.

Now we have a housing affordability endemic on our hands, and those entrusted to look out for the greater good of us, got drunk behind the good times of condo development, political donations, and all the excesses of money that’s been pocketed from the rise in GTA development.

I’m frustrated, even angry at times, that playing politics at the expense of so many, for the profit and benefit of the few, is something tolerated by us all? It’s even a wonder we shake our heads and look despairingly at close friends thinking, how did such and such become Mayor? Or President?

As a city we need to unite. To ensure that all the people in Toronto are looked out for, and not just the ones deemed politically attractive. Let’s have transparency and a real long term commitment to making sure this great city of ours, is a place our kids can afford to grow up and live in, and not just a place for the wealthy.

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Warm Start to 2019

We all know that the weather in Toronto since the New Year has been pleasantly warm with above seasonal temperatures and then downright freezing!

With a balmy plus 9 degrees on January 8th, to the wind adjusted minus 25 on January 20th, It’s been a month of adjusting wardrobes and dreams of vacations in warm, climates for some.

What hasn’t been cooling off it seems is house prices throughout the city. Removing condos from the equation, and only looking at detached, semi-detached and townhouses, average prices seem to be on the rise.

As of January 25, 2019, sales posted through the Toronto Real Estate Board it looks like prices are up 5% on average when compared to that of last year at the same time.

Metrics such as days on market and sales-to-list price are fairly even except once you get above the $2.3 million dollar point. Average prices are up but when you factor in the highest sale of $11,250.000 which outpaced the next sale by far, this will certainly make the averages look better.

Also in the higher end market there is a big drop in sale-to-list ratio and days on market have almost doubled.

In another two weeks we will get the official report but it looks like 2019 is off to a warm start, and one I wish would apply to warmer temperatures as well!

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What’s going on in Toronto’s rental market?

Well for starters, in many parts of the city over the past two years, the demand for quality rentals has been high. So high in fact, that often you would expect multiple applicants on available units.

The baffling part is that most of the small mom and pop rental housing being provided is through the glass towers in the sky. Yes, those same glass towers that people kept screaming were being overbuilt!

Demand is high, supply is low (obvious from multiple applicants placing offers) which has led to many very happy landlords. But the party may be coming to an end.

Just like trying to purchase a home or condo, affordability is starting to hit the rental market. Yikes!!

According to Urbanation, who are a real estate consultancy whom mainly advise the development industry, we have some financial challenges rearing its head on the rental side.

With an average income of $65,000, today’s renters after taxes, deductions etc is spending on average 58% of their pay. Ouch.

Okay seriously, when do we start to wake the f&*@ up and realize that an entire generation(s), are being royally screwed when it comes to housing?!

I don’t care where you lean politically, but if people cannot afford to buy or rent, in the places they work and play, they will find somewhere else to do so. No wonder those young ladies that solicited two police officers to act as Uber drivers and take them from one bar to another did so. Who can afford a Lyft with the high cost of housing these days?! Read all about it here

With average rents hovering around $2400/month, how does one pay for housing, and with the remaining 42% of their earned income, set aside money for retirement, living expenses, charity donations etc? The simple answer is they can’t.

Maybe it’s time we turn the notion of senior discounting on it’s head? Eliminate some of the subsidies and discounts that apply to anyone above the age 40, and allow anyone aged 22-39 discounts on pretty much everything. Because they need it. And we need them. And trust me, you need them more than you think.

It looks like more supply is about to come to market and curb rental rate growth in 2019. Will it be too late? I for one have seen the first time buyer market almost come to a halt in my real estate practice. Renting is the only option, and one that is increasingly becoming a non guaranteed second option.

Maybe we will start to see downtown tiny condos with multiple roommates like Manhattan has been known for? Or a push back to rental apartment building living on the outskirts of downtown and trendy neighbourhoods? This is assuming our young people stay, and work and play where we need them. Which is right here, in Toronto.

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What should we expect in 2019 for Toronto real estate activity?

Ah, the crispness of winters air jolts you awake, as your feet hits the pavement on your brisk walk to work.

Sub-freezing temperatures combined with the on again/off again sprinkling of snow, have you pulling your toque down tightly over your ears, protecting you from Mother Nature’s bitter cold.

If you profession is aligned to the real estate industry, your thoughts drift off to the countless reports, forecasts, podcasts, webinars and info sessions that have been crossing your path and feeding your brain since November ’18 on what to expect for housing sales in 2019!

Before I dive in and give my two cents on what to expect in the coming year in the Toronto real estate market, let me take you back a bit, to the beginning of the preceding fall market.

In September 2018 I had written that the total number of property sales expected for 2018 throughout the GTA, would come in lower than what some forecasters were predicting at the time . See post here

The fall market was just starting and looking back over the first three quarters of sales activity, signs were clearly showing that a slow down was in place.

I had made mention that this would reflect in the lowest amount of sales activity we had seen in while, actually a long while, the year 2008. Everything the government had been doing of late to ‘cool’ the hot housing market, well, it was working.

Toronto and Vancouver are almost always hot topics on house prices and housing activity. Other markets were equally hot in their own right (Ottawa, Montreal, Calgary) but in Toronto it was clear that the condo market appreciation was puffing up the overall averages into the positive.

So, the surrounding areas and Toronto detached, semi-detached and townhouse values were slightly cooling, to which is being referred to as a soft landing rather than a bursting bubble. Of course, real estate can be national but is locally driven, meaning there are neighbourhoods where prices of the above housing types were increasing, and a few areas, were downright hot.

Some controversy surrounds if the term soft landing, even exists when it comes to housing prices, but that debate is left for another time. Now what does this mean for Toronto and GTA house prices over the coming year you ask?

In my humble opinion, if the government does nothing to interfere with the current rules in place, we’ll continue to see downward pressure on pricing. To what extent, well, nobody really knows? At best it would be an educated guess as the government has proven it will mingle when it feels its needed, even against popular opinion or on the long term affects it might have.

A close eye will be paid by me to the actual housing numbers changing hands, as this is a good indicator to what is happening in a market. People can be out looking at property, and this can look like a positive indicator, but if the activity in sales is low, then a shift could be underway?

I’ve made mention in earlier posts about the ‘depth’ of buyers, especially when it comes to multiple offer situations. A property gets listed for sale with an minimum expectation of $500,000 as the valued price. You have 5 buyers interested, and 4 of the 5 have offers are between $480,000-$500,000 with the 5th offer blowing the rest away with an offer of $550,000, is this the sign of a healthy or strong market? Some would say it is.

I guess for starters you could point out that there were 5 interested buyers, and 4 with reasonably priced offers. But the $550,000 is what gets recorded, and this number can at times be deceptive to what’s really going on. I won’t get started on some pricing practices of agents who list extremely low, just so they can “pad” their stats, but I will say that this method when used as the norm, is not constructive for any of the parties involved. I’ll tackle this topic further in a future post.

I also think long term thinking should always prevail when it comes to buying real estate. Waves come and go, and timing them is tricky at best, even for the worlds most prolific surfers.

Building a home is what most people are after. Somewhere to feel safe and secure. To raise a family, to live and grow in and entertain both family and friends. To benefit from the pride of home ownership and, whatever else they may dream up. When property is looked at purely as a commodity, it can blur even the most seasoned of us.

My hope is that with less sales activity the real estate pros rise to the top, and better eduction and transparency abides, our housing market will remain healthy and strong. That’s what 2019 will look like for me. My wishes are it does for you as well.

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It’s All Rainbows and Puppies

Sales prices are up 3.5% In October 2018. Sales activity up a healthy 6%. Active listings available for sale have dropped 2.7%.

What does this mean?

Well for starters, the real estate market is doing just fine, thank you very much.

That housing crash we’ve all been hearing and talking about, well Bloomberg thinks we’ve avoided it. For now at least. (see Bloomberg article here)

One sign that may support this in the GTA, is that housing sales over the past five months have outstripped new listings. This is good.

The condominium market continues to be very strong as price appreciation led all housing categories at 8.6%. Much stronger gains than we are seeing in the stock market of late.

Actually, all housing types are in the positive, across the entire GTA. The 905 region which had taken a beating early in the year was healthy in all categories.

So it looks like heading into the holidays as my good friend Henry Lee like’s to say,  it’s all rainbows and puppies regarding the housing market. Unless of course you are a renter, as most rental units (condos, houses and town homes) are in very high demand.