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.

11 June 2014 ~ 0 Comments

CMHC’s Recent Changes Adding More Confusion?

Canada Mortgage and Housing Corporation recently added more changes to what it will insure and whom they will offer their products to.

They no longer will be offering mortgage insurance to developers to finance new construction projects.

They are still insuring individual purchasers who purchase a unit from these builders, and this is where I am finding there is some confusion.

Recently I have had a few clients ask me what impact will these changes have on the condo market? The questioning seemed to be coming from the position that it might be a negative one?

I think the changes will be minimal worst case and maybe even positive since the policy is being put in place to offset the pace of new condo development. Policy makers seem to believe that the pace of new construction projects that are coming on board are too many.

Be smart in what you buy, whether it’s for investment or a condo for you to live in and you will be fine.

16 May 2014 ~ 0 Comments

City of Toronto’s Home Energy Loan Program Kicks Off

The City of Toronto has launched a new pilot program that provides low interest loans to homeowners who are interested in making their homes more energy efficient. The program is called HELP – Home Energy Loan Program.

For many people, the high upfront costs of doing energy improvements, such as installing new windows or a new energy efficient furnace, can make it difficult for them to take action. Through HELP, homeowners can access low interest loans from the City that they pay back over time on their property tax bill.

If your home postal code starts with  any of these three digits, you are eligible  to apply for a HELP loan: M1C; M1E; M1K; M1L; M1M; M1N; M3N; M4B; M4C; M4E; M4J; M4K; M4L; M4M; M5A; M6P; M6S.

As this is a pilot program, only certain areas of the City are eligible at this time, but the Program is expected to open up to more areas in the near future.

As this is a pilot program, only certain areas of the City are eligible at this time, but the Program is expected to open up to more areas in the near future.

Click here to download a Home-owner Guide for the City of Toronto’s Home Energy Loan Program (HELP) and learn how to:

* Make your home more energy efficient

* Increase your home’s comfort for your family

* Reduce your energy usage

* Reduce your energy bills and save money

* Improve the value of your home

* Reduce pollution.

This article was featured in the March 2014 issue of Across the Board, a publication by the Toronto Real Estate Board.

03 May 2014 ~ 0 Comments

Latest “must haves” in condos priced between $750,000 – $1 million dollars

modern-porchFor years now the standard condominium has become the option of choice for the majority of first time buyers. Various reasons have led to this reality, but what are condominium buyers looking for today when purchasing a condo in a price range that is not targeted to the first time buyer?

In my experience working with both buyers and sellers in the $750,000-$1 million price range, here are some of the sought after “must haves” they desire.

Outdoor space
Terraces or any outdoor space that can accommodate added areas for entertaining friends or lounging around reading a book are at the top of the list. Landscaping outdoor space is becoming more popular as owners look to turn their drab concrete and glass palaces into dreamy outdoor oasis’s.

Corner units
This may seem like an obvious one, but I’m seeing buyers increasingly ask for this as a must have! Many of these buyers are experienced condo lifestyle consumers and seek out the benefits of having multiple views and added natural light.

High ceilings
Nine feet has quickly become the norm while ten feet is even better. Higher puts you in an even more exclusive club!

Mid rise buildings. Boutique style buildings with floor heights ranging from ten to twenty stories, and unit numbers ranging from fifty to one hundred units can help foster a community feel.

Usable gyms and yoga rooms
It can be hit and miss in some smaller condo buildings to have a practicable space for a gym equipped with weights, cardio equipment and space to stretch. If you find it, consider yourself lucky. A separate room for yoga and stretching is a plus.

Ample storage space both inside and outside your unit
As buyers gravitate to longer term living in a condominium, many come to seek out ample storage space for not only everyday items, but also for their seasonal gear. Ski’s, snowboards, golf clubs, holiday decorations need to be stored somewhere, and this buying demographic do it all!


16 April 2014 ~ 0 Comments

Tax tips for investors: Clearing up real estate confusion

April 2014

Real estate has been a hot investment area in Canada for quite some time now due to favourable economic conditions, immigration, and historically low interest rates. Canadians who have taken advantage of these conditions are sometimes confused about the measures they can take to reduce their tax burden.

Here are some tax tips addressing several typical areas of confusion:

To depreciate or not to depreciate

Depreciation, or for income tax purposes Capital Cost Allowance (CCA) can be an effective way to shelter your real-estate income from current taxes by transferring your obligation to future tax years. CCA works by amortizing a portion of the cost of your rental property against your rental income, generally 4% of your building’s cost on a declining basis year over year.

CCA is an election, meaning that it is the taxpayer’s choice whether or not to use it. The drawback to CCA is that it is recaptured in the year you sell your property, meaning that the historical CCA you’ve taken will be added back on income account to your tax return if you sell the property for anything more than your current un-depreciated capital cost (i.e. the cost of your property less the CCA claimed on prior tax returns).

This recapture can have a negative impact on your taxes in the year of sale so some planning around this election is required. Generally, if you plan on holding the income property for a very long period of time then taking CCA to reduce your rental profits to zero will almost always be advisable.

However, if you plan on selling your property in the near future you should attempt to estimate if your potential recapture will push you into a higher tax bracket, thereby reducing the current effectiveness of the CCA claim. You may also want to consider forfeiting CCA in years where your overall taxable income is low thereby allowing you to claim higher CCA in subsequent years when your marginal tax rate is higher.

Documents, documents, documents

As far as the Canada Revenue Agency is concerned, if your expense transactions are not documented then they may as well not exist. When you own an income generating property it is your responsibility to keep adequate records and supporting documents in an organized fashion. Records would be the accounting information supporting the final reporting on your tax returns. Supporting documents would provide evidence of the transactions that make up your final accounting records.

Contrary to popular belief, simply maintaining banking and credit card statements is not always considered adequate supporting documentation. Original contracts, purchase receipts, and other documents should be maintained. In addition, if you are claiming auto related expenses a detailed log of your driving should be maintained outlining the dates of travel, the kilometres travelled, and the reason for travel (it must be to support the production of your rental income). My suggestion is always: If in doubt, save it. The more detailed your back-up, the more likely it will pass the scrutiny of a CRA review or audit.

Flipping a Property for Capital Gains?

Thinking of flipping a property and reporting the profit as a capital gain? You may want to think again. Capital gains are generally favorable to business or property income for tax purposes because of the fact that only half of your capital gains are subject to income tax. While the sale of a property held for the purpose of generating rental income would normally be considered a capital gain, this is not always a black and white scenario.

Use the analogy of an apple tree: An apple farmer purchases an apple tree in order to grow and sell apples. The apples are her inventory, while the tree is her capital property. When the farmer sells the apples she is generating business income, but if at some point down the road she decides to sell the tree, she is selling a capital property. If she makes a gain on the sale of the tree that would be a capital gain and taxed at only half her marginal tax rate. The same can be said for an income producing property. If you were to buy an income producing property, rent it out for a decade, profit during that rental period, then eventually sell the property at a gain, the rental profits would be taxed at the full rate and the gain on sale would most likely qualify as a capital gain (taxed at half your marginal rate).

The same cannot be said for short term property flips. When buying or selling a property on a short term basis for a profit (say buying, renovating, and then flipping) the CRA may consider the gains to be a type of business income rather than capital, thereby taxing the full gain at your marginal tax rate. Why is this? The law distinguishes between properties explicitly bought to generate rental income and those bought to profit on a sale. The former would normally be considered capital property to the taxpayer while the latter would be considered a type of business related inventory or more specifically an “adventure in the nature of trade.” While there are no concrete rules on whether a transaction is on capital account or an adventure in the nature of trade there are several indicators that the CRA and courts would take into consideration. Among these considerations are:

  • Whether the property was bought and sold in a manner similar to a dealer in that property
  • Whether the taxpayer has developed a pattern of buying and selling properties with short holding periods
  • Whether or not the taxpayer’s intentions were consistent with a business transaction or adventure in the nature of trade.

The determination of whether or not the sale of a property is a capital gain or business income is complex and has been played out in the courts on numerous occasions.

Blog post reprinted from National Post Financial Post article by Fabio Campanella, partner at Campanella McDonald LLP – Chartered Accountants.

17 March 2014 ~ 0 Comments

Toronto Real Estate Market Starts to Thaw from Winter Freeze

marchThe Toronto real estate market is showing signs of stirring from its deep freeze, with new listings starting to pick up — and an almost 8 per cent spike in prices — as of mid February, year over year.

Toronto Real Estate Board President Dianne Usher announced that “sales growth has rebounded so far in February after a slow start to the year in January.  While new listings were still down in comparison to last year, the annual rate of decline was less than experienced last month.  This may point to an improvement in the listings situation moving forward, which would help alleviate some of the pent-up demand that currently exists in the marketplace.”

Some 2,767 properties were sold during the first two weeks of February, up just 1.3 per cent from the same period a year ago, says the Toronto Real Estate Board.

But the average sale price was up 7.8 per cent to $547,107 from the $507,474 recorded in the first two weeks of February 2013.

“Price growth well above the rate of inflation will be the norm for the remainder of the year,” said TREB senior manager of market analysis Jason Mercer.

New listings remained down about 6.1 per cent as of mid February, year over year. But that’s a significant improvement from the 16.6 per cent decline in new listings in January which was blamed, along with the unrelenting polar vortex, for a 2.2 per cent drop in sales across the GTA.

Realtors say they are seeing more folks looking to list, but at the same time a lot of pent-up demand which has played out the last few weeks in almost irrational bidding wars, including 32 offers on a Perth Ave. house that went for $210,000 over the $639,900 asking price.

Sales of detached homes were down 0.2 per cent across the GTA (they dropped 12.4 per cent in the City of Toronto), in large part a reflection of the lack of houses available to buy, but prices were up 10.9 per cent.

Detached homes in the City of Toronto sold for an average of $942,066 as of mid month, up 15.2 per cent year over year, while they averaged $634,146 in the 905 regions, up 10.2 per cent, according to TREB.

Semi-detached sales flatlined across the GTA, but sank by 23.6 per cent in the City of Toronto, again, largely reflecting the lack of listings for what has become, due to sky-high detached housing prices, some of the most in-demand housing stock across the GTA.

The average sale price of semi was $685,111 across the 416 region as of mid month, up 9.6 per cent, while they averaged $419,972 in the 905 regions, up 4.7 per cent year over year.

Townhouse sales were down 9 per cent across the GTA but prices were up 27.4 per cent in the 416 region, to an average $568,894. Prices were up just 2.2 per cent in the 905 regions to an average of $384,468.

Condo apartments saw a 12.6 per cent increase in sales across the GTA as of mid month, with prices up 5 per cent in the City of Toronto (to an average of $373,576) and up 4.2 per cent in the 905 regions (to an average price of $287,433.)

Blog post reprinted from Toronto Star Real Estate article by Susan Pigg, Business Reporter

13 February 2014 ~ 0 Comments

Easy Home Renovation Ideas

03ModernRustic_0Overhauling your entire home can be costly and time consuming, but it doesn’t have to be. Choosing smaller projects can deliver a great look in less time.

Upadate Your Flooring
Consider the function of your renovated rooms when choosing flooring for the space: a playroom will benefit from a soft floor made from play mats or carpet, for example, while laminate or hardwood flooring will add warmth to living areas.

Update Your Lighting
Consider energy-efficient dimmers and recessed halogen lights in all rooms. Recessed lighting is one of the most widely used and effective fixtures on the market. Paired with ambient lighting, recessed lights brighten a room without taking up floor space. However, recessed or pot light fixtures require more space for installation above the finished ceiling. Be sure to have your contractor or electrician check that you have enough height above the ceiling to accommodate the can part of the fixture (the smaller the can, the more expensive the fixture).

Refresh Kitchen And Bathroom Cabinets With Paint
Painting cabinets, replacing sink fixtures and installing new lighting are all easy ways to update a bathroom or kitchen, says Ty Pennington, host of “Extreme Makeover: Home Edition.”

Replace Kitchen Countertops & Add An Island
Countertop finishes add colour, shine and personality to a kitchen. Available in a plethora of materials and colours, one can easily feel overwhelmed by the many choices. Make sure to speak to your builder, designer or product representative about the pros and cons of the materials you’re interested in before making a decision.

If you’ve got the square footage to spare, an island can also be a practical addition to a kitchen. Family and guests tend to congregate in the kitchen and an island with counter height stools offers a smart seating and dining solution. Make the most of a kitchen island by having as much storage built into it as possible. If a cooktop will be installed, consider adding a 6″ high ledge for a dining surface that will also act as a barrier from hot pots and messy pans.

Install New Trim And Moulding
Inject character into your new basement living area by adding architectural details such as wainscotting, crown moulding and baseboards. Consider overscale crown moulding for living and dining rooms, painted matte white to create a grand, Paris apartment feel.

Add Storage
Built-in storage always looks sophisticated, saves space and can further add to the function of your rooms. Always try to plan for the maximum amount of storage possible: from drawers carved out under the stairs, to built-in shelving and closets — one can simply never have enough.

Cover Radiators
Old radiators look dingy and can make a room look lopsided if they’re on one side of the room only. Covering them and creating a matching faux cover on the other side adds symmetry and elegance to rooms.

Blog post reprinted from an article by Canadian House & Home, a leading Canadian design and decorating magazine.

22 January 2014 ~ 0 Comments

Ontarians Optimistic About 2014 Real Estate Market and Economy


Ontarians seem hopeful about the provincial real estate market, according to new research conducted by Ipsos Reid on behalf of the Ontario Real Estate Association (OREA). A third of Ontarians say the market will strengthen rather than weaken (21%) in 2014. Looking even further ahead – ten-year’s time – significantly more Ontarians believe the Ontario real estate market will strengthen (50%) rather than worsen (20%), speaking to the long-term investment value of owning a home.

“The research comes on the heels of an optimistic forecast by the Canadian Real Estate Association,” says Sean Simpson, vice president, Ipsos Public Affairs. “Consumers seem to be echoing a similar sentiment for the 2014 real estate market. Prospective buyers and sellers in particular are also more likely to believe the overall economy is strong, which may be why they’re considering buying or selling their home in the next two years.”

Two in three (65%) Ontarians who are at least somewhat likely to buy a home in the next two years believe the economy is in good shape, compared to just 53% of Ontarians overall who think the economy is ‘good’. Six in ten (59%) Ontarians looking to sell in the next two years believe the economy is ‘good’.

The study, the first of its kind for OREA, examined public opinion in Ontario on a variety of matters pertaining to consumer sentiment of the Ontario real estate market. The findings include:

  • Six in ten (59%) Ontarians believe the current real estate market in Ontario is ‘favourable’. Two in ten (18%) Ontarians believe the market is ‘not favourable’.
  • Two thirds (67%) of homeowners believe the market is ‘favourable’, compared to 47% who currently don’t own a home. Ontarians who said they are somewhat likely to buy or sell a home in the next two years are even more likely to believe the market is favourable (70% and 77%, respectively).
  • Homeowners are more likely to believe the market has improved in the last year (31% stronger vs. 21% weaker), looking ahead to the next year (34% stronger vs. 16% weaker), and in the next ten years (55% stronger vs. 18% weaker). Prospective buyers and sellers are most optimistic with a majority saying the market will be stronger in the next year (54% and 50%).

Regional Survey Highlights

  • Residents in the 905 area of the GTA are most likely to say their market is favourable (71%), followed by those living in Toronto proper (61%), Eastern (58%), Southwestern (54%), Northern (47%) and Central (45%) Ontario.
  • When looking at local economies, the GTA (63%) and Eastern Ontario (54%) have the most positive outlooks, while Central (37%) and Northern Ontarians (42%) are most pessimistic.
  • GTA residents are most ‘likely’ to buy (16%) and sell (17%) a home in the next two years. Residents in Northern Ontario are least likely (4%) to buy a home in the next two years, while Central Ontarians are least likely to sell (5%) a home in the next two years.

Full Ipsos Reid Factum

Blog post reprinted from OREA blog posted by Katarina Markovinovic, Media Relation Specialist for OREA

19 December 2013 ~ 0 Comments

BIG changes approved on how Realtors charge fees or commissions

New changes to how Realtors charge fees or commissions may have a big impact in the real estate market.

Last spring, Minister Tracy MacCharles introduced Bill 55, Stronger Protection for Ontario Consumers Act, 2013 in the legislature. Bill 55 sought to strengthen consumer protection in the areas of door-to-door sales, debt settlement services and real estate transactions.

Under the old act, Realtors could either charge a flat fee or a percentage (commission) based on the sale price. But not both. This also determined to a large extent, which brokerage an agent would go to work for.

But now all of that has changed! And personally, I think this change is good for both consumers and brokers alike.

Once again, personally speaking, I have been using a sliding rate scale on commission fees charged to my clients for over the past 7 years. Depending on variables such as loyalty of client (past sales and referrals), would they be buying as well as selling, difficulty of sale (list price, condition, timing of sale etc), I would set a rate that is fair for both sides.

What are some of the changes you might see? Well for one, I think retainer style charges would be considered. What this would entail is that an upfront flat fee of for example, $5,000 plus a commission of 4% when the property is sold might be beneficial to both parties?

In the past (and still currently) the selling agent assumed all of the risk financially when a home was listed. If for some reason the seller changed their mind, or the house didn’t sell then the selling agent would be out pocket for expenses that could run into the thousands of dollars.

Another example might be that only a flat fee for the buyers agent would be offered, while a commission to the selling broker would be payable. Or vice versa? Or maybe even a combination of these two scenarios?

It will be exciting to see how these changes play out in 2014 and beyond.


18 December 2013 ~ 0 Comments

GTA Housing Predictions for 2014

As 2013 comes to an end, preparations are already underway for what looks like to be shaping up as a busy 2014.

Attending information sessions put on recently by CMHC and RE/MAX Ontario Atlantic, as well as reading information provided by a few of the big banks and other industry related sources, here is what is predicted for next years real estate market.

  • It will be a good year overall for sales with activity nearing 90,000 on an annual basis. If this holds true, 2014 will go down as the second highest year transaction wise ever, slightly edging higher than 2011’s numbers, yet well behind 2007 sales.
  • Prices are expected to continue to rise, albeit at a slower % increase. Best guesses are somewhere between 2.5%-3.5% over the course of the year. If values for December hold up, 2013 will have increased 6% year over year from 2012 values.
  • Consumer confidence continues to be high. Unemployment numbers are expected to drop to slightly under 7%
  • High migration from other parts of Ontario, the rest of Canada as well as new immigrants, will continue to push demand for GTA housing.
  • The push to live in Urban neighbourhoods continues, especially in downtown Toronto.
  • Vacancy rates are extremely low and rental rates have risen in condos across the GTA. One bedroom rates have outpaced % wise that of Two bedroom units
  • Mortgage rates are expected to rise in the latter half of 2014, depending on how the United States continues to do. The U.S. showed strong growth in 2013 and is expected to continue through 2014
  • 2015 will see a large amount of condo completions come to the market, but keep in mind 95% of these units are sold by the time they are built and ready for occupancy. CMHC feels the condo market is balanced, considering housing needs of today’s consumer.
  • Condo costs are reasonable comparatively to the developed world. Owners and renters continue to be drawn to condos, especially in the Toronto core.
  • Canada has the second highest homeownership rates (second to only Italy) and slightly ahead of the United States.
  • Demand for housing is strong as single households increase (led by single females then followed by divorcing couples)

19 November 2013 ~ 0 Comments

Are New Build Condo Buildings a Good Deal?

Weekly I am inundated with offers from builders and or their marketing/sales teams on incentives for unsold inventory on various sites throughout the GTA.

$20,000 Cash Back to your Buyer! Five Percent Commission For The Agent! Free Maintenance Fees For Two Years and a B.B.Q.!!

How do you know if this is a good deal? I’m often asked by clients (mostly investor ones) are new condo units a good deal in today’s marketplace?

While no one has a crystal ball on what the future values of real estate will be, following some basic fundamentals will help you buy not only a good unit, but also if you are getting the deal you are expecting.

For starters, answering this question can be a complex one and is not a one size fits all response. For a more customized answer contact me directly.

From an investment perspective buying something that isn’t built yet and may not be for 3-5 years, takes a bit of skill, knowledge, luck and blind faith.

  • Is the unit(s) that is being offered for sale, desirable for a wide range of buyers both now and in the foreseeable future?
  • Will there be anything impacting the unit(s) location in a negative way from a resale perspective?
  • Is the builder burying the incentives in the purchase price or additional costs upon closing?
  • Does the unit have mass appeal for both rental and resale?
  • What will mortgage rates be like 3-5 years down the road, when the project is built and registered?
  • Is the quality of finishes and construction worthy of the price?
  • Is the location of the building in an area that is rising in demand, flat, or a decreasing one? Both rental and resale.
  • What are my closing costs from the builder in total?
  • Future development fees and charges, what will they be like? (Blind faith)

These are some of the items you need to know the answer too in order to help determine if the unit you are buying is a good deal or not?

In my opinion today, new construction for the most part is still overvalued for the risks involved in purchasing something sight unseen and not built.  There are plenty of good inventories to select from in the resale condo market, that you can find better value in many buildings that have been built in the past three years. And you also get the huge benefit and comfort of knowing what today’s interest rates will be if you need to finance your investment.