TO MOVE OR NOT TO MOVE?

Dear aspiring move up buyers,

The ones who, through luck of their Toronto property's incredible appreciation, have an enviable amount of home equity and want to use it to finally make a move for the better. Would you be among the cohort?

Have you been at it for a while, attempting to make this, your next and possibly last step in the property ladder, a reality? Trying to find a place you appreciate not only as much as your current home but even more? It can be quite the challenge, can't it?

No doubt you love many things about your current abode. Maybe it's the location, the extra high ceilings, the private rooftop deck you built, or the new kitchen you just lovingly renovated to your specs. All things you don't want to give up anytime soon. Understood. 

And becoming house poor at this age and stage is not your intention either, am I right? You'd prefer to have cash for the family, to travel, not to have to work so hard, and perhaps even retire one day?

Hence the challenge of a move up buy that is based on home equity as opposed to improved income. It is the combined dream of having a home that suits your current life much better than your current house does, while also not spending much more than the value of your current home to get it. With such opposing interests at play simultaneously, it's no wonder your search may feel as though it's against all odds.

Most would-be move up buyers I've encountered admittedly feel pretty stuck. When I question what they can let go of to make their search more efficient and timely, I'm inevitably hit with a 'this needs to be a serious improvement or I'm not moving!' look.

So what are your options if you want to use your home equity wealth to fund a move? It may seem obvious when I put it this way, but your option combinations are in fact finite. Your search can be distilled to just four equations, no matter where you live, no matter what kind of market is at play, no matter if you're thinking of a move this year or five years from now.

Which equation can you work within?

 

Better Location + Better House = Higher Price
Better Location + Lesser House = Higher or Same Price
Lesser Location + Better House = Same or Lesser Price (higher if wayyyyy better)
Lesser Location + Lesser House = Lesser Price

 

If the problem you're looking to solve is location based, it makes sense that you should be prepared to pay up or buy a lesser house. If it's a combination better house while also saving for retirement, then it follows that you'll be moving to a neighbourhood that is considerably cheaper. If a straight cashing out is what you seek most, then downsizing or moving out of town altogether will be the gist of your move.

Awareness of the equation you're working within, based on the primary problem you're looking to solve, will go a long way to making your home search more efficient. You're much more likely to be ready at the next opportunity, after having already considered and accepted the compromises you're most willing to make.

Or, if you look at these equations and can accept none of the above, then at least you'll know why you're staying put!

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ABSENCE MAKES THE HEART GROW FONDER?

For those of you who actually read my blog ... you may have noticed that I've been missing in action recently.

May I go ahead and blame that on the market too?

Seriously though, when in the trenches of an all out assault on housing in this city, it's been tough for me, if not impossible, to back away long and far enough to reflect and write with any sort of coherence about what is happening.

In a nutshell?

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WHAT REAL ESTATE INVESTING IN TORONTO IS NOT

I helped a couple of enterprising millennials buy their first investment property in Toronto last week. They are a great example for other would-be, independent investors to learn from. I'll be presenting their story as a case study but before I do, I wanted to take a step back to look at what real estate investing in Toronto is not.

Since investment opportunities are locally specific and ever shifting, many of the age old or more general rules simply don't apply to Toronto investing today. The millennials I worked with were well aware of that. Are you? If you're entertaining the idea of an investment property, it may be helpful to break down a few of the more common assumptions before you begin.

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Your Comfort Zone Versus Your Safety Zone

For those wanting to move up the property ladder in Toronto here is a suggestion: unpack your things and stay home. As you know, the market is too tight, too expensive and too fast for you to move anyway.

Well... I don't actually see it that way but I'm pretty sure that you do. The truth is, your want to make a move just isn't enough of a motivation to leap into the expensive unknown of a new house. This market is reserved for those who are beyond want. They've decided that they have to move and they don't change their minds about it. The home buyer today seeks long term safety at the expense of current comfort. So if feeling at all comfortable is what you're after in a process that is highly competitive and bound to cost you more than you had hoped, you're best to stay home. There are people moving in this city, and contrary to what you may assume, it's not only stealthy wealthy ones who are doing so. They are the ones brave enough to occupy the space between comfort and safety and who've chosen to be uncomfortable for the time being.

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Market Patterns - They do exist, can be predicted (and have nothing to do with ask price)

While I can’t give you details on any one deal – it’s confidential stuff - I do see clear patterns across many deals ... patterns that may interest you. My buyers are often surprised when I tell them we can predict within range, what a property will likely go for and that it has nothing to do with ask price. Here's what you need to know about market patterns and how to effectively predict them - useful stuff for sellers and buyers both.

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5 Reflections for Buyers

When reading yesterday about Maria Popova's reflections as a blog writer, I couldn't help but be struck by how closely they apply to my advice for real estate buyers - the ones who dare to dream and do battle in Toronto's real estate bid war trenches, where few mere mortals dare to tread.

Admittedly based on Popova's reflections, here are 5 parallel thoughts I stand by for buyers. This goes out to them, to keep in their back pockets, as they attempt to navigate Toronto's highly competitive and often confusing market. 

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With The Spring Season Almost Behind Us, Let's Take Stock.

Yes, Toronto’s record-breaking streak of real estate sales continues...

Homes are selling today for 15.7 per cent more than they did in May 2015.

The Toronto Real Estate Board’s (TREB) latest monthly statistics showed Toronto home prices increased $64,262 on average to $782,051.

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The Long Game of Excellence

As a full time Realtor, I also devote time each week to coaching other Realtors who seek to be great at what they do, thanks to my coaching collaboration with Suze Cumming of The Nature of Real Estate. 

Her recent blog post entitled 'The Long Game of Excellence', conveys well the values I hold as a sales professional so I've included it below word for word. It describes how I see myself managing for my clients, the intersection of a complex housing market with the very real human psychology of major life choices.

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