A Tale of Two Real Estate Markets – Canada and the United States

feature_img_1.jpgKen McLachlan, principle broker for Re/Max Hallmark Realty in Toronto, Ontario writes a very insightful post on his blog describing the differences between the real estate markets in the United States and Canada.

http://remaxhallmark.typepad.com/remax_hallmark_blog/2007/08/two-different-m.html

Interesting real estate times we live in. Our friends south of the border have been experiencing quite a different market than us. We had to know that the sensational growth of their market several years ago could not be maintained. Much of the real estate market acceleration in the States was fueled by speculators and secondary financing.

This type of play created a real estate market which wasn’t real. How bad was it? More than 30% of every residential real estate deal done in the States at one time involved a speculator, someone who was purely buying a property to trade in it like one would a stock. Their mortgage market fueled the strong growth as well. It wasn’t uncommon for a purchaser, (unqualified) to obtained over 100% financing on a property. No questions asked or verified at least.

Imagine the lure of buying a property with no money down with a payout to you the buyer on closing! Rates would be very very low to start, with “an adjustment” down the road. The adjustment time came and many many unqualified buyers found out they didn’t have the stomach to carry their “home” and simply walked away.  So the lethal combination of owners walking away from properties in droves and 30% of the market now not interested in playing has killed the real estate market in many regions in the States.

At home, we haven’t had many speculators working in our markets and certainly our mortgage rules and habits are much more controllable. The debt service ratio is very very healthy in Canada which is another good indicator of a mature market. Price increases our moderate on average and supply – although a problem in some markets – is good.

Traditionally the real estate market in Canada has mirrored the market in the States. Not this time. We learned our lessons hard from the recessions of the 80’s and 90’s – hopefully.

In a buyers market, where listings are plentiful, real estate agents must put a lot of energy into marketing a property for sale, in order to attract and expose it to as many potential homebuyers as possible.

In a sellers market, where listings are harder to come by, it is important for agents to demonstrate to their prospective selling clients how they will go above-and-beyond other agents competing for the same listing.

Under either of these scenario’s, UniqueHomeSites provide real estate agents in Canada with a powerful tool to market their listings on the Internet, attract buyers, and win more listings.

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One Response to A Tale of Two Real Estate Markets – Canada and the United States

  1. This article is right on the money.

    Real Estate agents in my area – Nashville TN – are beginning to realize that extra time and effort is required to “go a step beyond” marketing listings given the current state of the housing market.

    The savvy one’s are turning to HOME STAGING and PROFESSIONAL REAL ESTATE PHOTOGRAPHY and VIRTUAL TOURS to market and sell their property listings. The key word here is ‘professional’ – the “do it yourself” virtual tours are now coming across as cheesy and unprofessional.

    The proof? A client of mine with a listing well over $1.5M hosted her own pictures and her own do-it-yourself virtual tour. Very little interest in the property. After she contacted me to provider her with professional results, she has had numerous local and out of state inquiries, and expects to close later this month. Worth the investment? You betcha.

    Further proof — a realtor who started using professional real estate and architectural photographer services 2 years ago is now selling 25% more listings due to the higher interest from buyers generated by the professional real estate photos and virtual tours provided.

    READ THE BLOG ARTICLE HERE – https://base10blog.wordpress.com/2007/08/27/growing-number-of-real-estate-agents-in-canada-employ-professional-photographers/

    Warm regards,
    Jason Bennett – Nashville Virtual Tours & Photography – http://www.nashvtp.com

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