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Giving Tenants Notice to Vacate in Ontario — The More Notice, the Better

Ending a Tenancy as a Landlord in Ontario

giving tenants notice ontario

In Ontario, tenancies usually last a year, however, if the lease has ended and the tenant has not given you notice, the tenancy will automatically renew on a month-to-month basis. Legally, a tenant must give at least 60 days notice that he/she will be ending their tenancy. But what rules apply to landlords and how do you go about giving tenants notice to vacate? If you have a rental property which currently has tenants but decide that you want to sell the house, a good rule of thumb is the more notice, the better. You can not contract “out of the law,” therefore, the guidelines and standards set by the Residential Tenancies Act or the Landlord Tenant Board must be followed.

If you decide you want to sell your house, giving notice to your tenant asking them to vacate the property in a month because you’re “thinking of selling your property” will not suffice. In this instance, the law does not work in your favour and the tenant is not legally obligated to move.

Let’s looks at a few situations:

You have been renting a condominium unit to a very responsible couple who have been your tenants for three years. They’re currently renting on a month-to-month basis. You’ve spoken to a few people in the building and noticed that there is a demand for units, and they’re selling at a very desirable price. After doing a CBA, you decide that selling your unit would be more profitable than renting it out. Legally, you do not have to give notice to your tenants until you actually sell the unit, but you can let them know that it’s on the market. As a landlord, you must make a reasonable effort to inform your tenants that you’re going to show the unit to prospective buyers. Showings must occur between 8 a.m. and 8 p.m. In this situation, the couple is cooperative and tell you they’ve been looking at buying a property in another part of the city. Shortly after you listed the unit, it sells above asking and the closing date is two and a half months from today, February 25, 2015. Along with the correct forms, you give your tenants 60 days notice, which goes into effect on the last date of the rental period (February 29). They must vacate the premises by April 30. Since your closing date is May 16, it works out perfectly for you because you’re maximizing your rental income, and have a significant amount of time for your property manager to ensure the unit is clean and ready for the new buyers. You and the couple end the tenancy on great terms, and you start looking into other investment properties.

But what happens if you sell your property while your tenants are in the middle of a lease agreement? Legally, they are not obligated to leave until the end of their tenancy. You can tell them your situation and ask them to leave, compromising on a substantial amount of time. Hopefully, they are cooperative, however, if they are not, you can buy them out. Unfortunately, you cannot force them to leave unless you have grounds to evict them.

In any situation, it’s best to give as much notice as possible. Hiring a Toronto property manager to assist you with a tenant screening process will help decrease the likelihood of you encountering problems when ending a tenancy due to uncompliant tenants. Before you enter any lease agreement, carefully plan it out and consult your property manager for advice to ensure the decision you make is the right one for your situation.

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Toronto Real Estate Market Watch — November 2015

In an announcement made by Toronto Real Estate Board President Mark McLean last week, GTA REALTORS® reported 7,385 home sales through TREB’s MLS® System in November 2015 – a 14 per cent increase compared to November 2014 and a record number for November sales to date.

Toronto’s real estate market saw 96,401 sales for the first eleven months of this year. There is no doubt that 2015 will go down in history as a year Toronto real estate made the record books. High housing prices, the number of homes sold, and benchmark indexes as well as a low number of active listings, average days on market and the amount of square footage you get for a dollar–not to mention the value of the Canadian Dollar itself. However, as the year winds down, people are turning their focus away from the red-hot real estate market and putting themselves in gear for the holiday season.

record highs for GTA housing market

Credit: Toronto Real Estate Board

December is often an interesting month in for the Toronto real estate market–sometimes, buyers bid to get into the market right before the new year while other years they wait for the fresh listings that often arrive in January. Mr. McLean remains optimistic for December, as well as the upcoming year. With one more month to go until 2016, we’ve still managed to set a record in for home sales in the TREB market area for an entire calendar year (the previous record set in 2007 and reflected all 12 calendar months).

McLean believes the widespread demand for homeownership is a priority for families in the GTA and attributes it to real estate being the best long-term investment. Despite rumours of a housing crash, Toronto continues to prosper and doesn’t seem to show signs of stopping. The other question remains–if there is no crash, will there be a correction? Will the market get out of control?

The federal Department of Finance wants to step in and increase the minimum down payment for a home from 5 per cent to 10 per cent. With stiffer borrowing rules, the market has a better chance of cooling without a drastic crash. An increase will also alleviate the taxpayers exposure to insured default losses and possibly boost sales in the condo market. First time home buyers who are only prepared to put a 5 per cent down payment must either wait until they have twice the amount of money they initially had or settle for a condo. While all these pros sound fantastic for markets like Toronto and Vancouver, other markets in the Country, especially cities that have already experienced losses in the housing market, will suffer. When will these proposed changed come into effect? We can expect the Federal Department of Finance to present the motion for additional 5 per cent on down payments to the Minister of Finance as early as January 2016.

With what seems to be a very small window to decide whether to toss the whole idea of buying a home, borrowers looking to put a smaller down payment on a home should seek the advice of a mortgage professional and reassess their budgets realistically. Increase or not, the New Year is the perfect time for families to analyze their finances to ensure sound decisions in the future.

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Toronto Millennials — A Landlord’s Dream

Toronto Millennials are poised to take over the rental market. Are you ready for them?

Millennials: We’ve heard this term thrown around a lot lately, but who exactly are they and what role does Generation Y play in the real estate market?

You don’t need to have an inside scoop to know that Toronto and Vancouver’s housing markets are on fire. As a matter of fact, not a day goes by without an argument of a housing bubble (or lack thereof), or a major media company discussing foreign investment and housing affordability becoming increasingly out of reach.

Toronto Millennials feel the effects of the latter, as the likelihood of having $1 million on hand for a house is slim to none. The first wave of this generation makes up a group of young single professionals. Unlike their predecessors, it’s more common to see millennials in their late twenties and early thirties focusing on advancing their careers. If we look at Baby Boomers and Generation X, we would see people graduating, finding work, settling into an area, getting married and purchasing their first home all before the age of 30. The thought of doing any of that for someone from Gen Y would be overwhelming to say the least.

As for the younger Millennials, the right of passage to adulthood includes transitioning from post-secondary institutions and living with mom and dad to living in the real world. Property managers see an increase in this demographic coming to them for rental properties. Gone are the days where young adults dreams include white picket fences and 2.5 children. Millennials are less interested raising families and climbing the corporate ladder and more interested in seeing the world and being their own boss. If you get the chance to chat with someone between the age of 23 to 28, ask them what their one wish in life would be. Nine times out of 10 it would be to travel or sell hats on the beach.

To the average Millennial, renting vs. buying is the best way to save money in today’s real estate market. As many do not have existing capital or sizable assets, renting puts them at a much lower risk of losing money, should there be a shift in the market. Between a down payment and a mortgage, and first and last rent, losing a deposit isn’t as big of a deal as foreclosure is.

So far this post has taught us that the majority of Millennials will not be buying your property–got it. What we haven’t covered is a way to capitalize on this market. Essentially, Millennials are a landlord’s and property manager’s dream. They make up a market of people in seek of quality rental housing without a major time commitment or financial investment. These people are loyal to premium brands (i.e. Apple or Samsung, iPhone or Android), and if treated right, will make wonderful long-term tenants. They also like to share their positive experiences with their friends via social media and other short forms of communication that don’t require face-to-face meetings, which means more business for you in the form of referrals.

If you are a property owner, leave Marketing to the Millennials to the pros. As seasoned Toronto property managers, we have all the tools to stage your property to make it appeal to quality tenants, and ensure that your investment is in good hands. For more information on our Property Managment services in Toronto, or how we can help source quality tenants for your rental property, contact us today.

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Liberal Party Policy Change–Additional Land Transfer Tax for Buyers in Ontario

The Municipal Land Transfer Tax is coming to a town near you, and most likely, your town as well.

Real Estate Professionals in Ontario up in arms about new land transfer tax

The dreaded Municipal Land Transfer Tax (MLTT) might be spreading across Ontario as an additional taxation measure backed by the Liberal Government. This tax will be on top of the existing Provincial Land Transfer Tax (PLTT) levied upon closing a land or property transaction in Ontario. As a buyer, the amount you paid for the land as well as your mortgage or remaining debt related to the purchase of the property are factors that determine the tax payable.

In 2007, Toronto City Council approved the Municipal Land Transfer Tax to the dismay of Realtors® and hopeful residents alike. Currently, Toronto is the only city in the province that levies an additional tax on top of the Provincial Land Transfer Tax. Although the MLTT has caused some homebuyers to consider, properties outside of the city, buyers in Toronto seem to be more accepting of the tax as of late. In a competitive market where the cost of an average detached home is over $1 million, what’s another $15,000 in municipal taxes?

Several Realtors® are up in arms about the possibility of the Liberals moving forward with this decision, as it may have a significant impact on the housing marketing in cities outside of Toronto. Although Toronto’s housing market is robust, during its first five years, the MLTT is said to be responsible for a severe decline in home sales. The Ontario Real Estate Association (OREA) is requesting that the Liberals reconsider giving municipalities the power to levy this tax. Homebuyers in Ontario can expect this new tax to implement as early as next year, and if the Liberals do follow through with the policy change, Ontario will become North America’s most taxed jurisdiction.

As investors, what can we do to prepare for this? Not much, however, we can expect increased competition in housing markets in the surrounding GTA, especially luxury homes in York Region. With the policy change looming near, there is even more incentive to invest in property on the outskirts of Toronto. Do the suburbs suddenly sound more appealing? We think so too.

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Autumn in Toronto, 2015

Happy thanksgiving Toronto, 2015

A new season starts out with many expectations. Imagining fall brings up thoughts of crunchy leaves, long walks through auburn forests, and spending time with loved ones. Life gets busy though, and before you know it, the temperatures drop and its winter: another autumn come and gone. Get the most out of this fall season by writing some activities down in advance, and crossing them off as you complete them.

Here’s a fun list of things to do with the kids this Autumn in Toronto, 2015.

  1. See the fall colours
    You don’t need to go on a hike to see fall colours in Toronto (though that would be a good idea). There are tons of parks and vantage points from which you can enjoy fall’s splendour. Rosedale Valley Road is a gorgeous drive, a picnic in High Park is great on a warm day, and the Leslie Street Spit is great for a bike ride.
  2. Go for a nature ride
    The massive Tommy Thompson Park features lush biking trails perfect for bird watching and admiring the fall foliage, but the Don and Humber Valleys are also great. If you’re not up for cycling, you can always take a guided nature walk held on weekend mornings.
  3. Go apple picking
    Apparently hand-picked apples make the best pies. Test this theory and take a drive outside of the city to Chudleigh’s or another nearby spot such as Organics Family Farm or Applewood Farm Winery.
  4. Make your own hot chocolate tour
    While you could plan a hot chocolate hop via the annual Toronto Chocolate Festival, which gets underway October 17, it’s also easy to DIY this one. All you need to do is check out our roundup of the best hot chocolate makers above, put on a snug scarf, and head to streets in search of sweet warmth.
  5. Pick a pumpkin at a farm
    Skip pumpkin shopping at your local Loblaws and instead opt for a day trip beyond city limits. Though not too common in the city, there are plenty of farms on Toronto’s outskirts that sell gourds of all shapes and sizes. Markham, Oshawa, and Alliston are just a few options.
  6. Look for ghosts on a haunted walk
    If you kid loves all things spooky and supernatural, take then out for a haunted tour. You’ll visit the creepiest places in the city and maybe even happen upon a spirit or two.

For more ideas visit www.blogto.com

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Setting Your Sights on the Suburbs of Toronto

The 2015 Toronto Real Estate Market – An economic landscape where supply rarely meets demand, low-rise houses are highly coveted, and detached homes can fetch well over $1 million. We already know the 416 housing market is red hot right now, but what about the Suburbs of Toronto?

Suburbs of Toronto

Suburban GTA — Living here can really pay off

This year, Toronto has seen an increase in sales of freehold (low-rise towns, semis, and detached) homes, however, the actual figure may surprise you.  From January 2015 to August 2015, there has been a marginal increase of only 2 per cent.  This is mainly due to the lack of active listings as well as affordability.  What might be more surprising is the sales activity in the 905 area – in York Region, freehold housing sales saw radical increases this year, with a 20 per cent jump in New Market alone.

As housing prices in the 416 continue to become out of reach for many, hopeful homebuyers set their sights on the suburbs for a place to call home.  With larger lots, newer homes, less hustle and bustle, and basically more bang for your buck, the suburbs of the GTA are a winning choice for buyers in search of family homes as well as investors looking to stretch dollars.

The following Top 10 List covers housing markets in the GTA which saw the most significant price growth for low-rise homes in 2015, and figures representing a year to date comparison for 2015 and 2014.

Newmarket

Average 2015 House Price 2015: $693,190 – (25% increase)
Average 2014 House Price: $551,413

Total Sales 2015: 1173
Total Sales 2014: 999

Average Days on Market 2015: 16
Average Days on Market 2014: 20

Richmond Hill

Average 2015 House Price 2015: $1,011,031 – (20% increase)
Average 2014 House Price: $833,913

Total Sales 2015: 2014
Total Sales 2014: 1838

Average Days on Market 2015: 16
Average Days on Market 2014: 17

Vaughan

Average 2015 House Price 2015: $886,727 – (16% increase)
Average 2014 House Price: $764,782

Total Sales 2015: 2283
Total Sales 2014: 1981

Average Days on Market 2015: 16
Average Days on Market 2014: 21

Whitby

Average 2015 House Price 2015: $506,715 – (16% increase)
Average 2014 House Price: $437,082

Total Sales 2015: 1424
Total Sales 2014: 1327

Average Days on Market 2015: 14
Average Days on Market 2014: 16

Markham

Average 2015 House Price 2015: $935,272 – (15% increase)
Average 2014 House Price: $814,173

Total Sales 2015: 2287
Total Sales 2014: 2073

Average Days on Market 2015: 14
Average Days on Market 2014: 16

Aurora

Average 2015 House Price 2015: $734,735 – (15% increase)
Average 2014 House Price: $637,213

Total Sales 2015: 656
Total Sales 2014: 536

Average Days on Market 2015: 15
Average Days on Market 2014: 17

Ajax

Average 2015 House Price 2015: $515,318 – (14% increase)
Average 2014 House Price: $451,483

Total Sales 2015: 1414
Total Sales 2014: 1361

Average Days on Market 2015: 12 – (Ajax saw its homes sell the fastest in the GTA
Average Days on Market 2014: 15

Mississauga

Average 2015 House Price 2015: $717,661 – (11% increase)
Average 2014 House Price: $647,571

Total Sales 2015: 4317
Total Sales 2014: 4,166

Average Days on Market 2015: 17
Average Days on Market 2014: 18

Milton

Average 2015 House Price 2015: $521,548 – (10% increase)
Average 2014 House Price: $427,923

Total Sales 2015: 1,443
Total Sales 2014: 1,399

Average Days on Market 2015: 14
Average Days on Market 2014: 17

Pickering

Average 2015 House Price 2015: $563,823 – (9% increase)
Average 2014 House Price: $515,671

Total Sales 2015: 716
Total Sales 2014: 616

Average Days on Market 2015: 14
Average Days on Market 2014: 17

 

Source: Toronto Real Estate Board

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Sellers Continue to Ride Housing Wave as Toronto Home Prices Climb 10 Per Cent

New hope for buyers as supply of new listings in Toronto exceeds demand for the first time since January

mls+toronto+avg+august

 

In August, sellers continued to ride the wave of the GTA Housing Market, as Toronto home prices climbed 10 per cent. Last week, Toronto Real Estate Board President Mark McClean announced that GTA REALTORS® reported 7,998 residential sales through the TREB MLS® System for the month of August. In a year over year comparison, this figure represented a 5.7 increase compared to 7,568 sales reported in August 2014.

mls-avg-aug2015-toronto

For the first time since January, the supply of new listings in Toronto exceeded the demand, however, active listings toward the end of August were still down compared to the same time last year. Although the increase in new listings is encouraging, it will likely take several months for the market to balance out. Until then, GTA housing market conditions remain in the seller’s favour.

“Buyers in the GTA remain confident in their ability to purchase and pay for a home over the long term. They see ownership housing as a quality investment that has historically produced positive returns while at the same time providing owners with a place to live in their chosen community,” said Mr. McLean.

Both the MLS® Home Price Index (HPI) Composite Benchmark and the average selling price for all home types combined were up substantially in August compared to the same period in 2014, an increase of about 10 per cent in a year-over-year comparison.
(Source: Toronto Real Estate Board)

Market Bears anxiously await a bubble to burst, however, if the health of the city’s economy serves as any indicator, this “bubble” is nonexistent … and crash? Not likely. As for residential sales, we can expect them to slow in the upcoming months, however, they will remain hot compared to markets in other Canadian cities – with the exception of Vancouver of course.

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6 Facts About the Toronto Real Estate Market

Photo Credit:  Kevin Van Paassen

Photo Credit: Kevin Van Paassen

  1. 56,000 condos
    At the end of 2014, there were more than 56,000 condos under construction in Toronto. That’s far more than what’s being built in other cities with a greater population like Chicago, Los Angeles, or New York. As a comparison, during most of the 1990s the city hovered around 10,000 condo starts.
  2. Almost 3,000 unsold condo units
    In May, CMHC reported 2,837 unsold condo units. An all-time high, the closest we’ve come to that number was in the early 90’s when the condo market was out of control. Despite the high number of unsold units, sales for the fancy high-rise units continue to increase. Condo sales also help stabilize the market by offering an affordable entry point for first-time buyers.
  3. $1 million average price
    In February Toronto reached a milestone that had previously only been reserved for some of the most expensive cities on the planet. The average price for a detached home in the city limits surpassed $1 million. In June, that number increased to $1.052 million. The increase in demand for luxury homes, namely houses sold at $3 million or more has contributed to this number. Buyers have not been discouraged by this, as bidding wars are still very common.
  4. 50% in five years
    In 2010 the average price for a Toronto property (including condos) was hovering around $430,000. In just five years, that average has rocketed up more than 50%, recently almost hitting $650,000.The last time the market moved that quickly was back in the late 1980s, with the average price hitting a peak of $273,000 in 1989. The average value didn’t top $270,000 again until 2004.
  5. 39,000
    The number of sales in the Toronto market has more than tripled since hitting a low of 26,700 transactions in 1990, right after the 1989 bubble popped.That’s created a lot of jobs selling houses. According to the Toronto Real Estate Board, there are currently more than 39,000 realtors currently working in the city. That’s one realtor for every 140 residents.
  6. 8.9 times
    According to Statistics Canada, the average Toronto family earned $72,830 in 2013, the most recent year for which statistics are available. During May 2015, the average price of real estate in the city was $649,599. That puts the price-to-income ratio at an eye-popping 8.9 times, which is a record high.

Sources:

Canadian Mortgage and Housing Corporation http://www.cmhc-schl.gc.ca/
Canadian Newswire: http://www.newswire.ca
The Motley Fool: http://www.fool.ca
Toronto Real Estate Board: http://www.treb.net

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HighGate Property Investments Inc: Your Source for Professional GTA Real Estate Services