Today is a big day in the United States and the world for that matter. I was chatting with a client today who told me, and this is just hearsay, that US stock markets have historically gone up after a Democrat has been elected. You have probably figured out in which direction my politics leans.
There has been so much bad press about the US stock markets, and the Canadian stock markets have not fared that well either for that matter, that perceptions of the general public is that the sky is falling.
This sentiment has had an impact on the Toronto Real Estate Market as well. Buyers it seems are reluctant to get into the Toronto real estate market. One colleague had a buyer who was considering buying a condo in a prime location in the core of the city. His financial advisor told him that he should definitely not get into the Toronto real estate market and that instead he should keep his money in his mutual funds! Sadly, this potential condo buyer is probably losing his shirt!
I recently took a look at some statistics for MLS district C01 in Toronto. This district is the heart of the downtown core – Bay Street, The Entertainment District, Queen West, King West,, Queens Quay are all areas in this district. After hearing all the doom and gloom in the Toronto newspapers, I was surprised to find that in fact, prices for Condo Apartments have not gone up or down. Just going sideways – consolidating – just waiting for the next upswing in the market.
I am still of the opinion that the relatively new land transfer tax imposed by the City of Toronto has had more of an impact on Toronto’s real estate market than the declining fortunes of the stock markets. Last year, 2007, saw record prices and a record number of sales in Toronto which was spurred on by the fact that the new land transfer tax started on January 1, 2008. You could avoid paying an additional 2% of the purchase price in taxes if you bought by December 31, 2007.
I know for a fact, that I have never been busier in December and I have many colleagues who were running around trying to get some last minute sales before the deadline, in what is typically a very slow period.
So let’s hope for some good news tonight……..
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