How are you? I hope you are staying healthy and safe.
I wanted to give you a quick update on what’s happening to the current market and what can you do now to take advantage of the situation.
First and foremost is, check if you can qualify for any government support.
Everyone should be eligible for the $2000 government support. The federal government has introduced legislation to establish the Canada Emergency Response Benefit (CERB) that will provide $2,000 a month for up to 4 months for workers who lose their income as a result of the COVID-19 pandemic and covers Canadians who have lost their job, are sick, quarantined or taking care of someone who is sick with COVID-19, as well as working parents who must stay home without pay to care for children who are sick or at home because of school and daycare closures.
Now, if you are a small business owner you can qualify for the Canada Emergency Business Account that provides access to a $40,000 loan: There is 0% interest until Dec 31,2022 and you can get $10,000 loan forgiveness, provided $30,000 is paid back on or before Dec 31, 2022.
If you have people on payroll, Parliament has now passed the Canada Emergency Wage Subsidy (CEWS) Program totalling $73 billion. The bill will allow the federal government to pay companies’ 75 percent of the first $58,700 earned by each employee, up to $847 per week for up to 12 weeks. However, the federal employment minister says it can take up to a month for this program to be rolled out and for companies to receive the money.
More details about the government support you can find on our website under COVID-19 Update.
We are still open for business. Real estate is deemed. To be an essential service. The offices are closed but we all work from home. The transactions are still going through. We have been doing virtual open houses, virtual clients tours and meetings with clients over zoom. On MLS we introduced a tool that will allow agents to add links for Live Stream Open Houses to their listings so that interested clients can join the Salesperson in real time as they walk through the property, present its features, and answer their questions. We can promote upcoming Live Stream Open House showings on the Collab listings, on TRREB’s public listing site (TRREB.ca), as well as on REALTOR.ca.
Clients showings are more efficient, usually only 2-3 showings and they are submitting an offer. Good time to get a deal as well, since you are facing fewer active buyers
Sales for the first two weeks of March were excellent for that time of year. Then the lock down happened, which caused the sales decline by 85%. Condos sales for downtown Toronto are off by 73% so are the condo leases by 69%. The spring market will be coming up soon, it is warming up now. We are starting to see a build-up of the inventory. Prices will soon fall. By how much we can only guess, it will depend of two factors- when the government opens the country for business and. how much equity the property owners have. If owners have enough equity in their property, then lenders will be happy to defer or restructure payments and add them to the back end of the mortgage balance. And with courts being closed for now, any foreclosure or power-of-sale orders are at least a year away. That gives breathing room for owners. On that basis, we believe that prices will come off at most 10% and more likely in the 5% range from February prices. But this is a very positive prediction
The next 2-3 weeks will be like a flat line. They we will enter a window of 3-4-6 months where only sellers that have to sell will be selling and people that have to buy will be buying, or investors looking for deals. You will notice softness in prices. After that 6 months window the prices will increase again back to prices from March 2020.
If you are a Landlord and you don’t have to sell, then stay put. Don’t make any move for the next 6 months. Have a conversation with your tenants, make a plan for their rent payments. If your tenants won’t deliver rent on time, remember to file M4 to protect yourself. You have to understand that the M4 form is just to protect the Landlord, and it doesn’t mean the Landlord wants to evict the Tenant. It’s a simple document that has to be signed to confirm the amount in arrears.
When it comes to mortgages, our colleagues are constantly working on refinancing client’s homes. More than 213,000 requests for mortgage deferrals – skipping payments – have been completed or are still being processed by the country’s six largest banks. On March 17, the banks announced a program that allows customers facing financial hardship as a result of COVID-19 to defer payments for up to six months.
Some are saying to sell your assets before they will become your liability (Grand Cardone). Let go of tenants, who want to go and who you feel may not be able to afford the rent and sell the units before everyone will start panicking and start selling the condo units in large. My suggestion is to cash on everything you can and hold to money to take advantage later on the market downturn. You have to decide where are you with your investments and what will work the best for you to protect your investments and your family.
If you have questions regarding real estate, want to buy or sell your home call me today.
My direct phone number: 647.836.9130
Stay well, I am here to serve you.
Marta Pozniakowski, M.A. | Broker of Record