Household Debt & Market Crash Overblown

Sales have slowed in Canada’s largest markets, Vancouver and Toronto and the blame is being pointed to the new mortgage rules that were implemented this summer.  Though sales have taken a noticeable decline, prices have corrected only marginally.  However, the Canadian Association of Accredited Mortgage Professionals (CAAMP) published a recent report stating that the real impact has not been felt yet, and it will take time for it to digest through the market.

“Our concern today is the number of growing first time buyers who are now unable to get a mortgage. We worry that this is having a dampening effect on what was an already cooling market and we hope policy makers will give some thought to addressing the needs of this key sector of the market.” says Jim Murphy, chief executive of CAAMP.

The report determined that 17% of the high ratio mortgages funded in 2010 would not qualify today, including 11% of prospective high ratio homebuyers who wouldn’t qualify under the new 25-year amortization rule.

“The changes to the mortgage insurance criteria are unnecessarily jeopardizing the health of Canada’s housing markets and the broader economy.” says the report.

Though the rules may have been excessive and untimely, GluskinSheff economist David Rosenberg predicts we are going through a market correction rather than the over exaggerated market collapse that is being heavily publicized in the media.

Rosenberg has also provided 5 reasons why the Canadian household debt panic is overblown. For one, our debt ratio is closer to 118% than the recent data showing 165%, a percentage that surpassed the American ratio of the US 2008 bust. Rosenberg explains the percentage discrepancy is a simple healthcare equation. The remaining four reasons include our relative assets to debt, the amount of equity in our homes, wage growth, and better ability to handle debt round out the list.

It is obvious that doom and gloom sells, however, Canada as a whole is in a strong position relative to the rest of the world. Rates will remain low until other economic regions including Europe, US and Japan start to regain momentum. Our unemployment remains low with some markets experiencing exceptional activity such as Calgary, Edmonton, and Winnipeg.

It will remain important for Canadians to monitor their debt levels as rates will eventually increase. However, while interest rates remain low, retirees will need to source effective ways to grow their savings for the future.

Mortgage Forum 2012: Worth Tweeting About

I attended the annual Mortgage Forum hosted by the Canadian Association of Accredited Mortgage Professionals (CAAMP) this past Monday and Tuesday; I know what you’re thinking…“bor-ring.” On the contrary, I would say anybody, from anywhere or from any industry, could have taken something valuable from this conference.

Most of the good stuff came on day two. I was shocked that our 600 or so group was blended with another 1200+ general attendees for The Art of Marketing conference. With the likes of David Usher, Singer/Song Writer from Moist; Randi Zuckrberg, (yes, she is related to Mark Zuckerberg), his Marketing-guru sister; Biz Stone, Co-founder of Twitter; Scott Stratten, President of Un-Marketing and an expert in social applications; and Mitch Joel, a digital visionary. Ron Tite was also an exceptional host and masterfully conducted the flow perfectly. There were many amazing quotes from the day and I urge you to discover the #tao or #caamp2012 hashtags on twitter to discover some of the brilliance that was shared that day.

Day one covered the mortgage-specific topics. I was looking forward to seeing Kevin O’Leary from CBC’s Dragon’s Den, however, he was cancelled after announcement of his new mortgage product hit the newsstands last week. Dominion Lending Centers, the session’s sponsors, didn’t want their investment promoting someone they now considered a direct competitor. There’s some exciting mortgage-biz drama, at the expense of my ticket value and personal disappointment.

There was just one thing more disappointing than O’Leary’s absence. I feel it necessary to address, as it’s too explicit to not mention. Within 5 minutes of sitting in my seat at our opening ceremonies, I realized something was lacking. Between the opening speeches, the structured sponsor advertisements, introduction to our next year’s Board of Directors and our entire speaker list, women were sparsely accounted for to the point of almost non-existence. Not one women speaker, except for the moderator, CBC business correspondent Amanda Lang, would be seen on stage. Only two women sit on our 18-person Board of Directors, both from the province of Ontario. And to a lesser extent, but still noticeable, the marketing components of the conference had a strong male directive.

I understand my industry is heavily male-dominated, especially in the higher ranks, however, when I looked around the room I noticed an attendance ratio closer to 50/50. It could have even tipped in favor of the females.

There is a powerful new force to add to the industry’s assets that I feel is currently being left untapped; women. Not only are women more involved from a business perspective, but more women are in the market of buying real estate. This generation’s buying habits are strongly determined by the women and children of the household and a larger purchase such as a home should not be discounted. If we ever hope break the near-decade stagnant levels of 25% market penetration, then I think we need to rethink the way we communicate externally as well as internally. It’s time to hang up the old boys club and make room for the unisex boardroom!

In addition to investing in women, we need to consider the strength of our human-power. The industry leaders were asking for the broker community to be the champions and the voice; to consider more investment in the promotion of what we do as a whole and help encourage the support of stronger, more recognized training amongst our colleagues. If the industry association is looking to the individual brokers, competitors or not, to join forces to increase our market share, I feel the interaction in at the conference will need to shift from a full “we talk, you listen” agenda to hybrid of speeches and “interactive” breakouts sessions or brainstorms that encourage our members to collaborate and develop concepts that CAAMP can help implement into action through it’s membership. More women, more involvement, more ideas, more opportunity…it’s just a thought.

Michael Tudorie

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BUSINESS BASICS

Started as a Realtor in: Early 2010

Specialization: Vancouver West, Vancouver East, Burnaby, New Westminster, and Richmond.

One-piece of advice for your clients: Hire the right Realtor. Do your due diligence and interview 3 or 4 agents; it will make or break your experience and your bottom line.

Why Dexter Associates Realty? Michael previously worked in the hospitality industry in boutique hotels. Dexter is a boutique brokerage so it was a perfect fit. He doesn’t see himself working for one of the larger companies.

“We had our property listed and went through two different Realtors without any success over an eight month period. Once we met Michael our home sold within a month. We were very impressed. He worked very hard and had a lot of action in a short amount of time.” -Ian Brown, Client

Q & A

1. Do you have a favorite client experience? I met this older couple who never felt comfortable with a realtor, but were considering selling their home. I spent some time with them to talk about it. We ended up listing their home and selling within two weeks. They had purchased their home 25 years ago and are now financially set to live comfortably through retirement. They stayed within their neighborhood, moving to a nearby senior’s home where they have full care services. I still visit them now.

2. What is your favorite success story? A client had their house on the market for the past year and a half with no adjustments or changes to the listing. When I took the listing over, I was able to market it properly, promote it through showings and sold it at their asking price within 45 days.

3. What inspired you to be a Realtor? I was in the hospitality industry and I would have had to move away if I wanted to move up. It seemed like a natural transition to move to real estate; another “people” job. I would have loved to start earlier, however, I feel the background I have has added to my success.

4.What differentiates you from the 11,000 licensed real estate agents in the Greater Vancouver area?

1. Business skills to understand people’s needs and wants.
2. Trust
3. Follow up

I don’t just focus on the client’s immediate real estate needs, but provide solutions for the whole experience. For example, I had a client with lots and lots of stuff. They were very concerned with packing and moving it. I listened to their needs and I recommended a company I knew who could help organize and pack everything. They had no idea these companies existed. They were so happy with the referral. It only took four hours for them to complete; something the clients swore would have taken them a week to do themselves.

I stay in contact with my clients in various ways; this October I partnered with a landscaping company to do a pumpkin delivery – Fun things like that.

I also have a special interest in helping new immigrants, as I have been there myself. I have dealt with various cultures and customs and can help ease any of the challenges that can be experienced during the transition of being new to Canada.

"I have worked together with Michael at Dexter and have found him to be a very sincere honest guy. We worked closely on a specific project and he came across as one of the most hardworking realtors I know. Michael’s philosophy is building long term business relationships with buyers and sellers and making sure that they enjoy the whole experience from beginning to end. He’s a great guy!”-Kathrine Light, Realtor, Dexter Associate

PERSONAL SNAP SHOT

About: Michael is married and has a 5-year-old son. Michael spent nearly 14 years living in Halifax followed by 2 years working on a cruise line as administration staff before he moved to Vancouver. He has bought and sold many of his own properties within the Kits area over the past 17 years.

He volunteers with big brothers in Vancouver and mentors a 10-year-old within the school program. Michael also coaches soccer and has changed this year from his usual 12 to15 year-old team to working with a women’s team, The Westside Wild.

He’s Unique because…

1. If he weren’t a Realtor, he would be playing right wing in the European First division football league.
2. He listens to positive affirmation cd’s in his car, but more commonly has Team 1040 on to listen to the Canucks.

Likes (If you had more time, what would you do more of): Spending time with family and travel

Loves (can’t live without): Tim Horton’s and the Canucks!

THE EXTRAS

Michael loves meeting different people and understanding how he can help meet their needs. He enjoys the challenges each and every client presents. He prides himself on his resourcefulness to help provide options so that clients can make the best decision for themselves.

Beyond the regular real estate educational requirements, Michael is active in marketing; monitoring what has sold or been listed every day. Even though many people in Vancouver think they understand real estate, he cautions people to understand that professionals can help guide and support the process with correct and reliable information.

Michael believes clients are looking for a Realtor to solve their problems, eliminate the worry and to be proactive in the buying or selling process. He listens to clients and wants to ensure they know he has the capabilities and can be trusted to get the job done.

Contact Michael Learn more: Vancouver Sun Interview with Michael  

Make the holidays merry with a little “Sex in a Pan!”

Ingredients

Original recipe makes 1 – 9×13 inch pie 1/2 cup butter, melted 1 cup chopped pecans 1 1/2 cups graham cracker crumbs 1 (8 ounce) package cream cheese 1 cup confectioners’ sugar 4 cups frozen whipped topping, thawed 1 (3.9 ounce) package instant chocolate pudding mix 1 (3.4 ounce) package instant vanilla pudding mix 3 cups milk 1 (1 ounce) square unsweetened chocolate, melted

Directions

Preheat oven to 350 degrees F (175 degrees C).

1. To Make Crust: In a medium bowl, mix together butter, pecans and graham cracker crumbs. Pat into a 9×13 inch baking pan. Bake in preheated oven for 20 minutes or until lightly browned; allow to cool completely.
2. In a medium bowl, beat together cream cheese and confectioners sugar until smooth. Fold in 1 cup of the whipped topping. Spoon mixture into graham cracker crust.
3. Prepare chocolate and vanilla puddings as per package directions, but with 1-1/2 cups of milk each. Allow pudding to set before pouring on top of the cream cheese layer. Spread remaining 3 cups of whipped topping over pudding layer; swirl melted chocolate throughout whipped topping.
4. Cover and refrigerate for about an hour. For leftover pie, keep frozen in a tightly covered container. When ready to eat, just cut off a piece and allow to thaw; keep rest frozen.

Shaz Karim

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BUSINESS BASICS

Started as a Realtor in: Late 2008, right when the market took a downturn, he had to work hard to create a unique foundation.

Specialization: Residential detached/attached all Vancouver East & West, downtown Vancouver, Burnaby, New Westminster, and Tri-cities.

One-piece of advice for your clients: Take the time to find the right Realtor. When you do, it’s important to listen and have trust in them and ask questions along the way.

Why TRG The Residential Group? It’s a boutique real estate brokerage, which allows Shaz to be Shaz. He can invest in his brand and put efforts to promote him and his services. Six brokers with over 120 years of real estate experience own the business and they provide mentorship to all of their agents. Industry involvement is also important to him and the company, one of the owners was the former president of the British Columbia Real Estate Association (BCREA) and the Real Estate Board of Greater Vancouver (REBGV).

“Our experience working with Shaz has been a pleasant surprise. His approach is refreshing and holistic. He is the consummate professional with a personalized approach, always reinforcing the feeling that he is on your team. His level of organization, attention to detail and high standard of customer service distinguish him from others. From our perspective, he has set a new standard and we look forward to continuing working with Shaz as our family grows and our real estate needs do too.” Prashant Ohri & Anjana Moitra-Ohri, Clients

Q & A

1. What differentiates you from the 11,000 licensed real estate agents in the Greater Vancouver area? My background. I have work experience in management and strategic marketing, that’s allowed me to develop skill sets, elevating the customer service experience. I’m strategic, detail-orientated, and marketing focused. In particular, when it comes to selling homes, we develop a plan and materials to target a specific demographic that the homes fit. My custom features sheets, targeted email campaigns and single property websites are a few examples of my marketing touch points compared to the cookie-cutter traditional approach.

It’s a competitive environment, which I think is good. It provides an opportunity to push and challenge the boundaries. For me, entering the industry in a down market was a good test, and forced me to show my unique attributes in order to set myself apart.

2. What is your favorite success story? When I started in real estate, my first client was my mom. A couple came in to view the home and didn’t have a Realtor. I spent some time to get to know them and understand their needs. We realized this home wasn’t right for them. After my open house, I took them for a drive around to show them some different neighborhoods. Two weeks later I got a call from them asking me to be their Realtor. They didn’t have a mortgage broker yet, so I set them up with a contact, got them pre-qualified and showed them several homes. We soon found a home put in an offer and purchased. They then referred me to their brother who wanted to sell. My mom’s listing actually resulted in getting me three clients and my business just grew from there.

3. What inspired you to be a Realtor? Three things:

1. My dad was in real estate in the 80’s and it really shaped who I am today.
2. Having had personal experiences with a few different realtors, I felt that the whole process could be done better. I thought that, if I were ever to get into Real Estate, I could change it to be more effective.
3. I have a background that compliments real estate well. My management, marketing and communications experience is something that really sets me apart…there aren’t many real estate agents that have my type of resume.

4. What do you think clients look for in a real estate agent and what do you think clients should look for in a real estate agent? I think clients look for someone that is personal, understands their needs and goals, and someone that is confident.

What they should also consider when seeking a real estate agent is what added value they will bring. Look at the services offered and the type of person they want to work with.

Each buyer has their own individual needs. Whether it be for investment, first time buying, or moving up the property ladder, I’ve developed a unique program to deliver based on their needs.

Sellers, I mentioned, we take the time to develop a plan that specifically targets the demographic we are focusing on. A Realtor should be investing their time and resources to represent the property they are marketing. Out of the 11,000 realtors how many are full-time and make the investment that is needed for their clients.

I do things to help educate my clients. For example, I have a great deal of experience reviewing Strata documentation. Clients may not understand them, so I help to break them down to their simplest form. I let them read first and then we review together and make a summary list of questions we have regarding the documents. The better we understand these documents, the more confident we are in moving forward in purchasing the property.

“Sincere, amazing and thorough Realtor to work with. He is a very thoughtful person. I can always count on him; he has always been there for me. A professional, dynamic and I repeat, amazing person!” Angela Chase, Realtor, TRG The Residential Group

PERSONAL SNAP SHOT

About: Shaz grew up in North Burnaby and lived and went to school there for over 20 years. He now lives in Vancouver and is very familiar with many of the downtown residential buildings. As well his main office is located in downtown at 849 Homer Street. He enjoys running, biking, skiing, travel and generally being outdoors in the summer months. His background is in marketing, sales, and management, which he is actively applying to his real estate career by creating a unique value proposition for his clients.

He’s Unique because…

1. He is a strata guru. Having sat on a number of different councils, Shaz has gained a thorough knowledge of strata process and documents
2. If he weren’t a real estate agent he would be in brand development, strategy and communications.

Likes (If you had more time, what would you do more of): He likes getting up early in the morning and going for a good workout and having a good breakfast. He likes to try to have a balanced day, challenging to do in the real estate industry, but he make sure he takes time out to breathe, de-stress and start fresh.

Loves (can’t live without): Shaz loves food from different cultures, trying diverse and new things as well as exploring anything.

THE EXTRAS

He believes his clients see him as an up front, organized, strategic and strong communicator. He feels that his marketing background is one of his best features. He loves that every day is different and that he can never know what to expect or who is going to call him next. His least favorite part of the job is all the tedious administration. Shaz would much rather be hanging out with his client than managing documents; there’s a lot of paperwork in the job which clients don’t see, but its necessary.

There isn’t one type of clientele that Shaz works with, “Everyone is so different” he says. However, last year most of his clients were first time homebuyers or clients starting a family that needed to upgrade to more space.

He keeps up with his professional development courses and fits in more than the minimum required credits. He attends speaking engagements and industry discussions to learn and understand different opinions being shared within the industry.

Contact Shaz