Seller Property Information Statement ~ Boychuk and Bulter

(Ontario Real Estate Source)


By Brian Madigan LL.B.


SPIS ~ Boychuk and Butler

This is another case involving the improper completion of a Property Condition Disclosure Statement and the remedies that are available afterwards. This document is similar to the Seller Property Information Statement used in Ontario.

This case was determined in the Small Claims Court of Nova Scotia February 2007.

The Boychuks entered into an agreement of purchase and sale to acquire a residence owned and occupied by the Butlers in Dartmouth. It should be noted that Mrs. Butler was a licensed real estate agent and acted for herself and her husband in connection with the sale.

The agreement contained the following provision:

"3(b) This agreement is subject to the Seller providing to the Buyer within 24 hours of the acceptance of this offer, a current Property Condition Disclosure Statement, and that statement meeting with the Buyer's satisfaction. The Buyer shall be deemed to be satisfied with the statement unless the Seller or the Seller's agent is notified to the contrary, in writing, on or before (date) Jan 30/06. The Seller warrants it to be complete and current, to the best of their knowledge, as of the date of acceptance of this agreement, and further agrees to advise the Buyer of any changes that occur in the condition of the property prior to the closing date. If notice to the contrary is received, then either party shall be at liberty to terminate this contract. Once received and accepted, the Property Condition Disclosure statement shall form part of this Agreement of Purchase and Sale."

A Property Condition Disclosure Statement dated January 8, 2006, was completed by the Sellers and was provided to the Buyers as required under the terms of the agreement.

The home had been purchased by the Sellers in July 2002. In 2003, they experienced dampness in their yard. They contacted Ralph Crowell, who is a local installer of septic fields and septic tanks. Subsequently, they contacted two other contractors. Remedial work to the septic system was undertaken in both 2003 and 2005.

The agreement and closing took place during the winter conditions of 2006 (30 March), so the septic system could not be properly inspected at that time. By the summer of 2006, a contractor reported that there was a complete system failure and the septic system required replacement.

The Court looked at the issue of negligent mispresentation. There is a five part test before a claimant will be successful:

(1) there must be a duty of care based on a "special relationship"
between the representor and the representee;

(2) the representation in question must be untrue, inaccurate, or misleading;

(3) the representor must have acted negligently in making said misrepresentations;

(4) the representee must have relied, in a reasonable manner, on said negligent misrepresentation; and

(5) the reliance must have been detrimental to the representee in the sense that damages resulted.

There is a review and analysis of the facts and the law in the Judgment:

"(76) According to paragraph 3(b) of the Agreement in this case, the Property Condition Disclosure Statement forms part of same once received and accepted.

(77) Applying the five part test .... I find firstly that there is a duty of care based upon the relationship between the parties.

(78) The next issue is whether the Sellers made to the Buyers a representation that is untrue, inaccurate or misleading.

(79) The Sellers rely upon the fact that the Property Disclosure Statement contains additional comments at paragraph 11 as previously noted. In fact paragraph 11 does contain a statement that french drains had been installed around the rear of the property in the summer of 2004 and spring of 2005.

(80) From their perspective, however, the Buyers submit that the provisions of the Property Condition Disclosure Statement relating to the septic disposal system note no previous problems with the existing system or upgrades having been carried out to the system in the last five years. In addition, paragraph 5 of Addendum Form 101, Schedule 4, contains a specific statement that the Seller warrants "to the best of their knowledge" that the septic disposal system is in good working order and has not presented any problems during their ownership and this warranty explicitly is stated to survive the closing.

(81) On the whole, I find the statements in the Property Condition Disclosure Statement to be misleading to potential purchasers. Anne Butler is a licensed Real Estate Agent. Despite her lack of personal experience with septic waste disposal systems, she clearly was aware that the water and drainage problems they were having were related to the septic field.... The drainage repairs were undertaken by them as a means of attempting to fix the issues they were having with their septic system. No explanation was given concerning why the information about the french drains was noted under additional comments in the area of "Structural" in the Property Condition Disclosure Statement. Paragraph 6A. and B. specifically refer to structural problems, unrepaired damage or leakage in the foundation, roof or walls and make no reference to problems with the septic system.


(82) The third step of the test is to determine whether the representor acted negligently in making the representation. I do conclude that the Vendors were negligent in making such representations in the manner in which they were made. It would be expected of a Vendor in this case, and even more so where Ms. Butler is a licensed Real Estate Agent, to note the drainage repairs in the area in the Property Condition Disclosure Statement concerning "Sewage Disposal" which would alert potential purchasers to possible problems with the system, such that they would inquire further. To include this information in the area of "Structural" would imply to a potential purchaser that the repairs were undertaken to deal with a problem of leakage in the foundation, roof or walls of the house. They would not be alerted to the possible problems with the septic system which the Sellers in this case were fully aware of.

(83) I find in this case that the Sellers were at the very least careless when preparing the Property Condition Disclosure Statement by failing to connect the drainage repairs to possible problems with the septic system.

(84) ....... to place this information under the "Structural" section of the Property Condition Disclosure Statement could easily mislead a potential purchaser into believing that the aforesaid repairs concerned structural issues with the foundation, roof or walls. This was particularly important in this case as the Sellers had in fact undertaken major structural repairs, including replacement of leaking windows before listing the property for sale.

(85) In reaching my conclusions on this point, I have also taken into consideration that a failure to provide information may constitute a misrepresentation as much as a positive misstatement.

(86) The fourth step of the test is whether the Buyers in this case relied in a reasonable manner upon the negligent misrepresentation. Once again, I have no hesitation in finding that this is the case. A buyer would reasonably conclude from the way that the Property Condition Disclosure Statement was prepared that the installation of the french drains was to deal with structural issues not possible problems with the sewage disposal or septic system.

(87) Step five of the test is clearly proven as the Buyers discovered that the system had failed entirely shortly after the snow melted from the ground."

The trial Judge allowed the purchasers' claim for the cost of the replacement of the septic system, but reduced the amount of the damages by 50% by reason of betterment.

COMMENT:

This case again points out the difficulties with the completion of the form. Here, one of the vendors was a real estate agent and was therefore held to a higher standard than might otherwise have been the case. While there was no real attempt to deceive, the document was filled out carelessly.

It should be observed that in this particular case the Property Condition Disclosure Statement (PCDS) was elevated to form part of the contractual terms of the agreement itself.

The test of correctness of the answers was measured from the purchasers' perspective. What would a normal purchaser think, given the responses. The Court did not consider whether the answers might be good responses from a technical point of view on the part of the vendors.

It should also be noted that the vendor, being a real estate agent was held to a higher standard.

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

Seller Property Information Statement (SPIS) ~ Sask and Brooke

(Ontario Real Estate Source)

By Brian Madigan LL.B.

This was a case heard in the Supreme Court of British Columbia and it involved the Property Condition Disclosure Statement, which is similar to Ontario’s Seller Property Information Statement.

Briefly, the plaintiff as purchaser acquired a condominium unit for $133,000 but the unit leaked, as did others in the complex. Obviously, this problem had become well known in Vancouver. No one wants to buy, particularly with so many others available. The value had dropped to $22,000 and the purchaser, Sask faces a special assessment of $60,000 for her share of common ownership repairs.

In a nutshell, this is a mess!

Naturally, the condominium owners are suing the builder but that will take time. In this case, Sask claims that the vendors made false or negligent representations in the Property Condition Disclosure Statement (PCDS).

The trial Judge expressed the issues in the case as the following questions:

1. Did Michael Brooke and Ursula Wenzel misrepresent the condition of their condominium at the time of sale?

2. Was Shirley Sask induced to purchase the condominium by those misrepresentations?

3. What damages has Shirley Sask suffered?

The agreement of purchase and sale included several conditions including financing, perusal of the strata council minutes and the sellers' Property Condition Disclosure Statement.

In many cases, the PCDS is made to form part of the agreement by attching it to the agreement as a Schedule or Addendum. Here, it was simply a condition.

The sellers answered "No" to the following questions:

H. Are you aware of any structural problems with the premises or other buildings on the property?

K. Are you aware of any damage due to wind, fire, water?

M. Are you aware of any roof leakage or unrepaired damage?

The preamble to the document is worth noting, according to the trial Judge:

"THE SELLERS ARE RESPONSIBLE FOR THE ACCURACY OF THE ANSWERS ON THIS DISCLOSURE STATEMENT AND WHERE UNCERTAIN SHOULD REPLY "DO NOT KNOW". THIS DISCLOSURE STATEMENT CONSTITUTES A REPRESENTATION UNDER ANY CONTRACT OF PURCHASE AND SALE IF SO AGREED IN WRITING BY THE SELLERS AND BUYERS."

In addition, there is a statement that appears in the document above the seller's signature:

"The sellers state that the above information is true, based on the sellers' current actual knowledge as of the above date. Any important changes to this information made known to the sellers will be disclosed by sellers to buyers prior to closing. The sellers acknowledge receipt of a copy of this disclosure statement and agree that a copy may be given to prospective buyers."

Further, just above the buyers' signature on the same document is the following disclaimer:

"The buyers acknowledge that they have received and read a signed copy of this disclosure statement from the sellers or the sellers' agent on the 24th day of February, 1997. The prudent buyers will use this disclosure statement as the starting point for their own inquiries. The buyers are urged to carefully inspect the property and, if desired, to have the property inspected by an inspection service of their choice."

The Judge in analysing this case said that "The more important questions concern the extent to which the sellers represented the condition of the property and the extent to which Shirley Sask relied upon their representations.

A copy of the disclosure statement, dated February 17, 1997, was given to Shirley Sask before she signed the contract of purchase and sale on February 24th, and the sale was subject to Sask "perusing & approving" the strata council's minutes, bylaws, and financial statements.

Sask has not proved reliance upon the disclosure statement in isolation from the strata council minutes which were provided to her at the time of sale. Sask has failed to prove that the sellers intended to mislead her in any way, particularly when the disclosure statement is read in conjunction with the strata council minutes.

It should be noted that the strata council minutes detailed the problems and expenditures of the condominium in respect to the premises.

The tort of negligent misrepresentation is now an established principle of Canadian law: Queen v. Cognos Inc. (1993), 99 D.L.R.(4th) 626 (S.C.C.). Five requirements must be met:

(1) there must be a duty of care based on a "special relationship" between the representor and the representee;

(2) the representation in question must be untrue, inaccurate, or misleading;

(3) the representor must have acted negligently in making said misrepresentation;

(4) the representee must have relied, in a reasonable manner, on the said negligent misrepresentation;

(5) the reliance must have been detrimental to the representee in the sense that damages resulted.

In this case, the first three requirements were met including negligence on the part of the sellers in making the statements.

The trial Judge stated:

"However, whether or not the sellers were negligent in purporting to confine their representations to the condition of their own unit is not, in my view, determinative of this claim. In light of their concurrent provision of minutes from strata council meetings where leakage problems were discussed, the sellers' disclosure obligations were fulfilled in a manner that should have alerted a prudent purchaser to the need to make further inquiries."

And further commented:

"In my view, the fourth requirement of the mentioned test in Queen v. Cognos Inc. has not been met, as I cannot conclude that Shirley Sask acted in a reasonable manner by relying upon the property condition disclosure statement without reference to the information provided in the strata council minutes. The sale was subject to a condition precedent that contemplated perusal and approval of the strata council's minutes, bylaws and financial statements, and in complying with that condition the sellers were effectively providing Shirley Sask with the history of water leakage problems in the complex. In light of her opportunity to review those documents, Ms. Sask had the right to refuse to close the transaction as a consequence of that information, but chose not to do so.

On the whole of the evidence, it has not been proven that the sellers misrepresented the condition of unit #206, and the claim is dismissed".

COMMENT:

So, this is an interesting case. The sellers made a misrepresentation. That misrepresentation was made negligently, but the Judge concluded that all in all, the purchaser did not rely on that the document that contained the errors.

There was ample opportunity for the purchaser to find out the correct facts from the strata council minutes. As a result, there was no liability on the part of the vendors. However, rather than being saved by the signing of the Property Condition Disclosure Statement, they were in fact saved because there was a condition in the agreement permitting the purchaser to peruse the strata council minutes, and the correct information could be found there. The mere fact that the Purchaser failed to look, is her fault, and does not establish liability on the part of the vendors.

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

Toronto House Prices in 2011

(Ontario Real Estate Source)

By Brian Madigan LL.B.

The market always moves up sharply in the Spring, but over the winter months the market moved up 6.82%.

In January, the average price of a single family home in the GTA was $427,037. At the end of March, it reached $456,147. That’s a 6.82% increase.

The two most active months traditionally have been April and May. So, watch out for further increases. Then we are in for the start of a slowdown. Prices will decline slightly in June. Of course, “all things being equal”, and they never are!

January Is Often a Market Indicator

The month of January is always a key indicator of the trend in the market for the entire year.

At least, that’s what they say!

Let’s have a look at some previous Januarys, and see what happened:


January............ Entire Year

2004……….up……….up

2005……….up……….up

2006 ……….up……….up

2007……….up……….up

2008……….down……….down

2009……….down……….up

2010……….down……….up

2011……….down……….yet to be determined

We are essentially looking at the results in 7 years, and in 5 of those years, the month of January was an indicator of the overall trend.

However, look a little further. Is that just coincidence? Other than 2008, the year of the commencement of the recession, all markets were up. That is 6 up and 1 down. Yet in 2 out of 6 years, January provided the wrong indicator. However, there was some comfort in January 2008 turning against the tide and pointing to a down market, with the stock market later to crash in the month of October.

Sometimes, the rule works and sometimes it doesn’t. You be the Judge!

February is Always a Good Month

Again, another “truism” among real estate agents, or is it?

Let’s have a look at Februarys since 2004 and compare them to Januarys. Are the average prices in the GTA for single family homes (the key market indicator) up or down?

February

2004……….up

2005……….up

2006 ……….up

2007……….up

2008……….up

2009……….up

2010……….up

2011……….up

So, whether it’s an “old wives’ tale” or not, it does seem to work. And, it is important to note that it was even the case in 2008 with the onset of the recession.

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

Toronto Property April Mid-Month Report

(Ontario Real Estate Source)

By Brian Madigan LL.B.

Here are the mid-month numbers for April. This month is always a key indicator of what is going to happen in the Spring market and over the year.

We will look at Toronto, the rest of the GTA and the combined figures and compare them to the previous year.

Sales for April (mid month) 2011 (2010 in brackets)

1,760..........Toronto (1,837)

2,684...........Rest of GTA (2,764)

4,444...........Combined (4,601)

Average Prices for April (mid month) 2011 (2010 in brackets)

540,229..........Toronto (470,532)

445,746...........Rest of GTA (403,514)

483,165...........Combined (430,271)

It is important to remember as a qualifier that these figures represent recorded transactions. They do not track comparative house values.

So, what do these statistics show? There is a shortage of listings. That is apparent. If there is no corresponding increase, then there should be some upward pressure on prices. If there is an increase then the additional listings will ameliorate the market somewhat.

For further interest this is the report from TREB:

GTA REALTORS® RELEASE MID‐MONTH RESALE HOUSING FIGURES

TORONTO, APRIL 18, 2011 ‐‐ Greater Toronto REALTORS® reported 4,444 sales during the first two weeks of April 2011 - a three per cent decrease compared to the first two weeks of April 2010. The number of new listings was down by 21 per cent compared to the same period last year.

"Sales activity was quite strong during the first two weeks of April. If this level of activity is sustained for the remainder of the month, we could see April transactions close to last year's record result. Positive economic news has kept households confident in their ability to purchase and pay for a home over the long term," said TREB President Bill Johnston.

The average selling price for firm deals reported through the first two weeks of April was $483,165, representing a 12 per cent increase over the average price of $430,271 reported during the same period last year.

"The number of homes listed for sale so far in 2011 has been below expectations. Market conditions have tightened, resulting in increased competition between home buyers and accelerating rates of average price growth," said Jason Mercer, TREB's Senior Manager of Market Analysis.

"The strong rate of price growth reported for the first two weeks of April should entice more households to list their homes for sale. This would result in more balanced market conditions and more moderate rates of price growth," continued Mercer.


Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

ORES Real Estate Index for March 2011

(Ontario Real Estate Source)

By Brian Madigan LL.B.

Here is the "ORES REAL ESTATE INDEX" which tracks the average resale prices of single family homes and condominiums in the Greater Toronto Area (GTA). It also tracks certain benchmark comparisons such as the price of oil and gold, as well as the Consumer Price Index.

In addition, the stock market indices for Toronto, and the three largest US markets are also compared.

For ease of comparison, everything we look at is worth 100 points on the Index as of 1 January 2005. That time period compares favourably with the five year average used as a standard benchmark comparison in the mutual fund industry.

As of 31 March 2011, here is the Index representing average prices:

Real Estate

141.16.....GTA single family homes
137.89.....All condos in GTA
146.99.....Downtown Central Condos
131.96.....East condos
134.99.....West condos
131.99.....North condos

Other market comparisons

336.41.....gold (price per ounce)
241.56.....oil (price per barrel)
153.37.....TSX index
141.16.....ORES Index single family homes
112.16 .....CPI index
134.84.....NASDAQ index
117.44......Dow Jones index
112.24.,....S&P Index

Using the Index

Just a quick note on reading the information. Have a look at the ORES Index for Real Estate (single family homes). As of the end of January, the index stood at 141.16. That's a 41.16% increase in 75 months. That means the increase is 0.548% monthly, or it could also be expressed as 6.59% annually. The performance here is shown without annual compounding for the sake of simplicity.

The other statistics are reported in a similar fashion for the ease of comparison.

Observations (on the Index)

As we use index, there are several notable comments:

· Commodity prices are just commodity prices

· There is no other "extra return" for commodities

· The same is true for the CPI

· The CPI is a benchmark to see whether you are keeping pace with inflation, that number is 116.00; however in January it was 111.59, so this is the largest single month increase since we have tracked this Index from 1 January 2005. Although increases have been modest and inflation appeared to be under control, this is significant.

· For a realistic performance goal, you should aim for CPI plus 3.5% annually

· Stocks provide dividends in cash or extra stock. This return is additional to that shown in the stock market indices

· The stock market Indexes only measure the survivors. So, in 2009, both GM and Chrysler would have been dropped due to the bankruptcies

· If you held GM and Chrysler, you lost everything, but two new companies moved in to replace them in the Indexes

· Real estate offers a return in terms of occupancy. You can rent out the property and receive income, or occupy the property and enjoy it yourself

· Actually, I should have mentioned that if you held gold bullion, you could sit in a room, count it, and enjoy that experience too. I'm not quite sure how to measure that. You'll have to ask King Midas or Goldfinger!


Comparative Observations Using the New Index

· Gold was the best performer, reaching 336.41, eclipsing earlier peaks achieved mid January

· Oil was the most volatile, (yes it dropped in half over our measurement period), but recent increases do not offer good news

· Real estate was the most stable, with solid predictable returns at about 6.59% annually

· single family homes continue to show a better overall return than most condos

· Our own stock market posted reasonable gains, and is now ahead of single family homes over the measurement period, however, don't forget that the TSX is still well off its highs

· All three US stock market indicators now show positive numbers, and may truly be a better overall indication of the true state of the North American economy.

Conclusion

For steady, predictable, measured gains pick real estate. It's a solid performer with lower risk (less volatility) and generally moving in a positive direction.

And remember, when it comes to real estate, it's never "wiped out" completely, like GM or Chrysler stock. So, unless you're sitting on the edge of a tsunami, you'll still own something when the storm is over.

For a benchmark of success, there's 1,000 years of history to point to a rate of return in real estate being about the equivalent of 5% per annum, simple interest (non-compounded). That means that real estate doubles in value every 20 years. There are a lot of companies (now bankrupt, including CanWest Global, and many US Banks) that would have been happy with that return.

The present rate of return is sustainable in a sought after location like the GTA. Currently, that is about 1.6% annually in excess of the longer term predictable returns.

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

GTA First Quarter Maintains Steady Pace

(Ontario Real Estate Source)

By Brian Madigan LL.B.

How is the real estate market this year? That's a simple enough question. While many will respond by referring to the latest week or the latest month, the true measure of the 2011 market, at this time is to look at the first quarter numbers and compare that to other first quarters in previous years.

Sometimes, some of the February sales take place in January and sometimes some of them take place in March. Such "fine tuning" can distort the results and lead to erroneous conclusions.

Let's see how many homes have sold in the first quarter of the year since 2004:

2004..........19,392

2005..........18,238

2006..........20,050

2007..........21,397

2008..........17,721

2009..........14,897

2010..........22,667

2011.........19,865

The average number of first quarter sales is 18,278. That means that the first quarter in 2011 is 3.04% higher than the average over the last eight years. In fact, there are four higher, so this year is right at the median.

You will notice that 2009 is quite low. That was at the height of the recession, and the markets have now recovered.

What does this mean? It simply indicates that the market is strong and continues to be steady and predicable. Wild swings, soaring prices and crashes really don't help anybody. Unfortunately, that has happened in many US markets, but, not here. Prices, by the way are higher than they have ever been.

So, oddly enough, this is one of those times, when it's both good to buy and good to sell.

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

March was 11% Better than Average

(Ontario Real Estate Source)

By Brian Madigan LL.B.

The sales in the GTA for single family homes are reported by the Toronto Real Estate Board to be the second best March ever.

March was a good month, but how good?

Let's see how many homes have sold in the month of March since 2004:

2004..........9,076

2005..........7,904

2006..........8,707

2007..........8,518

2008..........6,631

2009..........6,171

2010..........10,430

2011..........9,262

The average number of monthly sales in March is 8,337. That means that March 2011 is 11.09% higher than the average over the last eight years. It is risky to go back much further than that since the population was smaller.

However, it is even riskier to compare it to March 2010. That would show an 11.19% decrease. There were 1,168 fewer sales in the month of March 2011, than the month of March 2010.

That's really not that many, and it doesn't spell doom.

You have to remember that there was a world wide financial crisis in October 2008. The stock market had lost half its value. When 2009 started off the automotive industry was on the brink of bankruptcy. People weren't buying homes. The economy settled down following the government bailouts and the housing market normalized.

There was a lot of pent-up demand from the Spring of 2009. Some waited a few months, while the others waited an entire year. Consequently, March 2010 was a trend setting month in a year that recorded the highest number of sales ever.

So, what does that mean? It simply means that March 2010 was a great month. It doesn't mean that March 2011 was a bad month showing numbers that are 11.19% off the 2010 record.

If you look at the numbers closely, you will see that it was rather steady and normal. You always have to look behind the headlines. All in all, this looks good for an active Spring market.


Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

Is it Time to Buy or Sell Real Estate in Toronto?

(Ontario Real Estate Source)

By Brian Madigan LL.B.

Frequently, real estate buyers and sellers wonder whether they have missed the market. Sometimes, they have.

So, what would you say about mid April 2011?

The market has shown steady growth and sales. The first quarter numbers show that the pace is steady and the more recent March numbers have been the second best on record. And, something which is particularly important for sellers, the sale prices have never, ever been higher.

Let's see what percentage of homes have sold in the first quarter of each year since 2004:

2004..........23.22%
2005..........21.67%
2006..........24.13%
2007..........25.69%
2008..........23.19%
2009..........16.69%
2010..........25.69%
2011……..yet to be determined

The sales in the first quarter of each year approximate 22.89%. That’s a little shy of 25% which might otherwise be expected. But remember, that’s mostly winter months in the GTA with lots of inclement weather. It also includes the March break.

Well more than half the transactions will have taken place by the end of June, so for sellers, this is certainly a good time to list your property.

For buyers, the prices might be a little higher and the competition might be a little higher, but this is the time when the better properties are on the market. And, if you are planning to stay for a while, you really want the right house.


Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

GTA March 2011 Second Best March Ever ~ Steady Growth

(Ontario Real Estate Source)

By Brian Madigan LL.B.

The sales in the GTA for single family homes are reported by the Toronto Real Estate Board to be the second best March ever.

March was a good month, but how good?

Let's see how many homes have sold in the month of March since 2004:

2004..........9,076
2005..........7,904
2006..........8,707
2007..........8,518
2008..........6,631
2009..........6,171
2010..........10,430

2011…….....9,262

The average number of monthly sales in March is 8,337. That means that March 2011 is 11.09% higher than the average over the last eight years. It is risky to go back much further than that since the population was smaller.

However, it is even riskier to compare it to March 2010. That would show an 11.19% decrease. There were 1,168 fewer sales in the month of March 2011, than the month of March 2010.

That's really not that many, and it doesn't spell doom.

You have to remember that there was a world wide financial crisis in October 2008.

The stock market had lost half its value. When 2009 started off the automotive industry was on the brink of bankruptcy. People weren't buying homes. The economy settled down following the government bailouts and the housing market normalized.
There was a lot of pent-up demand from the Spring of 2009. Some waited a few months, while the others waited an entire year. Consequently, March 2010 was a trend setting month in a year that recorded the highest number of sales ever.

So, what does that mean? It simply means that March 2010 was a great month. It doesn't mean that March 2011 was a bad month showing numbers that are 11.19% off the 2010 record.

If you look at the numbers closely, you will see that it was rather steady and normal. You always have to look behind the headlines. All in all, this looks good for an active Spring market.


Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

Negligence Act ~ Recovery

(Ontario Real Estate Source)

By Brian Madigan LL.B.

In our example, A sustained injuries and damages due to the negligence of both B and C. But, since it was actually just B who came into direct contact with A, then A might decide that just B will be sued.

Let's look at section 2:

Recovery as between tortfeasors

2. A tortfeasor may recover contribution or indemnity from any other tortfeasor who is, or would if sued have been, liable in respect of the damage to any person suffering damage as a result of a tort by settling with the person suffering such damage, and thereafter commencing or continuing action against such other tortfeasor, in which event the tortfeasor settling the damage shall satisfy the court that the amount of the settlement was reasonable, and in the event that the court finds the amount of the settlement was excessive it may fix the amount at which the claim should have been settled.

So, B gets sued by A and is liable for a judgment in favour of A in the amount of $50,000. B can still sue C and claim contribution and indemnity. There are two choices 1) add C to the action by third party proceedings or 2) wait until the judgment is rendered by the court.

It is also contemplated that the first action will be settled rather than tried. In this case, B still has the same rights of recovery. However, this time B needs to prove that the settlement figure, (whatever it was) was reasonable in the circumstances.

In this situation B might reasonably argue that a $40,000 settlement was reasonable since it represented a savings, and that a $60,000 settlement might also be reasonable since it saved the costs of trial.

Should the settlement figure have been $100,000, which a court might conclude was well in excess of a reasonable amount, the court could fix a lower amount.

Again, the right to recover is limited to the apportionment determined by the court, which in the case of settlement shall be determined at the second trial (B vs. C) or in the third party proceedings (B vs. C).

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com

Negligence Act ~ Joint Tortfeasors' Liability

(Ontario Real Estate Source)

By Brian Madigan LL.B.

The Negligence Act sets out dealing with the matter of the liability between joint tortfeasors.

Here is the section 1:

Extent of liability, remedy over

1. Where damages have been caused or contributed to by the fault or neglect of two or more persons, the court shall determine the degree in which each of such persons is at fault or negligent, and, where two or more persons are found at fault or negligent, they are jointly and severally liable to the person suffering loss or damage for such fault or negligence, but as between themselves, in the absence of any contract express or implied, each is liable to make contribution and indemnify each other in the degree in which they are respectively found to be at fault or negligent.

So, what does that mean?

Let's assume that three cars. A, B and C are involved in an accident. They are following one another. The first vehicle A comes to a full stop. However, it's icy and the second car B fails to stop and collides with the rear of vehicle A. The third car is travelling far to fast and crashes into the rear of vehicle B, forcing it once again into vehicle A.

Let's assume that a court determined that the total damages sustained amounted to $50,000.

This particular section of the Negligence Act provides as follows:

•· The Court decides on an apportionment of liability between B and C for A's damages.

•· The Court might determine that B is 25% at fault and C is 75% at fault.

•· Both B and C are responsible or liable to A for $50,000.

•· As between themselves, B will be responsible for 25% of $50,000, or $12,500.

•· As between themselves, C will be responsible for 75% of $50,000, or $37,500.

•· The liability to A, is joint and several, that means they both together owe A $50,000 and each of B and C owe A, $50,000 individually.

•· Should either B or C pay A, the full $50,000, then they are entitled to contribution and indemnity from the other, for their share. B can get 75% from C, and C can get 25% from B.

Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com