House buying – Cynthia Reyes

At this time of year, people in Southern Ontario usually talk — ad nauseum — about the weather. This year, it’s real estate prices.

In a village store 90 minutes east of Toronto yesterday afternoon, a woman mentioned a small house in her neighborhood whose price had almost doubled in recent years.

“It’s unbelievable, what’s happening,” she said.

The house recently sold, after a bidding war, for $100,000 more than the asking price.

House prices in the Toronto area are crazy. And there’s a huge downside.

The prices of some homes have increased by a third in the last year alone.

It’s affecting the rental market too. Last week, I read that some Toronto landlords have nearly doubled their rents.

So I wonder: where’s the average person supposed to live?

Many families and single people are moving away — up to a couple hours’ drive away from their work — for affordable housing.

But that’s having an impact too. House prices were a lot lower in regions east, west and north of the city just a couple years ago. But the newcomers’ arrival in those regions has pushed up prices there too.

Blog Photo - House sold sign

Last evening, at a small gathering roughly 2 hours from Toronto, the host seemed to still be in shock when he told visitors that two houses in the nearby village had recently sold for more than a million dollars. A few years ago, they would have been around $600, 000.

Foreign speculators, investing in Toronto’s real estate, were blamed for causing the huge increases. There oughta be a law, some people said. The government, fearing a real estate crash, now requires house buyers to have a 20% downpayment – or pay for very costly mortgage insurance.

Blog Photo - House 2

If you’re well-off, that’s not a problem. But for first-time buyers, 20% is $140-thousand downpayment on a $700,000 dwelling… if you can find one.

No-one’s yet instituted a law against bidding wars. These fierce competitions bring an intense ‘auction fever’ to every house sale — the kind of panic that leads to foolish decisions. Many families today, after paying their mortgages, are barely making ends meet.

And now there are bidding wars in the rental market too.

So who benefits from these out-of-control price increases? Well, some sectors do.

Sellers moving out of the region to a more affordable community.
Realtors, whose percentage (5 or 6%) is usually fixed. That means huge increases for them when house prices explode.
Some landlords.
And government, through taxes.

But if you’re an average-income, would-be buyer (or renter), you’re scrood.

There outghta be a law.

Interior designer Valerie Rowley and her husband Chris took a big risk in 1993 when they bought their future home. For one thing, the countryside house north of Toronto was quite run-down.

“We immediately saw the potential but we hadn’t sold our existing house and it was during the recession. So did we play it safe and wait? Nah! We bought it and just fervently hoped our other one sold (we were up against another bidder so really had no choice).”

The other house sold, in the nick of time.

Looking at the house today, you wouldn’t know all the work Val and Chris took on. “We virtually rebuilt the interior of this home. And made the garden almost from scratch – unless you count the few scrubby six-foot cedars that we inherited. It took many years which is why we feel we have so much of ourselves invested in it.” Val’s favourite interior spaces are the kitchen and sunroom. “The sunroom is full of light all year round. It’s also where I raise my vegetable and flower seedlings, grow watercress, herbs and salads through the winter, take cuttings of summer geraniums. To have this area full of pink, salmon and red blooms through the snow season makes the monochrome of winter bearable.” Favourite outdoor spaces?
The garden is an important part of “home” for Val and Chris. “Luckily, Chris enjoys physical work a lot more than I do, so it’s a good partnership. I grow things and prune and he digs holes and chops down branches. And we have a young weeding lady who is also a budding opera singer!” In late summer and early fall, there’s the harvest.
It takes work. But as you can see from Chris’ smile, it’s work they love doing. They plan to keep doing it for as long as possible.

Many people today are drawn to houses that look like they belong in a glossy interior design magazine. Valerie, an interior designer, and her husband Chris, a TV producer, didn’t do that. They bought a run-down place and worked hard at it for 20 years. Today, for this couple, this place is — quite simply — home.

“I guess because everywhere I look, what I see is immensely satisfying to me,” says Valerie. “The flowers (growing, not cut) that I always have everywhere, the artifacts that Chris and I have accumulated from numerous foreign countries over the years, the carefully chosen furnishings and the general knowledge that we have constructed a home that is very personal and comforting to the two of us. It all works.”

“We have no intention of leaving,” says Val, “ until we physically can’t handle the work it entails – and it does entail work!”

“It’s about staying as healthy as one can as one ages,” says Val. “I think it’s important for everyone to realize life doesn’t have to stop when the wrinkles and aches and pains start. “

Bravo, Val and Chris. You’re an inspiration.