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A Look Back at 2021, 2022 Real Estate Market Update & My Predictions

<< 邁向自由人生2022年 1月 >> 不藏私！ 我对2022年地产市场的预测

Happy belated new year! It’s been a while since my last blog and it has been a very eventful year. I felt like the half of the year was spent pivoting and putting out work-related fires. The second half of the year just went by like a dream.

迟來的新年快乐！ 自从我上次写博客以来已经有一段时间了，今年是非常多事的一年。 我觉得这一年中有一半时间在工作上救火、解決事情。 而下半年就在疫情影响下，像一场梦一样过去了。

 On the realtor side of things – First and foremost, thank you to all of my clients for their continued support and the trust you have given me. I’m very grateful to have helped so many investors secure great investment purchases as well as hit all-time market highs on the sale of their properties. Just to highlight a few pre-construction projects that we were able to secure for our investors.

在房地产经纪业务方面 – 首先，感谢我的所有客户的持续支持和给予我信任。我非常感谢能够帮助这么多投资者获得巨大的投资机会，并在出售房产时创下历史新高。尤其是在楼花项目上为我们的投资者成功买下心仪的物件

I’m also very proud of the Supreme6ix team for an amazing year. Our team has now grown to a team of 8 and we’re continually looking to expand in 2022. Congratulations to the team on winning the Toronto team of the year award for all the Century21’s across Canada. We are looking to better these results in 2022!

我也为我创办的Supreme6ix团队感到自豪。我们的团队现在已经发展到8人，我们一直寻求在2022年扩大规模。也恭喜团队赢得了加拿大所Century21的多伦多年度团队奖。希望在2022年可以取得更好的成绩！

Our Brokerage is ranted #1 in Toronto, #2 in Canada &
#4 around the world across all Century21 brokerages (over 14,000 office)

Market Update 市场信息更新

Some of you have been asking me for recent markets updates so I thought I’d take a minute to summarize 2021.

1. The Average home sold prices in Toronto increased 24% year-over-year to $1,157,849 for December 2021
2. Detached home prices increased by 29% year-over-year to $1.60M
3. Semi-detached home prices increased by 26% year-over-year to $1.18M
4. Townhouse prices increased by 30% year-over-year to $1.14M
5. Condo apartment prices increased by 18% year-over-year to $712k

已经有一些朋友询问我最近的地产市场状况，所以我想花一点时间来回顾一下2021年。

1.         2021年12月，多伦多的平均房屋销售价格同比增长24%，至$1,157,849。
2.         独立式住宅价格同比增长29%，达到160万元
3.         半独立式住宅价格同比增长26%，至118万元
4.         联排别墅价格同比增长30%，至114万元
5.         公寓 价格同比增长18%， 达到71.2万元

Imbalance of supply and demand resulting in record-high prices which is 17.8% higher than the peak in 2020. This data represents only the re-sale market and not pre-construction prices 供需失衡导致房市价格创历史新高，比2020年的峰值高出17.8%。此数据仅代表二手房市场，不代表楼花的价格

 In 2020, the trend was for people to move out of Toronto and to the suburbs. 到2020年，人们的趋势是搬出多伦多，住到郊区。

In 2021 there was clearly a resurgence for homes within the city of Toronto. What’s caused this resurgence was the demand for condos as well the re-opening of the city 2021年，多伦多市中心内的房屋大幅复苏。导致这种复苏的原因是对公寓的需求以及城市的重新开放。

My Predictions 我的预测

Given the constant printing of money, cash is devaluating daily. This is sped up by the rising cost of consumer goods (e.g., food, gas, utility, housing etc). In my opinion, holding cash during this COVID era is probably one of the worst things to do.

 鉴于不断印钞票，现金每天都在贬值。消费品（例如食品，天然气，水电，住房等）成本的上升加速了通膨趋势。在我看来，在这个COVID时代持有现金可能是最糟糕的选择。

The government was planning on slowing down inflation with interest rate hikes in the spring. With this new lockdown, I don’t believe the government will increase the rates and hurt the economy. It just so happened that earlier this week the Bank of Canada announced they’re keeping rates where they are right now! Therefore, it is expected that Canadian real estate prices will continue to rise another 10% – 12% in 2022.

政府计划在春季加息来减缓通胀。随着这次新的封锁政策，我不相信短期內政府会提高利率损害经济發展。碰巧的是，本周早些时候，加拿大央行宣布他们将利率维持在目前的水平！因此，预计2022年加拿大房地产价格将继续再上涨10%-12%。

The wealth gap between the rich and the poor will continue to widen. It is just my suggestion that if you have extra cash available, investing is the wiser option. Asset classes such as real estate and commodities continue to hold their value.

贫富差距将继续扩大。这只是我的建议，如果你有额外的现金可用，投资是更明智的选择。房地产和大宗商品等资产將继续保持並增加其价值。

If you’re interested in learning more about this feel free to reach out to me directly. I’ll be happy to answer any questions you might have

如果您有兴趣了解更多信息，请随时直接与我联系。我很乐意回答您可能遇到的任何问题

Until next time. 我們下次見 ！
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Raymond Lui, Team Leader/Co-Founder

Mike and I are not just passionate about investing, we obsess over it.  We love stories of people gaining financial freedom, we’ve read all the great books out there, and we’re learning every day.  Whenever you meet someone that is successful, take note of their traits.  That’s how we got started really, we changed our TRAITS, and all the work and success slowly followed.  Here are our very own top 6 Characteristics of Highly Successful Investors!

Continuous Improvement 

This is a no brainer and you’ll see this mindset on successful people from all industries.  What is interesting about the real estate market, and not every knows this, it is always changing!  Those who find the efficiencies in ever changing conditions will win.  So even if you’re young and don’t have a lot, think about how you are evolving and keeping up with NEW opportunities in this world.

Trustworthy

Even if you are continuously improving, you won’t be able to succeed on your own.  Every Steve Jobs had a Steve Wozniak.  When it comes to investing, you’ll need to find your trusty Wozniak!  Are you bad with financial modeling, then find someone who loves it.  Bad with construction, grab a phone, make some calls.  Try things out with your gut at first, then follow up with your brain later!

Network

Another foundation to almost any successful industry.  As Realtors that do a lot of negotiations, we have committed to honing our networking skills.  If you are a bit of an introvert, that’s fine, but at least find an outgoing partner (your Wozniak!) and recognize the value and dedication it takes to expand your network.

Tip: LinkIn Pro and Meetups are great tools!

Give Value

If you give real value to the world, the world will give back to you!  Participate in the GTA community by helping others online or in person.  You will find it not only rewarding, but it’s also another great way to network.

1. Subscribe in Toronto-based investment & real estate communities on Reddit
2. RedFlagDeals, a Canadian staple 
3. Participate!  When on an online Forum, use a business friendly user name.  Having a “history” of posting material online lets Google know that you’re a trust worthy person, so in the future, the URL’s you recommend on Reddit, RedFlagDeals, etc will actually get picked up by Google & SEO reports! Not many people realize this!

Forward-thinking

If you can predict the future based on past events, then historians would dominate the world!  Even stock managers will admit that past performance is not a good predictor of future events, yet they do use history to make “predictions”!  So be forward-thinking in what you want to achieve.  Think in terms of the Present, Next Week, Next Month, Next 5 Years, Next 20 Years.  Know what investment targets you can hit in each of those time frames and start searching!

Logical

We use emotions to sell, but when we invest, we use logic!  Not one successful investor does not know how to work an Excel model, basic financial math and doesn’t pour over data.  When we pull the trigger on investment, we are ALREADY SURE that it’s going to be a significant profit.  This is because all the costs and possible market conditions are already modeled out.  The only “unknown” we work with is how much profit we will gain through a deal!

BONUS TIP: Confidence

This is not a “fake it till you make it” kind of trait for us.  Successful people are confident because of their past success.  They are not afraid to pull in deals that others mind find risky.  That’s because they KNOW how to manage the risks.  As one of the best investors have taught us:

Thinking about investing in Real Estate?  The time to start researching is NOW because the market is fearful!

We’re actually looking for potential investors/joint partners for our next couple of projects. If you’re interested, please feel free to reach out.

Till next time.

Hey guys,

hope all of you are well.  I’m happy to announce that my project with my buddy is finally completed. The project was delayed due to some unforeseen complications but it wasn’t anything we couldn’t handle. Now that everything’s been resolved, the property is now full tenanted and generating a (NET) cash flow of $1400/month. Not bad, considering at the end of the day we spent only $5,000, out of pocket, to purchase this property. No, you didn’t misread, just $5,000! We’re pretty pleased with the outcome and our big cheque FROM the bank!

Even with all the recent changes and uncertainties surrounding the Ontario there are still opportunities to be found that can generate nice a stable healthy return. The key is to think outside the box.

To summarize, we bought a completely run-down investment property, renovated it, brought in new tenants paying higher rents then going back to the bank requesting a re-appraisal in order to do a re-finance. From the re-finance, we managed to receive a cheque from the bank of just over $360,000! This was more than enough to pay off our full renovation costs + our initial deposit which leaves us with a surplus of just over $39,000.

We essentially purchased a house with ZERO MONEY DOWN which in my opinion is mind boggling to me.  There are NO TRICKS OR GIMMICKS here, this is the same method many investors use, including Rich Dad Poor Dad (one of the many books we recommend!).  Even with the recent rise in interest rates along with all the other changes and uncertainties surrounding the real estate market in Ontario, particularly with detached freehold investment properties, there are still opportunities to be found that can generate lucrative healthy stable returns. The key is to think outside the box.

We’re actually looking for potential investors/joint partners for our next couple of projects. If you’re interested, please feel free to reach out.

Until Next Time!

One late winter evening, two friends gathered over coffee in Toronto to talk about their finances.

Both of them are busy and well-educated professionals.

Both of them have paid off their debts a few years back, having been careful about their savings.

Yet one friend was tired, over-worked and lamented about the housing situation in Toronto.  He is trying to start a family and there just doesn’t seem to be any room to grow roots in the city he loves.  Though he invested well into the stock markets, it’s difficult to know when to sell, and the markets have made a sudden drop recently.

The second friend was more relaxed.  He had invested in a small but affordable condo many years ago.  He later added a second investment and collected cash flow.  He diversified his investments well, built a portfolio unique to his situation, and was well on his way to financial independence.

“Never put all your eggs in one basket”, he said.  He tried to explain the rationale for his portfolio, the breakdown would have been something like this:

This may be considered an unusual portfolio strategy by some investors.  It’s targeted for young adults in Toronto and the GTA area.  The relaxed friend pulled out a pen and napkin and explained why he has the “Perfect Portfolio”: Toronto Housing is Great Value

Toronto Housing is Great Value

Despite what many people feel, housing prices have always been fair in Toronto.  Frequent travelers will realize that there are few better places to live in the world than Toronto.  Here is a CBC report on the best cities in the world to live:

Toronto is in top demand from the WORLD, yet prices are more expensive elsewhere.  For example, housing prices in Hong Kong are TWO TIMES more expensive than Toronto (accounting for living expenses of course).   This detailed analysis from The Economist shows the comparison

Renters in Toronto may feel prices are high, but Canadians enjoy a stable economy, a great environment, world-class education and some of the world’s best social safety nets.  Toronto is uniquely located near the economic hubs in the USA and yet it features a very diverse and inclusive culture.  This is what drives Toronto to be a top immigration destination and supplies the economy with a young and eager working force.

Stocks Don’t Collect Rent

GTA residential prices have out-performed the TSX and are generally in line with the S&P.  The 2009-2019 S&P / Dow Index has performed very well with a 280% gain.  While GTA residential prices for the same period performed admirably with a 218% gain.  One should study a normalized data-set together below:  

At this point, the first friend eagerly pointed out, “See! If I bought an index fund in the recession of 2009, I would have almost tripled my money by now!”

“You would have gotten similar gains in GTA real estate, but with real estate, you also collect rent”, replied the second friend. “Think about it; an extra $1500 rent cash flow over 10 years is $180,000, on top of your existing rising asset price.  This is my secret sauce.”

The second friend continued with another point.

Time is On Your Side

Take any stock market and look at the trend on a 20 then 50-year horizon.  That’s how long one should expect to keep some investments for.  The law of averages states that one is bound to catch an upswing as long as they are invested.

Secondly, younger adults have more working capital.  So if a $20,000 investment is stale at the age of 30, that is still a very small part of one’s total life’s earning.  One can easily recover that amount.

“Time in the market is better than timing the market”, says the second friend, as he finished his coffee.

There are many things that YOU may not have been taught in school about investments.  So please feel free to email us for any advice on your situation.

We’re actually looking for potential investors/joint partners for our next couple of projects. If you’re interested, please feel free to reach out.

Until Next Time!