I’m not sure what’s more important, and/or appealing between the top five “Blog Posts” and that of “Real Estate Stories.”

I think the posts are always a fun flashback to whatever you were doing at the time you read the blog, and the regular readers might enjoy revisiting their comments, and perhaps their arguments with other readers too!

But the stories are more important from a macro standpoint, and since real estate has been such a hot topic in our city over the last decade, keeping tabs on the most burning stories and topics is a good to take it all in, without necessarily living and breathing real estate on a daily basis.

So before I get to the top five stories of the past year, I thought it would be fun to look back at how this feature read over the past three years:

From 2015:

5) Urbancorp “Stealing” Their Condos Back
4) Real Estate Commissions
3) The Media’s Continued Obsession With The Pending Real Estate Collapse
2) CMHC, The Bank of Canada, & Monetary Policy
1) The Market

From 2016:

5) New Mortgage Regulations
4) Foreign Ownership
3) The Business Of Real Estate And The Real Estate Industry
2) Kathy Tomlinson & Vancouver Real Estate
1) Prices

From 2017:

5) International Real Estate
4) Rental Market
3) Business of Real Estate
2) Government Intervention
1) Spring Insanity

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I notice a theme here.

The #1 story in each of the past three years is essentially the same thing: the market, prices, spring insanity.

2015 and 2016 provides identical topics, just with different names, and 2017’s #1 point is about prices and the market, just more of a micro-look into a 4-month window.

The role of various government entities is a common thread, as is the business of real estate.

And all the while, I can’t help but be amused by the fact that this year’s list is very, very different.

Take me at my word when I say this – I wrote the “Top Five” first, and this introduction second, which includes looking back at the topics for the last three years.  I don’t come up with these topics on the spot, but rather I group my 120 – 140 blog posts into categories, with highlights on the very important and/or well-received blogs, and then look for the topics that showed up the most.  At the end of it all, I might choose to add a burning topic, if there is one.

So without further adieu, I present to you, the top five Toronto real estate stories of 2018.

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5) TREB vs. The Competition Bureau

I actually wish this wasn’t a story, and I most certainly wish that it wasn’t in my top five!

But every single person in real estate is affected by the ongoing battle between TREB and the Competition Bureau, and I have news for you folks not in the know: the battle is far from over.

The battle, as I wrote in an August blog post, officially began on May 27th, 2011.

That was when the Competition Bureau announced that they had filed an application with the Competition Tribunal seeking to prohibit anti-competitive practices by the Toronto Real Estate Board.

And here we are, seven years later, looking at a “conclusion” of sorts.

Of sorts, of course, because I don’t personally believe that this battle is over.

Ever since the Competition Bureau “won,” TREB has been slow, aloof, and at times – questioning the ruling itself.

I don’t see the Competition Bureau coming back to play again, since they can simply chalk this up to a “victory,” and move on.  Far be it for me to say, but I think that some levels of government care more about the official outcome, rather than the actual one, and saying that they won might be more important than seeing the intended legislation through.

The Competition Bureau has taken TREB to task over the years for many things, but in the end, the whole battle came down to access to sales data.

TREB has decided, and by “TREB,” I mean a group of about 20 people, that licensed Realtors should not be permitted to provide sold data to clients, even though, in my opinion, an overwhelming majority of Realtors would vote ‘yay’ if asked.

The Competition Bureau correctly asserted that this was wrong, but I still remain confused as to whether the origin of their disagreement with TREB’s actions fell under “preventing abuse of market power” or “advocating for greater competition,” which are the only two of their six total mandates that would make sense in this case.

While I agree with the outcome – that TREB is now allowing its dues-paying members to provide sold data to their clients, I don’t agree with the process.  I don’t think the Competition Bureau should have stepped in, and here’s where my struggle begins.

I despise the way that the Toronto Real Estate Board is run, and an onlooker would think it’s downright laughable that over 50,000 people have ZERO power over the 20 in charge.  We members are completely helpless, and can’t do a thing, even though we pay the dues, that pay the people at TREB, and that our voting power would be about 2500-to-1.

But TREB scares us all, with their omnipotence and real estate nuclear codes.  They could blow up any one of our careers in an instant, and routinely threaten to do so.

Think back to February of 2015: “Did TREB Threaten Toronto Realtors?”

And this happened again, and again, during the summer when Realtors began to act on their own accord after the Competition Bureau announced its victory.  TREB was slow to react to the ruling (some say they didn’t really intend to respond until they absolutely had to), and thus Realtors began to make their own plans, and take action as they saw fit.  Then along came TREB, with threatening letters, bulletins, and emails once again.

Working in real estate is like working in any other field: you’re doing it as a primary source of income, and you and your family rely on the occupation for your livlihood.  So while many Realtors, myself included, would love to push the envelope, and maybe even try crossing the line once in a while, in order to either provide better customer service to our clients, or to offer outside-the-box solutions and new innovations, we know in the back of our minds that if we piss off TREB, they can take our authenticator access away.

We are licensed by the Province, but those of us who work in Toronto, are members of TREB.  We need TREB, and thus we would all back down, if urged to do so, by TREB, or anybody else.

This is why I think the battle with the Competition Bureau might not be over.

The Competition Bureau got sold data out there, but what about the potential for abuse of power at TREB?  At the end of the day, the Competition Bureau’s ruling was far from crystal-clear, and in parts, it was ambiguous, at best.  TREB was able to come up with “their interpretation” of the ruling, and whether or not that’s how the Competition Bureau intended the ruling to be implemented, we’ll never know.  We’ll never know, unless, the Competition Bureau comes back for Round #2.

Personally, I’ve had enough of this story, and I hope we don’t hear about it again in 2019.

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4) The 2017 Market

What does it say about the 2018 real estate market that we’re calling the 2017 market one of the top stories of this year?

Well, I suppose if we wanted to be more specific, we could say that the #4 story of the year was how 2018 compared to 2017, but no matter how you look at the year that passed, you can’t help but compare in to last year.

There’s a common misconception that every piece of real estate in Toronto has declined since 2017, but that’s so incredibly untrue.

February 7th, 2018, I wrote: “Do The Toronto Newspaper Headlines Tell The Whole Story?”

This resulted in 68 comments from readers, most of whom agreed with my claim that what’s written in the headlines is often hyperbolic and intended to solicit an immediate reaction, rather than give the reader an accurate picture of what’s happening.

February 28th, 2018, I wrote: “The One-Bedroom Condo Market Is On Fire.”

This produced a whopping 145 comments, since I feel a lot of readers felt affected, in one way or another, by the insanity in the downtown condo market.

The buyers out there felt it the hardest, and responded in kind.

The market bears wanted it to be untrue.

Those who sold their condos in 2017, also wanted it to be untrue, having felt like the “peak” being reported by media, and most Toronto-wide stats would suggest that there was no money left on the table.

And many onlookers with no real horse in the race still felt like paying $1,100 per square foot for a 485 square foot, 1-bedroom unit with micro-appliances, no parking, no locker, and no view, was a peak of a different kind, this one being insanity.

The discussion among the commenters treaded into all kinds of tangential conversations, about the economy, the stock market, international real estate, and the future of the city of Toronto in general.  I found it interesting that writing a blog about the lowest end of the real estate spectrum caused the most people to comment.  I suppose if we were talking about luxury real estate, very few people would care.

That blog served as a measuring stick of the public’s continued interest in the real estate market, and while I don’t know that suggesting there was more mania about Toronto real estate in February of 2018, than in the spring of 2017, I would suggest that when it came to downtown condos, there actually was.

As of November’s TREB stats, the average price of a Toronto condo sits at $595,678, up 3.0% since the “peak” in April of 2017.  And it’s also worth noting that the average condo price in 2018 peaked in September, at $615,582.

But what of the rest of the market?

This is where everybody wants to steer the conversation!

The average home price, GTA-wide, in November was $788,345, down massively from the peak in April of 2017 of $920,791.  That’s 14.4%!

14.4% is not a crash per se, but hot damn, it’s a big number!

I suppose it only matters, however, to those that bought in April of 2017, and sold in November of 2018, having owned a truly “average” GTA home.

But as I explained on my blog throughout 2018, the GTA-wide numbers shouldn’t be used for those looking at their downtown 1-bedroom condos, or Danforth Village 3-bedroom semi’s, or High Park detached 4-bedrooms.

The “core” of Toronto simply was not affected in the same way as a freehold home in a mud-covered sub-division in Vaughan.

And I’ll be the first to admit that in March and April of 2017, the prices being paid for those mud-covered subdivision homes outside the central core were, in hindsight, irresponsible.  The prices were affected more by mania, emotion, and consumer behaviour than the actual intrinsic value for the buyer, and a healthy combination of supply and demand.

But I didn’t sell any freehold homes in Bayview & 16th, so my conscience is clear.  I also didn’t sell to anybody looking to flip 12-15 months later, so to be quite honest – buying in February, March, or April of 2017 was not a bad move for those looking to be in their homes for 5, 10, or 15 years.

The market bears will suggest that the $1,000,000 east-end semi-detached, in March of 2017, will not be worth $1,000,000 in the year 2022, but I would whole-heartedly disagree.  I bet my reputation on it.  A buyer client of mine who paid $1,000,000 might have seen his or her comparable home value drop to $940,000 three months later, only to see it pull close to even once again by September of 2018.  And what of another five years?  Pah-lease!

If the comments on Monday’s blog is any indication, this debate is merely getting started…

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3) The Rental Market

This was the #4 topic on our list in 2017, and I did have this at #2 in this space for a short period earlier in the week, but once I wrote about the topic you’ll see below, I realized that it was well, well ahead of the mere mortal rental market!  Yeah, stay tuned for point #2, it’s a doozie…

For now, we’ll discuss the same topic that we discussed last year around this time, and that’s the incredible run-up in rental prices, how we got to this point, and where the heck we can go from here!

January 19th, 2018, I wrote: “Could Tighter Rent Controls Be Coming?”

I referenced the following letter to the editor:

Your Letters: Young Familes Can’t Afford To Live In Toronto

This is just silly.  The rental market doesn’t “hate” anybody, and landlords aren’t discriminating.  They might be looking for people who can afford to pay the rent, but that’s being prudent and responsible; it’s not discrimination.  Lastly, the “government who choose to do nothing” is extremely ill-informed, since rent controls were introduced in Ontario in April of 2017.

As for the last point about “we need rent control now,” see my previous point, three seconds ago.

Maybe I’m guilty of choosing the most absurd letter, from an uninformed Torontonian, but this is how 2018 started.

That blog post produced 73 comments, most of which were in agreement, and some which were far harsher than I was, ie. somebody suggesting that if a couple can’t afford to rent in Toronto, then perhaps bringing a child into the world is irresponsible.

February 12th, 2018, I wrote: “Buy vs. Rent: Toronto vs. Calgary.”

This was necessitated by an article about Calgarians who were “smart” to rent, rather than buy, and accompanied by a whole host of people who figured the same would be true of Toronto.

Except that, as I wrote on my blog, since November of 2007, the Toronto HPI Benchmark price rose 107.6%, compared to a gain of 3.8% for Calgary during that same time period.  And I chose that time period because the article mentioned a person who bragged about not having “tied up” his money in real estate, and was free to invest in equities.

This blog post produced 80 comments, and suddenly I realized that “Renting” might be a huge topic in 2018.

February 26th, 2018, I wrote: “Introducing Ontario’s New Standard Lease Agreement”

This new standard lease was supposed to help both landlords and tenants, but in my opinion, it offers more ambiguity, and ways for both landlords and tenants to “legally” look to screw each other.

I spent hours looking over the standard lease, and in the blog, I went through every single section, explained how it differed from the previous lease agreements, and offered my two cents.

August 15th, 2018, I wrote: “The Sad State of Toronto’s Rental Market”

In this blog, I detailed several of the awkward, weird, and/or unqualified inquiries I received on a lease listing.

This was the summer, of course, which is a peak season for rentals, but nevertheless, it was a really tough conversation on TRB, and 58 comments resulted.

October 10th, 2018, I wrote: “What’s Really Happening With Toronto Lease Prices?”

In this blog, I looked at rental units which had turned over multiple times during the past 5-7 years, to see how the real increase in rents looked.

This was one of my favourite posts of the fall, if I do say so myself.

It’s one thing to get a stat on rent increases from Urbanation, but it’s another thing to look at one specific unit, and see at what price it was leased in 2011, 2013, 2014, 2016, and 2017.

December 5th, 2018, I wrote: “Shouldn’t We Talk About Rent Control?”

This resulted in one of the best discussions I’ve seen on TRB all year.  The comments were all informed, intelligent, and backed up by facts and evidence.

I’ve said it before, but I’ll say it again now: I am absolutely blessed to have such an incredible following of intelligent, savvy, and astute readers who comment on a regular basis.  This blog post is a great example of how TRB is the sum of its parts; half blog post from myself, half follow-up comments from the readers.

If I were a betting man, I would wager that the topic of rents will make an appearance on the 2019 list as well.

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2) Financial Literacy & Personal Responsibility

I alluded to this several times in Monday’s blog, and now you can see why.

When describing my early-January blogs, “What Is The Government Doing To Tackle Consumer Debt?” and ““Household Debt vs. Mortgage Debt: The Good, The Bad, & The Ugly,” I concluded that both blog posts aren’t so much about “debt,” and are more so about financial literacy.

And when discussing my #2 post of 2018, “The Friday Rant: Has The World Lost Its Mind?” I offered the theory that personal responsibility is also at an all-time low, and never before have members of society seemed so entitled.

Both themes are underscored in many of the conversations we have on Toronto Realty Blog, both in the blogs themselves, and the comments.

As I have suggested before, I do believe that part of the reason why we’ve moved into the entitlement generation is because our governments at all levels have led us to believe, not only that we can have everything we want, but also that we deserve it.

I also feel as though the over-reaching liberal establishment is, consciously or otherwise, trying to prolong adolescence indefinitely.  That’s why our universities have adopted this safe-space mentality, done away with failing grades and, in some cases done away with clapping as well, and why graduates are so ill-prepared for the real world.  They have been coddled since Junior Kindergarten, and to expect them to magically snap out of their spell is unreasonable.

When it comes to Toronto real estate, I live in constant fear of the words, “should” and “deserve,” and while it’s not necessarily only the younger generation, they are the ones most equipped to get their thoughts into the public eye.

The best possible example I can give you of this is the 2017 “open letter” written by a millennial that made headlines for all the wrong reasons.  It was one of the most poorly-written, logically-flawed, factless pieces of drivel I have ever read from somebody over the age of 16.

While I don’t want to slag the person who wrote it, I kind of have no choice here.  Maybe it was her attempt at creative writing, or maybe it was all from the heart, I don’t know.  But I’m choosing to use this as an example of the utter delusion that exists out there today with regards to lack of financial literacy and personal responsibility as it pertains to Toronto real estate.

A 23-year-old millennial, who ironically, from what I can tell from even a basic social media search, grew up in a very wealthy family, wrote an article about high real estate prices in Toronto, and how her generation would just have to “move out of the city” because they can’t immediately afford to buy large houses in the areas of their choosing, at their age.

Here are some excerpts from this bloated piece of fantasy:

“That first family home we always dreamed of owning in North York, or off Eglinton, and now, the hot areas of Roncesvalles and the Leslieville … we are slowly accepting it just may not happen for us in the foreseeable future.”

You are a 23-year-old.  You just finished university.  You don’t deserve a house in Roncesvalles or Leslieville.  You have no income or savings to justify such a purchase, unless your parents gave it to you.  This statement is absolutely preposterous.

“There may be a movement starting. The millennials are heading north — and we mean really north. It’s pretty much all we can afford. Vaughan would be nice, but those prices are also rising fast. So, cottage country it is (we can think of worse things).

Reports suggest that you’ve pushed us so far, we’re never buying that first house in Toronto. So we’ll just have to buy a cottage instead, and perhaps rent in Toronto (if we can even afford that). We do want to own something, right?”

First of all, who is “you?”

I know, I know, she’s writing an “open letter” to the city of Toronto.  But to be mad at the city is to be mad at economics, and supply and demand.  God did not create high real estate prices in Toronto; people did, via their interactions in an open market.

And who says cottages are any cheaper?  For a rich millennial that attended Western University, I’m thinking that her reference of a “cottage” means Lake Joseph, or Lake Rousseau.

“Maybe it will be better for us. To own land far away from this busy city, where we focus too much on our screens and less on what the great outdoors has to offer.”

Okay, great idea – owning land far away from the city.  But what about working at your job?

This comment ignores the fact that people must work for a living, and living on “land far away from the city” probably doesn’t offer many job opportunities.  It also ignores that “land” needs services like water, sewage, electricity, gas, et al.

And the talk about “focusing too much on your screen” seems to conflict with your social media profiles, just saying.

“Could a brighter future for our children be on the horizon? Our kids will experience a much different upbringing — they’ll be outdoors-y, adventurous, they’ll love the lake. And they’ll love their cottage.”

This is absolute fantasy!  A 23-year-old talking about raising kids “that love the lake,” and “that love their cottage.”  It’s like a 7-year-old saying, “I LUV MY DOGGIE!!”

“But you can’t get rid of us for good. Our careers are still largely here in the city. Maybe soon our bosses won’t be able to afford their rent either, and we will all move up north.

And then you’ll have no one. You’ll be forced to lower your absurd home prices. And you’ll be asking us all to come back.”

Wait………so this person does realize that she works in the city?  Then how does she expect to live up north “on a piece of land?”  And if her boss rents, why does she think she deserves to own a house in North York, off Eglinton, or in Roncesvalles or Leslieville?

How will “everybody” move up north?  Will every single business in Toronto move their headquarters up north?  Every law firm, tech company, financial institution – all of them?

Then “you” will be forced to lower your absurd prices.

Holy crap.  It just keeps going…

This is so bad, and what’s worse is that she got some media fanfare for this, when all the while we would be better off if people took her to task for being childish, naive, selfish, unrealistic, and snobby.

Whatever happened to personal responsibility?

This is merely one person’s opinion on the city, I understand that.  But if this is truly “a voice for all millennials” as it was made out to be in 2017, then good God are we ever in trouble.

April 30th, 2018, I wrote: “Is Financial Literacy At An All Time Low?”

This was the story of a couple of would-be renters that submitted an offer to lease one of my condo listings.

She worked for minimum wage, and he was self-employed but showed no income.  He had no job letter, no income verification, no pay stubs, and no bank statement.

He had $486 per month in student loans payable.

She had a credit score of 634.

He had a balance of $1,900 on his $2,000 credit card, $8,000 on his $10,000 line of credit, and $9,000 on his $15,000 line of credit.

And they wanted to lease a $2,400 per month condo.

Assuming she makes $29,120 per year (40 hours per week at minimum wage, as per her application), and his “self-employment” that shows zero income, provides, say, $25,000, they’re looking to spend 55.4% of their gross income on rent.

Now assume they keep 75% of that gross income after taxes, and they have a mere $40,590 left over.  Subtract the $486 per month in student loans that is automatically debited from his bank account, and they’re left with $34,758.

$34,758 in their pockets, before any personal expenditures.  And they want to rent for $30,000 per year.

Oh, and he has $18,900 in combined debt on his two credit cards and line of credit.

This is the height of stupidity, the best example of financial illiteracy you will ever find, and a classic case of having zero personal responsibility.

I could go on, but I’m angry.  And I know that amazingly, 11.74% of you don’t agree with what I just wrote, so I need to take a time out to mull that over…

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1) The Future Of The City Of Toronto

I’ll bet you did not see this topic coming!

How could you?

It’s not exactly a post I have featured four or five times over the last year, or even once.

And it’s not something we directly talk about on a daily basis.

But indirectly?

We talk about it every single day.  In every blog post, and with every comment.  And it’s really only during the course of the past year that I’ve taken notice.

The recurring theme in the real estate, politics, economics, socio-economics, governance, and all things Toronto, discussed on this blog, is that we all have both hopes and fears for the future of the city we call “home.”

As with the real estate market, we can be labelled more bullish, or more bearish, on the future of this city.  But every one of us has an opinion, and perhaps unlike real estate, every one of us has a major stake in the result.

We also all have thoughts on what this city needs, how to achieve the results, who can help, and where to start.  But with those thoughts also comes disagreement, and that often makes things contentious.

I just did an interview where the reporter asked me about Bill 66, and how I felt about the potential for building on the Greenbelt.

I was, shall I say, “in a mood,” and the interview quickly went off the rails.  At least that’s what two of my colleagues said who were listening.

I said that I wasn’t necessarily “against” building on the Greenbelt, and it would be irresponsible not to consider it.  I was basing this on the fact that if we are to have super-density here in the core, we need infrastructure to support it.  And as we all know, we don’t have that infrastructure.  Not even close.

Our transit system is the finest example of our city’s failure to support its growing population.  The “Yonge Line” opened in 1954, and in 1978, the Spadina line was finished with a 2KM extension from Wilson to Downsview added in 1996.  The “Bloor-Danforth Line” opened in 1966, and extensions were added in 1968 and 1960.  Sure, we got the Sheppard “line” if you can call it that, with it’s five stops, and the Scarborough extension.  But is this primarily 1950’s and 1960’s infrastructure really suitable in 2018?

What about schools?  What about water, solid waste, and sewers?  What about parks?  What about access to healthcare for families living downtown?

The infrastructure in the downtown core is abhorrent, and I cringe when I think of the people who suggest we should tear down the Gardiner Expressway, “Because it’s unsightly,” and add to our already-congested roads.

So then, should we consider making the downtown core even more dense?  Or should we consider urban sprawl?

The reporter told me this afternoon, “There aren’t a lot of people who would come out and say they’re in favour of building in the Greenbelt, just look at the mayors who commented for the Toronto Star article.”

I quickly responded, “Well politicians don’t provide opinions that are unpopular; that’s why they’re politicians.  Politics isn’t about doing what’s best for people, it’s about self-preservation.”

None of the people who commented have any real plan for how to deal with rising home prices, or lack of existing infrastructure to support those in high-density areas.  They’re just looking to avoid saying anything that could cost them their job!

I was asked, “Don’t you think that by building houses in the Greenbelt, it will simply add to people’s commute times?”

Yeah, it will!

“You can’t have it both ways,” I said with a frustrated laugh.  “Home prices are too expensive and downtown is too dense.  There’s an article in the paper today about how prices in Hamilton have increased 70% in the last four years, because of people relocating from the expensive Toronto market!  So add new supply wherever you can in the GTA, and that might mean the Greenbelt!  But to complain about commute times?  You can’t have it both ways!  You can’t say that you want access to less expensive housing, and then bitch about commuting!”

Maybe it was just the way the question was phrased, or maybe it was the idea that people should have affordable housing and short commute times, I’m not sure.

So yeah, I did a very………….interesting interview.  But when you ask me about the future of Toronto, I get riled up.

Everything we talk about on TRB is directly related to the future of Toronto, whether you want to see it that way or not.  I’ve always felt that the reason real estate makes for such an interesting, and at times, hot-button topic is because everybody lives somewhere.  And when you live in Toronto, you can’t help but be tied to this city for all that it is, and will be.

–

Okay folks, that’s it for me.

Point #1 could have gone on, and on, and on, but I feel that just the mere mention of “the future of the city” should make you realize that, indeed, it truly is our top story.

Apologies for the 5,000+ words, which may be the longest post I’ve ever written, but I’d rather write too much than too little, and these are our top stories, after all.

Please let me know if you feel there’s a hot topic that should have been listed.

And of course, I welcome predictions for 2019, whether it’s topics to be on the lookout for, or actual predictions about the real estate market, economy, or financial market.

I’ll be back on Friday to sign off, and shed that one, lonely tear…