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REP 1.03

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Mark Youash

The document discusses alternative financing options that are gaining popularity as more Canadians find themselves unable to qualify for conventional financing due to tighter lending standards. It provides examples of Canadian real estate companies that have partnered with Leading Real Estate Companies of the World to gain global resources while maintaining local strength and independence. The executives interviewed praise this model as providing an invaluable platform for growth without the restrictions of franchising.

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ALTERNATIVE FINANCING WHY MORE OF YOUR CLIENTS ARE TURNING TO THIS SOLUTION LANDSCAPE LESSONS 6 QUICK FALL SPRUCE-UPS THAT WILL ENTICE BUYERS HISTORIC DEAL INSIDE THE SALE OF A MULTIMILLION-DOLLAR PIECE OF CANADA REPMAG.CA ISSUE 1.O3 | $6.95 THE AGENT’S LIFESTYLE See how you stack up to your peers in commission, marketing strategies, work/life balance and more
A NEW WAY TO GROW LeadingRE.com | sbarr@LeadingRE.com | 312.361.8632 ® Leading Real Estate Companies of the World® has brought its unique and compelling business model to Canada–one that has helped create a real estate powerhouse responsible for over 1,000,000 transactions valued at $321 billion in annual home sales. If you are a local leader of an independent company – or are intrigued by building your own brand without sacrificing robust resources and connections – we invite you to learn more about the value of aligning with Leading Real Estate Companies of the World® . LOCAL STRENGTH. GLOBAL RESOURCES. “We are grateful this alternative to franchising is available to strong independent companies like ours across Canada.” - Ron Stader Broker & General Manager CIR REALTY Calgary, Alberta “Leading Real Estate Companies of the World® has provided an invaluable platform.” - Jonathan Cooper, Vice President, Operations Macdonald Real Estate Group, Inc. Vancouver, British Columbia “The firms that make up this global network are hand-chosen and the most successful independent brokerages in the world.” - Tom Bosley President & CEO Bosley Real Estate Ltd. Toronto, Ontario
CENTURY 21 ASSURANCEKELOWNA THE BIG LITTLE CITY We think there’s a better way to do real estate.  EARN MORE AND KEEP MORE – A full service brokerage with a full service marketing team to take care of all the administrative and creative tasks so you can focus on the buyers and sellers.  LOOK BETTER DOING IT – State of the art agent websites, professional photographers and graphic designers will make you look like a rockstar.  YOU GET YOUR LIFE BACK – You deserve better from your brokerage. Let us take care of listing details while you spend time doing what you love. CENTURY 21 Assurance Realty Ltd. 251 Harvey Avenue, Kelowna, BC V1Y 6C2 Office: 250-869-0101 Fax: 250-869-0105 Toll Free: 888-301-2121 myrna.park@century21.ca FOCUS YOURSELF ON HIGH-VALUE TASKS WORKING SUCCESSFULLY WITH BUYERS AND SELLERS
14 34 36 40 18 2 www.repmag.ca CONTENTS CONNECT WITH US Got a story or suggestion, or just want to find out some more information? twitter.com/REPMagCA plus.google.com/+RepmagCanada CHECK IT OUT ONLINE REPMAG.CA facebook.com/REPmagCA COVER STORY THE AVERAGE AGENT’S LIFESTYLE Ever wondered how you compare to your peers? REP surveyed agents across the country to paint a picture of the ‘typical’ real estate agent’s lifestyle PEOPLE INDUSTRY ICON Exit Realty CEO Tami Bonnell talks about the unique way the company retains top talent FEATURES DONE DEAL Selling the 65,000-acre, multimillion-dollar Kenauk Montebello estate required a one- of-a-kind marketing strategy FEATURES EXPERT ADVICE Carson Arthur offers 6 ways to wow buyers before they walk through the door FEATURES LENDING SOLUTIONS Alternative lending moves into the spotlight as more Canadians find themselves unable to qualify for conventional financing ISSUE 1.03 UPFRONT 04 Editorial Is foreign investment a good or bad thing for the housing market? 05 Head to head The future of online real estate in the wake of Zoocasa 06 Statistics What the burgeoning condo market means for your business 08 News analysis The sold data debate reaches an apex 10 Mortgage update Are more regulations on the horizon? 12 Technology update How one agent is making the most of new drone technology FEATURES 32 What is a 15-minute mortgage? A look at Centum’s new online lead-generation tool 38 How to become a leading real estate company The CEO of Leading Real Estate Companies of the World explains how Canada fits into its global strategy PEOPLE 46 Agent profile After a near-death experience in Afghanistan, former soldier Glen Kirkland found a new life in the real estate industry 48 Favourite things Vanessa Roman, host of HGTV’s “Reno vs Relocate”
4 www.repmag.ca UPFRONT EDITORIAL Fuel to the foreign buyer fire T his summer, foreign buyers were once again thrust into the hot seat, as Prime Minister Stephen Harper moved to make one of Canada’s hottest real estate debates an election issue. His campaign promise, announced in August, is that if the Conservatives are re-elected, they would spend half a million dollars tracking and reporting data on foreign ownership. Harper said that if foreign investors are found to be driving the cost of housing to unaffordable levels, the government should find a way to address this. The move has been welcomed by economists, who called the promise very positive, regardless of who wins the election. However, they also have pointed out that any decision on policies to restrict overseas investors from buying Canadian property should be left until after the data has been collected. Earlier in the summer, China’s plummeting stock market reignited the debate about the influence of foreign investment on the country’s housing market. The decline of the Shanghai Composite has led many to predict Chinese nationals buying Canadian property will soon head for the exits as they look for cash to make up for stock losses. Others are just as convinced there will be no fire sale on Canadian real estate. The discussion also has turned to just how much influence those interna- tional buyers have in the first place, and whether more rigorous restrictions on their investments are needed. Regardless, experts suggest that, since many Chinese investors saw surges in stock values last year, they are happy to sit on their now-modest profits. That suggests – fingers crossed! – they’re prepared to hold their Canadian property for the long term as well. Clearly, that kind of steadfast commitment benefits all players in Canadian real estate – especially those agents representing the buyers and sellers. Vernon Clement Jones, editor Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as the magazine can accept no responsibility for loss EDITORIAL Editorial Director Vernon Clement Jones Senior Writer Jennifer Paterson Writers Olivia D’Orazio Jordan Maxwell Donald Horne Copy Editor Clare Alexander CONTRIBUTORS Carson Arthur ART & PRODUCTION Design Manager Daniel Williams Designer Lea Valenzuela Production Manager Alicia Salvati Traffic Manager Kay Valdez SALES & MARKETING Associate Publisher Trevor Biggs General Manager, Sales John Mackenzie National Account Manager Mark Youash Marketing and Communications Manager Claudine Ting Project Coordinator Jessica Duce CORPORATE President & CEO Tim Duce Office/Traffic Manager Marni Parker Events and Conference Manager Chris Davis Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil EDITORIAL INQUIRIES vernon.jones@kmimedia.ca SUBSCRIPTION INQUIRIES tel: 416 644 8740 • fax: 416 203 8940 subscriptions@kmimedia.ca ADVERTISING INQUIRIES mark.youash@kmimedia.ca KMI Media 312 Adelaide Street West, Suite 800 Toronto, Ontario M5V 1R2 tel: +1 416 644 8740 www.keymedia.com Offices in Toronto, Denver, Sydney, Auckland, Manila SUMMER 2O15 Real Estate Professional is part of an international family of B2B publications and websites for the real estate and mortgage industries CANADIAN MORTGAGE PROFESSIONAL vernon.jones@kmimedia.ca T +1 416 644 8740 MORTGAGE PROFESSIONAL AUSTRALIA sam.richardson@keymedia.com.au T +61 2 8437 4787 MORTGAGE PROFESSIONAL AMERICA cathy.masek@keymedia.com T +1 720 316 0154 www.repmag.ca If foreign investors are found to be driving the cost of housing to unaffordable levels, the government should find a way to address this
UPFRONT www.repmag.ca 5   “Zoocasa was never a big player in the real estate industry.There are thousands of agents in Toronto, and less than 400 were registered with Zoocasa. It was fairly insignificant.With the new investment in the site, it’s just going to be like any other brokerage.Zoocasa, at the beginning, was trying to be a brokerage, but it ended up becoming an agent matchmaker. Buying a home is the most expensive purchase people make during their lifetime, and I don’t think it can be done by just looking at listings online. It’s important to work with an experienced Realtor. Buyers who just shop online are missing the experience and could make mistakes.” “The demise of Zoocasa is something that many could have predicted.The market for online discount brokerages has historically been riddled with failure.The reality is that consumers prefer the more traditional approach to buying and selling homes. The new ownership appears to understand the basic consumer desire for a more full-service and a perceived non-discounted approach.The‘new’ Zoocasa tries to do what most Realtors do – provide a full end-to-end personal service. I don’t personally think it’ll succeed, primarily because the traditional way of conducting business has always come out ahead.” “A challenge for any alternative brokerage is getting a critical mass of market share. Most of these alternative sellers haven’t done well in terms of acquiring any significant market share. It’s difficult when CREA and its MLS product have 90% to 95% of the market. As a buyer or seller, you’re not inclined to go to any other service. Until an alternative brokerage hits that threshold and can have a meaningful number of listings, it will be in a Catch-22 situation, because it’s difficult to grow. It doesn’t bode well for the start-ups, if their business model is competing head- to-head with MLS.” Is this the end of the online brokerage? How much is Zoocasa’s demise – and subsequent resurrection – an indication of what’s to come for online real estate? Josee Couture Salesrepresentative Re/MaxHallmarkRealty Dr. John Andrew Realestateprofessor Queen’sUniversity Dustin Graham Salesrepresentative TheGrahamPartners OnlinebrokerageZoocasa,asubsidiaryofRogers,announcedinJunethatitwasclosingitsdoors.ARogersspokespersonsaidthetelecommunicationsprovidermadethedecisionto nolongercontinueitsinvestmentinZoocasa,andmembersoftheindustrylashedoutonREP’sonlineforum,sayingthatbeingarealestateagentisaboutmorethanjustdata.Tendays later,ZoocasawasrevivedwhenRealtorLaurenHawandagroupofinvestorspurchasedthesite’sdomainfor$350,000.Thebusinessmodelhaschanged,butagentsremainwatchful. ZOOCASA’S ROLLER COASTER SUMMER HEAD TO HEAD
UPFRONT 6 www.repmag.ca STATISTICS House or condo? AsCanada’spopulationcontinuestoswell–especially insomeofthecountry’smoremetropolitanareas– condosarebecominganincreasinglypopularoption foralldemographics TALL ORDERS IN TORONTO AND VANCOUVER Source:CREA,2014 Source:CMHC,CanadianHousingObserver2013 Source:StatCan,Census2011 1 NumberofupdatestotheOntario CondominiumActsince1998 FORGET URBAN versus suburban. The new­est debate is about property types: specifi- cally, condo (or strata) properties versus detached or semi-detached homes. In most Canadian markets, condos remain an affordable option for first-time buyers, those new to the country and those looking to downsize. However, detached homes remain popular for growing families and those seeking freehold living quarters. While detached properties far outnumber condo units in every Canadian province, the sales and prices of condos are growing, particu- larly in Vancouver and Toronto. Demand for housing is still driving new single-family home construction in the suburbs, which is currently outpacing condo construction. But strata properties are slowly spreading to some of the country’s suburbs as the inventory of detached properties dwindles, pushing prices up. That’s one trend that’s likely to gather pace in the coming years as condos currently under construction reach completion and developers embark on new projects. 844.4% Percentagegrowthinoccupied condounitsbetween1981and2011 19% Percentageofcondoowners whoareyoungerthan35 29% Percentageofcondoowners whoareolderthan65 Increaseinannualsales,2014(YOY) Increaseinaverageprice,2014(YOY) HOW DO YOU TAKE YOUR HOME? GROWING OPPORTUNITY InmostCanadiancities,the salesofdetachedandsemi- detachedhavehistorically outweighedthesalesofcondo units,butthefiguresarestarting tobalanceout,offeringagents anopportunitytobolster volumeswithoutleavingtheir ownfarmarea. It’snosurprisethatTorontoandVancouverhavesomeofthestrongestcondo marketsinthecountry,andcondosalesandpricescontinuetoincrease Mosthomeownersprefer detachedproperties,followed bycondos.Butthereisstill alargeportionofCanadians livinginrowhouses, townhousesandothersemi- detachedproperties Singledetached Condo Rowhouse, townhouse orduplex Semi-detached 56% 28% 11% 5% Vancouver Toronto 41.3% 58.7% Vancouver 30.8% 69.2% Victoria 14.1% 10.2% 3.8% 5.2%
www.repmag.ca 7 BUILD UP, BUILD OUT SPOTLIGHT: EAST COAST Source:CREA2014,TREB2014,GMREB2014 Source:CREA,2013and2014Source:CMHC,PreliminaryHousingStartData2014 Annualsales SaintJohn 35% Halifax-Dartmouth 3% St.John’s 8% Medianprice SaintJohn -4% Halifax-Dartmouth -5% St.John’s -2% The year-over-year change in building permits paints a varying picture across the country. On the West Coast, more detached properties were being built in 2014 than the year before, but in Saskatchewan, Manitoba and Quebec, growth in permits for condo construction far outpaced that for detached properties TheWestCoasttendstodominatewhenitcomes tocondosales,buttheEastCoastmarketis slowlygrowing.However,whiletransactions haverisen,year-over-yearpriceshavedipped British Columbia Alberta Saskatchewan Manitoba Ontario Quebec New Brunswick NovaScotia PrinceEdward Island Newfoundland &Labrador 15% 0% 0% 6% 15% -19% 20% -17% -11% -12% 11% -7% -24% -24% -16% -23% -16% -27% -43% 16% Detached Other 23.9% 76.1% Toronto 9.4% 90.6% Ottawa 10.6% 89.4% Hamilton-Burlington 6.5% 93.5% Londonand St.Thomas 34% 66% Montreal 9.8% 90.2% St.John’s3.8% 96.2% Newfoundland& Labrador 19.2% 80.8% Edmonton 17.9% 82.1% Calgary 23.9% 76.1% Saskatoon 8.8% 91.2% Regina 1.8% 98.2% SaintJohn Detached Condo 16.5% 83.5% Halifax-Dartmouth
UPFRONT 8 www.repmag.ca NEWS ANALYSIS Sold data debate heats up As a tribunal prepares to hear the case on making sold data public,real estate veterans weigh in on what a decision ultimately means for the industry THE HEATED debate around the release of sold data is about to combust, as the Toronto Real Estate Board finally goes up against the Competition Bureau in a tribunal hearing in October. The long-awaited ruling will determine once and for all whether sold data will remain private or be opened to the public. Regardless of the outcome, many agents are convinced that sold data’s entry into the public domain is inevitable. “Buyers today are choosing to ... be heavily involved in the search,” says Carl Langschmidt, president of Property.ca. “It makes sense that they can use technology to help them do homework and due diligence on a property.” But most agents disagree, pointing out that allowing public access to the system could create a host of problems. “An investment has been put in by all the agents in paying for these systems to operate, and there should be compensation if we’re going to allow other people to have access to them,” says Ernie Hawrysh, an agent at Century 21 Gold Key Realty. “We have to operate the system. It doesn’t get cheaper.” He does admit, however, that even agents are demanding more from the system, a point the Competition Bureau is also focused on. A spokesperson for the organization told REP in a statement that TREB’s actions in restricting access to the data are harming competition by preventing real estate agents from offering new and innovative services to consumers through the Internet. Indeed, south of the border in the US, data flows much more freely, paving the way for a range of smartphone apps and websites that build on that data and offer consumers access to things like proximity to schools and crime rates. While some of these types of technol- ogies are becoming available in Canada, they are thwarted by the fact that the underlying data is not widely open to the public. “MLS has been caught in the dark ages,” says Dr. John Andrew, a real estate professor at Queen’s University and director of the school’s Real Estate Roundtable. “If it was really willing to compete and wanted to protect what it has, it would have done a lot more in developing that kind of technology. “If it made that data freely available, these various apps would pop up overnight,” he continues, “and there’s no reason those couldn’t be added on to the MLS system. But it’s not doing that at all. As a result, the system today looks pretty much exactly how it looked 15 years ago.” “There are a lot of agents whose value proposition is still information. They view themselves as the gatekeepers of information ...” CarlLangschmidt,Property.ca
www.repmag.ca 9 While Andrew says transparency is a good thing for the industry, he also admits that the way the Canadian Real Estate Association, via MLS, has protected its data over the years is an effective business strategy. “It essentially has a monopoly,” he says. “But it’s legal, in the sense that it developed that product, and it’s not really willing to share much of the data.” One reason many real estate agents are against the sharing of sold data is that providing and contextualizing the figures on what houses actually sold for is a key part of their value-added service model. “There are a lot of agents whose value proposition is still information,” Langschmidt says. “They view themselves as the gatekeepers of information and view their job as helping people price a property.” Hawrysh adds that home sellers are biased and don’t have the expertise to list their own homes. “Your own personal house is always the castle,” he says. “You will always price it at the maximum because you’re a biased appraiser. Those numbers won’t be realistic.” REP ROOTS OF THE COURT CASE “An investment has been put in by all the agents ... and there should be compensation if we’re going to allow other people to have access ...” ErnieHawrysh,Century21GoldKeyRealty May2011 April2013 January 2014 February 2014 March 2014 July2014 September– October 2015 October 2015 Anapplicationisfiledwith theCompetitionTribunalto challengetherestrictionsTREB hasimposedonitsmembers’ useofdataintheMLSsystem Thetribunaldismissesthe application Anappealtothatdecisionis heardbytheFederalCourtof Appeal[FCA]inToronto TheFCAreferstheapplication backtothetribunal TREBfilesanapplication forleavetoappealtheFCA’s decisiontotheSupremeCourt ofCanada[SCC] TheSCCdeniesTREB’s applicationforleavetoappeal Thetribunalwillreconsiderthe Bureau’sapplicationinare- hearingthatbeginsSeptember 21andendsOctober5 Adecisionisexpectedfrom thetribunalaboutthefutureof solddata
NEWS BRIEFS Feds could consider more mortgage changes The federal government is reportedly undertaking consultations to determine whether it should impose new mortgage rules to help take the heat out of the real estate market, according to the Financial Post. It said Ottawa is considering a range of changes, including raising the minimum down payment, tweaking mortgage insurance, imposing a 20-year maximum amortization and bringing in specific conditions on high-value housing. If the reported consultations lead to changes, homebuyers would face more difficulty in being approved for a mortgage. The Department of Finance denied the report. Bank of Canada hopes cut will stimulate economy The Big Five banks reacted quickly to the Bank of Canada’s decision to cut interest rates in July, but mortgage brokers suggest the lowering of rates will have little impact on the market, except to attract homebuyers who are currently sitting on the sidelines to finally get in the game. In a statement, the BoC said,“Canada’s economy is undergoing a significant and complex adjustment. Additional monetary stimulus is required at this time to help return the economy to full capacity and inflation sustainability to target.” Low mortgage rates helping affordability The affordability of homes across Canada was mostly unchanged in the first quarter of 2015, activity that was largely down to lower mortgage rates, according to a report published in June by the economics research arm of mortgage lender RBC. The report showed that, between February and May, sales increased 11.2%. With limited signs of stress being exerted on homebuyers outside the white- hot Toronto and Vancouver markets, RBC’s measures are still quite close to their long-term averages, suggesting that current conditions are within historical norms. Mortgage increase would hurt homeowners More than a third of homeowners would encounter financial difficulty if their mortgage increased by just 10%, according to the recent Manulife Bank of Canada Household Debt Survey. A further 15% of respondents said they would not be able to absorb any increase in their mortgage payment. The survey also found that 56% of Canadian homeowners reduced their mortgage debt in the past year, paying down an average of $6,300. Nearly a fifth (18%) made an extra lump-sum payment, while 17% increased their regular payment, and 5% did both. Most first-time buyers consulted a broker First-time homebuyers consulted an average of 1.2 mortgage professionals and obtained 1.7 mortgage quotes before purchasing a home, according a recent survey from the Canadian Association of Accredited Mortgage Professionals. Nearly two-thirds of first-time buyers (61%) consulted a mortgage broker (and 39% obtained their mortgage from that broker), while 75% consulted a bank representative. The survey also found that fixed-rate mortgages are the most common type (72%), while 21% of borrowers opted for variable- or adjustable-rate mortgages. 10 www.repmag.ca UPFRONT MORTGAGE UPDATE A new report published by the CD Howe Institute proposed that mortgage insurance be separated from the CMHC and moved into a new fund to protect taxpayers. According to the report, if unemployment rises and house prices fall, Ottawa would have to pay out $9 billion to cover mortgage defaults. “Our analysis indicates that a low-probability, but severe, housing crash could result in roughly $17 billion of losses for mortgage insurers,” said Thorsten V. Koeppl, one of the report’s authors, in a statement. Industry professionals believe the risk, in reality, is very small, even with a significant correction. “The word ‘correction’ presup- poses that something is wrong, and I think the math shows today’s prices are simply the new normal – and still have room to run,” says Dustan Woodhouse, a mortgage broker with Dominion Lending Centres. Though the report did say that Canada’s mortgage insurance system is architecturally sound, it suggested three reforms that it believes would reposition the system to better address the risk of a severe housing crash. Those include redesigning the government backstop as a stand-alone fund that accumu- lates reserves in advance of a housing crisis, up to a target level, and has the capacity to borrow against future revenue if needed. The report also advocated mandating the Financial Institutions Supervisory Committee The mortgage insurance risk enigma Are proposed reforms to backstop mortgage insurance risk just more regulations the industry doesn’t need?
www.repmag.ca 11 to oversee the backstop fund, and making the backstop available for the residential ownership market only. Some brokers, however, remain uncon- vinced that more regulation is necessary. “My view is that the largest risk to the housing market is further overzealous regulation – in particular, further restrictions at the wrong end of the market, such as the first-time buyer,” Woodhouse says. “We need the new entrants into the market; they are vital to not only move up buyers looking to sell, but also to our economy, which relies on construction of new homes for new household formation – numbers that are projected to continue to rise.” The federal government has already imposed significant regulatory tightening on the mortgage market since 2008, he adds, much of it done for the optics as much as anything. “Canadians don’t miss mortgage payments, and Canadians don’t max themselves out,” Woodhouse says. “The debt-to-income metric thrown around is a weak measure and means little.” Educating clients on collateral charge mortgages What is a collateral charge mortgage? It is method of securing a mortgage or loan against a property that allows the borrower to tap into the equity of their property without incurring legal fees later on. These mortgages are not new; RBC, BMO, CIBC and the credit unions all offer them, but they were first introduced in October 2010 by TD Canada Trust. How does it differ from a conventional mortgage? A collateral charge is non-transferable, which means it can’t be assigned or transferred to a new lender like a regular mortgage. For a borrower looking to switch to a new lender at the end of their mortgage term, a collateral charge means they can’t switch without having the mortgage re-registered, thus incurring new legal fees and appraisal costs. It is also unlike a standard mortgage because it is readvanceable, which means the lender can loan more money after closing without the borrower needing to go back through a lawyer, as long as the borrower can service the new debt. Which type of borrower does it suit? It offers a lot of flexibility, so a buyer who wants to redo the kitchen three years after purchasing a home can roll it into the mortgage, assuming they can service the higher debt. For buyers who aim to pay off their homes as quickly as possible, it might not be the right option. If they want to be open to moving their mortgage at renewal and shopping all the lenders for a new rate and term, then having a collateral charge wouldn’t be the right fit because the borrower is locked in with their lender. What are some of the hidden challenges? Sometimes collateral charges allow the lender to do things like change the interest rate, increase the loan amount and use the equity to pay down other debts the borrower might have with the lender, should the borrower default on those debts. Why is it a hot topic right now? I think there are a couple reasons. One is because there has been a lot of negative press about them in the past few years. CBC News’“Marketplace,” for starters, did a piece on an undercover consumer getting a collateral mortgage through the bank, and it didn’t go well for TD. Another reason is that consumers are becoming more educated about mortgages. We’ve seen a lot of changes to the mortgage rules over the past years, as well as a big shift on interest rates. Because of this, I think we’ve seen a lot of consumers take a more inclusive role in the mortgage decision process. Kelly Hudson Mortgage expert DOMINION LENDING CENTRES AEGIS MORTGAGE SERVICES “The largest risk to the housing market is further overzealous regulation” Yearsintheindustry 3 Fastfact Inadditiontohelping peopleachievetheir dreamofowninga home,Hudsonalso advocatesforpeople adoptingrescuedogs Q&A
12 www.repmag.ca UPFRONT Zoocasa looked as if it might be the first in a domino-effect finish for web-based real estate buying and selling. The online brokerage, which was owned by Rogers, shut its doors in June. Darryl Mitchell, broker of record for the online brokerage, told REP, “We worked hard to provide quality leads, and the stats show that. [Agents] are going to say whatever they are going to say, but I’m proud of what we accomplished.” But just two weeks after the plug was pulled, Zoocasa was revived when Realtor Lauren Haw and a group of investors purchased the site’s domain for $350,000. Haw said that, going forward, the site will focus only on GTA properties, at least until it rebuilds with new agent clients and online listings. “Our mission is to give homebuyers access to the best possible real estate tools and infor- mation while providing a premium level of in-house customer service – and that means building a team of professionals who can adapt to changing consumer expectations,” Haw told the Toronto Star. The same week Zoocasa came back to life, Yellow Pages shared the news that it had purchased the online real estate platform ComFree/DuProprio Network for $50 million, marking the latest growth in its digital strategy. It is the fourth most visited network of real estate properties in Canada, generating more than $40 billion in revenue last year. The addition of the network is the latest in Yellow Pages’ move to accelerate its digital transformation by creating marketplaces that help Canadians transact with their local neigh- bourhoods, according to CEO Julien Billot. “As demand for comprehensive and cost-ef- fective real estate services continues to grow, we will actively leverage our national reach and relationships to enrich ComFree/DuProprio’s value proposition, extend their offerings to homebuyers and sellers Canada-wide, and deliver sustainable digital revenue growth for our company,” Billot said in a press release. Both the resurrection of Zoocasa and Yellow Pages’ push into the online real estate space signal that, despite the ironclad protection over sold data, competitors insist on challenging a status quo that works, according to most agents. The future of online brokerages The summer has been tumultuous for one online brokerage – but is that a sign of things to come? NEWS BRIEFS New app could be the ‘Tinder of real estate’ Pocket Homes, a new app created by a pair of Calgary entrepreneurs, is being called the‘Tinder of real estate’ because it offers the same yes-no swiping interface as the popular dating app. But it doesn’t look like the app is aiming to replace real estate agents – it simply allows homebuyers easier access to the opinions of their friends and families.“Pocket Homes makes the process a lot less daunting and allows people to quickly get opinions from the people they want to hear from,”said CEO Matt Diteljan. Fraud worries mount with new e-signature rule As of July 1, changes to the Electronic Commerce Act now allow buyers and sellers in Ontario to use electronic signatures in real estate transactions. Most agents expect the change to make things easier and more efficient, but it’s also raising concerns about potential risks of fraud.“It’s more realistic for this time, but the concern is that people are going to have to take steps to protect themselves and use privacy measures,”said one Toronto-based agent.“People could be opening themselves up to fraud.” “[Agents] are going to say whatever they are going to say, but I’m proud of what we accomplished” TECHNOLOGY UPDATE
www.repmag.ca 13 How and when did you start using drones in your real estate practice? In August 2014, I was visiting my parents, and we were watching a television program on real estate. A commercial came on about being creative and being different, and promoting the use of drones. My Dad suggested I buy one. We got online right away and bought a drone within the hour. What are the benefits of using drone technology? In business and sales, creativity sells. Being different always puts you above your competition. I got my licence 11 years ago. I started when I was 23 years old, and nobody wanted to do business with me. I was forced to try to be different and innovative, and come up with new strategic ideas. I felt this was where I could be different and give my clients more. I can feature properties differently than the rest of the market. What kinds of challenges have you experienced in using drones? From when I started, Transport Canada has made changes, which ultimately changes my platform. It’s still making changes. New regulations are coming. The danger and the liability risks are substantial. I’ve got to be very cautious when I’m flying. It’s not your regular video game, though you may feel like it with the remote in your hand. This is not a ‘fun’ business; it’s serious. How can drone technology simplify the sale of a property? I have global clients who are purchasing investment and waterfront properties. I can now give them a complete aerial tour of the property, including the rooftop, neighbourhood, yard and a complete scan from above, including the interior – and they don’t have to leave their computer. Many clients purchase properties without seeing them, because the technology gives them everything they need. What do you expect for the future of drones in the real estate market? I don’t think it will become the norm. The laws are changing quickly. For commercial use, it could be outlawed. I think it’s going to be tough to do these things, and the prices will be high for those who can. Transport Canada doesn’t know how to manage it. It’s overwhelmed by how rapidly drone use is growing, but I think the business needs to be regulated before accidents happen. I think there should be a licensing system in place. I’d happily pay $100 to become licensed. I’ll just forward this cost to my clients and bill it into the cost of doing business. This will keep the business safe with mature pilots who are serious about the business. Transport Canada should also charge us to file certificates and flight plans. 3D technology to have an impact on agents More agents are using 3D technology to create virtual online tours that simplify the home-buying process, add value for the buyer and give themselves an edge over the competition. The technology also allows agents to use still images from the 3D experience in MLS listings.“It’s been a really helpful tool and one that offers some kind of standardization,” said Justus Smith, a Regina-based agent.“The fact is, agents aren’t commodities; we have to use different ideas to generate clients and value.” BCREA developing new interactive tools As part of its new 2015-2020 Strategic Plan, the British Columbia Real Estate Association will develop a range of tech tools aimed at helping to ease the buying and selling experience for agents and their clients.The new tools under development include Transaction Mapping, which will create an interactive represen­ tation of the transaction process to track the journey from beginning to end, and Realtor Match, an online tool that will help clients connect with the agent who best meets their needs. New platform to centralize multiple offers A new registry service designed to centralize and standardize offers from multiple buyers could be a solution for agents and buyers who are frustrated by phantom bids and hidden offers. DealDocket will provide agents with a host of digital tools, including the ability to store and counter offers.“Typically, agents can get multiple offers, and the clients don’t get to see just how many offers there are, so we believe this platform could change the industry and bring some transparency,”said Drew Donaldson, co-founder of DealDocket. Q&A Yearsintheindustry 12 Career highlight Selling $14 million in volume in 2014 Paul Rouillard President FLATPRICE.CA Using drones to sell real estate
PEOPLE 14 www.repmag.ca INDUSTRY ICON TAMI BONNELL exhibited an entre- preneurial spirit from a very young age. She was 13 when she started her own company, cleaning houses in a subdivision in Burlington, Mass.; by the time she was in high school, she was selling houses. Her memorable introduction to the world of real estate sales came when she was hired to clean a newly built house while the Realtor and buyers were doing their final walk-through. “The wall between the kitchen and the dining room was supposed to be an open concept, but [the builder] had made a mistake,” she remembers. “The buyers were screaming and the Realtor was screaming. They ended up slamming the door and leaving, and I just kept sitting in the window, hoping I was invisible.” The project ended up being delayed, and in frustration, the builder put his fist through a wall, breaking his hand. He asked 13-year-old Bonnell to drive him to the hospital. On the drive, the builder complained how incompetent everyone was, while Bonnell wondered how difficult it could be to sell a house. By the time the builder had returned to the subdivision with a cast on his hand, he had offered Bonnell a job helping him sell houses. “I started working for him on weekends, making $500 a house,” she says, adding that it’s legal in Massachusetts for a minor to sell on-site for builders, as long as they Re/Max International and Exit Realty International – but she calls her working relationship with Exit Realty a “pure love affair.” She started as a regional owner in 1999, became the US vice president in 2000, president in 2001 and CEO of the whole company in September 2012. Taking the exit Founded in Canada in 1996, Exit Realty FINDING HER HOME Exit Realty International CEO Tami Bonnell talks about her unusual introduction to real estate, the company’s Canadian roots and her family of lethal weapons don’t represent anybody else. (Note: It’s not, however, legal to drive a car.) Whether it was kismet or simply being in the right place at the right time, Bonnell knew immediately that the real estate industry was where she belonged. The business of real estate However, Bonnell soon realized she liked the business side of the industry better than real “In Canada, the majority of our offices have dominant market share, and we have the second highest per-person productivity in the country. We’ve grown tremendously there” estate itself, so she took a job in banking at Merrill Lynch – but fate soon put her back on the path to real estate. Merrill Lynch started acquiring real estate companies, and when management became aware of her history, they realized she just might have a knack for it. “So for the last 30 years of my career I’ve been merging and acquiring companies, selling franchises, selling regions, and building brands,” she says. Bonnell was instrumental in building three major brands – ERA International, International’s head office is still in Mississauga, Ont. “The first office, the first people to join the company – they all came from Canada,” Bonnell says. “In Canada, the majority of our offices have dominant market share, and we have the second highest per-person productivity in the country. We’ve grown tremendously here.” The similarity between the Canadian and US real estate industries is one of the reasons the company has seen such tremendous growth across North America. “There are
Name:TamiBonnell Title:CEO Company:ExitRealty International Yearsintheindustry:30+ Funfact:Bonnell,herhusband andherthreechildrenare allinvolvedinmartialarts. “Everyoneinmyhouseisa registeredlethalweapon,” shesays.“[Myhusbandand I]referee,coachandmentor people.It’sexactlywhatIdo atwork.Imentorpeopleand coachnewregionalowners andfranchiseestohelpthem dobetter…thatreallyisthe role.That’sthecommonground withmartialarts;everyone comesacrossthatthreshold tobebetter.” PROFILE
Franchise sales, mergers and acquisitions, ERA International Franchisesales,mergers andacquisitions,Re/Max International RegionalownerofNew England,ExitRealty International Vicepresident, ExitRealtyUS President, ExitRealtyUS CEO, ExitRealtyInternational PEOPLE 16 www.repmag.ca INDUSTRY ICON more restrictions and regulations in the US than in Canada, as far as real estate goes, but the concerns are the same,” Bonnell says. “I was just at a national CEO meeting with people from the Boards of Realtors and the MLS in both countries. When they came together, they realized that the major concerns in both countries were the same.” Two of these concerns are succession planning and how to attract millennials to the profession. At Exit Realty, Bonnell has been integral to the development of programs and systems that address both concerns. Agents are provided with the opportunity for residual income, as the company rewards people for the percentage of the organization they help to build. For instance, if Bonnell introduces an agent into an Exit Realty office, she would receive the equivalent of 10% of that agent’s gross commission, up to $10,000 a year, for every year the agent works there. When she retires, she still earns 7% of that agent’s gross commission. “It works amazingly for succession plans,” Bonnell says. “Half of the franchises that we’ve sold in the last two years, we’ve actually acquired other companies with them, because brokers don’t have a succession plan. This gives them the opportunity to make sure their people are taken care of and to continue to make money off the top of what they built for as long as people continue to stay with the company. So we’ve created a succession plan.” Exit Realty also has a focus on millennials. “They want to get in the game; they want to have a vested interest – 50% of them want ownership in a business,” she says. “They are very high-tech, and we are a very high-tech, high-touch company.” The brand builder Bonnell’s three previous roles were at companies she calls cutthroat, where people didn’t like working together as a team. But at Exit Realty, “I can honestly tell you that if I introduce you into the company, it’s now in my best interest,” she says. “If I’m making $150,000 and you’re making $50,000, it’s in my best interest to teach you to do better, because I get better at my job by helping you, but I also make more money by helping you.” But does she miss that adrenaline rush of selling a property, the one she first experi- enced when she was 13 years old? “I get to be in sales, selling franchising and helping to change people’s lives,” she says. “I get to be in touch with it and go to our offices. I get to be around it all the time. It’s an amazing business; it’s responsible for the number-one dream – to own a home – and I don’t think that ever gets old.” REP TAMI BONNELL’S CAREER PATH “If I’m making $150,000 and you’re making $50,000, it’s in my best interest to teach you to do better, because I get better at my job by helping you, but I also make more money by helping you” 1988 2001 2012 1993 1998 2000
Build your niche with courses leading to credentials specializing in the buyers (ABR® ), sellers SRS), seniors (SRES® ) and international (CIPS) markets, and more. Enhance your business profile with the exclusive FRI designation. Learn More, Achieve More with the Real Estate Institute of Canada (REIC). www.reic.ca 1.800.542.7342 infocentral@reic.com Aim High Achieve More FEATURES EDUCATION Why an agent’s credentials matter TOO OFTEN, selling real estate is seen as a soft skill set. But in today’s market- place, consumers expect increasing value for the services provided. Those new to the industry can present themselves as extremely competent, but they may not have all the skills needed to succeed. Short courses and seminars are great, but it’s more essential to earn creden- protect their best interests. Real estate boards across Canada recognize the advantages of advanced credentials and are making the courses available to their members. A higher level of qualification is also beneficial for the long-term sales professional. The nationally recognized FRI designation offered by the Real Estate Institute of Canada provides recognition of knowledge and skills gained through work experience. The program covers topics such as negotiating, contracts, real estate law, human behaviour and ethics in greater depth to benefit the experienced profes- sional. The FRI designation is a clear differen- tiator that raises the bar of professionalism. The job of selling real estate has grown into a sophisticated career. Advanced education and credentials provide a solid way for agents to remain viable and competitive. REP tials that provide additional grounding and recognition, and reflect market needs. In specialized areas, such as working with seniors, international buyers or first-timers, consumers want to engage a professional who fits their unique requirements. Credentials that reflect these specialties show clients that they are working with someone they can trust to www.repmag.ca 17
18 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES IN AN industry first, REP is pulling back the curtain to reveal the secret elements of the real estate agent’s lifestyle, from money matters – such as how much the average agent has in savings, home equity and investments – to less sensitive subjects, such as vacation habits and the kinds of cars they drive. A peek into the average Admit it: You compare yourselves to your peers.Whether it be the number of transactions, social media presence or the kind of suit your fellow agent is wearing, it’s hard not to compete in such an entrepreneurial industry. So how do you stack up? Olivia D’Orazio reports We encourage readers to take a good hard look behind that curtain, but be warned: What you see might encourage you to work a little harder. And you’ll be able to compare your lifestyle to more than just your own peers. This year, two of our sister publications – Canadian Mortgage Professional and Wealth Professional – have run similar lifestyle survey findings in their own pages, so we borrowed some facts and figures to see how real estate professionals stack up against their counterparts in the financial and mortgage industries, too. AGENT’S LIFESTYLE DEMOGRAPHICS Agentsbetween55and59yearsoldareslightlybetterrepresentedthanotherages AGE BREAKDOWN 18to29 30to34 35to39 40to44 45to49 55to59 65to69 75or older 50to54 60to64 70to74 16.1% 3.3% 4.7% 8.9% 14% 15.3% 4.8% 5.2% 12.3% 11.4% 2.2%
www.repmag.ca 19 British Columbia 17% Nova Scotia 2.1% Alberta 8.8% Ontario 61.3% Quebec 4.9% Saskatchewan 2.4% Manitoba 1.2% New Burnswick 1.1% Yukon 0.1% Newfoundland 0.6% PrinceEdward Island 0.6% PROVINCE BREAKDOWN CITY BREAKDOWN 10.2% 6.1% 3.3% 3.4% 3.1% 2.5% 2.5% 2.1% 1.6% 1.2% 1.1% 1.0% 0.9% 0.9% 0.8% 0.8% 0.7% 0.6% 0.6% 0.4% 0.1% Toronto Whitehorse SaintJohn Charlottetown St.John’s Regina Winnipeg Nanaimo Halifax Oakville Victoria Saskatoon Kelowna Edmonton Montreal Mississauga Vancouver Ottawa Hamilton London Calgary Surveyrespondentsrepresentmorethan270differentcities,including: 92%ofagentswork withinthecitywhere theylive MALE 56%ofagentsare 58%ofmortgage brokersaremale 67%offinancial advisorsaremale FEMALE 44%ofagentsare
20 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES WORK LIFE Mostrealestateagents haveadecadeortwoof serviceundertheirbelts EXPERIENCE 22.1% have between six and 10 years of experience 5.9% arestillonprobation, withtwoyearsorfewer undertheirbelts 16.6% havebetweenthree andfiveyearsof experience 32.1% havebetween11 and25yearsof realestate experience 22.6% havebeeninthe businessfor26to 45years 96%offinancial advisorsworkfulltime 88%ofmortgage brokersworkfulltime 22.8%ofagentsarelegacysales reps,followingtheirfamilies’ traditionsinrealestate 97%arefull-timeagents 77.9%ofagentsenteredthereal estatebusinessasa second–orthird–career Based on our survey results, it would appear the contentious issue of part-timers versus full-timers is a molehill, not a mountain – a staggering majority of respondents are, in fact, full-time
www.repmag.ca 21 “I think Realtors should be full-time – dedicated, trained and professional. I don’t think you can give full your commitment being part-time” DebbieHanlan,DebbieHanlanRealEstate,St.John’s ROYAL LEPAGE 32.7% RE/MAX 24.9% CENTURY 21 9.6% COLDWELL BANKER 5.9% HOMELIFE 2.5% SUTTON GROUP 1.7% KELLER WILLIAMS 1.5% RIGHT AT HOME 1.4% HARVEY KALLES 0.5% EXIT REALTY 0.4% CHESTNUT PARK 0.3% SOTHEBY’S 0.2% VIA CAPITALE 0.2% AGENTS REPRESENT A DIVERSE LIST OF CANADA-WIDE BROKERAGES Someofthemostpopularinclude: 49% 21.3% 19.1% 6.6% 2.5% 1.4% 16ormore 5to10 3to5 1or2 None 11to15 AVERAGE NUMBER OF DEALS PER YEAR: HOW DO AGENTS GET THOSE DEALS? BY MARKETING LIKE MAD. 19.2% 20.6% 34.8% 12.8% 8.5% 4.3% ofagentsspendmorethan$10,000onmarketingeachyear ofagentsspendbetween$5,000and$10,000 ofagentsspendbetween$1,000and$5,000 ofagentsspendbetween$500and$1,000 ofagentsspendbetween$100and$500 ofagentsspendlessthan$100eachyear 14%ofagentsworkwithregional orindependentbrokerages Morethan
22 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES MONEY MATTERS NEARLY HALF OF AGENTS EARN SIX FIGURES EACH YEAR $150,001+ 25.1% $101,000–$150,000 21.6% $81,000–$100,000 12.6% $61,000–$80,000 17% $41,000–$60,000 11.8% $0–40,000 11.9% SAVVY SAVERS $5,000to $20,000 11.8% Lessthan$3,000 17.4% $1millionormore 6.8% $550,000to $900,000 4.4% $240,000to $500,000 19.8% $110,000to $200,000 15.2%$60,000to $100,000 12.4% $25,000to $50,000 12.2% AMOUNT IN SAVINGS AND INVESTMENTS Manyofthosewithsmallamountsintheir savingsadmittedtohavingjustpurchasedtheir firsthomes 77%ofrealestate agentsplantobe workingpast65 anyway “It all comes out of sacrifice. As with any sales job, if you put in that much time, you’ll make a lot of money” NeresSraidarian,BigCityRealty,Toronto 39.3%ofagentswillbesetfor retirementby65 34.9%won’tbe 25.9%areunsure 53%ofmortgage brokerswillbeready forretirementby65 $312,000averageamountamortgagebroker hasinsavingsandinvestments $483,000averageamountafinancialadvisor hasinsavingsandinvestments Agentsmighthaveareputationforflash,butmostalso havesomemoneysockedawayinsavings $324,000Averageamountarealestateagenthasinsavings
www.repmag.ca 23 REAL ESTATE AND MORTGAGE MATTERS WHO SOLD YOUR HOME? 70.1%ofrespondentsusedareal estateagenttobuyorselltheirownhome 29.9%ofagentsfeltcomfortable doingitthemselves OWNING A HOME 0-10% 15-25% 55-70%30-50% 75-98% 100% 7.2% 8.2% 27% 10.7% 16% 30.4%Nearlyathirdof agentsreportthat they’vepaidoff themortgageon theirprincipal residence INVEST IN STYLE CHESTNUT PARK REAL ESTATE LIMITED, BROKERAGE Stay tuned for the fall edition of Chestnut Park’s Invest In Style magazine. Landing on doorsteps near you. This beautiful publication includes feature articles and boasts some of the finest homes and recreational properties in Ontario. @chestnutparkhomes #investinstyle @therealtiffsly #investinstyle @estatesofmuskoka #investinstyle @bradenwhite_toronto #investinstyle @bessieseyfert #investinstyle chestnutpark.com | 416.925.9191 | 1300 Yonge Street, Suite 100 Toronto, ON M4T 1X3
24 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES EDUCATION “I have represented the sale of my own home – every one I’ve sold. I know it best, and I know the industry, so I would represent the sale of my home – not necessarily the person purchasing it, though” DebbieHanlan,DebbieHanlanRealEstate,St.John’s 45.6% preferthe country 54.4% ofagentsare citydwellers 48.2% OF AGENTS OWN RENTAL PROPERTIES Onaverage, mortgagebrokers payaninterest rateof2.5% 62.8%ofagentshaveamortgage, buttheirratesvary 1.9% ofagentspaylessthan2% 19.9% ofagentspaybetween 2%and2.49% 41.9% ofagentspaybetween 2.5%and2.99% 23.7% ofagentspaybetween 3%and3.5% 5.9% ofagentspaybetween 3.54%and3.99% 6.5% ofagentshaveaninterestrate higherthan4% Thehighestinterestratereportedwas12%;thatwas foranincomeproperty 47.7% own1rentalproperty 21.1%own2 11.7%own3 19.5%own4ormore 60%offinancial advisorshaveatleastan undergraduatedegree 42% ofmortgage brokershaveatleastan undergraduatedegree ONGOING EDUCATION Continuingeducationismandatory,butsomeagentsgo aboveandbeyond 53.3%ofagentsholdatleastonedesignation 5.1%ofagentsholdmorethan fouradditionaldesignations Somehighschool 3.2% Highschooldiploma 12.2% Someuniversity 48.7% Undergraduatedegree 23.2% Graduatedegree 12.7% Ofthosewhoowninvestmentproperties:
www.repmag.ca 25 “It’s a stereotype in any sales job. You have to show success, and that’s one of the ways to do it. But some people do it too early, and that’s why they don’t get anywhere” NeresSraidarian,BigCityRealty, Toronto 16.5%paid$100or lessfortheir bestsuit 52.8%paid $100-$500 21.9%paid $500-$1,000 8.8%paid$1,000 ormore 41.1% ofagentsspent lessthan$100on theirwatch 39.4% spentbetween $100and$500o awatch 8.51% spentbetwee $500and$1,000 onawatch 11% ofagentsspent morethan$1,000on theirwatch 58.4%donot 41.6%ofagentsconduct businessinasuit LIFESTYLE 60%offinancial advisorsdobusiness inasuit 40%ofmortgage brokersdobusiness inasuit 18.4% ownabespokeor tailoredsuit
“It’s important to have a vehicle for the terrain you deal with. And it’s nice to have a nice car” RaymondBorley,Century21,Rocky MountainHouse,Alta. 02 04 06 08 0 100 39.2%boughtused 60.8%boughtnew 6.7%driveapickuptruck 4%driveaminivan 33.5%driveasedan 43.9%driveanSUV 4.2%driveasportscar 7.7%driveacompactcar OF THOSE WHO OWN A CAR 16.6%paidlessthan$20,000 fortheirmainvehicle 10.8% paid$20,000-$25,000 15.5% paid$25,000-$30,000 21% paid$30,000-$40,000 17.3% paid$40,000-$50,000 18.9% paid$50,000ormore WHAT KIND OF CAR DO YOU DRIVE? Ford:11.2% Toyota:9.9% BMW:7% MercedesBenz:6.4% Lexus:5.4% Honda:5.3% Nissan:4.9% Dodge:4.2% Volkswagen:4.1% Cadillac:3.6% Chevrolet:3.6% Acura:3% Maserati:0.1% Agentsdriveeverymakeandmodelimaginable. Herearesomefavourites: 26 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES 79.7%owntheircar 19.9%lease
www.repmag.ca 27 HOW MUCH VACATION TIME DO YOU TAKE? 8.5% takelessthanone weekperyear 11.1% takeoneweekof vacation 23.7% takethreeweeks 24% taketwoweeks 23%ofmortgage brokersown avacationhome 20%offinancial advisorsown avacationhome 10.2%ofagentsare membersofaprivateor countryclub 57.6%ownacottage 32.3%ownUSor international property 10.1%ownboth 44%ofmortgage brokerstakeatleastfour weeksofvacation 59%offinancial advisorstakeatleast fourweeksofvacation 32.8% takefour weeksormore 19.3% OF AGENTS OWN A VACATION HOME Ofthosewhoownavacationhome: www.repmag.ca 27
COVER STORY: AGENT LIFESTYLE FEATURES HOW OFTEN DO YOU USE SOCIAL MEDIA? 28.5% useit occasionally “Social media is a new venue for reaching people, and it’s exploding. If you’re not involved with social media, you are behind the times” DebbieHanlan,DebbieHanlanReal Estate,St.John’s 63.1% useitdaily 8.4% ofbrokersneveruse socialmedia “It’s where everybody looks for information, where everybody complains. It’s what comes up when you Google someone’s name” NeresSraidarian,BigCityRealty,Toronto 68.3%favour Facebook 14.2%focuson LinkedIn 6.3%choose Google+ 4.5%favour YouTube 4.2%prefer Twitter 2.4%choose Instagram 47.3% 30.2% 22.6%useaniPhone preferAndroid stillsupportBlackberry 60%ofmortgagebrokers usesocialmediadaily 51%offinancialadvisors usesocialmediadaily 28 www.repmag.ca
FAMILY LIFE 71%offinancial advisorshavebeen marriedonce 69%ofmortgage brokershavebeen marriedonce 10%ofagents havenever beenmarried 19.8%havebeen marriedtwice 2.4%havebeenmarried threeormoretimes 67.8%havebeen marriedonce 18.9%ofagentsdonothaveanykids 11.7%have1 40.7%have2 19.1%have3 6.3%have4 3.5%have5ormore 29%ofmortgage brokersdonothavekids 23%offinancial advisorsdonothavekids www.repmag.ca 29
30 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES 16.1%of agents haveacat 28%ofmortgage brokershaveacat 15%offinancial advisorshaveacat 38.5%of agentshave adog AGENTS ARE EITHER GUNG-HO FITNESS BUFFS OR PROUD COUCH POTATOES 35.5%ofagentsnever gotothegym 32.5%ofagentsgo atleasttwice aweek 45%ofmortgage brokershaveadog 30%offinancial advisorshaveadog
www.mortgagebrokernews.ca 31 Finally, a fast & easy way for your sellers to obtain funds before their closing date! Learn more about how Tembo Financial can help you and your clients today Funds in as little as 48 hours with NO appraisal and NO credit check 4646 Dufferin St. Suite #6, Toronto, ON M3H 5S4 1.844.238.6717 info@tembofinancial.com www.tembofinancial.com 1.844.238.6717 info@tembofinancial.com Great reasons sellers may need early access to their equity: FSCO License No. 12598 ♦ Deposit For New Purchase ♦ Bridge Financing ♦ Closing Costs ♦ Moving Expenses ♦ Repairs On Their Sold Home ♦ Unexpected Expenses ♦ Personal Emergency ♦ Renovations ♦ Debt Consolidation ♦ Taxes ♦ Vacation TIM HORTONS IS THE PREFERRED COFFEE VENDOR 49.4% ofagentsenjoyTim Hortonscoffee 24.7% preferStarbucks 24.5% ofagentsbringtheir coffeefromhome 1.4%ofagentslike SecondCup ARE AGENTS FOODIES, OR JUST BAD COOKS? 0 10 20 30 40 50 60 eatoutmultipletimesaday eatoutonceaday eatoutonceaweek eatoutonceamonth 5.2% 24.6% 52.8% 17.5%
32 www.repmag.ca What is a 15-minute mortgage? The 15-Minute Mortgage is a lead-generation tool that can be placed on any website. It currently appears on all CENTUM mortgage agents’ websites. How does it work? What is the process for the client? A client would click on the online tool to get prequalified for a mortgage. This process takes 15 minutes or less. After they have completed the questions, they will receive an email thanking them for the application and providing a prequalified amount, as well as advising them that they will be contacted shortly by a CENTUM agent. The agent gets the lead immediately, and they are required to call within 30 minutes or send an email within an hour. The lead will show all the information on the client, along with the purchase price and down payment they are looking for. How does it benefit real estate professionals? It can be placed on any website, so it can What is The 15-Minute Mortgage? Kathryn Grant, CENTUM’s new Director of Broker Services, answers REP’s questions about the company’s new mortgage lead-generation tool that benefits real estate agents go on a Realtor’s website. For instance, a CENTUM agent might partner with a Realtor and have the widget on their website. If a client used this tool, the lead would be emailed to the Realtor and the mortgage agent. The agent would then contact the Realtor with a pre- approval. This is a great way for mortgage agents to build strong relationships with Realtors. In the past, it has typically been an agent trying to get Realtors to send referrals, but we’re giving a lot more back now. It’s quick, it’s easy, and it’s a very good-quality lead for the real estate agent. What happens if the client is declined? They are never declined. They will receive an email letting them know they need to answer more questions, which still offers a very good opportunity for a mortgage agent to get in contact with that client to help them if there is a concern with credit or income, etc. The agent can then advise and help the client to re-establish their credit or, if the income isn’t enough, they can provide other options. This is still a lead for the agent and Realtor in the future. Is The 15-Minute Mortgage available to all mortgage brokers? No. This is an exclusive tool created by CENTUM and used only by their mortgage agents. If a real estate agent would like access to the tool, they can easily partner with a CENTUM agent. REP INTRODUCING KATHRYN GRANT WHAT’S NEW AT CENTUM? CENTUMiscontinuouslygrowinganddeveloping newtools.Thecompanyhascreatedavery excitingnewbusinessmodelthatbringsthereal estateandmortgageindustriestogether,forming theperfectmarriagebetweenqualityservice, minimaleffortandhighprofits.Staytunedfor detailsinthenextissueofREP. In her role as Director of Broker Services, Kathryn Grant is the newest member of the CENTUM corporate family. She’s spent more than a decade in the financial services industry, and brings a wealth of knowledge and experience to the role. Kathryn began her career in finance before moving to a senior position at a major bank. She joined CENTUM as a mortgage agent and then opened her own franchise, building it to become one of the most successful in the CENTUM family. Kathrynenjoystakingonchallengingand creativefinancing,aswellasexperiencingthe joyofhelpingCanadiansrealizetheirdreams ofhomeownership.“Iamveryexcitedbymy newroleandamlookingforwardtosupporting CENTUMagentstocontinuetobetheoutstanding professionalstheyare,”shesays.“Ilovebeing withanorganizationthatisonthecuttingedgeof drivingboththeCENTUMbrandandthemortgage industryforwardthroughinnovation.” SPECIAL PROMOTIONAL FEATURE Q&A
34 www.repmag.ca DONE DEAL FEATURES Selling a piece of Canadiana SPRAWLING ACROSS 65,000 acres in rural Quebec, Kenauk Montebello is one of the largest privately held parcels of land in Canada – so it’s no surprise that it offered its listing agents a one-of-a-kind marketing opportunity when it came time to open the sale up to the public. “It was a very unique strategy based on a cost-per-acre model,” says Herb Ratsch, a broker with Sotheby’s International Realty, who sold the property with Jones Lang LaSalle’s Robert MacDougall in December 2013. The asking price was $81.25 million – or $1,250 per acre – to own one of North America’s largest and longest-established private fish and game reserves. The property The wilderness reserve lays claim to more than 70 private lakes and is home to a gated community with 13 luxury chalets and an exclusive marina. Add more than 102 kilometres of lakefront vistas on Lac Papineau, hundreds of kilometres of existing roads and an idyllic location neigh- bouring the quaint village of Montebello, Que., and the possibilities for the buyer are endless. “It’s the proverbial location, location, location,” Ratsch says. “It’s an hour from Ottawa, an hour from Montreal, and Highway 50 goes directly there. It is also connected to the world-famous Chateau Montebello.” The roots of this property are entrenched in the history of the region. In 1674, the King of France granted the land to Quebec’s first bishop, Monseigneur Laval. Before the opening of nearby Chateau Montebello, the area was the private retreat of the Seigniory Club, whose elite membership reportedly included notable foreign and Canadian businessmen, politicians, and dignitaries, such as former prime minister Lester B. Pearson, as well as Prince Rainer and Princess Grace of Monaco. A 65,000 acre parcel of land in rural Quebec – with 70 private lakes, 13 chalets and a piece of Canadian history up for grabs – offered its listing agents a unique challenge “It has incredible, rich history,” Ratsch says. “Every prime minister was a member of the club.” Since the 1970s, Kenauk has operated a retreat where guests can stay in one of the 13 chalets, eight of which reside on their own exclusive lake. Guests enjoy the year-round activities Canada is famous for, such as fishing, kayaking, canoeing, boating, swimming, hiking, hunting, golf, cross-country skiing, snowshoeing and dogsledding.
take aerial photos and video – and, once the property was listed, to take clients on site visits. Ratsch and MacDougall worked with Sotheby’s New York head office, asking: “This is the biggest, most prestigious piece of land on the market. What would you do?” The Wall Street Journal agreed to launch the sale in its magazine and on its website as long as it was the first to promote it. “So we held off for around 60 days to get the massive distribution in the US,” Ratsch says. In March 2013, the property was officially launched with a feature article in the Wall Street Journal, and then was subsequently picked up by the New York Times. “Then it went everywhere,” Ratsch says. “The spin-off was huge, the media afterwards … everyone wanted to know what was going on. That really gave it a big international jump. You can only come out of the bag once, and we wanted to come out with a bang. We felt that this had more legs internationally than in Canada.” The sale The sales strategy was to use a price- per-acre listing because nobody believed the property could be sold at such a high price. “It was just a lot of acres,” Ratsch says. “When you look at it on a cost per acre, it was cheap. If you listed it at $75 million, people would ask how we came up with that number. So we listed it at $1,250 per acre with the goal of achieving about $1,000 to $1,250 an acre. And then it’s just a multiplier.” The duo also put together a booklet that provided information about Kenauk Montebello Reserve and broke up the property by each of its lakes. “This lake is worth $2 million, that lake is worth $5 million ... people realized there is $100 or $150 million of sales when you break it all up,” Ratsch says. For instance, he explains, a private lake between 500 or 1,000 acres might sell for $3,000 to $5,000 an acre, so when a potential buyer looked at the booklet to see the breakdown, they would realize what a great opportunity it was. The property was sold as a private estate to a group of five buyers for an undisclosed but princely sum. REP THE PROPERTY BY THE NUMBERS The marketing The listing of Kenauk Montebello was as unique as the property itself. Sotheby’s and Jones Lang LaSalle signed an exclusivity contract with the Wall Street Journal in September 2012. The agents spent the next six months building a website, working on the marketing content, creating a video and a booklet, and using a helicopter to QUICK LOOK ADDRESS 100CheminKenauk, Montebello,QC,J0V1L0 LISTING DATE March2013 LISTING PRICE $81.25million SOLD DATE December2013 SIZE 65,000acres PROPERTIES 13chalets 475 14.5 5 100 90 KILOMETRES OF LAKEFRONT KILOMETRES OF RIVER ISLANDS ON THE PROPERTY KILOMETRES OF ROADS -MINUTE DRIVE FROM MONTREAL OR OTTAWA www.repmag.ca 35
36 www.repmag.ca EXPERT ADVICE FEATURES 3 Repurpose unusable indoor items for outdoor use Instead of dumping old possessions in the trash, why not think of creative ways to use them in the garden? This is a great way to give an outdoor space a stylish and individ- ualized aesthetic. I like to get imaginative with my planters, using anything from WE’RE ALL guilty of funnelling time and money into indoor spaces and barely giving the backyard a moment’s thought. After all, what is there to do with a patch of grass and a few trees? The easy answer: A whole lot! Don’t underestimate the design (and selling) potential of an outdoor space. With cooler weather and firm, dry ground, autumn is the perfect time to take on these types of projects, adding subtle details that will have a big impact on homebuyers. It’s not as hard as you think. You don’t need to be a landscape designer to help your clients make their green space as great as their living room. All that’s required is some crafty thinking and a bit of creativity. 1 Build a deck for entertaining When it comes to improving the backyard, I’m a huge advocate of creating and maximizing usable space. Homebuyers will perceive a home as larger, and therefore more valuable, if it has great, usable space outdoors. A deck is the most versatile way to achieve an even, multipurpose surface, perfect for dining furniture and comfortable seating. There are a lot of things to consider when installing a deck, but choosing the right materials is the key. For outdoor projects, my go-to is MicroPro Sienna, a pressure-treated wood that has a gorgeous rich brown hue but doesn’t require initial staining. It’s durable and built to last, but sellers will love that it’s also affordable. 2 Increase those outdoor hours With fewer bugs and beautiful breezes, fall evenings are always my favourite. Urban fire bowls or infrared heat lamps are a great way to extend the season and make a space instantly cozier. Add a few extra pillows and blankets, and you’ll have a hard time bringing the homebuyers back indoors. 6 ways to get the backyard ready for buyers As the summer winds down and the fall selling season kicks off, now is the perfect time to make sure a home’s outdoor space looks as great as the rooms indoors. Celebrity landscaper Carson Arthur shares his 6 tips for making the best of the backyard
www.repmag.ca 37 watering cans to old garden boots or even broken chandeliers. 4 Don’t be afraid of colour Don’t just rely on flowers to create colour in your client’s backyard. Colourful planters, pillows or even rugs are a great way to add a bit of character. Plus, the extra bonus of adding colour through acces- sories means that you’re not married to any one look. You can easily change it up complement the rest of your client’s home! Remember, just like any room inside the house, the backyard is a blank canvas that your clients and prospective buyers can paint with their personality. 5 Add privacy With more patios being installed in backyards and fewer trees, the need for a private area out of the view of neigh- bours has never been more pertinent. I recommend adding a pergola, which creates a secluded space with extra privacy. Like with a deck, when constructing a pergola, make sure to choose durable and environ- mentally friendly materials. 6 Use multifunctional pieces to maximize outdoor space Just as with the indoor space, you don’t want an empty room outside – you want it to have purpose! Creating a versatile living space that functions both for your clients and for future buyers can add significant value to the home’s resale price. It could be an outdoor dining area, a vegetable garden, a play area for the kids or a cozy spot to unwind. Be sure to incorporate multipurpose furniture pieces as well. REP Whennotinthedirtwithhiseco-friendly landscapedesigncompany,CarsonArthur staysbusybuilding,planting,writingor designingasafeaturedgueston“CityLine.” Hisshow,“CriticalListing,”iscurrently airingonHGTVCanada.Formore,visit www.carsonarthur.com. Just like any room inside the house, the backyard is a blank canvas that your clients and prospective buyers can paint with their personality PhotobyBobGundu,courtesyofMicroProSienna
SPECIAL PROMOTIONAL FEATURE 38 www.repmag.ca What is Leading Real Estate Companies of the World? How does it work? Leading Real Estate Companies of the World [LeadingRE] is the largest global real estate network in terms of annual home sales. It was established in 1997 by brokers who wanted to control their own destiny and build their distinctive local brands while enjoying the power of inter- national connections and the resources available through economies of scale. Our members benefit from more than 30,000 client referrals annually, as well as listing and branding tools, luxury marketing, online learning, confer- ences and technology solutions – programs previously available only from franchises. How does LeadingRE differentiate itself from the competition? One differentiator is that we are local and we are global. We start with local market-leading firms and empower them to prosper as part of a powerful global entity. Another is that membership is by invitation only – we are very selective in order to live up to our name. And because LeadingRE is the brand behind the member’s brand, we see them as the stars and us as the supporting cast. Finally, we provide the advantages of a franchise without the costs and restrictions. Our members are with us because they have a return on investment and derive measurable value, not because they are bound by a long-term contract. How should the real estate industry be thinking about education? We live in a world where information is free and knowledge is priceless. LeadingRE’s mantra is ‘making the best brokerages better,’ so we are all about high standards of quality, competence and exceptional performance. We support our affiliates through a 24/7 online learning platform called Institute, with a version specifically for Canadian members. Our conferences are routinely charac- terized as the industry’s best. We provide webinars to Pam O’Connor, president and CEO of the Chicago-based company Leading Real Estate Companies of the World® tells REP how Canadian real estate professionals can grow their global presence address evolving educational needs, and our CEO groups connect owner brokers for idea-sharing and peer reviews. These continuous learning opportunities are embraced by our members in their quest to maintain and enhance their market leadership. Why is LeadingRE interested in the Canadian market? Our hybrid local/global model has been a tremendous success in the US, where we represent 14 of the top 25 brokerages and have $80 billion more in annual sales than any franchise. Replicating that success in Canada, with the same opportunity for brokers to own and control their local brand while enjoying the resources and connections of a worldwide affiliation, would be a win-win for all. As the world becomes smaller with more cross-border movement, it’s essential to think beyond borders and provide services to assist clients both across town and around the world. Building on our foundation of top independent brokers in Canada to have an even stronger national presence here is a priority for LeadingRE. What are some Canadian real estate trends that excite you? First, the trend toward urbanization for convenience and lifestyle signals more referral opportunities, which is one of the strengths of our network. Second, the slow but steady improvement in the housing market and low interest rates make Canadian real estate a great investment. And third, the shrinking business margins in real estate here should make our high-value model very attractive to Canadian brokers. We believe we offer a unique opportunity for top-quality Canadian firms that are interested in a new and rewarding way of doing business. REP Q&A BY THE NUMBERS Formoreinformation,visitwww.leadingre.com,orcontactSheila Barrat312-361-8632orsbarr@leadingre.com. How to become a leading real estate company 500globalindependent realestatefirms 50+countrieswhere LeadingREhasa presence 30,000+annualclient referrals $80 billion moreinannual salesintheUSthan anyfranchise 14ofthetop25 brokeragesinthe USareLeadingRE members
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FEATURES 40 www.repmag.ca Lending solutions for subprime clients ALTERNATIVE FINANCING Subprime homebuyers require a little more work when it comes to putting together financing, but teaming up with the right alternative lender can help make these deals go smoothly ALTERNATIVE LENDING may not be the first route real estate professionals think of taking when advising clients about their mortgage options, but it’s certainly an area that is growing in popularity – and in necessity, given the tightening of Canada’s mortgage regulations. There are a range of clients who fit into the alternative lending space, such as those who are self-employed, those with below-average credit scores or those who know they are pushing the boundaries on typical A-lender affordability factors. “For some, alternative lending will always be their best option,” says Brian Gentles, a mortgage broker with TMG The Mortgage Group Alberta. “It can help them grow their business. It can help them manage personal tax implications and build a nest egg for later years in the form of retained earnings. But too few borrowers even know that alternative lending exists. We need to do a better job of getting the word out.” Many clients will require a broker or real estate agent to explain to them how and why they don’t fit into A lending, what alternative lending can do for them, and how they might eventually transition to an A lender if they make and follow a plan.
www.repmag.ca 41 “I provide clients with alternative solutions when they are not able to get regular financing from the banks,” Xu says. “Especially for Realtors, the aim is to get the deal closed.” Moss feels those operating in the alternative lending space should take on the role of educating the homebuyer. “Maybe the term ‘lifestyle coach’ is more of a recent thing, but that’s the way I’ve always been since day one – and it’s always been effective,” he says. He adds that the advice he passes along to clients is very much welcomed – even if it is tough-love advice – especially when it comes to credit rehabilitation. “People living within their means can be a big issue,” he says. “People are afraid to give that sort of advice or tell a person what to do, but it really does help them. They appreciate hearing the honest truth, and they respond to it.” Xu is also a strong believer in the value of education. She runs in-office teaching “Too few borrowers even know that alternative lending exists. We need to do a better job of getting the word out” BrianGentles,TMGTheMortgageGroupAlberta CASE IN POINT Who: A professional couple wanted to buy a second home for a family member to live in. Why: They had great income stability, very low ratios and were able to put 25% down, but they were also very sloppy on credit card payments. The couple was declined four times in the A lending space, including at financial institutions where they had previous relationships. Outcome: Since their Beacon scores were still 640-660, an alternative lender was able to do the deal in a heartbeat. “Almost everyone goes through ups and downs,” says Graeme Moss, principal broker at Fair Mortgage Solutions in Hamilton, Ont. “If a person has a down, whether it is due to illness, job loss, divorce, a million things, the goal I have is to get them back on track, like a doctor. What is powerful to clients is giving guidance or a roadmap.” Lending alternatively The proportion of mortgages given out by alternative institutions – other than banks or credit unions – remains small, at roughly 2.2% of the entire market, according to a recent report by CIBC. But alternative lenders’ share of the overall mortgage market has grown, starting at 0.8% during the 2008 recession and expanding at a rate of around 25% per year, said Benjamin Tal, deputy chief economist of CIBC World Markets, in a recent Globe and Mail article. One of the reasons for this is tighter government regulations, which have allowed alternative lenders to fill an important void. Beginning in 2012, the Office of the Superintendent of Financial Institutions ushered in the B20 and B21 guidelines, aimed at defining principles that encourage best practices in respect to sound residential mortgage insurance underwriting. The final phase of the regulations was just imple- mented in June 2015. The changes have had a predictable knock-on effect on the lending space, forcing more borrowers to consider alternative options. Mortgage brokers and real estate agents have adapted accordingly. “I think a percentage of the broker world has learned the alternative side due to the regulation changes and how they have affected the lender’s guidelines,” Gentles says. Three years ago, many feared the regula- tions would be too onerous for the industry and on borrowers, but the new rules have, in fact, helped to reassert the traditional broker role – and, subsequently, the real estate agent’s role – as expert advisor and educator. Relationships and education Christine Xu, a mortgage broker and private lender at Mortgage Architects in Markham, Ont., has seen her client base evolve over the past few years, from mostly A clients to alternative borrowers. Of these clients, around half are referred to her by real estate agents, a reciprocal relationship that she believes is integral to the process.
FEATURES sessions for real estate agents. “I try to educate the Realtor, explain how they can qualify their client,” she says, adding that those same lessons can be extended directly to the client. “When the client has the down payment, I teach them how to calculate a regular interest payment to show them whether they are able to afford it. If the client is unable to afford it, then I’m not doing the client any favours.” Doing your homework An important strategy for attracting clients who are suited to alternative lending options is to forge relationships with key stakeholders, including those in the A lending space. “Having a relationship with branch managers of banks and credit unions is more important than ever because more of those clients are being turned down than ever before,” says Dustan Woodhouse, a broker at Dominion Lending Centres based in Coquitlam, BC. This is where education comes into play, as WHAT PERCENTAGE OF YOUR DEALS ARE ALTERNATIVE? Source:PollconductedbyMortgageBrokerNews.ca,March2015 81%ormore 61-80% 41-60% 21-40% 10.6% 32.9% 11.7% 17% 9.5% 7.4% 10.6% “Almost everyone goes through ups and downs. What is powerful to clients is giving guidance or a roadmap” GraemeMoss,FairMortgageSolutions agents will be required to have candid conver- sations with borrowers to make sure they are aware what is required, since the regulation changes ushered in an increase in necessary documentation. “They’ll come to you and say, ‘Five years ago, I only needed to provide three documents, and now you’re asking me for 20 documents,’” Woodhouse says. “Well, that’s the way it’s changed – so it’s the skill with which you can communicate the increased requirement of documents that will make a huge difference.” Lenders are on the same page in asking brokers and agents to focus on communi- cating the appropriate use of alternative financing options to clients, but the starting point for that process often will involve the brokers and real estate agents ensuring they are up to speed on alternative lending. “In a nutshell, education, partnerships and CASE IN POINT Who: A seasoned professional had recently left employment to create his own company. He had one month’s work on the books, solid credit and net worth, and owned his principal residence free and clear. He also owns three rental properties with around 50% financing. His goal was to conserve cash for a rainy day, and he wanted to purchase another income property. Why: The A-lenders were looking for two years of tax history and proven income for his business. Outcome: His principal residence was refinanced with an alternative lender to secure the down payment, and he financed 70% on the new income property with the same lender. All funds borrowed are for investment purposes, so all interest is tax deductible. 0% 1-10% 11-20% 42 www.repmag.ca ALTERNATIVE FINANCING
 Self-employed; bruised credits; quick closings;  Our turn around time is 24-48 hours for 95% of our deals;  We will give you a straight forward answer for all your mortgage concerns;  Our private mortgage rate starts from 4.99%.  Call me for your free consultations. Hotline: 416-716-6468 Toll Free: 1-866-908-7234 Email: inquiry@moneybroker.ca 4400 Hwy. 7 E, Markham ON L3R 1M2 (Hwy. 7 Kennedy) RESIDENTIAL AND COMMERCIAL MORTGAGES Mortgage Broker, AMP CHRISTINE XU Ranked No.3 at CMP “Top 75 Mortgage Brokers 2015” Recipient of the Chinese Business Excellence - Social and Community Contribution Award 2015 “Top 10 Commercial Brokers 2013” “Top 10 Women of Influence in Mortgage Industry 2015 & 2013” BEST ALTERNATIVE LENDING BROKER OF THE YEAR WINNER 2015WINNER 2015 Winner of “Best Alternative Lending Mortgage Broker of the Year 2015” WE SPECIALIZE IN CHALLENGING DEALS!
FEATURES OUR PROMISE TO YOU:  To share with you all information that is relevant to making an informed decision regarding your choice of mortgage.  To answer all of your questions.  To respond promptly to all telephone call and emails.  To keep you, and the rest of your real estate team as appropriate, appraised of the status of your file.  To show you the opportunity to pay off mortgage and other debt much faster.  To be your mortgage consultants for life. BRIAN GENTLES ACCREDITED MORTGAGE PROFESSIONAL TMG The Mortgage Group Alberta Ltd. | 1-866-273-6192 | brian@briangentles.com | www.briangentlesteam.com  Experience  Competence  Relationships  Putting it all to work for you Not just a mortgage... YOUR mortgage! Residential and Commercial Mortgages networking are the trifecta of the alternative lending business,” says Steve Lydon, national sales manager for alternative lender MCAP Eclipse. “This area is growing quickly with huge future potential, but brokers need to know how to make it work for them and their customers. Attending seminars, researching the sector, and reading industry journals and “I provide clients with alternative solutions when they are not able to get regular financing from the banks. Especially for Realtors, the aim is to get the deal closed” ChristineXu,MortgageArchitects articles to learn about the business and alternative lending guidelines are the keys.” Ultimately, agents will need to acclimatize themselves, and then their clients, to a very different landscape than that of the prime- lending world. “I think the surge is more of a long-term wave,” Gentles says, “and I believe that we are just at the beginning of it.” REP CASE IN POINT Who: After a messy marital separation, but with help from parents, this borrower had clear title to the home but battered credit. Why: The borrower needed 50% loan-to-value to repay her parents. No A lender would come to the table, not even at that LTV with low ratios. Outcome: It took a three-year alternative lender deal with a plan in place to rebuild credit and then refinance with an A lender at maturity. 44 www.repmag.ca ALTERNATIVE FINANCING
PEOPLE 46 www.repmag.ca AGENT PROFILE THE DAY was September 3, 2008. Glen Kirkland, a fourth-generation soldier in the Canadian Army, was just days away from returning home to his family after a difficult tour in Afghanistan’s Zhari District in the heart of Kandahar Province. The day started like any other. Kirkland and his crew drove through the mountainous desert, patrolling a Taliban stronghold. Minutes later, the only light Kirkland would see was from the fire of a rocket launched at the tank carrying members of his platoon. Usually, Kirkland never rode up front, but on this day, he was driving. That decision proved to be the difference between life and death. Three of his fellow soldiers were killed in the attack, while Kirkland was left for dead. “By the numbers, I should be dead,” he says in I Came Back, a recent documentary about his experience. “Ninety per cent of the time, I was in the back of the LAV. That time I wasn’t, and that was the time we got hit.” Heart of darkness During a mission with US and British forces, Kirkland and his team were surveying areas in what is known as the ‘Heart of Darkness,’ an epicentre of Taliban control. The operation had started a few days before the attack took place; Kirkland slept in old buildings and huts. During the mission, he went out with his platoon as a medic in case of enemy attack. He took the wheel just before the attack, turning onto Taliban Road near Kandahar City. “We were going to pick a fight with them,” he says. “We were going to knock on their door and pick a fight with them.” The mission looked like it was going to be a success, but things soon took a turn for the worse. That day on the tank is now seared in Kirkland’s memory. “It was a very surreal thing,” he says. “I didn’t have any feeling in [my body], and I thought, ‘Wow, this is what it’s like to die; it isn’t too bad.’ So I made a choice – either I was going to stay there and die or try to get out of there.” Kirkland managed to escape and was later rescued by Canadian forces. He was lucky to be alive. His bulletproof vest was gone. His helmet was dust. His shirt was torched. He suffered severe burns and damage to his hearing, but was able to help load the rest of his colleagues into the LAV. Back from the brink From the gruelling war zones of Afghanistan to the rigorous world of real estate, Glen Kirkland has come full circle after a traumatic experience changed his life forever. Jordan Maxwell reports “I didn’t have any feeling in [my body] and I thought, ‘Wow, this is what it’s like to die; it isn’t too bad. So I made a choice – either I was going to stay there and die or try to get out of there”
www.repmag.ca 47 The return When he returned to Canada from Afghanistan, the traumatic experience hit Kirkland hard. Like many of his fellow soldiers, he battled PTSD and alcoholism. It was his father, who also served in the military, who helped him through to the other side. “When I first came back, everything was surreal,” he says. “You’re ripped from a war zone and put back into normal civilian life. It was a tough transition for me. It was my Dad who really helped me. I talk to him literally every day, and he’s a true hero. But ultimately, it was a decision I made. And I didn’t want to be that person. I went to Brandon University right away and went right into my real estate career. That helped a lot, just to have something else to focus on.” After making the decision to go back to school, Kirkland eventually reintegrated himself back into civilian life. His decision to go into real estate was something he’d been pursuing long before he became a member of the Canadian Army. While he’ll never forget what happened that September day in Afghanistan, what Kirkland chooses to focus on are the similarities between life on the battlefield and life in the real estate industry, where his discipline has helped to make him one of the most decorated agents in Manitoba. “You never turn it off,” he says. “When you’re overseas, you’re always switched on; you’re always working, so in that regard, it’s the same thing. You can’t compare getting into a gunfight to selling a deal, but that work ethic and discipline is what keeps us going.” REP THE FIGHT FOR BENEFITS WhenGlenKirklandreturnedfromAfghanistan,hefaceda strugglethatmanysoldiersintheCanadianArmyhavetaken theHarpergovernmenttotaskover:benefits.Kirklandtestified beforeaparliamentarycommitteeaboutthedifficultyhefaced whentryingtoreceivehealthbenefitsfollowingtheTaliban attackthatkilledthreeofhisfellowsoldiers.Hewaseventually dischargedfromthearmyaftersufferinghearinglossandabrain injurythatlefthimdependentoninsulin. TheConservativegovernmenthassincepouredmillionsof dollarsintoveterans’programs,andrecentlyunderscoredits commitmenttoex-soldiers,butmanyremainskepticalaboutthe treatmentofCanadiansoldiers.
48 www.repmag.ca FAVOURITE THINGS PEOPLE FAVOURITE CELEBRITY I have a not-so-secret celeb crush on Gerard Butler. FAVOURITE VACATION SPOT Dubrovnik, Croatia. It has the perfect mix of Old World charm, stunning landscapes and horrifying history. FAVOURITE BOOK Atlas Shrugged by Ayn Rand. This book sparked some of the most intense debates of my life so far. VANESSA ROMAN FAVOURITE THING ABOUT WORKING IN REAL ESTATE: Real estate is the epitome of change; it is all about beginnings and endings. With every house I sell, people close one door, only to open another, behind which awaits endless possibility, adventure and opportunity. I feel privileged to share the journey of homeownership with my clients. First-time buyers,Gerard Butler,‘mom jokes’and Manchester United – these are a few ofVanessa Roman’s favourite things FAVOURITE MOVIE I’m a sucker for rom- coms. I have watched Love Actually and P.S. I Love You more than 15 times each. FIRST REAL ESTATE DEAL: My first real estate deal wrecked me – it was absolutely perfect! I was working with a family member who was well-qualified, knew exactly what she wanted, and we found ‘the one’ after touring only four properties. In the days that followed, I had endless daydreams about the perfect clients I would work with in the future, negotiating perfect deals for them. Looking back, my naivety makes me smile. FAVOURITE REAL ESTATE DEAL First-time homebuyers are always my favourite deals. It’s wonderful to share their enthusiasm, witness their wide-eyed wonder at all of the housing options out there and to be a voice of reason when the responsibility of becoming a homeowner seems overwhelming. FAVOURITE THING OUTSIDE OF REAL ESTATE I tell jokes – the really cheesy kind that only dads can get away with. I’m a mom, so I just don’t have the same delivery, I guess. People expect mom jokes to be better somehow. My family and friends don’t even fake laugh anymore. Photofromwww.goodreads.com Realtor with Exit Realty Metro,radio host,columnist and host of HGTV’s“Reno vs Relocate” FAVOURITE SPORT Soccer (football) – I’m a proud Manchester United fan. FAVOURITE FOOD Anything I can eat with my fingers. Silverware is overrated. FAVOURITE MUSIC 1930s and ’40s swing-era bands. Duke Ellington, Glenn Miller and Benny Goodman had a timeless rhythm I could listen to all day long.
GET EXCLUSIVE EDUCATION including C21 CareerXpress: harness top producers’ habits in 30 days. JOINTODAY!1.855.228.7338 | century21franchise.ca | century21careers.ca Independently Owned and Operated. ®/™ trademarks owned by Century 21 Real Estate LLC used under license or authorized sub-license. © 2015 Century 21 Canada Limited Partnership ®™ Trademarks of AIR MILES International Trading B.V. Used under license by LoyaltyOne, Co. and Century 21 Canada Limited Partnership. THIS LISTING IS MINE. I’M IN CONTROL.WHO KNEW? TODAY, MY WEEK IS FULL. LIMITS? WHAT LIMITS? NOW,WHICH COURSE NEXT...
Realty isEXIT Regional Office EXIT Franchise *Not including 2015 growth Prime Canadian Regional and Franchise Territories Available For more information contact: Tami Bonnell, C.E.O. 1.877.253.3948 Make this ThE fInEsT busInEss dEcIsIon of your career! GRoWInGaND eVeRyONe CaN Feel it!Objective: 3,600 Franchises With Over 100,000 Agents Across North America! HAWAII* *Out of proper positioning because of lack of space www.exitrealty.com

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REP 1.03

  • 1. ALTERNATIVE FINANCING WHY MORE OF YOUR CLIENTS ARE TURNING TO THIS SOLUTION LANDSCAPE LESSONS 6 QUICK FALL SPRUCE-UPS THAT WILL ENTICE BUYERS HISTORIC DEAL INSIDE THE SALE OF A MULTIMILLION-DOLLAR PIECE OF CANADA REPMAG.CA ISSUE 1.O3 | $6.95 THE AGENT’S LIFESTYLE See how you stack up to your peers in commission, marketing strategies, work/life balance and more
  • 2. A NEW WAY TO GROW LeadingRE.com | sbarr@LeadingRE.com | 312.361.8632 ® Leading Real Estate Companies of the World® has brought its unique and compelling business model to Canada–one that has helped create a real estate powerhouse responsible for over 1,000,000 transactions valued at $321 billion in annual home sales. If you are a local leader of an independent company – or are intrigued by building your own brand without sacrificing robust resources and connections – we invite you to learn more about the value of aligning with Leading Real Estate Companies of the World® . LOCAL STRENGTH. GLOBAL RESOURCES. “We are grateful this alternative to franchising is available to strong independent companies like ours across Canada.” - Ron Stader Broker & General Manager CIR REALTY Calgary, Alberta “Leading Real Estate Companies of the World® has provided an invaluable platform.” - Jonathan Cooper, Vice President, Operations Macdonald Real Estate Group, Inc. Vancouver, British Columbia “The firms that make up this global network are hand-chosen and the most successful independent brokerages in the world.” - Tom Bosley President & CEO Bosley Real Estate Ltd. Toronto, Ontario
  • 3. CENTURY 21 ASSURANCEKELOWNA THE BIG LITTLE CITY We think there’s a better way to do real estate.  EARN MORE AND KEEP MORE – A full service brokerage with a full service marketing team to take care of all the administrative and creative tasks so you can focus on the buyers and sellers.  LOOK BETTER DOING IT – State of the art agent websites, professional photographers and graphic designers will make you look like a rockstar.  YOU GET YOUR LIFE BACK – You deserve better from your brokerage. Let us take care of listing details while you spend time doing what you love. CENTURY 21 Assurance Realty Ltd. 251 Harvey Avenue, Kelowna, BC V1Y 6C2 Office: 250-869-0101 Fax: 250-869-0105 Toll Free: 888-301-2121 myrna.park@century21.ca FOCUS YOURSELF ON HIGH-VALUE TASKS WORKING SUCCESSFULLY WITH BUYERS AND SELLERS
  • 4. 14 34 36 40 18 2 www.repmag.ca CONTENTS CONNECT WITH US Got a story or suggestion, or just want to find out some more information? twitter.com/REPMagCA plus.google.com/+RepmagCanada CHECK IT OUT ONLINE REPMAG.CA facebook.com/REPmagCA COVER STORY THE AVERAGE AGENT’S LIFESTYLE Ever wondered how you compare to your peers? REP surveyed agents across the country to paint a picture of the ‘typical’ real estate agent’s lifestyle PEOPLE INDUSTRY ICON Exit Realty CEO Tami Bonnell talks about the unique way the company retains top talent FEATURES DONE DEAL Selling the 65,000-acre, multimillion-dollar Kenauk Montebello estate required a one- of-a-kind marketing strategy FEATURES EXPERT ADVICE Carson Arthur offers 6 ways to wow buyers before they walk through the door FEATURES LENDING SOLUTIONS Alternative lending moves into the spotlight as more Canadians find themselves unable to qualify for conventional financing ISSUE 1.03 UPFRONT 04 Editorial Is foreign investment a good or bad thing for the housing market? 05 Head to head The future of online real estate in the wake of Zoocasa 06 Statistics What the burgeoning condo market means for your business 08 News analysis The sold data debate reaches an apex 10 Mortgage update Are more regulations on the horizon? 12 Technology update How one agent is making the most of new drone technology FEATURES 32 What is a 15-minute mortgage? A look at Centum’s new online lead-generation tool 38 How to become a leading real estate company The CEO of Leading Real Estate Companies of the World explains how Canada fits into its global strategy PEOPLE 46 Agent profile After a near-death experience in Afghanistan, former soldier Glen Kirkland found a new life in the real estate industry 48 Favourite things Vanessa Roman, host of HGTV’s “Reno vs Relocate”
  • 5.
  • 6. 4 www.repmag.ca UPFRONT EDITORIAL Fuel to the foreign buyer fire T his summer, foreign buyers were once again thrust into the hot seat, as Prime Minister Stephen Harper moved to make one of Canada’s hottest real estate debates an election issue. His campaign promise, announced in August, is that if the Conservatives are re-elected, they would spend half a million dollars tracking and reporting data on foreign ownership. Harper said that if foreign investors are found to be driving the cost of housing to unaffordable levels, the government should find a way to address this. The move has been welcomed by economists, who called the promise very positive, regardless of who wins the election. However, they also have pointed out that any decision on policies to restrict overseas investors from buying Canadian property should be left until after the data has been collected. Earlier in the summer, China’s plummeting stock market reignited the debate about the influence of foreign investment on the country’s housing market. The decline of the Shanghai Composite has led many to predict Chinese nationals buying Canadian property will soon head for the exits as they look for cash to make up for stock losses. Others are just as convinced there will be no fire sale on Canadian real estate. The discussion also has turned to just how much influence those interna- tional buyers have in the first place, and whether more rigorous restrictions on their investments are needed. Regardless, experts suggest that, since many Chinese investors saw surges in stock values last year, they are happy to sit on their now-modest profits. That suggests – fingers crossed! – they’re prepared to hold their Canadian property for the long term as well. Clearly, that kind of steadfast commitment benefits all players in Canadian real estate – especially those agents representing the buyers and sellers. Vernon Clement Jones, editor Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as the magazine can accept no responsibility for loss EDITORIAL Editorial Director Vernon Clement Jones Senior Writer Jennifer Paterson Writers Olivia D’Orazio Jordan Maxwell Donald Horne Copy Editor Clare Alexander CONTRIBUTORS Carson Arthur ART & PRODUCTION Design Manager Daniel Williams Designer Lea Valenzuela Production Manager Alicia Salvati Traffic Manager Kay Valdez SALES & MARKETING Associate Publisher Trevor Biggs General Manager, Sales John Mackenzie National Account Manager Mark Youash Marketing and Communications Manager Claudine Ting Project Coordinator Jessica Duce CORPORATE President & CEO Tim Duce Office/Traffic Manager Marni Parker Events and Conference Manager Chris Davis Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil EDITORIAL INQUIRIES vernon.jones@kmimedia.ca SUBSCRIPTION INQUIRIES tel: 416 644 8740 • fax: 416 203 8940 subscriptions@kmimedia.ca ADVERTISING INQUIRIES mark.youash@kmimedia.ca KMI Media 312 Adelaide Street West, Suite 800 Toronto, Ontario M5V 1R2 tel: +1 416 644 8740 www.keymedia.com Offices in Toronto, Denver, Sydney, Auckland, Manila SUMMER 2O15 Real Estate Professional is part of an international family of B2B publications and websites for the real estate and mortgage industries CANADIAN MORTGAGE PROFESSIONAL vernon.jones@kmimedia.ca T +1 416 644 8740 MORTGAGE PROFESSIONAL AUSTRALIA sam.richardson@keymedia.com.au T +61 2 8437 4787 MORTGAGE PROFESSIONAL AMERICA cathy.masek@keymedia.com T +1 720 316 0154 www.repmag.ca If foreign investors are found to be driving the cost of housing to unaffordable levels, the government should find a way to address this
  • 7. UPFRONT www.repmag.ca 5   “Zoocasa was never a big player in the real estate industry.There are thousands of agents in Toronto, and less than 400 were registered with Zoocasa. It was fairly insignificant.With the new investment in the site, it’s just going to be like any other brokerage.Zoocasa, at the beginning, was trying to be a brokerage, but it ended up becoming an agent matchmaker. Buying a home is the most expensive purchase people make during their lifetime, and I don’t think it can be done by just looking at listings online. It’s important to work with an experienced Realtor. Buyers who just shop online are missing the experience and could make mistakes.” “The demise of Zoocasa is something that many could have predicted.The market for online discount brokerages has historically been riddled with failure.The reality is that consumers prefer the more traditional approach to buying and selling homes. The new ownership appears to understand the basic consumer desire for a more full-service and a perceived non-discounted approach.The‘new’ Zoocasa tries to do what most Realtors do – provide a full end-to-end personal service. I don’t personally think it’ll succeed, primarily because the traditional way of conducting business has always come out ahead.” “A challenge for any alternative brokerage is getting a critical mass of market share. Most of these alternative sellers haven’t done well in terms of acquiring any significant market share. It’s difficult when CREA and its MLS product have 90% to 95% of the market. As a buyer or seller, you’re not inclined to go to any other service. Until an alternative brokerage hits that threshold and can have a meaningful number of listings, it will be in a Catch-22 situation, because it’s difficult to grow. It doesn’t bode well for the start-ups, if their business model is competing head- to-head with MLS.” Is this the end of the online brokerage? How much is Zoocasa’s demise – and subsequent resurrection – an indication of what’s to come for online real estate? Josee Couture Salesrepresentative Re/MaxHallmarkRealty Dr. John Andrew Realestateprofessor Queen’sUniversity Dustin Graham Salesrepresentative TheGrahamPartners OnlinebrokerageZoocasa,asubsidiaryofRogers,announcedinJunethatitwasclosingitsdoors.ARogersspokespersonsaidthetelecommunicationsprovidermadethedecisionto nolongercontinueitsinvestmentinZoocasa,andmembersoftheindustrylashedoutonREP’sonlineforum,sayingthatbeingarealestateagentisaboutmorethanjustdata.Tendays later,ZoocasawasrevivedwhenRealtorLaurenHawandagroupofinvestorspurchasedthesite’sdomainfor$350,000.Thebusinessmodelhaschanged,butagentsremainwatchful. ZOOCASA’S ROLLER COASTER SUMMER HEAD TO HEAD
  • 8. UPFRONT 6 www.repmag.ca STATISTICS House or condo? AsCanada’spopulationcontinuestoswell–especially insomeofthecountry’smoremetropolitanareas– condosarebecominganincreasinglypopularoption foralldemographics TALL ORDERS IN TORONTO AND VANCOUVER Source:CREA,2014 Source:CMHC,CanadianHousingObserver2013 Source:StatCan,Census2011 1 NumberofupdatestotheOntario CondominiumActsince1998 FORGET URBAN versus suburban. The new­est debate is about property types: specifi- cally, condo (or strata) properties versus detached or semi-detached homes. In most Canadian markets, condos remain an affordable option for first-time buyers, those new to the country and those looking to downsize. However, detached homes remain popular for growing families and those seeking freehold living quarters. While detached properties far outnumber condo units in every Canadian province, the sales and prices of condos are growing, particu- larly in Vancouver and Toronto. Demand for housing is still driving new single-family home construction in the suburbs, which is currently outpacing condo construction. But strata properties are slowly spreading to some of the country’s suburbs as the inventory of detached properties dwindles, pushing prices up. That’s one trend that’s likely to gather pace in the coming years as condos currently under construction reach completion and developers embark on new projects. 844.4% Percentagegrowthinoccupied condounitsbetween1981and2011 19% Percentageofcondoowners whoareyoungerthan35 29% Percentageofcondoowners whoareolderthan65 Increaseinannualsales,2014(YOY) Increaseinaverageprice,2014(YOY) HOW DO YOU TAKE YOUR HOME? GROWING OPPORTUNITY InmostCanadiancities,the salesofdetachedandsemi- detachedhavehistorically outweighedthesalesofcondo units,butthefiguresarestarting tobalanceout,offeringagents anopportunitytobolster volumeswithoutleavingtheir ownfarmarea. It’snosurprisethatTorontoandVancouverhavesomeofthestrongestcondo marketsinthecountry,andcondosalesandpricescontinuetoincrease Mosthomeownersprefer detachedproperties,followed bycondos.Butthereisstill alargeportionofCanadians livinginrowhouses, townhousesandothersemi- detachedproperties Singledetached Condo Rowhouse, townhouse orduplex Semi-detached 56% 28% 11% 5% Vancouver Toronto 41.3% 58.7% Vancouver 30.8% 69.2% Victoria 14.1% 10.2% 3.8% 5.2%
  • 9. www.repmag.ca 7 BUILD UP, BUILD OUT SPOTLIGHT: EAST COAST Source:CREA2014,TREB2014,GMREB2014 Source:CREA,2013and2014Source:CMHC,PreliminaryHousingStartData2014 Annualsales SaintJohn 35% Halifax-Dartmouth 3% St.John’s 8% Medianprice SaintJohn -4% Halifax-Dartmouth -5% St.John’s -2% The year-over-year change in building permits paints a varying picture across the country. On the West Coast, more detached properties were being built in 2014 than the year before, but in Saskatchewan, Manitoba and Quebec, growth in permits for condo construction far outpaced that for detached properties TheWestCoasttendstodominatewhenitcomes tocondosales,buttheEastCoastmarketis slowlygrowing.However,whiletransactions haverisen,year-over-yearpriceshavedipped British Columbia Alberta Saskatchewan Manitoba Ontario Quebec New Brunswick NovaScotia PrinceEdward Island Newfoundland &Labrador 15% 0% 0% 6% 15% -19% 20% -17% -11% -12% 11% -7% -24% -24% -16% -23% -16% -27% -43% 16% Detached Other 23.9% 76.1% Toronto 9.4% 90.6% Ottawa 10.6% 89.4% Hamilton-Burlington 6.5% 93.5% Londonand St.Thomas 34% 66% Montreal 9.8% 90.2% St.John’s3.8% 96.2% Newfoundland& Labrador 19.2% 80.8% Edmonton 17.9% 82.1% Calgary 23.9% 76.1% Saskatoon 8.8% 91.2% Regina 1.8% 98.2% SaintJohn Detached Condo 16.5% 83.5% Halifax-Dartmouth
  • 10. UPFRONT 8 www.repmag.ca NEWS ANALYSIS Sold data debate heats up As a tribunal prepares to hear the case on making sold data public,real estate veterans weigh in on what a decision ultimately means for the industry THE HEATED debate around the release of sold data is about to combust, as the Toronto Real Estate Board finally goes up against the Competition Bureau in a tribunal hearing in October. The long-awaited ruling will determine once and for all whether sold data will remain private or be opened to the public. Regardless of the outcome, many agents are convinced that sold data’s entry into the public domain is inevitable. “Buyers today are choosing to ... be heavily involved in the search,” says Carl Langschmidt, president of Property.ca. “It makes sense that they can use technology to help them do homework and due diligence on a property.” But most agents disagree, pointing out that allowing public access to the system could create a host of problems. “An investment has been put in by all the agents in paying for these systems to operate, and there should be compensation if we’re going to allow other people to have access to them,” says Ernie Hawrysh, an agent at Century 21 Gold Key Realty. “We have to operate the system. It doesn’t get cheaper.” He does admit, however, that even agents are demanding more from the system, a point the Competition Bureau is also focused on. A spokesperson for the organization told REP in a statement that TREB’s actions in restricting access to the data are harming competition by preventing real estate agents from offering new and innovative services to consumers through the Internet. Indeed, south of the border in the US, data flows much more freely, paving the way for a range of smartphone apps and websites that build on that data and offer consumers access to things like proximity to schools and crime rates. While some of these types of technol- ogies are becoming available in Canada, they are thwarted by the fact that the underlying data is not widely open to the public. “MLS has been caught in the dark ages,” says Dr. John Andrew, a real estate professor at Queen’s University and director of the school’s Real Estate Roundtable. “If it was really willing to compete and wanted to protect what it has, it would have done a lot more in developing that kind of technology. “If it made that data freely available, these various apps would pop up overnight,” he continues, “and there’s no reason those couldn’t be added on to the MLS system. But it’s not doing that at all. As a result, the system today looks pretty much exactly how it looked 15 years ago.” “There are a lot of agents whose value proposition is still information. They view themselves as the gatekeepers of information ...” CarlLangschmidt,Property.ca
  • 11. www.repmag.ca 9 While Andrew says transparency is a good thing for the industry, he also admits that the way the Canadian Real Estate Association, via MLS, has protected its data over the years is an effective business strategy. “It essentially has a monopoly,” he says. “But it’s legal, in the sense that it developed that product, and it’s not really willing to share much of the data.” One reason many real estate agents are against the sharing of sold data is that providing and contextualizing the figures on what houses actually sold for is a key part of their value-added service model. “There are a lot of agents whose value proposition is still information,” Langschmidt says. “They view themselves as the gatekeepers of information and view their job as helping people price a property.” Hawrysh adds that home sellers are biased and don’t have the expertise to list their own homes. “Your own personal house is always the castle,” he says. “You will always price it at the maximum because you’re a biased appraiser. Those numbers won’t be realistic.” REP ROOTS OF THE COURT CASE “An investment has been put in by all the agents ... and there should be compensation if we’re going to allow other people to have access ...” ErnieHawrysh,Century21GoldKeyRealty May2011 April2013 January 2014 February 2014 March 2014 July2014 September– October 2015 October 2015 Anapplicationisfiledwith theCompetitionTribunalto challengetherestrictionsTREB hasimposedonitsmembers’ useofdataintheMLSsystem Thetribunaldismissesthe application Anappealtothatdecisionis heardbytheFederalCourtof Appeal[FCA]inToronto TheFCAreferstheapplication backtothetribunal TREBfilesanapplication forleavetoappealtheFCA’s decisiontotheSupremeCourt ofCanada[SCC] TheSCCdeniesTREB’s applicationforleavetoappeal Thetribunalwillreconsiderthe Bureau’sapplicationinare- hearingthatbeginsSeptember 21andendsOctober5 Adecisionisexpectedfrom thetribunalaboutthefutureof solddata
  • 12. NEWS BRIEFS Feds could consider more mortgage changes The federal government is reportedly undertaking consultations to determine whether it should impose new mortgage rules to help take the heat out of the real estate market, according to the Financial Post. It said Ottawa is considering a range of changes, including raising the minimum down payment, tweaking mortgage insurance, imposing a 20-year maximum amortization and bringing in specific conditions on high-value housing. If the reported consultations lead to changes, homebuyers would face more difficulty in being approved for a mortgage. The Department of Finance denied the report. Bank of Canada hopes cut will stimulate economy The Big Five banks reacted quickly to the Bank of Canada’s decision to cut interest rates in July, but mortgage brokers suggest the lowering of rates will have little impact on the market, except to attract homebuyers who are currently sitting on the sidelines to finally get in the game. In a statement, the BoC said,“Canada’s economy is undergoing a significant and complex adjustment. Additional monetary stimulus is required at this time to help return the economy to full capacity and inflation sustainability to target.” Low mortgage rates helping affordability The affordability of homes across Canada was mostly unchanged in the first quarter of 2015, activity that was largely down to lower mortgage rates, according to a report published in June by the economics research arm of mortgage lender RBC. The report showed that, between February and May, sales increased 11.2%. With limited signs of stress being exerted on homebuyers outside the white- hot Toronto and Vancouver markets, RBC’s measures are still quite close to their long-term averages, suggesting that current conditions are within historical norms. Mortgage increase would hurt homeowners More than a third of homeowners would encounter financial difficulty if their mortgage increased by just 10%, according to the recent Manulife Bank of Canada Household Debt Survey. A further 15% of respondents said they would not be able to absorb any increase in their mortgage payment. The survey also found that 56% of Canadian homeowners reduced their mortgage debt in the past year, paying down an average of $6,300. Nearly a fifth (18%) made an extra lump-sum payment, while 17% increased their regular payment, and 5% did both. Most first-time buyers consulted a broker First-time homebuyers consulted an average of 1.2 mortgage professionals and obtained 1.7 mortgage quotes before purchasing a home, according a recent survey from the Canadian Association of Accredited Mortgage Professionals. Nearly two-thirds of first-time buyers (61%) consulted a mortgage broker (and 39% obtained their mortgage from that broker), while 75% consulted a bank representative. The survey also found that fixed-rate mortgages are the most common type (72%), while 21% of borrowers opted for variable- or adjustable-rate mortgages. 10 www.repmag.ca UPFRONT MORTGAGE UPDATE A new report published by the CD Howe Institute proposed that mortgage insurance be separated from the CMHC and moved into a new fund to protect taxpayers. According to the report, if unemployment rises and house prices fall, Ottawa would have to pay out $9 billion to cover mortgage defaults. “Our analysis indicates that a low-probability, but severe, housing crash could result in roughly $17 billion of losses for mortgage insurers,” said Thorsten V. Koeppl, one of the report’s authors, in a statement. Industry professionals believe the risk, in reality, is very small, even with a significant correction. “The word ‘correction’ presup- poses that something is wrong, and I think the math shows today’s prices are simply the new normal – and still have room to run,” says Dustan Woodhouse, a mortgage broker with Dominion Lending Centres. Though the report did say that Canada’s mortgage insurance system is architecturally sound, it suggested three reforms that it believes would reposition the system to better address the risk of a severe housing crash. Those include redesigning the government backstop as a stand-alone fund that accumu- lates reserves in advance of a housing crisis, up to a target level, and has the capacity to borrow against future revenue if needed. The report also advocated mandating the Financial Institutions Supervisory Committee The mortgage insurance risk enigma Are proposed reforms to backstop mortgage insurance risk just more regulations the industry doesn’t need?
  • 13. www.repmag.ca 11 to oversee the backstop fund, and making the backstop available for the residential ownership market only. Some brokers, however, remain uncon- vinced that more regulation is necessary. “My view is that the largest risk to the housing market is further overzealous regulation – in particular, further restrictions at the wrong end of the market, such as the first-time buyer,” Woodhouse says. “We need the new entrants into the market; they are vital to not only move up buyers looking to sell, but also to our economy, which relies on construction of new homes for new household formation – numbers that are projected to continue to rise.” The federal government has already imposed significant regulatory tightening on the mortgage market since 2008, he adds, much of it done for the optics as much as anything. “Canadians don’t miss mortgage payments, and Canadians don’t max themselves out,” Woodhouse says. “The debt-to-income metric thrown around is a weak measure and means little.” Educating clients on collateral charge mortgages What is a collateral charge mortgage? It is method of securing a mortgage or loan against a property that allows the borrower to tap into the equity of their property without incurring legal fees later on. These mortgages are not new; RBC, BMO, CIBC and the credit unions all offer them, but they were first introduced in October 2010 by TD Canada Trust. How does it differ from a conventional mortgage? A collateral charge is non-transferable, which means it can’t be assigned or transferred to a new lender like a regular mortgage. For a borrower looking to switch to a new lender at the end of their mortgage term, a collateral charge means they can’t switch without having the mortgage re-registered, thus incurring new legal fees and appraisal costs. It is also unlike a standard mortgage because it is readvanceable, which means the lender can loan more money after closing without the borrower needing to go back through a lawyer, as long as the borrower can service the new debt. Which type of borrower does it suit? It offers a lot of flexibility, so a buyer who wants to redo the kitchen three years after purchasing a home can roll it into the mortgage, assuming they can service the higher debt. For buyers who aim to pay off their homes as quickly as possible, it might not be the right option. If they want to be open to moving their mortgage at renewal and shopping all the lenders for a new rate and term, then having a collateral charge wouldn’t be the right fit because the borrower is locked in with their lender. What are some of the hidden challenges? Sometimes collateral charges allow the lender to do things like change the interest rate, increase the loan amount and use the equity to pay down other debts the borrower might have with the lender, should the borrower default on those debts. Why is it a hot topic right now? I think there are a couple reasons. One is because there has been a lot of negative press about them in the past few years. CBC News’“Marketplace,” for starters, did a piece on an undercover consumer getting a collateral mortgage through the bank, and it didn’t go well for TD. Another reason is that consumers are becoming more educated about mortgages. We’ve seen a lot of changes to the mortgage rules over the past years, as well as a big shift on interest rates. Because of this, I think we’ve seen a lot of consumers take a more inclusive role in the mortgage decision process. Kelly Hudson Mortgage expert DOMINION LENDING CENTRES AEGIS MORTGAGE SERVICES “The largest risk to the housing market is further overzealous regulation” Yearsintheindustry 3 Fastfact Inadditiontohelping peopleachievetheir dreamofowninga home,Hudsonalso advocatesforpeople adoptingrescuedogs Q&A
  • 14. 12 www.repmag.ca UPFRONT Zoocasa looked as if it might be the first in a domino-effect finish for web-based real estate buying and selling. The online brokerage, which was owned by Rogers, shut its doors in June. Darryl Mitchell, broker of record for the online brokerage, told REP, “We worked hard to provide quality leads, and the stats show that. [Agents] are going to say whatever they are going to say, but I’m proud of what we accomplished.” But just two weeks after the plug was pulled, Zoocasa was revived when Realtor Lauren Haw and a group of investors purchased the site’s domain for $350,000. Haw said that, going forward, the site will focus only on GTA properties, at least until it rebuilds with new agent clients and online listings. “Our mission is to give homebuyers access to the best possible real estate tools and infor- mation while providing a premium level of in-house customer service – and that means building a team of professionals who can adapt to changing consumer expectations,” Haw told the Toronto Star. The same week Zoocasa came back to life, Yellow Pages shared the news that it had purchased the online real estate platform ComFree/DuProprio Network for $50 million, marking the latest growth in its digital strategy. It is the fourth most visited network of real estate properties in Canada, generating more than $40 billion in revenue last year. The addition of the network is the latest in Yellow Pages’ move to accelerate its digital transformation by creating marketplaces that help Canadians transact with their local neigh- bourhoods, according to CEO Julien Billot. “As demand for comprehensive and cost-ef- fective real estate services continues to grow, we will actively leverage our national reach and relationships to enrich ComFree/DuProprio’s value proposition, extend their offerings to homebuyers and sellers Canada-wide, and deliver sustainable digital revenue growth for our company,” Billot said in a press release. Both the resurrection of Zoocasa and Yellow Pages’ push into the online real estate space signal that, despite the ironclad protection over sold data, competitors insist on challenging a status quo that works, according to most agents. The future of online brokerages The summer has been tumultuous for one online brokerage – but is that a sign of things to come? NEWS BRIEFS New app could be the ‘Tinder of real estate’ Pocket Homes, a new app created by a pair of Calgary entrepreneurs, is being called the‘Tinder of real estate’ because it offers the same yes-no swiping interface as the popular dating app. But it doesn’t look like the app is aiming to replace real estate agents – it simply allows homebuyers easier access to the opinions of their friends and families.“Pocket Homes makes the process a lot less daunting and allows people to quickly get opinions from the people they want to hear from,”said CEO Matt Diteljan. Fraud worries mount with new e-signature rule As of July 1, changes to the Electronic Commerce Act now allow buyers and sellers in Ontario to use electronic signatures in real estate transactions. Most agents expect the change to make things easier and more efficient, but it’s also raising concerns about potential risks of fraud.“It’s more realistic for this time, but the concern is that people are going to have to take steps to protect themselves and use privacy measures,”said one Toronto-based agent.“People could be opening themselves up to fraud.” “[Agents] are going to say whatever they are going to say, but I’m proud of what we accomplished” TECHNOLOGY UPDATE
  • 15. www.repmag.ca 13 How and when did you start using drones in your real estate practice? In August 2014, I was visiting my parents, and we were watching a television program on real estate. A commercial came on about being creative and being different, and promoting the use of drones. My Dad suggested I buy one. We got online right away and bought a drone within the hour. What are the benefits of using drone technology? In business and sales, creativity sells. Being different always puts you above your competition. I got my licence 11 years ago. I started when I was 23 years old, and nobody wanted to do business with me. I was forced to try to be different and innovative, and come up with new strategic ideas. I felt this was where I could be different and give my clients more. I can feature properties differently than the rest of the market. What kinds of challenges have you experienced in using drones? From when I started, Transport Canada has made changes, which ultimately changes my platform. It’s still making changes. New regulations are coming. The danger and the liability risks are substantial. I’ve got to be very cautious when I’m flying. It’s not your regular video game, though you may feel like it with the remote in your hand. This is not a ‘fun’ business; it’s serious. How can drone technology simplify the sale of a property? I have global clients who are purchasing investment and waterfront properties. I can now give them a complete aerial tour of the property, including the rooftop, neighbourhood, yard and a complete scan from above, including the interior – and they don’t have to leave their computer. Many clients purchase properties without seeing them, because the technology gives them everything they need. What do you expect for the future of drones in the real estate market? I don’t think it will become the norm. The laws are changing quickly. For commercial use, it could be outlawed. I think it’s going to be tough to do these things, and the prices will be high for those who can. Transport Canada doesn’t know how to manage it. It’s overwhelmed by how rapidly drone use is growing, but I think the business needs to be regulated before accidents happen. I think there should be a licensing system in place. I’d happily pay $100 to become licensed. I’ll just forward this cost to my clients and bill it into the cost of doing business. This will keep the business safe with mature pilots who are serious about the business. Transport Canada should also charge us to file certificates and flight plans. 3D technology to have an impact on agents More agents are using 3D technology to create virtual online tours that simplify the home-buying process, add value for the buyer and give themselves an edge over the competition. The technology also allows agents to use still images from the 3D experience in MLS listings.“It’s been a really helpful tool and one that offers some kind of standardization,” said Justus Smith, a Regina-based agent.“The fact is, agents aren’t commodities; we have to use different ideas to generate clients and value.” BCREA developing new interactive tools As part of its new 2015-2020 Strategic Plan, the British Columbia Real Estate Association will develop a range of tech tools aimed at helping to ease the buying and selling experience for agents and their clients.The new tools under development include Transaction Mapping, which will create an interactive represen­ tation of the transaction process to track the journey from beginning to end, and Realtor Match, an online tool that will help clients connect with the agent who best meets their needs. New platform to centralize multiple offers A new registry service designed to centralize and standardize offers from multiple buyers could be a solution for agents and buyers who are frustrated by phantom bids and hidden offers. DealDocket will provide agents with a host of digital tools, including the ability to store and counter offers.“Typically, agents can get multiple offers, and the clients don’t get to see just how many offers there are, so we believe this platform could change the industry and bring some transparency,”said Drew Donaldson, co-founder of DealDocket. Q&A Yearsintheindustry 12 Career highlight Selling $14 million in volume in 2014 Paul Rouillard President FLATPRICE.CA Using drones to sell real estate
  • 16. PEOPLE 14 www.repmag.ca INDUSTRY ICON TAMI BONNELL exhibited an entre- preneurial spirit from a very young age. She was 13 when she started her own company, cleaning houses in a subdivision in Burlington, Mass.; by the time she was in high school, she was selling houses. Her memorable introduction to the world of real estate sales came when she was hired to clean a newly built house while the Realtor and buyers were doing their final walk-through. “The wall between the kitchen and the dining room was supposed to be an open concept, but [the builder] had made a mistake,” she remembers. “The buyers were screaming and the Realtor was screaming. They ended up slamming the door and leaving, and I just kept sitting in the window, hoping I was invisible.” The project ended up being delayed, and in frustration, the builder put his fist through a wall, breaking his hand. He asked 13-year-old Bonnell to drive him to the hospital. On the drive, the builder complained how incompetent everyone was, while Bonnell wondered how difficult it could be to sell a house. By the time the builder had returned to the subdivision with a cast on his hand, he had offered Bonnell a job helping him sell houses. “I started working for him on weekends, making $500 a house,” she says, adding that it’s legal in Massachusetts for a minor to sell on-site for builders, as long as they Re/Max International and Exit Realty International – but she calls her working relationship with Exit Realty a “pure love affair.” She started as a regional owner in 1999, became the US vice president in 2000, president in 2001 and CEO of the whole company in September 2012. Taking the exit Founded in Canada in 1996, Exit Realty FINDING HER HOME Exit Realty International CEO Tami Bonnell talks about her unusual introduction to real estate, the company’s Canadian roots and her family of lethal weapons don’t represent anybody else. (Note: It’s not, however, legal to drive a car.) Whether it was kismet or simply being in the right place at the right time, Bonnell knew immediately that the real estate industry was where she belonged. The business of real estate However, Bonnell soon realized she liked the business side of the industry better than real “In Canada, the majority of our offices have dominant market share, and we have the second highest per-person productivity in the country. We’ve grown tremendously there” estate itself, so she took a job in banking at Merrill Lynch – but fate soon put her back on the path to real estate. Merrill Lynch started acquiring real estate companies, and when management became aware of her history, they realized she just might have a knack for it. “So for the last 30 years of my career I’ve been merging and acquiring companies, selling franchises, selling regions, and building brands,” she says. Bonnell was instrumental in building three major brands – ERA International, International’s head office is still in Mississauga, Ont. “The first office, the first people to join the company – they all came from Canada,” Bonnell says. “In Canada, the majority of our offices have dominant market share, and we have the second highest per-person productivity in the country. We’ve grown tremendously here.” The similarity between the Canadian and US real estate industries is one of the reasons the company has seen such tremendous growth across North America. “There are
  • 18. Franchise sales, mergers and acquisitions, ERA International Franchisesales,mergers andacquisitions,Re/Max International RegionalownerofNew England,ExitRealty International Vicepresident, ExitRealtyUS President, ExitRealtyUS CEO, ExitRealtyInternational PEOPLE 16 www.repmag.ca INDUSTRY ICON more restrictions and regulations in the US than in Canada, as far as real estate goes, but the concerns are the same,” Bonnell says. “I was just at a national CEO meeting with people from the Boards of Realtors and the MLS in both countries. When they came together, they realized that the major concerns in both countries were the same.” Two of these concerns are succession planning and how to attract millennials to the profession. At Exit Realty, Bonnell has been integral to the development of programs and systems that address both concerns. Agents are provided with the opportunity for residual income, as the company rewards people for the percentage of the organization they help to build. For instance, if Bonnell introduces an agent into an Exit Realty office, she would receive the equivalent of 10% of that agent’s gross commission, up to $10,000 a year, for every year the agent works there. When she retires, she still earns 7% of that agent’s gross commission. “It works amazingly for succession plans,” Bonnell says. “Half of the franchises that we’ve sold in the last two years, we’ve actually acquired other companies with them, because brokers don’t have a succession plan. This gives them the opportunity to make sure their people are taken care of and to continue to make money off the top of what they built for as long as people continue to stay with the company. So we’ve created a succession plan.” Exit Realty also has a focus on millennials. “They want to get in the game; they want to have a vested interest – 50% of them want ownership in a business,” she says. “They are very high-tech, and we are a very high-tech, high-touch company.” The brand builder Bonnell’s three previous roles were at companies she calls cutthroat, where people didn’t like working together as a team. But at Exit Realty, “I can honestly tell you that if I introduce you into the company, it’s now in my best interest,” she says. “If I’m making $150,000 and you’re making $50,000, it’s in my best interest to teach you to do better, because I get better at my job by helping you, but I also make more money by helping you.” But does she miss that adrenaline rush of selling a property, the one she first experi- enced when she was 13 years old? “I get to be in sales, selling franchising and helping to change people’s lives,” she says. “I get to be in touch with it and go to our offices. I get to be around it all the time. It’s an amazing business; it’s responsible for the number-one dream – to own a home – and I don’t think that ever gets old.” REP TAMI BONNELL’S CAREER PATH “If I’m making $150,000 and you’re making $50,000, it’s in my best interest to teach you to do better, because I get better at my job by helping you, but I also make more money by helping you” 1988 2001 2012 1993 1998 2000
  • 19. Build your niche with courses leading to credentials specializing in the buyers (ABR® ), sellers SRS), seniors (SRES® ) and international (CIPS) markets, and more. Enhance your business profile with the exclusive FRI designation. Learn More, Achieve More with the Real Estate Institute of Canada (REIC). www.reic.ca 1.800.542.7342 infocentral@reic.com Aim High Achieve More FEATURES EDUCATION Why an agent’s credentials matter TOO OFTEN, selling real estate is seen as a soft skill set. But in today’s market- place, consumers expect increasing value for the services provided. Those new to the industry can present themselves as extremely competent, but they may not have all the skills needed to succeed. Short courses and seminars are great, but it’s more essential to earn creden- protect their best interests. Real estate boards across Canada recognize the advantages of advanced credentials and are making the courses available to their members. A higher level of qualification is also beneficial for the long-term sales professional. The nationally recognized FRI designation offered by the Real Estate Institute of Canada provides recognition of knowledge and skills gained through work experience. The program covers topics such as negotiating, contracts, real estate law, human behaviour and ethics in greater depth to benefit the experienced profes- sional. The FRI designation is a clear differen- tiator that raises the bar of professionalism. The job of selling real estate has grown into a sophisticated career. Advanced education and credentials provide a solid way for agents to remain viable and competitive. REP tials that provide additional grounding and recognition, and reflect market needs. In specialized areas, such as working with seniors, international buyers or first-timers, consumers want to engage a professional who fits their unique requirements. Credentials that reflect these specialties show clients that they are working with someone they can trust to www.repmag.ca 17
  • 20. 18 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES IN AN industry first, REP is pulling back the curtain to reveal the secret elements of the real estate agent’s lifestyle, from money matters – such as how much the average agent has in savings, home equity and investments – to less sensitive subjects, such as vacation habits and the kinds of cars they drive. A peek into the average Admit it: You compare yourselves to your peers.Whether it be the number of transactions, social media presence or the kind of suit your fellow agent is wearing, it’s hard not to compete in such an entrepreneurial industry. So how do you stack up? Olivia D’Orazio reports We encourage readers to take a good hard look behind that curtain, but be warned: What you see might encourage you to work a little harder. And you’ll be able to compare your lifestyle to more than just your own peers. This year, two of our sister publications – Canadian Mortgage Professional and Wealth Professional – have run similar lifestyle survey findings in their own pages, so we borrowed some facts and figures to see how real estate professionals stack up against their counterparts in the financial and mortgage industries, too. AGENT’S LIFESTYLE DEMOGRAPHICS Agentsbetween55and59yearsoldareslightlybetterrepresentedthanotherages AGE BREAKDOWN 18to29 30to34 35to39 40to44 45to49 55to59 65to69 75or older 50to54 60to64 70to74 16.1% 3.3% 4.7% 8.9% 14% 15.3% 4.8% 5.2% 12.3% 11.4% 2.2%
  • 21. www.repmag.ca 19 British Columbia 17% Nova Scotia 2.1% Alberta 8.8% Ontario 61.3% Quebec 4.9% Saskatchewan 2.4% Manitoba 1.2% New Burnswick 1.1% Yukon 0.1% Newfoundland 0.6% PrinceEdward Island 0.6% PROVINCE BREAKDOWN CITY BREAKDOWN 10.2% 6.1% 3.3% 3.4% 3.1% 2.5% 2.5% 2.1% 1.6% 1.2% 1.1% 1.0% 0.9% 0.9% 0.8% 0.8% 0.7% 0.6% 0.6% 0.4% 0.1% Toronto Whitehorse SaintJohn Charlottetown St.John’s Regina Winnipeg Nanaimo Halifax Oakville Victoria Saskatoon Kelowna Edmonton Montreal Mississauga Vancouver Ottawa Hamilton London Calgary Surveyrespondentsrepresentmorethan270differentcities,including: 92%ofagentswork withinthecitywhere theylive MALE 56%ofagentsare 58%ofmortgage brokersaremale 67%offinancial advisorsaremale FEMALE 44%ofagentsare
  • 22. 20 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES WORK LIFE Mostrealestateagents haveadecadeortwoof serviceundertheirbelts EXPERIENCE 22.1% have between six and 10 years of experience 5.9% arestillonprobation, withtwoyearsorfewer undertheirbelts 16.6% havebetweenthree andfiveyearsof experience 32.1% havebetween11 and25yearsof realestate experience 22.6% havebeeninthe businessfor26to 45years 96%offinancial advisorsworkfulltime 88%ofmortgage brokersworkfulltime 22.8%ofagentsarelegacysales reps,followingtheirfamilies’ traditionsinrealestate 97%arefull-timeagents 77.9%ofagentsenteredthereal estatebusinessasa second–orthird–career Based on our survey results, it would appear the contentious issue of part-timers versus full-timers is a molehill, not a mountain – a staggering majority of respondents are, in fact, full-time
  • 23. www.repmag.ca 21 “I think Realtors should be full-time – dedicated, trained and professional. I don’t think you can give full your commitment being part-time” DebbieHanlan,DebbieHanlanRealEstate,St.John’s ROYAL LEPAGE 32.7% RE/MAX 24.9% CENTURY 21 9.6% COLDWELL BANKER 5.9% HOMELIFE 2.5% SUTTON GROUP 1.7% KELLER WILLIAMS 1.5% RIGHT AT HOME 1.4% HARVEY KALLES 0.5% EXIT REALTY 0.4% CHESTNUT PARK 0.3% SOTHEBY’S 0.2% VIA CAPITALE 0.2% AGENTS REPRESENT A DIVERSE LIST OF CANADA-WIDE BROKERAGES Someofthemostpopularinclude: 49% 21.3% 19.1% 6.6% 2.5% 1.4% 16ormore 5to10 3to5 1or2 None 11to15 AVERAGE NUMBER OF DEALS PER YEAR: HOW DO AGENTS GET THOSE DEALS? BY MARKETING LIKE MAD. 19.2% 20.6% 34.8% 12.8% 8.5% 4.3% ofagentsspendmorethan$10,000onmarketingeachyear ofagentsspendbetween$5,000and$10,000 ofagentsspendbetween$1,000and$5,000 ofagentsspendbetween$500and$1,000 ofagentsspendbetween$100and$500 ofagentsspendlessthan$100eachyear 14%ofagentsworkwithregional orindependentbrokerages Morethan
  • 24. 22 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES MONEY MATTERS NEARLY HALF OF AGENTS EARN SIX FIGURES EACH YEAR $150,001+ 25.1% $101,000–$150,000 21.6% $81,000–$100,000 12.6% $61,000–$80,000 17% $41,000–$60,000 11.8% $0–40,000 11.9% SAVVY SAVERS $5,000to $20,000 11.8% Lessthan$3,000 17.4% $1millionormore 6.8% $550,000to $900,000 4.4% $240,000to $500,000 19.8% $110,000to $200,000 15.2%$60,000to $100,000 12.4% $25,000to $50,000 12.2% AMOUNT IN SAVINGS AND INVESTMENTS Manyofthosewithsmallamountsintheir savingsadmittedtohavingjustpurchasedtheir firsthomes 77%ofrealestate agentsplantobe workingpast65 anyway “It all comes out of sacrifice. As with any sales job, if you put in that much time, you’ll make a lot of money” NeresSraidarian,BigCityRealty,Toronto 39.3%ofagentswillbesetfor retirementby65 34.9%won’tbe 25.9%areunsure 53%ofmortgage brokerswillbeready forretirementby65 $312,000averageamountamortgagebroker hasinsavingsandinvestments $483,000averageamountafinancialadvisor hasinsavingsandinvestments Agentsmighthaveareputationforflash,butmostalso havesomemoneysockedawayinsavings $324,000Averageamountarealestateagenthasinsavings
  • 25. www.repmag.ca 23 REAL ESTATE AND MORTGAGE MATTERS WHO SOLD YOUR HOME? 70.1%ofrespondentsusedareal estateagenttobuyorselltheirownhome 29.9%ofagentsfeltcomfortable doingitthemselves OWNING A HOME 0-10% 15-25% 55-70%30-50% 75-98% 100% 7.2% 8.2% 27% 10.7% 16% 30.4%Nearlyathirdof agentsreportthat they’vepaidoff themortgageon theirprincipal residence INVEST IN STYLE CHESTNUT PARK REAL ESTATE LIMITED, BROKERAGE Stay tuned for the fall edition of Chestnut Park’s Invest In Style magazine. Landing on doorsteps near you. This beautiful publication includes feature articles and boasts some of the finest homes and recreational properties in Ontario. @chestnutparkhomes #investinstyle @therealtiffsly #investinstyle @estatesofmuskoka #investinstyle @bradenwhite_toronto #investinstyle @bessieseyfert #investinstyle chestnutpark.com | 416.925.9191 | 1300 Yonge Street, Suite 100 Toronto, ON M4T 1X3
  • 26. 24 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES EDUCATION “I have represented the sale of my own home – every one I’ve sold. I know it best, and I know the industry, so I would represent the sale of my home – not necessarily the person purchasing it, though” DebbieHanlan,DebbieHanlanRealEstate,St.John’s 45.6% preferthe country 54.4% ofagentsare citydwellers 48.2% OF AGENTS OWN RENTAL PROPERTIES Onaverage, mortgagebrokers payaninterest rateof2.5% 62.8%ofagentshaveamortgage, buttheirratesvary 1.9% ofagentspaylessthan2% 19.9% ofagentspaybetween 2%and2.49% 41.9% ofagentspaybetween 2.5%and2.99% 23.7% ofagentspaybetween 3%and3.5% 5.9% ofagentspaybetween 3.54%and3.99% 6.5% ofagentshaveaninterestrate higherthan4% Thehighestinterestratereportedwas12%;thatwas foranincomeproperty 47.7% own1rentalproperty 21.1%own2 11.7%own3 19.5%own4ormore 60%offinancial advisorshaveatleastan undergraduatedegree 42% ofmortgage brokershaveatleastan undergraduatedegree ONGOING EDUCATION Continuingeducationismandatory,butsomeagentsgo aboveandbeyond 53.3%ofagentsholdatleastonedesignation 5.1%ofagentsholdmorethan fouradditionaldesignations Somehighschool 3.2% Highschooldiploma 12.2% Someuniversity 48.7% Undergraduatedegree 23.2% Graduatedegree 12.7% Ofthosewhoowninvestmentproperties:
  • 27. www.repmag.ca 25 “It’s a stereotype in any sales job. You have to show success, and that’s one of the ways to do it. But some people do it too early, and that’s why they don’t get anywhere” NeresSraidarian,BigCityRealty, Toronto 16.5%paid$100or lessfortheir bestsuit 52.8%paid $100-$500 21.9%paid $500-$1,000 8.8%paid$1,000 ormore 41.1% ofagentsspent lessthan$100on theirwatch 39.4% spentbetween $100and$500o awatch 8.51% spentbetwee $500and$1,000 onawatch 11% ofagentsspent morethan$1,000on theirwatch 58.4%donot 41.6%ofagentsconduct businessinasuit LIFESTYLE 60%offinancial advisorsdobusiness inasuit 40%ofmortgage brokersdobusiness inasuit 18.4% ownabespokeor tailoredsuit
  • 28. “It’s important to have a vehicle for the terrain you deal with. And it’s nice to have a nice car” RaymondBorley,Century21,Rocky MountainHouse,Alta. 02 04 06 08 0 100 39.2%boughtused 60.8%boughtnew 6.7%driveapickuptruck 4%driveaminivan 33.5%driveasedan 43.9%driveanSUV 4.2%driveasportscar 7.7%driveacompactcar OF THOSE WHO OWN A CAR 16.6%paidlessthan$20,000 fortheirmainvehicle 10.8% paid$20,000-$25,000 15.5% paid$25,000-$30,000 21% paid$30,000-$40,000 17.3% paid$40,000-$50,000 18.9% paid$50,000ormore WHAT KIND OF CAR DO YOU DRIVE? Ford:11.2% Toyota:9.9% BMW:7% MercedesBenz:6.4% Lexus:5.4% Honda:5.3% Nissan:4.9% Dodge:4.2% Volkswagen:4.1% Cadillac:3.6% Chevrolet:3.6% Acura:3% Maserati:0.1% Agentsdriveeverymakeandmodelimaginable. Herearesomefavourites: 26 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES 79.7%owntheircar 19.9%lease
  • 29. www.repmag.ca 27 HOW MUCH VACATION TIME DO YOU TAKE? 8.5% takelessthanone weekperyear 11.1% takeoneweekof vacation 23.7% takethreeweeks 24% taketwoweeks 23%ofmortgage brokersown avacationhome 20%offinancial advisorsown avacationhome 10.2%ofagentsare membersofaprivateor countryclub 57.6%ownacottage 32.3%ownUSor international property 10.1%ownboth 44%ofmortgage brokerstakeatleastfour weeksofvacation 59%offinancial advisorstakeatleast fourweeksofvacation 32.8% takefour weeksormore 19.3% OF AGENTS OWN A VACATION HOME Ofthosewhoownavacationhome: www.repmag.ca 27
  • 30. COVER STORY: AGENT LIFESTYLE FEATURES HOW OFTEN DO YOU USE SOCIAL MEDIA? 28.5% useit occasionally “Social media is a new venue for reaching people, and it’s exploding. If you’re not involved with social media, you are behind the times” DebbieHanlan,DebbieHanlanReal Estate,St.John’s 63.1% useitdaily 8.4% ofbrokersneveruse socialmedia “It’s where everybody looks for information, where everybody complains. It’s what comes up when you Google someone’s name” NeresSraidarian,BigCityRealty,Toronto 68.3%favour Facebook 14.2%focuson LinkedIn 6.3%choose Google+ 4.5%favour YouTube 4.2%prefer Twitter 2.4%choose Instagram 47.3% 30.2% 22.6%useaniPhone preferAndroid stillsupportBlackberry 60%ofmortgagebrokers usesocialmediadaily 51%offinancialadvisors usesocialmediadaily 28 www.repmag.ca
  • 32. 30 www.repmag.ca COVER STORY: AGENT LIFESTYLE FEATURES 16.1%of agents haveacat 28%ofmortgage brokershaveacat 15%offinancial advisorshaveacat 38.5%of agentshave adog AGENTS ARE EITHER GUNG-HO FITNESS BUFFS OR PROUD COUCH POTATOES 35.5%ofagentsnever gotothegym 32.5%ofagentsgo atleasttwice aweek 45%ofmortgage brokershaveadog 30%offinancial advisorshaveadog
  • 33. www.mortgagebrokernews.ca 31 Finally, a fast & easy way for your sellers to obtain funds before their closing date! Learn more about how Tembo Financial can help you and your clients today Funds in as little as 48 hours with NO appraisal and NO credit check 4646 Dufferin St. Suite #6, Toronto, ON M3H 5S4 1.844.238.6717 info@tembofinancial.com www.tembofinancial.com 1.844.238.6717 info@tembofinancial.com Great reasons sellers may need early access to their equity: FSCO License No. 12598 ♦ Deposit For New Purchase ♦ Bridge Financing ♦ Closing Costs ♦ Moving Expenses ♦ Repairs On Their Sold Home ♦ Unexpected Expenses ♦ Personal Emergency ♦ Renovations ♦ Debt Consolidation ♦ Taxes ♦ Vacation TIM HORTONS IS THE PREFERRED COFFEE VENDOR 49.4% ofagentsenjoyTim Hortonscoffee 24.7% preferStarbucks 24.5% ofagentsbringtheir coffeefromhome 1.4%ofagentslike SecondCup ARE AGENTS FOODIES, OR JUST BAD COOKS? 0 10 20 30 40 50 60 eatoutmultipletimesaday eatoutonceaday eatoutonceaweek eatoutonceamonth 5.2% 24.6% 52.8% 17.5%
  • 34. 32 www.repmag.ca What is a 15-minute mortgage? The 15-Minute Mortgage is a lead-generation tool that can be placed on any website. It currently appears on all CENTUM mortgage agents’ websites. How does it work? What is the process for the client? A client would click on the online tool to get prequalified for a mortgage. This process takes 15 minutes or less. After they have completed the questions, they will receive an email thanking them for the application and providing a prequalified amount, as well as advising them that they will be contacted shortly by a CENTUM agent. The agent gets the lead immediately, and they are required to call within 30 minutes or send an email within an hour. The lead will show all the information on the client, along with the purchase price and down payment they are looking for. How does it benefit real estate professionals? It can be placed on any website, so it can What is The 15-Minute Mortgage? Kathryn Grant, CENTUM’s new Director of Broker Services, answers REP’s questions about the company’s new mortgage lead-generation tool that benefits real estate agents go on a Realtor’s website. For instance, a CENTUM agent might partner with a Realtor and have the widget on their website. If a client used this tool, the lead would be emailed to the Realtor and the mortgage agent. The agent would then contact the Realtor with a pre- approval. This is a great way for mortgage agents to build strong relationships with Realtors. In the past, it has typically been an agent trying to get Realtors to send referrals, but we’re giving a lot more back now. It’s quick, it’s easy, and it’s a very good-quality lead for the real estate agent. What happens if the client is declined? They are never declined. They will receive an email letting them know they need to answer more questions, which still offers a very good opportunity for a mortgage agent to get in contact with that client to help them if there is a concern with credit or income, etc. The agent can then advise and help the client to re-establish their credit or, if the income isn’t enough, they can provide other options. This is still a lead for the agent and Realtor in the future. Is The 15-Minute Mortgage available to all mortgage brokers? No. This is an exclusive tool created by CENTUM and used only by their mortgage agents. If a real estate agent would like access to the tool, they can easily partner with a CENTUM agent. REP INTRODUCING KATHRYN GRANT WHAT’S NEW AT CENTUM? CENTUMiscontinuouslygrowinganddeveloping newtools.Thecompanyhascreatedavery excitingnewbusinessmodelthatbringsthereal estateandmortgageindustriestogether,forming theperfectmarriagebetweenqualityservice, minimaleffortandhighprofits.Staytunedfor detailsinthenextissueofREP. In her role as Director of Broker Services, Kathryn Grant is the newest member of the CENTUM corporate family. She’s spent more than a decade in the financial services industry, and brings a wealth of knowledge and experience to the role. Kathryn began her career in finance before moving to a senior position at a major bank. She joined CENTUM as a mortgage agent and then opened her own franchise, building it to become one of the most successful in the CENTUM family. Kathrynenjoystakingonchallengingand creativefinancing,aswellasexperiencingthe joyofhelpingCanadiansrealizetheirdreams ofhomeownership.“Iamveryexcitedbymy newroleandamlookingforwardtosupporting CENTUMagentstocontinuetobetheoutstanding professionalstheyare,”shesays.“Ilovebeing withanorganizationthatisonthecuttingedgeof drivingboththeCENTUMbrandandthemortgage industryforwardthroughinnovation.” SPECIAL PROMOTIONAL FEATURE Q&A
  • 35.
  • 36. 34 www.repmag.ca DONE DEAL FEATURES Selling a piece of Canadiana SPRAWLING ACROSS 65,000 acres in rural Quebec, Kenauk Montebello is one of the largest privately held parcels of land in Canada – so it’s no surprise that it offered its listing agents a one-of-a-kind marketing opportunity when it came time to open the sale up to the public. “It was a very unique strategy based on a cost-per-acre model,” says Herb Ratsch, a broker with Sotheby’s International Realty, who sold the property with Jones Lang LaSalle’s Robert MacDougall in December 2013. The asking price was $81.25 million – or $1,250 per acre – to own one of North America’s largest and longest-established private fish and game reserves. The property The wilderness reserve lays claim to more than 70 private lakes and is home to a gated community with 13 luxury chalets and an exclusive marina. Add more than 102 kilometres of lakefront vistas on Lac Papineau, hundreds of kilometres of existing roads and an idyllic location neigh- bouring the quaint village of Montebello, Que., and the possibilities for the buyer are endless. “It’s the proverbial location, location, location,” Ratsch says. “It’s an hour from Ottawa, an hour from Montreal, and Highway 50 goes directly there. It is also connected to the world-famous Chateau Montebello.” The roots of this property are entrenched in the history of the region. In 1674, the King of France granted the land to Quebec’s first bishop, Monseigneur Laval. Before the opening of nearby Chateau Montebello, the area was the private retreat of the Seigniory Club, whose elite membership reportedly included notable foreign and Canadian businessmen, politicians, and dignitaries, such as former prime minister Lester B. Pearson, as well as Prince Rainer and Princess Grace of Monaco. A 65,000 acre parcel of land in rural Quebec – with 70 private lakes, 13 chalets and a piece of Canadian history up for grabs – offered its listing agents a unique challenge “It has incredible, rich history,” Ratsch says. “Every prime minister was a member of the club.” Since the 1970s, Kenauk has operated a retreat where guests can stay in one of the 13 chalets, eight of which reside on their own exclusive lake. Guests enjoy the year-round activities Canada is famous for, such as fishing, kayaking, canoeing, boating, swimming, hiking, hunting, golf, cross-country skiing, snowshoeing and dogsledding.
  • 37. take aerial photos and video – and, once the property was listed, to take clients on site visits. Ratsch and MacDougall worked with Sotheby’s New York head office, asking: “This is the biggest, most prestigious piece of land on the market. What would you do?” The Wall Street Journal agreed to launch the sale in its magazine and on its website as long as it was the first to promote it. “So we held off for around 60 days to get the massive distribution in the US,” Ratsch says. In March 2013, the property was officially launched with a feature article in the Wall Street Journal, and then was subsequently picked up by the New York Times. “Then it went everywhere,” Ratsch says. “The spin-off was huge, the media afterwards … everyone wanted to know what was going on. That really gave it a big international jump. You can only come out of the bag once, and we wanted to come out with a bang. We felt that this had more legs internationally than in Canada.” The sale The sales strategy was to use a price- per-acre listing because nobody believed the property could be sold at such a high price. “It was just a lot of acres,” Ratsch says. “When you look at it on a cost per acre, it was cheap. If you listed it at $75 million, people would ask how we came up with that number. So we listed it at $1,250 per acre with the goal of achieving about $1,000 to $1,250 an acre. And then it’s just a multiplier.” The duo also put together a booklet that provided information about Kenauk Montebello Reserve and broke up the property by each of its lakes. “This lake is worth $2 million, that lake is worth $5 million ... people realized there is $100 or $150 million of sales when you break it all up,” Ratsch says. For instance, he explains, a private lake between 500 or 1,000 acres might sell for $3,000 to $5,000 an acre, so when a potential buyer looked at the booklet to see the breakdown, they would realize what a great opportunity it was. The property was sold as a private estate to a group of five buyers for an undisclosed but princely sum. REP THE PROPERTY BY THE NUMBERS The marketing The listing of Kenauk Montebello was as unique as the property itself. Sotheby’s and Jones Lang LaSalle signed an exclusivity contract with the Wall Street Journal in September 2012. The agents spent the next six months building a website, working on the marketing content, creating a video and a booklet, and using a helicopter to QUICK LOOK ADDRESS 100CheminKenauk, Montebello,QC,J0V1L0 LISTING DATE March2013 LISTING PRICE $81.25million SOLD DATE December2013 SIZE 65,000acres PROPERTIES 13chalets 475 14.5 5 100 90 KILOMETRES OF LAKEFRONT KILOMETRES OF RIVER ISLANDS ON THE PROPERTY KILOMETRES OF ROADS -MINUTE DRIVE FROM MONTREAL OR OTTAWA www.repmag.ca 35
  • 38. 36 www.repmag.ca EXPERT ADVICE FEATURES 3 Repurpose unusable indoor items for outdoor use Instead of dumping old possessions in the trash, why not think of creative ways to use them in the garden? This is a great way to give an outdoor space a stylish and individ- ualized aesthetic. I like to get imaginative with my planters, using anything from WE’RE ALL guilty of funnelling time and money into indoor spaces and barely giving the backyard a moment’s thought. After all, what is there to do with a patch of grass and a few trees? The easy answer: A whole lot! Don’t underestimate the design (and selling) potential of an outdoor space. With cooler weather and firm, dry ground, autumn is the perfect time to take on these types of projects, adding subtle details that will have a big impact on homebuyers. It’s not as hard as you think. You don’t need to be a landscape designer to help your clients make their green space as great as their living room. All that’s required is some crafty thinking and a bit of creativity. 1 Build a deck for entertaining When it comes to improving the backyard, I’m a huge advocate of creating and maximizing usable space. Homebuyers will perceive a home as larger, and therefore more valuable, if it has great, usable space outdoors. A deck is the most versatile way to achieve an even, multipurpose surface, perfect for dining furniture and comfortable seating. There are a lot of things to consider when installing a deck, but choosing the right materials is the key. For outdoor projects, my go-to is MicroPro Sienna, a pressure-treated wood that has a gorgeous rich brown hue but doesn’t require initial staining. It’s durable and built to last, but sellers will love that it’s also affordable. 2 Increase those outdoor hours With fewer bugs and beautiful breezes, fall evenings are always my favourite. Urban fire bowls or infrared heat lamps are a great way to extend the season and make a space instantly cozier. Add a few extra pillows and blankets, and you’ll have a hard time bringing the homebuyers back indoors. 6 ways to get the backyard ready for buyers As the summer winds down and the fall selling season kicks off, now is the perfect time to make sure a home’s outdoor space looks as great as the rooms indoors. Celebrity landscaper Carson Arthur shares his 6 tips for making the best of the backyard
  • 39. www.repmag.ca 37 watering cans to old garden boots or even broken chandeliers. 4 Don’t be afraid of colour Don’t just rely on flowers to create colour in your client’s backyard. Colourful planters, pillows or even rugs are a great way to add a bit of character. Plus, the extra bonus of adding colour through acces- sories means that you’re not married to any one look. You can easily change it up complement the rest of your client’s home! Remember, just like any room inside the house, the backyard is a blank canvas that your clients and prospective buyers can paint with their personality. 5 Add privacy With more patios being installed in backyards and fewer trees, the need for a private area out of the view of neigh- bours has never been more pertinent. I recommend adding a pergola, which creates a secluded space with extra privacy. Like with a deck, when constructing a pergola, make sure to choose durable and environ- mentally friendly materials. 6 Use multifunctional pieces to maximize outdoor space Just as with the indoor space, you don’t want an empty room outside – you want it to have purpose! Creating a versatile living space that functions both for your clients and for future buyers can add significant value to the home’s resale price. It could be an outdoor dining area, a vegetable garden, a play area for the kids or a cozy spot to unwind. Be sure to incorporate multipurpose furniture pieces as well. REP Whennotinthedirtwithhiseco-friendly landscapedesigncompany,CarsonArthur staysbusybuilding,planting,writingor designingasafeaturedgueston“CityLine.” Hisshow,“CriticalListing,”iscurrently airingonHGTVCanada.Formore,visit www.carsonarthur.com. Just like any room inside the house, the backyard is a blank canvas that your clients and prospective buyers can paint with their personality PhotobyBobGundu,courtesyofMicroProSienna
  • 40. SPECIAL PROMOTIONAL FEATURE 38 www.repmag.ca What is Leading Real Estate Companies of the World? How does it work? Leading Real Estate Companies of the World [LeadingRE] is the largest global real estate network in terms of annual home sales. It was established in 1997 by brokers who wanted to control their own destiny and build their distinctive local brands while enjoying the power of inter- national connections and the resources available through economies of scale. Our members benefit from more than 30,000 client referrals annually, as well as listing and branding tools, luxury marketing, online learning, confer- ences and technology solutions – programs previously available only from franchises. How does LeadingRE differentiate itself from the competition? One differentiator is that we are local and we are global. We start with local market-leading firms and empower them to prosper as part of a powerful global entity. Another is that membership is by invitation only – we are very selective in order to live up to our name. And because LeadingRE is the brand behind the member’s brand, we see them as the stars and us as the supporting cast. Finally, we provide the advantages of a franchise without the costs and restrictions. Our members are with us because they have a return on investment and derive measurable value, not because they are bound by a long-term contract. How should the real estate industry be thinking about education? We live in a world where information is free and knowledge is priceless. LeadingRE’s mantra is ‘making the best brokerages better,’ so we are all about high standards of quality, competence and exceptional performance. We support our affiliates through a 24/7 online learning platform called Institute, with a version specifically for Canadian members. Our conferences are routinely charac- terized as the industry’s best. We provide webinars to Pam O’Connor, president and CEO of the Chicago-based company Leading Real Estate Companies of the World® tells REP how Canadian real estate professionals can grow their global presence address evolving educational needs, and our CEO groups connect owner brokers for idea-sharing and peer reviews. These continuous learning opportunities are embraced by our members in their quest to maintain and enhance their market leadership. Why is LeadingRE interested in the Canadian market? Our hybrid local/global model has been a tremendous success in the US, where we represent 14 of the top 25 brokerages and have $80 billion more in annual sales than any franchise. Replicating that success in Canada, with the same opportunity for brokers to own and control their local brand while enjoying the resources and connections of a worldwide affiliation, would be a win-win for all. As the world becomes smaller with more cross-border movement, it’s essential to think beyond borders and provide services to assist clients both across town and around the world. Building on our foundation of top independent brokers in Canada to have an even stronger national presence here is a priority for LeadingRE. What are some Canadian real estate trends that excite you? First, the trend toward urbanization for convenience and lifestyle signals more referral opportunities, which is one of the strengths of our network. Second, the slow but steady improvement in the housing market and low interest rates make Canadian real estate a great investment. And third, the shrinking business margins in real estate here should make our high-value model very attractive to Canadian brokers. We believe we offer a unique opportunity for top-quality Canadian firms that are interested in a new and rewarding way of doing business. REP Q&A BY THE NUMBERS Formoreinformation,visitwww.leadingre.com,orcontactSheila Barrat312-361-8632orsbarr@leadingre.com. How to become a leading real estate company 500globalindependent realestatefirms 50+countrieswhere LeadingREhasa presence 30,000+annualclient referrals $80 billion moreinannual salesintheUSthan anyfranchise 14ofthetop25 brokeragesinthe USareLeadingRE members
  • 41. www.repmag.ca 39 CANADA'S #1 REAL ESTATE INVESTMENT MAGAZINE Canada's NEIGHBOURHOODS t t •Top10 most affordable markets • Top10 highestyield markets • Canada’s topcap-rate markets ANNUALNEIGHBOURHOODGUIDE–2015 138+PAGES BUMPER ISSUE EXCLUSIVEstatisticsandlocalmarketreports NEWup-and-comingregionsidentified BESTpropertiestobuyatlowcost THECARIBBEANSPECIALHOTPLACESTOINVESTIN2015 + OCTOBER/NOVEMBER14 $7.99 canadianrealestatemagazine.ca America’s NEXThotspot investing mistakes toavoid Howtoprofit fromCanada’s boomtowns 5 ANREALESTATEWEALTH TOP100NEIGHBOURHOODS|OCTOBER/NOVEMBER2014 CREW34_Cover_FINAL2.indd All Pages 17/09/2014 9:36:14 PM CANADIAN CANADA'S #1 REAL ESTATE INVESTMENT MAGAZINE RealEstateWealth PROPERTYFORECAST|DECEMBER/JANUARY2015 CANADIANREALESTATEWEALTH canadianrealestatemagazine.ca Displayuntil January26,2015DECEMBER/JANUARY2015 $7.99 TAP CANADA’S FUTURE RENTAL MARKET Establish key connections for tomorrow’s growth MASTER JOINT-VENTURE DEALS IN 2015 Take your portfolio to the next level ANNUAL BLUEPRINT GUIDE FOR 2015 INVESTING 2015 Real estate outlook by province The best bets for 2015 Top property types by city PROPERTY FORECAST MAKE RENT-TO-OWNA WIN-WINLearn how toprotect yourinvestment andyour tenant where to put your money Crew35_Cover_Final.indd All Pages 30/10/2014 2:45:10 AM RETIRERICHER|MARCH/APRIL2015CANADIANREALESTATEWEALTH canadianrealestatemagazine.ca Displayuntil April27th,2015 MAR/APR 2015 $7.99 5things to look for when analyzing an investment property 15tips for keeping good tenants 2,500+Canadian neighbourhoods: Exclusive home data 2015 SPECIAL GUIDE TO U.S. PROPERTY INVESTMENT: HOW TO WIN WITH A LOWER LOONIE 6 step-by-step guides from the experts Complete strategies by property type – houses, condos, multifamily units Real-life success stories from investors in their 20s, 30s, 40s and 50s 10-, 20-, and 30-year plans to ready you for retirement CANADIAN CONDOS: The time is now for high-rise investment RETIRE RICHand stay that way CANADIAN CANADA'S #1 REAL ESTATE INVESTMENT MAGAZINE RealEstateWealth HELP YOUR CLIENTS BUILD WEALTH IN REAL ESTATE The ONLY national publication for Canadian Real Estate Investors canadianrealestatemagazine.ca Discounts on bulk subscription orders are also available. Email: subscriptions@kmimedia.ca  In-depth analyses of Canada’s real estate markets  Market trends that affect your investments  Investment strategy guides (i.e. cash flow, capital growth and renovations)  Practical tips and advice on how to manage and finance your investments  Real life success stories  Latest legal, tax and financial guides to help you invest safely  Expert advice columns EVERY ISSUE INCLUDES: BUY YOUR CLIENTS A SUBSCRIPTION AND SAVE OVER 30% OFF THE NEWSSTAND PRICE PLUSReceive a bonus gift! Promo code: REPFP18 $25 VALUE1 YEAR FOR $42 - REPFP6 2 YEARS FOR $72 - REPFP12 3 YEARS FOR $99 + a bonus gift Canadian Real EstateWealth Magazine is published six times a year and is available on newsstands nationwide. Please allow 4 - 8 weeks for your first issue.
  • 42. FEATURES 40 www.repmag.ca Lending solutions for subprime clients ALTERNATIVE FINANCING Subprime homebuyers require a little more work when it comes to putting together financing, but teaming up with the right alternative lender can help make these deals go smoothly ALTERNATIVE LENDING may not be the first route real estate professionals think of taking when advising clients about their mortgage options, but it’s certainly an area that is growing in popularity – and in necessity, given the tightening of Canada’s mortgage regulations. There are a range of clients who fit into the alternative lending space, such as those who are self-employed, those with below-average credit scores or those who know they are pushing the boundaries on typical A-lender affordability factors. “For some, alternative lending will always be their best option,” says Brian Gentles, a mortgage broker with TMG The Mortgage Group Alberta. “It can help them grow their business. It can help them manage personal tax implications and build a nest egg for later years in the form of retained earnings. But too few borrowers even know that alternative lending exists. We need to do a better job of getting the word out.” Many clients will require a broker or real estate agent to explain to them how and why they don’t fit into A lending, what alternative lending can do for them, and how they might eventually transition to an A lender if they make and follow a plan.
  • 43. www.repmag.ca 41 “I provide clients with alternative solutions when they are not able to get regular financing from the banks,” Xu says. “Especially for Realtors, the aim is to get the deal closed.” Moss feels those operating in the alternative lending space should take on the role of educating the homebuyer. “Maybe the term ‘lifestyle coach’ is more of a recent thing, but that’s the way I’ve always been since day one – and it’s always been effective,” he says. He adds that the advice he passes along to clients is very much welcomed – even if it is tough-love advice – especially when it comes to credit rehabilitation. “People living within their means can be a big issue,” he says. “People are afraid to give that sort of advice or tell a person what to do, but it really does help them. They appreciate hearing the honest truth, and they respond to it.” Xu is also a strong believer in the value of education. She runs in-office teaching “Too few borrowers even know that alternative lending exists. We need to do a better job of getting the word out” BrianGentles,TMGTheMortgageGroupAlberta CASE IN POINT Who: A professional couple wanted to buy a second home for a family member to live in. Why: They had great income stability, very low ratios and were able to put 25% down, but they were also very sloppy on credit card payments. The couple was declined four times in the A lending space, including at financial institutions where they had previous relationships. Outcome: Since their Beacon scores were still 640-660, an alternative lender was able to do the deal in a heartbeat. “Almost everyone goes through ups and downs,” says Graeme Moss, principal broker at Fair Mortgage Solutions in Hamilton, Ont. “If a person has a down, whether it is due to illness, job loss, divorce, a million things, the goal I have is to get them back on track, like a doctor. What is powerful to clients is giving guidance or a roadmap.” Lending alternatively The proportion of mortgages given out by alternative institutions – other than banks or credit unions – remains small, at roughly 2.2% of the entire market, according to a recent report by CIBC. But alternative lenders’ share of the overall mortgage market has grown, starting at 0.8% during the 2008 recession and expanding at a rate of around 25% per year, said Benjamin Tal, deputy chief economist of CIBC World Markets, in a recent Globe and Mail article. One of the reasons for this is tighter government regulations, which have allowed alternative lenders to fill an important void. Beginning in 2012, the Office of the Superintendent of Financial Institutions ushered in the B20 and B21 guidelines, aimed at defining principles that encourage best practices in respect to sound residential mortgage insurance underwriting. The final phase of the regulations was just imple- mented in June 2015. The changes have had a predictable knock-on effect on the lending space, forcing more borrowers to consider alternative options. Mortgage brokers and real estate agents have adapted accordingly. “I think a percentage of the broker world has learned the alternative side due to the regulation changes and how they have affected the lender’s guidelines,” Gentles says. Three years ago, many feared the regula- tions would be too onerous for the industry and on borrowers, but the new rules have, in fact, helped to reassert the traditional broker role – and, subsequently, the real estate agent’s role – as expert advisor and educator. Relationships and education Christine Xu, a mortgage broker and private lender at Mortgage Architects in Markham, Ont., has seen her client base evolve over the past few years, from mostly A clients to alternative borrowers. Of these clients, around half are referred to her by real estate agents, a reciprocal relationship that she believes is integral to the process.
  • 44. FEATURES sessions for real estate agents. “I try to educate the Realtor, explain how they can qualify their client,” she says, adding that those same lessons can be extended directly to the client. “When the client has the down payment, I teach them how to calculate a regular interest payment to show them whether they are able to afford it. If the client is unable to afford it, then I’m not doing the client any favours.” Doing your homework An important strategy for attracting clients who are suited to alternative lending options is to forge relationships with key stakeholders, including those in the A lending space. “Having a relationship with branch managers of banks and credit unions is more important than ever because more of those clients are being turned down than ever before,” says Dustan Woodhouse, a broker at Dominion Lending Centres based in Coquitlam, BC. This is where education comes into play, as WHAT PERCENTAGE OF YOUR DEALS ARE ALTERNATIVE? Source:PollconductedbyMortgageBrokerNews.ca,March2015 81%ormore 61-80% 41-60% 21-40% 10.6% 32.9% 11.7% 17% 9.5% 7.4% 10.6% “Almost everyone goes through ups and downs. What is powerful to clients is giving guidance or a roadmap” GraemeMoss,FairMortgageSolutions agents will be required to have candid conver- sations with borrowers to make sure they are aware what is required, since the regulation changes ushered in an increase in necessary documentation. “They’ll come to you and say, ‘Five years ago, I only needed to provide three documents, and now you’re asking me for 20 documents,’” Woodhouse says. “Well, that’s the way it’s changed – so it’s the skill with which you can communicate the increased requirement of documents that will make a huge difference.” Lenders are on the same page in asking brokers and agents to focus on communi- cating the appropriate use of alternative financing options to clients, but the starting point for that process often will involve the brokers and real estate agents ensuring they are up to speed on alternative lending. “In a nutshell, education, partnerships and CASE IN POINT Who: A seasoned professional had recently left employment to create his own company. He had one month’s work on the books, solid credit and net worth, and owned his principal residence free and clear. He also owns three rental properties with around 50% financing. His goal was to conserve cash for a rainy day, and he wanted to purchase another income property. Why: The A-lenders were looking for two years of tax history and proven income for his business. Outcome: His principal residence was refinanced with an alternative lender to secure the down payment, and he financed 70% on the new income property with the same lender. All funds borrowed are for investment purposes, so all interest is tax deductible. 0% 1-10% 11-20% 42 www.repmag.ca ALTERNATIVE FINANCING
  • 45.  Self-employed; bruised credits; quick closings;  Our turn around time is 24-48 hours for 95% of our deals;  We will give you a straight forward answer for all your mortgage concerns;  Our private mortgage rate starts from 4.99%.  Call me for your free consultations. Hotline: 416-716-6468 Toll Free: 1-866-908-7234 Email: inquiry@moneybroker.ca 4400 Hwy. 7 E, Markham ON L3R 1M2 (Hwy. 7 Kennedy) RESIDENTIAL AND COMMERCIAL MORTGAGES Mortgage Broker, AMP CHRISTINE XU Ranked No.3 at CMP “Top 75 Mortgage Brokers 2015” Recipient of the Chinese Business Excellence - Social and Community Contribution Award 2015 “Top 10 Commercial Brokers 2013” “Top 10 Women of Influence in Mortgage Industry 2015 & 2013” BEST ALTERNATIVE LENDING BROKER OF THE YEAR WINNER 2015WINNER 2015 Winner of “Best Alternative Lending Mortgage Broker of the Year 2015” WE SPECIALIZE IN CHALLENGING DEALS!
  • 46. FEATURES OUR PROMISE TO YOU:  To share with you all information that is relevant to making an informed decision regarding your choice of mortgage.  To answer all of your questions.  To respond promptly to all telephone call and emails.  To keep you, and the rest of your real estate team as appropriate, appraised of the status of your file.  To show you the opportunity to pay off mortgage and other debt much faster.  To be your mortgage consultants for life. BRIAN GENTLES ACCREDITED MORTGAGE PROFESSIONAL TMG The Mortgage Group Alberta Ltd. | 1-866-273-6192 | brian@briangentles.com | www.briangentlesteam.com  Experience  Competence  Relationships  Putting it all to work for you Not just a mortgage... YOUR mortgage! Residential and Commercial Mortgages networking are the trifecta of the alternative lending business,” says Steve Lydon, national sales manager for alternative lender MCAP Eclipse. “This area is growing quickly with huge future potential, but brokers need to know how to make it work for them and their customers. Attending seminars, researching the sector, and reading industry journals and “I provide clients with alternative solutions when they are not able to get regular financing from the banks. Especially for Realtors, the aim is to get the deal closed” ChristineXu,MortgageArchitects articles to learn about the business and alternative lending guidelines are the keys.” Ultimately, agents will need to acclimatize themselves, and then their clients, to a very different landscape than that of the prime- lending world. “I think the surge is more of a long-term wave,” Gentles says, “and I believe that we are just at the beginning of it.” REP CASE IN POINT Who: After a messy marital separation, but with help from parents, this borrower had clear title to the home but battered credit. Why: The borrower needed 50% loan-to-value to repay her parents. No A lender would come to the table, not even at that LTV with low ratios. Outcome: It took a three-year alternative lender deal with a plan in place to rebuild credit and then refinance with an A lender at maturity. 44 www.repmag.ca ALTERNATIVE FINANCING
  • 47.
  • 48. PEOPLE 46 www.repmag.ca AGENT PROFILE THE DAY was September 3, 2008. Glen Kirkland, a fourth-generation soldier in the Canadian Army, was just days away from returning home to his family after a difficult tour in Afghanistan’s Zhari District in the heart of Kandahar Province. The day started like any other. Kirkland and his crew drove through the mountainous desert, patrolling a Taliban stronghold. Minutes later, the only light Kirkland would see was from the fire of a rocket launched at the tank carrying members of his platoon. Usually, Kirkland never rode up front, but on this day, he was driving. That decision proved to be the difference between life and death. Three of his fellow soldiers were killed in the attack, while Kirkland was left for dead. “By the numbers, I should be dead,” he says in I Came Back, a recent documentary about his experience. “Ninety per cent of the time, I was in the back of the LAV. That time I wasn’t, and that was the time we got hit.” Heart of darkness During a mission with US and British forces, Kirkland and his team were surveying areas in what is known as the ‘Heart of Darkness,’ an epicentre of Taliban control. The operation had started a few days before the attack took place; Kirkland slept in old buildings and huts. During the mission, he went out with his platoon as a medic in case of enemy attack. He took the wheel just before the attack, turning onto Taliban Road near Kandahar City. “We were going to pick a fight with them,” he says. “We were going to knock on their door and pick a fight with them.” The mission looked like it was going to be a success, but things soon took a turn for the worse. That day on the tank is now seared in Kirkland’s memory. “It was a very surreal thing,” he says. “I didn’t have any feeling in [my body], and I thought, ‘Wow, this is what it’s like to die; it isn’t too bad.’ So I made a choice – either I was going to stay there and die or try to get out of there.” Kirkland managed to escape and was later rescued by Canadian forces. He was lucky to be alive. His bulletproof vest was gone. His helmet was dust. His shirt was torched. He suffered severe burns and damage to his hearing, but was able to help load the rest of his colleagues into the LAV. Back from the brink From the gruelling war zones of Afghanistan to the rigorous world of real estate, Glen Kirkland has come full circle after a traumatic experience changed his life forever. Jordan Maxwell reports “I didn’t have any feeling in [my body] and I thought, ‘Wow, this is what it’s like to die; it isn’t too bad. So I made a choice – either I was going to stay there and die or try to get out of there”
  • 49. www.repmag.ca 47 The return When he returned to Canada from Afghanistan, the traumatic experience hit Kirkland hard. Like many of his fellow soldiers, he battled PTSD and alcoholism. It was his father, who also served in the military, who helped him through to the other side. “When I first came back, everything was surreal,” he says. “You’re ripped from a war zone and put back into normal civilian life. It was a tough transition for me. It was my Dad who really helped me. I talk to him literally every day, and he’s a true hero. But ultimately, it was a decision I made. And I didn’t want to be that person. I went to Brandon University right away and went right into my real estate career. That helped a lot, just to have something else to focus on.” After making the decision to go back to school, Kirkland eventually reintegrated himself back into civilian life. His decision to go into real estate was something he’d been pursuing long before he became a member of the Canadian Army. While he’ll never forget what happened that September day in Afghanistan, what Kirkland chooses to focus on are the similarities between life on the battlefield and life in the real estate industry, where his discipline has helped to make him one of the most decorated agents in Manitoba. “You never turn it off,” he says. “When you’re overseas, you’re always switched on; you’re always working, so in that regard, it’s the same thing. You can’t compare getting into a gunfight to selling a deal, but that work ethic and discipline is what keeps us going.” REP THE FIGHT FOR BENEFITS WhenGlenKirklandreturnedfromAfghanistan,hefaceda strugglethatmanysoldiersintheCanadianArmyhavetaken theHarpergovernmenttotaskover:benefits.Kirklandtestified beforeaparliamentarycommitteeaboutthedifficultyhefaced whentryingtoreceivehealthbenefitsfollowingtheTaliban attackthatkilledthreeofhisfellowsoldiers.Hewaseventually dischargedfromthearmyaftersufferinghearinglossandabrain injurythatlefthimdependentoninsulin. TheConservativegovernmenthassincepouredmillionsof dollarsintoveterans’programs,andrecentlyunderscoredits commitmenttoex-soldiers,butmanyremainskepticalaboutthe treatmentofCanadiansoldiers.
  • 50. 48 www.repmag.ca FAVOURITE THINGS PEOPLE FAVOURITE CELEBRITY I have a not-so-secret celeb crush on Gerard Butler. FAVOURITE VACATION SPOT Dubrovnik, Croatia. It has the perfect mix of Old World charm, stunning landscapes and horrifying history. FAVOURITE BOOK Atlas Shrugged by Ayn Rand. This book sparked some of the most intense debates of my life so far. VANESSA ROMAN FAVOURITE THING ABOUT WORKING IN REAL ESTATE: Real estate is the epitome of change; it is all about beginnings and endings. With every house I sell, people close one door, only to open another, behind which awaits endless possibility, adventure and opportunity. I feel privileged to share the journey of homeownership with my clients. First-time buyers,Gerard Butler,‘mom jokes’and Manchester United – these are a few ofVanessa Roman’s favourite things FAVOURITE MOVIE I’m a sucker for rom- coms. I have watched Love Actually and P.S. I Love You more than 15 times each. FIRST REAL ESTATE DEAL: My first real estate deal wrecked me – it was absolutely perfect! I was working with a family member who was well-qualified, knew exactly what she wanted, and we found ‘the one’ after touring only four properties. In the days that followed, I had endless daydreams about the perfect clients I would work with in the future, negotiating perfect deals for them. Looking back, my naivety makes me smile. FAVOURITE REAL ESTATE DEAL First-time homebuyers are always my favourite deals. It’s wonderful to share their enthusiasm, witness their wide-eyed wonder at all of the housing options out there and to be a voice of reason when the responsibility of becoming a homeowner seems overwhelming. FAVOURITE THING OUTSIDE OF REAL ESTATE I tell jokes – the really cheesy kind that only dads can get away with. I’m a mom, so I just don’t have the same delivery, I guess. People expect mom jokes to be better somehow. My family and friends don’t even fake laugh anymore. Photofromwww.goodreads.com Realtor with Exit Realty Metro,radio host,columnist and host of HGTV’s“Reno vs Relocate” FAVOURITE SPORT Soccer (football) – I’m a proud Manchester United fan. FAVOURITE FOOD Anything I can eat with my fingers. Silverware is overrated. FAVOURITE MUSIC 1930s and ’40s swing-era bands. Duke Ellington, Glenn Miller and Benny Goodman had a timeless rhythm I could listen to all day long.
  • 51. GET EXCLUSIVE EDUCATION including C21 CareerXpress: harness top producers’ habits in 30 days. JOINTODAY!1.855.228.7338 | century21franchise.ca | century21careers.ca Independently Owned and Operated. ®/™ trademarks owned by Century 21 Real Estate LLC used under license or authorized sub-license. © 2015 Century 21 Canada Limited Partnership ®™ Trademarks of AIR MILES International Trading B.V. Used under license by LoyaltyOne, Co. and Century 21 Canada Limited Partnership. THIS LISTING IS MINE. I’M IN CONTROL.WHO KNEW? TODAY, MY WEEK IS FULL. LIMITS? WHAT LIMITS? NOW,WHICH COURSE NEXT...
  • 52. Realty isEXIT Regional Office EXIT Franchise *Not including 2015 growth Prime Canadian Regional and Franchise Territories Available For more information contact: Tami Bonnell, C.E.O. 1.877.253.3948 Make this ThE fInEsT busInEss dEcIsIon of your career! GRoWInGaND eVeRyONe CaN Feel it!Objective: 3,600 Franchises With Over 100,000 Agents Across North America! HAWAII* *Out of proper positioning because of lack of space www.exitrealty.com