Toronto Real Estate and Neighbourhoods Blog | Move Smartly

Most Improved Toronto Schools 2012 (Realosophy Ten Ten Neighbourhoods)

Urmi Desai in Top Ten Neighbourhoods, Home Buying, Toronto Schools, Toronto Neighbourhoods

It's been an exciting week for our Realosophy Analytics spotlight on the relationship between School Quality and Real Estate Values.

Following our first list, Best Toronto Schools for 2012, we were profiled in the Toronto Star.

The feedback we've been hearing from you is consistent with our premise: while we are all aware that EQAO scores tell only a part of a school's story, these scores nonetheless influence your home buying decisions. You've told us that having access to this type of information helps you think about your goals and feel empowered about making your own decisions.

Realosophy Workshop

Many of you have been in touch with specific real estate and schools questions - and we have lots more data and information to share. Sign up for our "Schools for Home Buyers" workshop on Sat Feb 25th (limited seating, first come first served). As part of the workshop, you'll receive a free Neighbourhood Match report which lists out the best Toronto neighbourhoods for your needs. Sign up below (scroll down to the end of this post).

Most Improved Toronto Schools 2012

Now, onto the main show! I'm particularly excited about this week's installment: Top Ten Most Improved Elementary Schools in Toronto for 2012.

For all the controversy about EQAO scores and what they actually measure, we often miss a far more important story. No score is static, and improvement, more than any other metric, may reveal to us what is truly important about any organization - its ability to assess its current reality, successfully diagnosis problems and do better. (RIM, are you listening?)

And what a fantastic story this week's list has to tell. Most of the most improved schools are in affordable neighbourhoods, many of which are next generation emerging neighbourhoods. Seven out of the ten schools improved to an average EQAO score of 70 and above. Improvements ranged from between 24 to 36 in average percentage points.

Above all, this top ten list tells us a story of hard work - the hard work of students, teachers and parents working to make their schools better. And really, isn't hard work the biggest lesson we want to instill in our children?

The Data

• Overall change (in the bright yellow circle) represents the average increase or decrease (in percentage points) in EQAO scores from 2007-08 to 2010-11; average of all six tests written by students (reading, writing and math at the Gr. 3 and Gr. 6 levels)
• Covers all Toronto public schools with an overall average test score above 60 (Note: some schools are too small to report EQAO results and are excluded)
• Average EQAO test score represents number of students obtaining the provincial standard; average of all six tests written in 2010-11
• Average house prices for the neighbourhood in 2011
• 3-Year increase in house prices from 2008 to 2011

1. Kimberley Junior Public School
	Neighbourhood: East End Danforth Grades: JK-6 Enrollment: 271 Address: 50 Swanwick Ave Average EQAO Test Score: 86% 3 Yr EQAO Score Improvement: 36% Average House Price: $487,469 3 Yr Increase in House Prices: 16%
Browse detailed school scores and demographic data for Kimberley Junior Public School

Best Toronto Schools 2012 (Realosophy Top Ten Neighbourhoods)

Urmi Desai in  Top Ten Neighbourhoods, Toronto Schools, Home Buying, Toronto Neighbourhoods

It's school time at Realosophy Analytics! Our month-long feature looks at the special relationship between real estate and schools.

Today's post looks at the top elementary schools in Toronto as measured by the province's latest standardized EQAO scores.

While it's tempting to tape this school list to your goal wall/fridge/dreams and "make it so",  it's important to remember that EQAO scores only tell us so much about school quality. For one, standardized testing results tend to favour advantaged socioeconomic groups, which can make the results more about 'who' attends than 'what' is being taught.

Educators also stress that some school strengths - like special curriculums or educational philosophies - fall outside testing parameters. But interestingly, specialty schools are a strong presence on our list. This is likely due to admissions requirements (e.g., for arts schools) and smaller class sizes.

Realosophy Workshop

Many of you have been in touch with specific real estate and schools questions - and we have lots more data and information to share. Sign up for our "Schools for Home Buyers" workshop on Sat Feb 25th (limited seating, first come first served). As part of the workshop, you'll receive a free Neighbourhood Match report which lists out the best Toronto neighbourhoods for your needs. Sign up below (scroll down to the end of this post).

The Data

• Overall score (in the bright yellow circle) represents an average of the six EQAO tests written by students in 2010-11 (reading, writing and math at the Gr. 3 and Gr. 6 levels)
• Covers all Toronto public schools (Note: some schools are too small to report EQAO results and are excluded)
• 3 Year EQAO Increase represents an average of percentage points change from 2007-08 for all tests
• Average house prices for the neighbourhood in 2011
• 3 Year increase in house prices from 2008 to 2011

Next Up: Most Improved Toronto Schools 2012

 

1. Claude Watson School for the Arts
	Neighbourhood: Willowdale Grades: 1-8 Enrollment: 325 Address: 130 Doris Avenue Average EQAO Test Score: 100% 3 Year EQAO Score Improvement: 4% Average House Price: $488,344 3 Year Increase in House Prices: 30%
Browse detailed school scores and demographic data for Claude Watson

 

What’s Driving Toronto Real Estate Prices Up? The School Factor

Urmi Desai in Top Ten Neighbourhoods, Toronto Schools, Toronto Neighbourhoods, Home Buying

It’s time to get schooled!

We’ve updated www.realosophy.com with the latest 2011 EQAO data for over 1,800 GTA schools and the Realosophy Analytics team have taken a long, hard look at the data. Over the next few weeks, we'll be reporting on the symbiotic relationship that is Toronto real estate and Toronto schools.

Today, we’ll start with an overview of some key trends.

Move Over Starbucks

Look behind the crazy bidding wars in Toronto’s hottest neighbourhoods and you’ll find a lot of good schools. It’s not new that parents are anxious to give their kids the best start in life. (I’m reminded of the advice of a Richmond Hill high school principal once gave to my dad: “Frankly, Mr. Desai, if your kid’s smart, they’ll do great anywhere. If they’re not, well, that’s another story.”) But it’s an anxiety that’s only gotten stronger – or at least become more acted upon – thanks to the introduction of standardized testing at Ontario schools in 1995 and the reporting of results on the internet, a mini baby boom in Toronto and a growing sense that our children will be wrestling out their futures in a highly globalized bear pit of competition. Today, many home buyers with children focus their home search exclusively on school quality.

Forget about the Starbucks effect - it’s all about the school effect.

Toronto Schools are Getting Better

The good news is that our data shows that Toronto schools are improving under all this scrutiny. Compared to three years ago, there are 45% more elementary schools scoring an average of 80% or greater (this is an average of results obtained in the six different EQAO tests elementary school students write - reading, writing and math at the Gr. 3 and Gr. 6 levels). In November, a cross-Canada study carried out by Education Ministers showed that Ontario alone had students placing above the national average in all three examined subjects – reading, math and science.

5 Questions for...a Frustrated Home Buyer Blogger (FML Listings)

Urmi Desai in 5 Questions, Home Buying

The blogosphere has been abuzz about “FML Listings” an anonymous blog launched by a frustrated Toronto home buyer. FML’s MO is as simple as it is addictive: post a not-so-hot house with a whopping price tag listed on realtor.ca and add raw commentary. See for example, this post about a $739,000 house at Jane and Finch:

Does this mean that not only can I not afford to live where I want in North York because of the million dollar bungalows, and I for sure can’t live in my first choice of mid-town, I can barely live in Leslieville because of crazy bidding wars, but now I can’t even buy a reasonably priced home at JANE AND FINCH?!?!  Is this what it feels like to hit bottom?

It’s like the Globe and Mail’s celebrity caption guy for houses. It’s also a tonic for those tired of hearing (and experiencing) that a house is worth what the market (i.e., the next buyer) decides it is.

FML and spouse own a home in Richmond Hill, but after being underwhelmed by suburban life, decided to move to Toronto to be closer to family, friends and work. That was three years ago. The search continues.

***

Urmi Desai: Why did you start blogging about the real estate situation in Toronto?

FML Listings: After seeing so many ridiculous listings, I started to think maybe I was the only one who was wrongly thinking they were insanely overpriced. But then I saw one that just put me over the edge. I posted it to Facebook, and I got a lot of feedback that I didn't expect. Firstly, it made me realize that it wasn't just me who thinks that a million dollar bungalow is out of whack, but more importantly that not many people were actually aware of the situation that was going on with some of the listings around the city. I started finding more and more of these listings, each one worse than the next, which drove me to start the blog so I could show at least a few other people what was really going on in this city. It's really disheartening to go into an open house priced at $600,000 that you know is worth $400,000 and you're sure it's not going to sell, but then the open house is packed with people and it ends up turning into a bidding war situation. So to be able to have this outlet where I see feedback from people actually agreeing that it is ridiculous, it has validated the years that I've spent watching the market, being stressed out, wondering "who's buying these?!”

UD: What do you think is driving the house feeding frenzy in Yonge St. neighbourhoods in North Toronto?

Winter Mortgage Market Update (2012)

David Larock in Mortgages and Finance, Home Buying

This quarter’s Mortgage Market Update is a good news/bad news story.
 
I’m an optimist at heart so let’s start with the good news. Barring a global and systemic financial meltdown, our mortgage rates will probably stay at their current rock-bottom levels for an extended period of anywhere from one to five years.

The bad news is that these ultra-low rates will be the by-product of a massive global deleveraging process, which will be as necessary as it will be painful to the world’s most indebted economies. While Canada will not be at the epicentre of this debt purge and while we are somewhat uniquely positioned to endure the coming downturn (more on that later), we will not be immune from the negative effects that deleveraging will have on global economic growth.

Monday Morning Interest Rate Update (January 23, 2012)

David Larock in Mortgages and Finance, Home Buying

The Bank of Canada (BoC) left its overnight rate unchanged at 1.00% last week, and also released its latest quarterly Monetary Policy Report (MPR). The MPR tells us where the BoC thinks inflation is headed and offers the Bank’s perspective on where the greatest risks to the Canadian economy lie. Regular readers of the MPR can also compare the latest report to previous versions to gauge where the BoC’s views have changed at the margin.

For example, the BoC’s latest report said that “several significant upside and down risks are present” and that “the outlook for the global economy has deteriorated and uncertainty has increased”. This implies that the BoC sees greater volatility on the horizon and a broader range of possible outcomes ahead.  The latest report predicted that “the recession in Europe would be deeper and longer than the Bank had anticipated in October” and also said that “the Bank expects the U.S. recovery will proceed at a more modest pace going forward”. Despite this, the Bank said that it now expects the Canadian economy to return to full capacity in the third quarter of 2013, which is a quarter sooner than its previous forecast.

This begs the question. If the BoC is more negative on the prospects of both Europe and the U.S., why does it also think that our economy will return to full capacity more quickly than previously expected? The BoC’s answer is that “very favourable financing conditions are expected to buttress con­sumer spending and housing activity… and the ratio of household debt to income is projected to rise further”.

When one considers how outspoken  BoC Governor Mark Carney has been about the risks that rising debt levels pose to our economy, it was surprising to see the Bank predicting that a continued rise in our household debt levels will act as an effective counterbalance to stronger headwinds from oversees. But back to the earlier point about the broadening range of possible outcomes, the report goes on to say that our high debt levels “could lead to a sharper-than-expected deceleration in household spending”.

Five-year Government of Canada bond yields spiked at the end of last week, closing at 1.40% on Friday and finishing 14 basis points higher overall. It’s interesting that this happened at the same time that lenders finally started dropping their fixed-mortgage rates – a change that was long overdue given that gross-spread levels have been well above normal for some time (even when new lending costs are factored in). If yields continue to surge, the recent fixed-rate drops will be short lived, but I haven’t seen any obvious catalyst to suggest that this will be the case.

Variable-rate mortgage holders got some good news from the latest Consumer Price Index (CPI) released by Statistics Canada on Friday. The CPI dropped from 2.9% to 2.3% and core CPI (which excludes more volatile inputs like food and energy) also fell from 2.1% to 1.9%.  The core number was below the BoC’s projection of 2.2% for Q4, 2011 and is now below the BoC’s long-term target rate of 2%. This latest round of CPI data means that the BoC can continue to take its time before raising rates, and it also vindicates the Bank’s decision last year not to raise rates when higher food and energy prices caused inflation to temporarily accelerate.   

The bottom line: To paraphrase my key take-away from the BoC’s latest MPR, rising household debt levels are expected to provide the fuel needed to drive our economy through tougher times ahead, as long as no one lights a match.

David Larock is an independent mortgage planner and industry insider specializing in helping clients purchase, refinance or renew their mortgages. David's posts appear weekly on this blog (movesmartly.com) and on his own blog integratedmortgageplanners.com/blog). Email Dave

The Magic of Five Percent: A New Year’s Resolution Worth Keeping

David Larock in Mortgages and Finance, Home Buying

When the calendar flips to a new year, many of us make resolutions to improve our lives. Judging by how busy the gyms get during the first three weeks of January, I’d bet that improving physical fitness is the most popular resolution, but improving one’s financial fitness is probably not far behind. To that end, today’s post will offer you a simple mortgage tip to help you lower your interest cost, pay off your mortgage more quickly, and prepare for higher rates at renewal.

Canadian mortgage rates are at record-low levels and there has never been a better time to put extra dents in your mortgage. The trick is to increase your regular payments by a relatively small amount to chip away at your principal over time, instead of waiting until you have saved up a chunk of money for a large extra payment (which for most of us tends to be a plan whose time never actually comes).

Monday Morning Interest Rate Update (December 19, 2011)

David Larock in Mortgages and Finance, Home Buying

Last week the Bank of Canada (BoC) issued its latest Financial System Review (FSR), and its governor, Mark Carney, gave a speech called “Growth in the Age of Deleveraging”. If you’re trying to gauge where mortgage rates are headed, both links are well worth the read.

The bi-annual Financial System Review basically outlines what the BoC is worried about and explains to what degree. Not surprisingly, the report concludes that “the risks to the stability of Canada’s financial system are high and have increased markedly over the last six months”. Here are the highlights: 

• The BoC’s greatest concerns are “(i) a sharp escalation of the sovereign debt crisis in the euro area; (ii) a much weaker outlook for global economic growth; and (iii) a pronounced retrenchment from risk taking in international financial markets.”
• The report’s general assessment of the euro-zone crisis is that member countries have not responded with appropriate urgency and that their window for pre-empting a full-blown bond-market meltdown is closing rapidly.
• The BoC is also concerned about economic growth in the world’s largest economies, highlighting “the risk that household deleveraging and fiscal consolidation in the U.S. could drag the U.S. economy into another recession” and “an increased risk of a more pronounced slowing of economic activity in China”. (And although not many people are focusing on this elephant in the room yet, if China falters in a major way it will be a game changer.) 
• On the topic of Canadian consumer debt levels: “[Canadian household] credit growth has slowed noticeably over the last six months” but remains a “heightened risk”.
• The report’s overall assessment is that “the global recovery is expected to remain weak and uneven”.  

Mr. Carney’s Monday speech on “Growth in the Age of Deleveraging” was refreshingly candid, and for a person whose words can move markets, he certainly didn’t pull any punches. Here is a summary of what the BoC Governor said (although it is tough to write a summary that does this content-rich speech justice): 

• Global debt has risen to critical levels and only hard choices remain.
• While corporate borrowing helps an economy grow because it leads to increased productivity, government and household borrowing provides an economy with little lasting benefit. (Unfortunately, almost all of the borrowing in advanced countries during this debt super-cycle has come from the latter and not the former.)
• Advanced countries simply can’t borrow their way out of their current predicaments, and they have no choice but to accept the Pyrrhic medicine of deleveraging.

• Europe is in for a long, grinding recovery: “fiscal austerity and structural adjustment will mean falling wages, high unemployment, and tight credit conditions”.
• Canada, relatively speaking, is in the best shape of any country in the G-7, but we are headed in the wrong direction since most of our borrowing is the non-productive consumer kind. We need to wean our economy off consumer spending, and businesses need to make up the difference by investing in productivity and focusing on increasing exports to emerging markets.
• In a related but more general vein, Mr. Carney said that all advanced nations need to retool their economies to replace falling domestic demand with export-led growth. At the same time, emerging countries which can no longer rely on demand from advanced countries must allow their currencies to float (and appreciate versus advanced-country currencies) while shifting their focus to domestic led growth. While this makes good sense, Mr. Carney laments that in actuality, “both sides are [instead] doubling down on losing strategies”.    

Five-year Government of Canada bond yields plunged another 15 basis points last week and closed at 1.18% on Friday as investors continued to prioritize ‘preservation of capital’ over ‘return on capital’. Five-year fixed-mortgage rates inched down last week, with 3.29% now more widely available, but lenders are still pocketing the higher spreads like Scrooge instead of discounting their mortgage rates like Santa.

Variable-rate mortgage discounts continue to shrink, but prime minus .20% are still available from a lender offering attractive terms and conditions. If you’re considering a variable rate and want to see how the potential cost of current variable and fixed-rate five-year terms might compare under different interest-rate projections, check out my latest Rate Simulation analysis (posted last Wednesday).

The bottom line: I’ve said it before but it bears repeating. If Canadian consumer-borrowing rates don’t moderate, and fast, more mortgage rule changes are coming. That’s not exactly music to my ears, but all of the alternatives are worse.

David Larock is an independent mortgage planner and industry insider specializing in helping clients purchase, refinance or renew their mortgages. David's posts appear weekly on this blog (movesmartly.com) and on his own blog integratedmortgageplanners.com/blog). Email Dave

Would You Save More With a Fixed or Variable-Rate Mortgage? (Rate Simulator – 2011 Year End Edition)

David Larock in Mortgages and Finance, Home Buying

It’s been three months since we last ran scenarios that compare the potential costs of fixed vs. variable-rate five-year mortgages using today’s market rates. Over that period, five-year variable-rate discounts have shrunk from prime minus .70% to prime minus .20% (which is 2.80% using today’s prime rate), and five-year fixed rates have dropped from 3.49% to 3.39% (or better if you know where to look).

The narrowing gap between today’s fixed and variable rates (3.39% vs. 2.80%) makes it harder to decide between them. Do you take the fixed rate because it gives you payment certainty for a premium of only .59%? Or do you bet that the same subdued economic forecasts that are driving fixed rates down will lead to a drop in the variable rate?

Monday Morning Interest Rate Update (December 5, 2011)

David Larock in Mortgages and Finance, Home Buying

On Friday, all twenty-seven leaders from the countries that make up the European Union (EU) will assemble in Brussels to take their latest shot at resolving the region’s financial crisis, which is based largely in the seventeen EU countries that use the euro as their currency (called the euro zone).

If past is prologue, the meeting will end with a press conference where EU leaders announce new measures and declare an end to the current crisis once and for all. The markets will rally around the headline, but as scant details emerge in the coming days, doubt will creep back in, and we’ll be one more whippy rally away from being right back where we started. (Sorry to spoil the ending for you.)

The euro-zone crisis won’t end until its member countries agree to cede their fiscal sovereignty to a central body that will enforce strict budgetary discipline, and politicians can’t sell that kind of concession to their voters until the majority of them are convinced that the only alternative is financial collapse. That means that the current crisis has to continue to get worse before it can get better – but this is a dangerous game the euro-zone leaders are playing as they cling to the market’s tiger tail for dear life, hoping for that fleeting moment when political expediency meets economic necessity.

Here are some other highlights from last week:

Central banks from several of the world’s largest economies (including the Bank of Canada) joined together to lower the cost of their short-term loans to the European Central Bank. True to form, bond markets rallied on the news, but the momentum was short-lived because making liquidity cheaper and more easily available does nothing to address the fundamental cause of the euro-zone crisis, which is solvency. Instead of a cure, this was more like giving a terminally ill patient another shot of morphine to ease the pain.

The U.S. Department of Labor released its latest employment report , showing a net gain of 120,000 new jobs in November and, to everyone’s surprise, a dramatic decline in the overall unemployment rate from 9% to 8.6%. A closer look at this unexpected drop reveals that it was primarily caused by 315,000 fewer Americans actively looking for work (this is referred to as a drop in the “participation rate”).  If we adjust the current employment numbers using the U.S.’s historical-average participation rate, U.S. unemployment is actually in the 11 to 12% range, and to put that in perspective, the U.S. would have to average 400,000 new jobs each month between now and 2020 to return to its long-term average employment level.

Meanwhile, in the Great White North, we lost another 19,000 jobs in November on top of our 59,000 net loss in October. While our third-quarter gross domestic product (GDP) increase came in at a robust 3.5%, most of that growth was export driven, and with global growth slowly markedly, this momentum is not expected to continue. In short, there was nothing in the latest data to change my prevailing view that mortgage rates will be on hold for the foreseeable future.

Five-year Government of Canada bond yields had one of the stranger weeks I can remember. We started with a few days of big rallies but by the end of each day they had fizzled to nothing. The market seemed ready to rally on any hint of good news but there just wasn’t enough confidence to keep the surges going. In the end, all that volatility left the five-year yield at 1.36% on Friday, down 3 basis points overall for the week. One of the major banks dropped its five-year fixed-mortgage rate by 10 basis points on Friday, so expect other lenders to respond in kind over the next few days.

Variable-rate mortgages have fallen out of favour with the Big Five, and this was confirmed in the comments accompanying their latest quarterly results. If you’re thinking about a variable rate mortgage, non-bank lenders are your best bet these days.  

The bottom line: The markets are so desperate for any good news that we will probably see a run-up in bond yields this week in anticipation of the EU’s Friday meeting. If you’re in the market for a pre-approval, best to lock in today so you don’t get wrong-sided by market overreaction to the post-meeting press conference where EU leaders will declare the crisis over…again.

David Larock is an independent mortgage planner and industry insider specializing in helping clients purchase, refinance or renew their mortgages. David's posts appear weekly on this blog (movesmartly.com) and on his own blog integratedmortgageplanners.com/blog). Email Dave