Tag Archives: figure
The Ripples of 2008 Slowdown are Now Getting Closer to Home
Real estate figures at the start of the year are now in, and the numbers for both low-rise and high-rise units indicate that we are still in for some bumpy ride in the next few months. The unfolding developments in various real estate markets are giving conflicting signals. For instance, high rise condo units are performing pretty well despite the lingering problems bugging other property segments. In a market report that was recently released, the new high rise home property segment registered an amazing 1,107 units sold for the first month of the year. The figure is by far the highest that was ever achieved by the segment for the last 5 years.
Surprisingly, things were not as rosy for low rise home properties. Total sales performance for the property segment for the same period was only 1,145. The figure is the second lowest for the property segment for the last five years and is only higher to the sales figure for the same period last year, which is admittedly the most difficult year for the real estate market. It was during this period that the market and the economy as a whole were mired in countless challenges including high interest rates, recession and high unemployment rate.
Things are no better in major real estate markets as well. The inventory level of low-rise properties in the Greater Toronto Area continues to decline and is now at 7,238 units. This inventory of home units for sale is more than 60% lower than the ideal level of inventory for the real estate market.
On the other hand, high-rise home properties and resale home units are now going for much higher tag prices due to strong pressures on the demand side in major real estate markets. We are seeing the worst situations on both extreme scenarios, which according to real estate experts and industry analysts is unprecedented.
Towards the end of the month under consideration, new condo properties were being sold by an average price of $407,885 which is 5% higher for the same period of the previous year. The January figure is also higher by $9,710 to the average price of the same home properties towards the end of last year. These numbers indicate that almost half of the incremental increase in prices for the entire year happened in a single month.
On the other hand, the average price of newly built single-family home units for Greater Toronto Area was pegged at $474,035 towards the end of January this year. This figure is a jump of $14,462 from December of last year and an incremental increase of $34,436 for the same period of the preceding year. Market experts observed that 42% of the increase can be attributed to the price shift during a single month.
What are the implications of these major shifts in the real estate markets? Real estate experts agree that the inventory levels of single-family home properties are critical factors that define the directions in the real estate markets. What worries experts is the continuing and fast downtrend in the supply variables of most real estate markets. Stakeholders who have front-seat view of the goings-on in the real estate industry believe that the current state cannot be attributed to one specific variable. Real estate analysts agree that the situation is a confluence of several factors that negate whatever upside changes that we are experiencing right now.
While the challenges in the real estate market can be attributed to the global recession that hit major economies last year, experts are not sure how long the condition will last. This prevailing market condition is the main reason why home buyers are not too keen on going back to the market, and this depressed situation in real estate market has led to fewer projects of developers and home builders.
Startup Loans and Your New Business (Page 1 of 2)
Anyone who’s ever tried it knows that building a real, working business is no easy matter. For every business you see that’s growing out there, you can find probably thousands that are on their way to failure. You see, it takes a lot more than a terrific idea to be successful. You need to have a “never say die” attitude and almost a relentless energy to work your way through the hard times – and make no mistake, there will be hard times. But if you have the right stuff, you can make it work.
In many cases, the hard times that plague startup businesses revolve around money, or more to the point, undercapitalization. It takes real money to open a business and to keep it running. Lots of startup moms and pops usually turn to their personal savings or other assets to do this and that can be a mistake. More often than not their money simply wont last long enough. And when it runs out their fledgling business folds and theyre left without a business or any savings.
Business journals, text books, and business gurus will tell you that you need enough money in a startup business to keep your doors open for the first six months to a year. Without that minimum amount of cash you’re looking at only a small chance at success. Savvy entrepreneurs know this too and therefore give themselves a solid chance at success by finding their capital in the form of business startup loans.
However, the kind of business startup financing most entrepreneurs need isn’t available to just anyone. Lots of banks and lenders consider these types of loans pretty risky vehicles and so the barriers to qualifying can be quite high. Still, any fledgling business owner can increase his or her chances by taking the time to prepare themselves thoroughly – that’s the key.
Look at Your Numbers
Start by making a thorough examination of what your operating expenses and potential returns will be. You’ve got to be realistic and even conservative. Figure there will be unexpected expenses and build them into your plan. Also figure that your sales or returns will be less than you hope. Add up the numbers so that you have a reasonable figure that tells you how much money you’ll need to make it through your first year of business.
Just how much of your own savings and assets you can bring to the table? Again, be conservative. Don’t commit all of your available money (experienced entrepreneurs never do). But you need to commit some of your holdings because every lender you deal with will want to know you believe in yourself. And taking a financial stake in your own new business will show them just that.
Create a Business Plan
One absolute necessity in all of this is a sound business plan. Don’t count on receiving any financing without one. Business plans are nothing more than evidence (factual and/or anecdotal) that demonstrates your business will succeed. And lenders want as much evidence as possible. They actually want to make the loan and building a strong business plan tells them that you’re probably also capable of building a strong business.