Blog › January 2012

Planning a Move

Planning a Move

It can take years to accumulate a home full of treasured belongings but only a matter of days to pack it all into boxes for a move. Packing up and moving require organization and planning. In fact, it can be the greatest test for a procrastinator - what seems like few belongings can take far longer and use more boxes than expected. The following tips can help keep your breakables intact, your pets safe, and make the whole process as efficient as possible.

Most people have at least a month's notice before a move. During that time, there are a number of preparations that will make the move easier including the following:

  • If you have a pet and plan to take a flight to your new home, be sure to contact the airline early for information about vaccination requirements, tranquilizers and acceptable cages. Airlines have strict rules regarding pets and it is essential to be prepared in order to avoid delays.
  • Reserve a rental truck or make arrangements with a professional moving company. Remember to check out the company with the Better Business Bureau and get all quotes in writing.
  • Check your homeowner's or renter's insurance policy to ensure your belongings are covered during the move.
  • If applicable, make travel arrangements with airlines, bus companies or car rental agencies.
  • Have a yard sale or give unneeded items to charity. Some charities will pick-up bagged or boxed items and may issue a donation receipt for tax purposes.
  • Ask your doctor and dentist for records, x-rays and prescription histories. Also be sure to get your prescriptions refilled before moving day.
  • Make a list of the companies that send you mail on a regular basis and provide them with a change of address. Arrange with the post office to have mail forwarded to your new address.
  • Take inventory of your belongings before they're packed in the event you need to file an insurance claim later. Take pictures or videotape your belongings. Record the serial numbers of electronics and cameras.
  • Cut back on grocery shopping and start using up food items you already have so there will be less to pack.
  • Notify your cable, telephone, power and water companies of your move. They can arrange to have your final bill prorated to the end of the month in order to close or transfer your account.
  • Update the address on your magazine subscriptions with your new address.
  • Start collecting boxes from grocery stores early - at the end of the month stores are usually flooded with requests for boxes.
  • If you are moving into an apartment building, be sure to reserve the elevator a few weeks in advance. The building manager will arrange a time with you when one elevator will be locked off for your use.
  • And the number one rule is…start packing early! Assign one room or corner of a room as the spot to pile boxes. Pack one or two boxes a day and pile them in the designated spot to avoid clutter and simplify moving day.

Packing Made Simple

  • It seems that no matter how hard we may try to pack them neatly, clothes always come out of boxes wrinkled. This can be a liberating phenomenon for most of us! If however, you strive for wrinkle-free clothing, try layering several items then gently roll up the pile. Rolling the clothes means there are fewer straight edges and wrinkles.
  • The best way to move computers, televisions, DVD players and other electronics is in the original boxes and packing material. The foam and plastic that came in the boxes are specifically shaped to protect items from impact.
  • When possible, pack heavy items in smaller boxes for easier carrying.
  • Use colour-coded labels to denote the contents e.g. red labels for kitchen items, blue for bathroom supplies etc. Use a permanent marker to write the contents of the box on the label.
  • Have the following items on hand: a roll of packing tape, a pair of scissors, and a permanent marker for every person participating in the move. Also have more boxes than you anticipate needing in a variety of sizes.
  • Carry all valuables with you.
  • Instead of newspaper, use clothing, towels or bedding to wrap up breakables. This way you won't waste energy and money transporting newspaper.
  • Use strong boxes such as those from the liquor store to pack dishes and pans.
  • Empty drawers in dressers and tape the drawers closed.
  • Professional moving companies can usually supply wide plastic wrap for couches and chairs prior to the move. Another alternative is to use old sheets taped in place.
  • Label boxes as fragile on all sides of the box and indicate which side is up.

Moving Day

Hopefully, if all has gone according to plan, you've completed and checked off all the items from the previous list. Theoretically, moving day should not be a packing day but it's a good idea to have an extra box handy along with tape and scissors. The following are a few other important tips:

  • If you are using professional movers, be there to watch the loading and unloading. If anything does get dropped or knocked you will know which items to inspect.
  • Examine furniture and loose items carefully before paying for the move.
  • Return keys to the landlord or arrange to provide the keys to the new owner.
  • Find out what type of payment is acceptable to the movers i.e. cash, credit or cheques.
  • Bottles of juice and water along with packaged snack foods can keep energy levels high.

Posted: 20-01-2012 under Real Estate Blog

Burglary Prevention

Burglary Prevention

Odds are that some day your home will be broken into. In fact, over 450,000 Canadian households were burglarized in 1998. The best way to minimise your risk of becoming a victim is to become aware of what burglars look for. By eliminating any vulnerable points of entry and taking some security measures, you can reduce your chances of becoming a crime statistic.

Tips:

  • Don't leave a spare key outside. Burglars know the likely hiding spots: under a mat or planter, or on top of the doorframe. Insurance companies tend not to be too co-operative when they discover you provided the key! If you must leave a spare key outside choose a spot far from the door-in the backyard or better yet with a trustworthy neighbour.

  • Take extra precautions when you are out for the day. Most burglaries occur during the day when the occupants are at work. Remove any obstructions which a burglar could use for cover in front of your home. Trim back bushes so that any suspicious activity can be seen from the street. Turn on a radio, especially a station with talk shows, to make it seem like someone is home.

  • Use an automatic timer. Turning on a few dim lights when you go out is not a significant deterrent to crime. Most burglars know that most people who are at home have at least one room well lit and turn on other lights as they move around their home. An automatic timer can be used to turn lights, radios and televisions on and off in realistic patterns.

  • Add security peepholes to your front and back doors. These devices are available at most hardware stores and don't require any handyman skills other than drilling a hole into the door.

  • Make it look like you're home even when you're on vacation. Stop delivery of newspapers and have the post office to hold your mail. Ask a neighbour to pick up any junk mail or free newspapers that get deposited on your doorstep. If you will be gone for more than a week, arrange to have your grass cut or snow removed.

  • Get a safety deposit box. It may seem inconvenient but it's a foolproof way to protect your valuables especially when you're on vacation.

  • Consider getting a dog. Not only are they great companions they are natural alarm systems. It's not important whether it's large or small as long as it likes to bark at strangers on your property.

  • Mark valuables such as stereos, televisions and cameras. Engrave your driver's license number on these items with an engraving tool available through your local police department.

  • Disperse your valuables throughout your home. Make it harder for the thief to find all your jewellery or spare cash by hiding it in different places. (Thieves are onto homeowners who hide them in the ice cube tray or anywhere in the fridge so choose other locations.)

  • Never leave windows open even if you are only going to the corner store. Professional burglars can be in and out of a home in less than ten minutes. Crime statistics show that first floor windows are the second most common point of entry after the front door.

  • Invest in an alarm system. Ask friends and neighbours if they know of a reliable security company. If you can't afford an alarm system you can use official-looking alarm system stickers for your doors and windows (available at hardware stores) in the meantime.

  • Use motion sensor alarms inside your home. These devices use a laser which can detect motion even in pitch black rooms. They are inexpensive ($25-45) and run on batteries. Position the sensor at a height that will avoid pets and aim it toward an area a thief would likely pass. Turn on your motion sensor at night and enjoy greater peace of mind (although remember to turn it off before you walk past it in the morning as it can be a rude awakening!)

  • Ensure the exterior of your home is properly lit. A dark yard makes a home easy prey.

  • If you want to add a lock to your door be sure that a burglar could not reach it by putting an arm through a broken window. Also note that spring locks, with the keyhole in the doorknob are easy to jimmy. It's better to use a deadbolt lock with a one-inch throw, a 5- or 6- pin tumbler cylinder and a cylinder guard ring.

These precautions should deter all but the most persistent thieves. A house that poses several obstacles stacks the odds in the homeowner's favour-chances are that the would-be thieves will move onto a more inviting house and leave your belongings and sense of security intact.


Posted: 20-01-2012 under Real Estate Blog

How to Make Your House a Show Stopper

How to Make Your House a Show Stopper

Showing a house is a lot like going on a first date: you try to look well groomed even if that's not how you normally look! The old adage about first impressions being the most important is just as true for your home as it is for you. A clean house gives prospective buyers the impression that the whole house is well maintained including the out of sight items such as plumbing or heating.

Most sellers know that a tidy home can help their home sell faster but 'clean' is a relative term. What one person finds acceptable could send another running for the door. Real estate agents and brokers have seen it all: ring around the bathtub, clothes on the floor, pantyhose hanging off the shower curtain, sinks full of dirty dishes, living rooms littered with toys, dust bunnies behind the sofa the size of prairie tumbleweeds…

There are three main incentives to keeping your house in perfect showing condition: your home may sell faster, you may get more money for it and by removing the clutter you will allow people to focus on any improvements you've made to your home. (It's hard to see the new tile floor in the bathroom when it's covered in wet towels!)

Long before the first open house, take stock of your home. Do you have piles of magazines you've never finished beside your couch? Are your closets and drawers overflowing with clothes you're hoping will come back in style? Do you trip over a pile of shoes when you walk in the door? Be brave and pack up anything you don't use on a regular basis and give away whatever you haven't used or worn in the last five years-bell-bottoms couldn't possibly make another comeback! A good guideline to aim for is the uncluttered, unobtrusive look of a hotel room.

While you may feel that achieving such a high level of cleanliness is seemingly impossible for amateurs your efforts will pay off! Begin by washing the walls, windows and doors and shampooing carpets. If you have hardwood you may want to get them professionally cleaned and varnished. Put a drop of oil in squeaky joints. Polish brass hinges and doorknobs.

Pets should be kept outdoors or in cages during showings for everyone's safety. If you have a cat, ensure that the litter is changed or cleaned daily. Cat odour can be a great hindrance to the sale of your home since people may worry that the odour will be permanent. Open windows shortly before a showing if possible.

For the exterior of your home, a fresh paint job can do wonders. If painting your entire home is prohibitively expensive consider making small updates such as painting the window frames in a contrasting colour (ex. white against a deep blue) or just touching up rough spots. The garden is another outdoor area many homeowners overlook despite the fact that it is the first thing prospective buyers will see. Keep the lawn and bushes trimmed. If you were never much of a gardener you can still have fresh flowers by cheating a bit-make a quick trip to the garden store. Most small annual flowers are available for less then $2 per plant. Choose flowers in only two or three colours to create a sense of uniformity in your garden. Attractive flowerpots on the window ledge can be a nice touch depending on your style of house.

Don't be surprised if people also want to see the garage. Some buyers feel the garage reflects the general maintenance of the entire property. Unfortunately, if you are like most people you enter your garage half expecting to be attacked by your belongings. If you have no where else to store the items you don't want to give away, at least try to put them in boxes piled neatly along one wall. Designate one area for bikes and other sporting equipment.

Once you've completed these tasks, it's important to maintain the neatness of your home (inside and out) on a daily basis while you have it up for sale. Open houses often take place on short notice. If you start with a clean house, it's easy to wipe off a counter or run the vacuum over the carpet to get it into good condition and ultimately complete the sale.

Posted: 20-01-2012 under Real Estate Blog

Getting the Best Service

Getting the Best Service

If you are planning to purchase a home, you will be faced with many decisions. What comes first buying the next home or selling your present home? What is your price range? What will be the location, size and style of your next home?

Before getting the answers to these questions there is one major decision to be made: which Realtor shall you choose to help you get through the maze of forms and give you the direction needed to successfully complete your real estate transactions?

Buying a home is too important to leave up to a committee. Some buyers like to leave their name with three or four salespeople. Although it may seem to be to the buyer's advantage to have a number of people to work with, it is usually a very ineffective approach. The basic assumption is that a committee of agents can produce more results than working exclusively with one realtor. Like most committee assignments--everybody's responsibility is nobody's responsibility.

ONE REALTOR = COMMITMENT

You need the total commitment of one Realtor whom you feel comfortable with and who will get to know and understand you and have compassion and empathy for your particular situation. Buying and selling a home is a journey that must be carefully plotted and mapped from the start to completion. Tell this Realtor that you will work with them exclusively as long as you see the effort and work needed to get the job completed. In fact if you are a Buyer you should sign a Buyers Agency form with this agent to show your commitment, as well the agent should put in an escape clause for you the buyer if they do not perform or work actively for you. In this way you will have a dedicated Realtor who will make it his personal responsibility to handle all the details to get you to a successful completion of this real estate journey.

A REALTOR NEEDS CANDID FEEDBACK

A good agent will listen to your needs and search through properties that are available both their own office and the Multiple Listing Service, then sort out the inappropriate ones. They will likely show you a number of homes and get your feedback and then continue the process until you have found the right home. Be very candid with your feedback, point out your likes and dislikes of the properties. Your Realtor should have a copy of each of the listings you will be viewing with a space on each of the pages for your written notes. You will not remember the likes and dislikes you have of each home after you have finished your entire showing tour. Make your notes immediately after viewing each home. Also remember it is in your best interest to view only a maximum of 4 to 5 homes on any one showing tour. It is easy to become confused when viewing too many homes at one time.

A Realtor is paid on a straight commission basis. They do not receive a salary or have an expense account. They are paid only after they have sold something and it successfully closes. This is why working with more than one Realtor is not a good idea. None of the Realtors will know if it will be to their financial benefit to spend any of their time or effort trying to find you a property, when you could possibly buy through another Realtor. Believe it or not, you will be best served by dealing with one committed Realtor as opposed to shopping the field with a variety of Realtors and Brokerages. By giving your commitment to one Realtor, the Realtor will work with the enthusiasm and diligent efforts required to successfully complete your transaction.


Posted: 20-01-2012 under Real Estate Blog

Thinking of Buying a House? Do your Homework First

Thinking of Buying a House? Do your Homework First

I think it was Will Rogers who said "A fellow that owns his own home is always just coming out of the hardware store…" Most homeowners would agree but, often in the excitement of house-hunting, we tend to overlook some of the sobering realities. Before you start, be sure you're comfortable with the obvious and less obvious costs of home-ownership.

The Price Range
First determine how much house you can afford. Take a ballpark figure by multiplying your income before tax by 2.5. This formula is used by lenders to establish the price range for various income levels. Using this formula, and income of $50 thousand ($50 x 2.5) would put you in the $125 thousand price range. Then estimate how much you can afford for a monthly mortgage payment. A lender's rule of thumb here is usually about one-third of gross monthly income. Keep in mind that the one-third guideline includes not only the mortgage payment but also property tax and any other secondary financing or condominium management fees, if applicable.

Test this guideline by reviewing your current spending. Do you, for instance, have a commitment to a car or personal loan ? How much do you spend on rent, clothing, transportation, entertainment and travel? Would the guideline mortgage payment still be comfortable considering these expenses?

Looking Ahead
Consider the cost of living in the home. How much will it cost to heat monthly? What about the monthly cost of insurance, electricity, water, maintenance - painting, repairs etc.? If you are considering buying a condominium, what effect will the monthly management fees have on your ability to carry a mortgage?

It can be difficult to forecast the cost of living in a home as compared to living in an apartment. Here is another rule of thumb that may help you to estimate the difference between the two. Take the value of the home you are considering and multiply it by 3 per cent. Then divide that figure by 12. In our example of the $125,000 home, the monthly cost using this formula would be roughly $312 in addition to mortgage and taxes.

The Down Payment
The size of your down payment is a major part of your mortgage consideration. Most lenders will require a minimum down payment of at least 10 per cent of the purchase price of the home. For instance, our example of a home in the $125,000 thousand range would require a $12,500 down payment. You would then need a mortgage of $112,500.

Cash Costs
When you have made an offer, had it accepted and begin to finalize the purchase, there are other costs to be paid in full. There are legal costs, registration costs, possibly house inspection costs and probably a land transfer tax. Your real estate agent will give you an estimate of these costs. Be sure to discuss with your agent the question of what lenders call "interest adjustment date", depending on the date of your closing and the date of mortgage payment upon closing. Be prepared to pay for any heating oil left when you take over and to re-imbrues the seller for property taxes paid in advance. Don't forget about moving charges, your mover will give you an estimate before you move. You will have to pay the movers upon delivery of the furniture.

Be Prepared
The way Will Rogers saw it, home-ownership is all work and no play. But, the pleasures of having a place of your own usually outweigh the work involved. Be sure you get maximum enjoyment from the experience by buying within your means.


Posted: 20-01-2012 under Real Estate Blog

Reverse Mortgages

Reverse Mortgages

What if you are retired and discover that your retirement income isn't enough. Or perhaps you need some money to pay for home care or to help finance a grandchild's education. The reverse mortgage may be for you.

The reverse mortgage allows homeowners to withdraw the equity from their home. It is a new variation of a traditional mortgage - instead of the balance falling as you make payments, it rises. There are no restrictions on what the money can be used for: living expenses, investment, travel, renovations and debt reduction. There are no payments due until the property is sold or the borrowers die. At which time the entire balance is due. The amount of the loan is between 10% - 40% of the fair market value of the home. The amount is based on borrowers age, the older a person is the larger the amount that can be borrowed as the repayment is anticipated sooner. The title of the property remains in the homeowners name, and the homeowner is able to live in the home as long as they want.

The loan is based on several factors and borrower(s) must:

  • Be 62 or older
  • Own house outright or have substantial equity
  • Applicants can be single or married
  • Property must qualify and meet lender's qualifications

The interest rate is usually slightly higher than on typical financing and the rate is adjusted annually. The interest is added to the principal each month.

The reverse mortgage is not for everyone but it can be very beneficial for some people. Consider a reverse mortgage if:

  • Your income is too low to qualify for a conventional mortgage or line of credit.
  • You don't wish to increase the amount of debt against your house and/or you don't want to make monthly payments.
  • You are comfortable with the decision to deplete your estate and not leave much of an estate.

Since the mortgage must be repaid upon death of the borrower. The heirs will have to either sell the property or repay the loan out of their own resources and keep the home. It is important to remember that since no payments are required, when the mortgage is finally repaid, the debt could equal the bulk of the equity in the property, so you may not be able to pass the property on to your family.


Posted: 20-01-2012 under Real Estate Blog

Price Price Price! Assessing Correct Value

Price Price Price! Assessing Correct Value

Of course what most of us tout is location, location, location. It is important to understand how price and location fit together. When it comes to selling, the importance of pricing a home is superior to everything else. A simple illustration is to picture a home for sale in the best location you can imagine. Then put a price on it that is too high by market comparison. The result will be that the home may be admired by many but no offers will come since the price is attracting the wrong crowd. To further illustrate, take a less popular location and market-price it, the buyers will be lined up with offers. Location factors in to correct pricing the way other important features do when assessing the likely sale price of a home. Correct pricing then, when it comes to selling, plays the leading role followed by strategic marketing and negotiating in order to obtain optimum value.

Location is paramount on the other hand when assessing where the highest rate of appreciation might be expected over a period of time. Locations that are superior for neighbourhood, proximity to schools and shopping, receive a steady demand on the part of buyers and usually produce a higher increase in value and of course a quicker sale when that time comes.

When buying, there is a trade-off for location. A home for sale on a main street for example will usually have more features for the price, than the same home on the nearby crescent. So a main street may be just what a consumer prefers knowing that they are getting more of the features they want for their money. On the other hand, a buyer may prefer to take the "crescent" home with less features for the money preferring the added safety that accrues to that location, where small children may be a concern.

It is by and large a matter of choice and most folks whether buying or selling want to come away from the process feeling they were well informed and pay or receive a fair price.


Posted: 20-01-2012 under Real Estate Blog

The Benefits of Home Ownership

The Benefits of Home Ownership

When weighing the options involved in purchasing a home, there are emotional and financial factors to consider.  Most people can easily articulate their emotions such as a desire to be free of a landlord, to decorate and renovate as they wish, to set down roots in and enjoy the pride of homeownership.  Financial considerations can be more complex and less obvious.

One of the main benefits of homeownership is tax-free capital gains.  If a buyer purchases a home for $200,000 and sells it for $325,000, they can enjoy $125,000 in capital gains without tax.  In today’s economy, tax-free is a rare and wonderful concept!

Real estate also offers the benefit of being a leveraged investment.  This means that a mortgage allows a buyer to enjoy a home and take as long as 30 years to pay for it even as the value of the property increases during the intervening years.  Consider the previous example with a mortgage:

• Home price: $200,000
• Down payment: $40,000
• Mortgage amount: $160,000
• Interest rate: 3.9% *  
• Amortization: 25-years
• Bi-weekly payments (26 per year): $384.12 each

In this example, the buyers would spend $249,678 on the principal and interest over 25 years.  Adding in the down payment, the total expenditure is $289,678.  Canadian real estate generally appreciates over the long term so, if the value of the home is $325,000 after the mortgage is paid, the appreciation is $35,322.  That is a nice, tax-free nest egg for retirement!  In the unlikely event that the property did not increase in value at all, the owners still have a property worth $200,000.

*Note: interest rates will fluctuate but for this example, it was 3.9% for the mortgage duration

How does renting compare to purchasing?  First and foremost, renting does not build equity.  At the end of 25 years of renting, a person would have zero property assets.  As well, the types of properties available to rent vary greatly.  

Using the previous example, a $200,000 property in a medium-sized city could purchase a nice one or two-bedroom condominium.  The owners would spend $832.26 per month on mortgage payments (384.12 x 26 payments/12 months) plus approximately $140 for strata fees for a total of $972.26 per month.  Renting the same condominium, if something comparable was even available, would cost approximately $1,150 per month.  At current low interest rates, owners are enjoying accommodation for less and, at the same time, building equity.

Clearly, purchasing a property offers many emotional and financial benefits.  The challenge, of course, is choosing the time, place and property where the investment will grow.  

Location is an important factor in price appreciation.  Location refers to both the community and the neighbourhood within a community.  While not everyone has the luxury of choosing where they will live due to job and family ties, when options are available, it pays to research.  Some Canadian communities are thriving while others have suffered due to the loss of major employers, demographic shifts or environmental changes.  There are costs and benefits to both.  Prices in thriving communities generally increase steadily over time but are more expensive markets to enter.  Struggling communities typically have lower priced properties but the trade-off may be longer commutes to work/social activities and less price appreciation.  

The old phrase ‘location, location’ says so much.  A property with a great view of a lake or parkland will always be in demand.  Properties in close proximity to train tracks, busy roadways, industrial areas, landfills, etc. are a fact of life too.  The latter generally offer great value in terms of home and yard size compared to view properties.  The choice usually comes down to family size and personal requirements.

Remember that not every property is created equal.  Buyers will ask for as much as the market will bear—and that may not accurately reflect the true value!  Prior to purchasing a property, a home inspection by a qualified professional is essential.  Inspections can reveal potentially expensive problems such as mould/moisture, roof and foundation damage, etc.  In some cases, problems are worth fixing for a price adjustment.

The style of a home can also affect its price and long-term value.  A very unusual design may attract fewer buyers when it comes time to sell.  The same is true when the style of the home is not suited to the neighbourhood such as a log house in a city.  A very old home may or may not last another 25 years depending on the construction and upkeep.  The quality of a condominium complex is directly related to the care taken by owners and the decisions by strata representatives.  

A well-built, attractive home that is maintained over the years is most likely to appreciate in value.  A REALTOR® can provide market-specific expertise to help buyers make decisions that satisfy both emotional and financial needs far into the future.


Posted: 20-01-2012 under Real Estate Blog

Cool Buyers in a Hot Market

Cool Buyers in a Hot Market

In some regions across Canada, the real estate market has been steadily heating up. In these areas, real estate agents have more buyers than sellers, and multiple offer situations are becoming commonplace. It's called a seller's market, and it can be perilous for a buyer.

The most common hazard for a buyer in a sellers market is to be in a multiple offer situation and get caught in a bidding war. With each round of counter offers, the price gets higher and the buyer has to decide between the possibility of overpaying for the property or losing it to another buyer.

But there are other perils for the buyer in a seller's market, where the risk is not as clear cut. In order to make the offer more attractive to the seller, a buyer may be tempted to make an offer without any conditions. Conditions are included in an offer to ensure that the buyer is not bound to the Contract unless the buyer:

  • Is approved for required financing.

  • Is satisfied with the results of a property inspection.

  • Has an opportunity to review and approve all minutes of the Strata Corporation and financial statements (if the property is a strata unit).

Additionally, if the buyer is already a homeowner, a condition may be required to ensure that the buyer is able to sell their own home prior to being bound to the offer for another house. Depending on the circumstances, there may be other conditions that are also required.

What happens if the buyer chooses to forgo the use of these conditions? A buyer should consider the consequence of not being able to perform the task. For example - what if the offer is not conditional upon -

  • Financing: what will happen if the buyer is not able to arrange the financing?

  • A property inspection: What if there are material defects that would likely only be discovered by a professional home inspector?

  • Review of financial statements and minutes (if purchasing a strata property). What if these documents contain evidence that the property has some potentially serious problems?

  • Sale of the buyer's property: what if the buyer needs the cash from their current home in order to buy another home?

A prudent buyer will ensure that any issues that need to be confirmed or investigated are enshrined as a condition in the Contract. Once the offer becomes firm (i.e. without any conditions) it is a legal promise by the buyer - secured by a "good faith" deposit - to complete the transaction.


Posted: 20-01-2012 under Real Estate Blog

Some Steps to Follow and Questions to Ask when buying a New Home

Some Steps to Follow and Questions to Ask when buying a New Home

  1. Visit your financial institution and ask to be pre-approved for a mortgage - this will help you know how much you can afford and consequently focus your search for your "new" home;
  2. Make a list of "wants" versus "needs"
  3. Visit display suites, compare asking prices and selling prices, and check out local amenities and the neighbourhood;
  4. Do not be lured by a beautiful brochure, a comfortable floor plan, or the new finishing. All of these appeal to buyers' emotions. Despite public perception, a new home is not automatically guaranteed to be well built nor perfect. It is essential to research the builder.
  5. Some important questions to ask:
    • How long has the builder been in business?
    • What are the names and addresses of the homes and projects the builder has constructed?
    • Ask for references &/or home owners who have purchased from this builder:
      • Are they happy with their home?
      • Have they experienced any problems?
      • Would they buy another home from this builder?
      • What is the builder's after sale service policy?
      • What responsibility will the builder assume for the subcontractor?
      • Does the builder belong to a professional organization such as the Canadian Home Builders' Association or the Urban Development Institute?
      • Does the builder and the trades in their employ have any formal training?
      • Is the builder registered with the New Home Warranty Program?
      • Is the home enrolled with the New Home Warranty Program?
  6. Inquire as to the availability and applicability of the New Home Warranty Program;
  7. Hire a lawyer (or Notary) to represent your interest and to review all documents on your behalf

Posted: 20-01-2012 under Real Estate Blog

Costs and Considerations when Buying a Home

Costs and Considerations when Buying a Home

"Home is an invention on which no one has yet improved."
- Ann Douglas

In the excitement of beginning a search for a home, many people jump right in without considering all of the elements that make a home truly right for them. It is a complicated and personal process. An unsuitable choice can be costly in many ways - you could lose money, waste time and effort relocating, or even put your family's health in danger. The following are some things to consider when identifying your ideal home and planning a successful purchase.

Choosing a Neighbourhood
Remember that you can renovate a house but neighbourhoods take years to change and there's no guarantee they'll change for the better! On the other hand, if you really love a certain part of town but it's out of your price range you may want to consider buying a less-than-perfect home then doing renovations. They can be quite expensive so try to make improvements that will be reflected in the value when you sell. These renovations have been found to have the greatest payback: kitchen 70%, bathroom 68%, interior painting 65%, exterior painting 62%.

Tips on choosing a suitable neighbourhood:

  • When you find a locale you like, walk around it. See what it's like from street level.
  • Are the people friendly?
  • Are there stores and recreation facilities nearby?
  • Contact the local school board if you have children. Do local schools provide good education opportunities? If applicable are there private/religious schools?

Figure out what you can afford:
Consider how much you currently need to live on and how much you actually have leftover every month. People have a tendency to create budgets that look nothing like reality - when we should have $400 left over, for some reason we only have half that.

Consider these basic costs of buying a new home:

  • Most homes require a down payment of several thousand dollars.

  • Monthly mortgage payments can be 1/3 of the average person's annual net income.
  • You may want to pay for a home inspection. Consider more than just the structure. Ask the inspector to check for asbestos, radon, animal infestation and lead.
  • Moving costs can be from a couple hundred to several thousand dollars depending on the distance of your move and the quantity of belongings.

Financing
The sort of home you can afford depends on several things:

  • How much you have saved

  • How much you earn

  • Past earnings
  • Your credit rating

The past has a way of haunting new homebuyers. If you are concerned about your credit rating you can usually get a free copy of your rating report from your local credit bureau. Normally all that's required is a couple pieces of photo identification. Remember, a few late payments or disputed bills can besmirch your record. Try to pay everything on time and don't have more than two credit cards. A bad rating can spell trouble getting a mortgage or you end up paying more for your mortgage as a form of insurance to the lender.

Pre-Qualification
This refers to documents from a bank or other lender indicating that you have the financing to back up your offer on a house. Pre-qualification is free and most lenders are happy to sit down with prospective buyers and figure how much they can afford. Having an accurate idea of price range will save time in the bidding process. If there are several people making offers on your dream home, being pre-qualified can make your offer more attractive since financing is not in question. It is important to note, however, that lending institutions will base their final decision about a mortgage on ability of the buyer to service the debt as well as the property. Most lenders state that the two components go hand in hand - the buyer with the ability to repay a mortgage and the property as security in the event of default on payment.

By taking all these points into consideration, you can worry less about the process of buying and get busy finding your ideal home!


Posted: 20-01-2012 under Real Estate Blog

10 Ways to Plan Ahead for a New House

10 Ways to Plan Ahead for a New House

There are many advantages to purchasing a new home: buyers are able to build equity, to enjoy the pride of ownership, and to obtain accommodation that is often larger and/or more luxurious than what is available to rent. Property has also proven to be a relatively safe and profitable investment in the wake of the technology stock plummet of 2000 and the Enron and Worldcom scandals.

If you are planning to buy a home within the next few weeks or months, preparing now can help you save time and money. When competing in a seller's market, being prepared may also give you an advantage over other buyers. Consider the following tips prior to beginning your home search.

  1. Know your bottom line before you begin looking at homes. This means more than just knowing what price you are willing to pay. Consider the distance you are willing to commute to work, the number of bedrooms and bathrooms you require and what you need in terms of local community facilities. If you have children, the proximity to schools and parks will likely also be a consideration.
    By knowing your bottom line, you can avoid making snap decisions guided by emotional responses to attractive home features or the pressures of competing buyers
  2. Know your bottom line before you begin looking at homes. This means more than just knowing what price you are willing to pay. Consider the distance you are willing to commute to work, the number of bedrooms and bathrooms you require and what you need in terms of local community facilities. If you have children, the proximity to schools and parks will likely also be a consideration.
    By knowing your bottom line, you can avoid making snap decisions guided by emotional responses to attractive home features or the pressures of competing buyers.
  3. Check your credit.
    Bad credit can happen to good people. Sometimes it’s due to an unpaid or lost bill and other times it can be inaccuracies in the report itself. Who wants to discover that they have a bad credit rating after finding the home of their dreams? Rather than waiting for a lender to inform you of your credit rating, it is wise to obtain a copy prior to beginning your home search. This will give you an opportunity to address any inaccuracies and perhaps settle any outstanding debts. The more ‘blemishes’ you have on your credit report, the more likely it is that your lender will charge you a higher interest rate as a hedge against a bad loan. You can obtain a copy of your credit report from accredited organizations such as Equifax.
  4. Avoid making any major purchases prior to buying home. Lenders tend to become nervous when they see that a potential homeowner has stretched their disposable income to the breaking point by buying a car or a boat for example. Such purchases can make it more difficult to obtain a mortgage or may lower the mortgage amount.
  5. Calculate the maximum monthly mortgage payment you can afford. Generally, the banks will allow people to take out a mortgage that is approximately equal to 30 percent of their gross monthly income. Depending on your personal circumstances, it may not be wise to take the largest mortgage possible. Consider your other long and short-term expenses such as tuition for yourself or your children, a new car, or vacations. Also be sure to factor in monthly retirement savings.
  6. Anticipate higher interest rates.
    Recalculate the above maximum monthly mortgage payment based on interest rates that are two or three percent higher than current rates. Ask yourself if you could afford to pay a higher monthly payment without infringing on other commitments
  7. Determine your cash flow at the time of purchase. There are various fees involved in closing a deal including the down payment, closing costs (federal and property taxes, appraisal fees, title insurance, survey fees, etc.) and home insurance. If you are moving from a rental suite, you should also be prepared for expenses that may have been incorporated into your rent such as heat, hot water, electricity and cable service.
  8. Budget for any repairs and maintenance that may be required in your new home. Sometimes people purchase a 'fixer-upper' because the home has other redeeming features such as a large backyard or proximity to schools or parks. If your new home will require repairs or maintenance be sure to budget for these expenses. For example, a bedroom renovation can wait for a few months but most families cannot go a day without a functioning water heater!
  9. Get your paperwork in order.
    Lenders will often need to see bank statements, pay stubs, and tax documents for the past two years. If you are self-employed, tax documents, bank statements and collateral such as a vehicle or other property are important criteria to securing a mortgage
  10. Get pre-approved for a loan.
    Once you have calculated a budget you can live with, approach a lender to find out if you can get approved for a mortgage and how much you can spend on a home. Being pre-approved can put you in a stronger position when you make an offer and can save you valuable time in a seller’s market.
    Buying a home is not only a lifestyle change; it is an important investment. Making the most of your investment means planning ahead to find the
    right home, the best rates and the ideal time for you to enter the market.

Posted: 20-01-2012 under Real Estate Blog

Expect home prices to keep climbing: LePage

The Canadian Press

TORONTO — The price of homes in Canada will continue rising this year, but the hottest markets in Toronto and Vancouver will grow much more slowly, predicts the country's largest real estate broker.

Low mortgage rates will continue underpinning housing demand despite the weakening economy, said Royal LePage Real Estate Services in its annual housing outlook Thursday.

LePage president and CEO Phil Soper said that predictions from housing experts and economists for a drop in prices for 2012 are wrong as mortgage rates remain near record lows.

"Interest rates are the primary driver behind activity levels in the marketplace," Soper said. "People buy homes on the payments that they will be making, not on the sticker price of a particular home."

Most experts believe interest rates will remain stable for this year and well into next as the economy expands sluggishly, but eventually rates should rise with stronger growth.

Royal LePage, which franchises real estate agencies across the country, predicted the national average price for resale homes will rise 2.8 per cent by the end of the year.

The forecast follows a gain of 4.2 per cent in the national average price for a standard two-storey home to $375,427 in the just completed fourth quarter of 2011.

In Vancouver, a standard two-storey home had an average price of $1.1 million in the fourth quarter, up 10.9 per cent from a year earlier, while Toronto saw a home in the same category gain 4.2 per cent to $629,000.

But for 2012, Royal LePage expects prices in Vancouver to gain about 2.3 per cent, while Toronto is expected to see growth of 2.6 per cent.

Regina is expected to lead the country with gains of five per cent for the year, reflecting the sharp growth in Saskatchewan, a province rich in potash, oil, uranium and other resources.

Soper noted that affordability in Vancouver is "on a knife's edge" as people spend upwards of 70 per cent of their post-tax income on their mortgage, property taxes and utilities.

The economic slowdown in China may also affect the market in Vancouver, which has a large Chinese-Canadian population with economic and business ties to China.

"If the investment from China slows, it will change the high-end and certain neighbourhoods," Soper said, noting that the west side of Vancouver, West Vancouver and Richmond have all seen in influx of wealthy Chinese buyers.

The International Monetary Fund has said that Canadian homes on average are 10 per cent overpriced and warned it may be a factor that puts the country's economic recovery at risk.

The Bank of Canada has also repeatedly cautioned prospective buyers to guard against being lured by low mortgage costs because interest rates and therefore monthly payments, will eventually increase as the economy gets stronger.

However Soper suggested that moves made by Ottawa to tighten mortgage lending rules have helped limit the risks.

"The government has made small but significant regulatory changes that have restricted access to the more risky mortgage products post the recession," he said.

The Royal LePage forecast came as the Statistics Canada reported the price of new homes rose again in November, led by gains in Toronto and Montreal.

The government agency's new housing price index rose 0.3 per cent in November, after a 0.2 per cent increase in October. On an annual basis, the index was 2.5 per cent higher in November compared with November 2010.

The largest year-over-year price increases reported by Statistics Canada were in Toronto and Oshawa, Ont., where they were up 6.2 per cent.

In the fourth quarter, the average price for detached bungalows rose 7.2 per cent from a year earlier to $532,137; prices for standard two-storey homes rose 4.2 per cent to $629,188 and standard condos rose 3.4 per cent to $347,659.

In Victoria and Saint John, N.B., house prices were flat or slightly down in the fourth quarter year over year.

In Saint John, detached bungalows fell 2.2 per cent year-over-year to $179,946, while standard two-storey properties slipped 0.3 per cent to $298,076. Condos were the exception, with average prices climbing 16.1 per cent year-over-year to $159,370, although LePage said those increases weren't typical.

In Victoria, standard two-storey homes were unchanged, with prices remaining at $480,000 while detached bungalows slipped 0.8 per cent to $486,000 and condos dropping 1.1 per cent to $282,000.


Read more: http://www.ctv.ca/CTVNews/BritishColumbiaHome/20120112/lepage-2012-house-price-outlook-120112/#ixzz1jSmHewLN


Posted: 14-01-2012 under Real Estate Blog

With low mortgage rates, can you afford to buy?

With banks lowering their five-year interest rates to a record low this week, many people are considering whether or not it's the right time to buy a new home.

 

But while interest rates may be remarkably low, housing prices in B.C. are at an all-time high.

 

While some people believe the Vancouver housing market is due for a pricing correction in the next few years, home buyers should still be very cautious and need to determine if they can really afford the high prices of the houses themselves.

 

The only reason some properties seem affordable right now is because of those record low rates. If the mortgage rates go back up in five years -- and you have to refinance that mortgage -- those home prices may not look so attractive because the payments are going to skyrocket.

 

For instance, a $600,000 mortgage with a rate of 2.99 per cent will have a monthly payment of $2,836, on a 25-year amortization period.

 

If the rate goes up to five per cent that means the mortgage payment is now $3,489.63 –$653.23 more each month.

 

Finally, if the rate goes up to seven per cent the monthly payment will be $4,202.49. That's $1,366.09 more each month than you would be paying if you locked in today.

 

There are many great mortgage affordability calculators online that weigh your income against debts and current lending rates to show you how much you'll pay each month if you lock in with a certain rate.

 

Related: CMHC calculator

 

If you're thinking about buying, go online and plug in your finances using today's rate, and then again using what the rate might get to in the future -- to get a realistic idea of what you could be paying in the future.

 

House prices in Metro Vancouver, where a two-storey home averaged $1.1 million last year, are expected to rise 2.8 per cent by the end of 2012, according to Royal LePage.


Posted: 14-01-2012 under Real Estate Blog

2011 real estate market showcases regional variation

2011 real estate market showcases regional variation

January, 04 2012 12:48:16 pm, by FVREB
Categories: Statistics

Overall, Fraser Valley’s real estate market in 2011 was below the 10-year average in property sales and above average in the number of new listings received, however, according to the president of the Fraser Valley Real Estate Board, results varied widely depending on the community and property type.  

Sukh Sidhu observes, “I can’t remember a year that illustrates better how local real estate is and the importance of talking to your REALTOR® before making a decision to buy or sell.  For example, in my community of Abbotsford, sales of single family homes dropped by almost 7 per cent compared to 2010, pushing prices down slightly, while in South Surrey/White Rock sales increased year over year by 45 per cent resulting in double-digit price increases.”

The Board’s Multiple Listing Service® processed 15,529 sales in 2011 compared to 14,891 the previous year, an increase of 4 per cent, while the number of new listings remained about the same – 31,592 in 2011 compared to 31,437 in 2010. Over the year, the number of active listings for buyers to choose from dropped by 9 per cent going from 8,139 properties in December 2010 to 7,399 in December 2011.

Although 2011 ranks the third slowest year for sales in Fraser Valley since 2002, it was only 10 per cent less than the 10-year average of 17,210 sales. The volume of new listings received in 2011 was 6 per cent more than the 10-year average of 29,867 new listings, placing last year third in ranking since 2002.

Sidhu adds, “One trend from 2011 that is clear was the preference for single family homes. For the most part in our region, both sales and prices of townhomes and condos either stayed on par with 2010 or decreased.”

In December, the benchmark price of a detached home in the Fraser Valley was $522,998, an increase of 3.3 per cent compared to $506,145 in December 2010 and a decrease of 1.7 per cent compared to November.

For townhouses, the benchmark price in December was $315,330, a decrease of 2.1 per cent compared to the same month last year when it was $322,054 and down 3.8 per cent compared to November. The benchmark price of apartments in December was $237,285, a decrease of 1.2 per cent compared to December 2010 and a decrease of 0.5 per cent compared to November.

Average prices year over year show detached homes up 9.1 per cent – $610,269 in 2011 compared to $559,456 in 2010. The average price of townhomes increased by 2.6 per cent, going from $336,484 in 2010 to $345,138 in 2011 and the average price of apartments increased by 0.9 per cent going from $223,910 in 2010 to $225,976 in 2011. 


Posted: 12-01-2012 under Real Estate Blog

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Posted: 10-01-2012 under New Listings