How do new government rules affect $ 200,000 mortgage?

 

 

Changes related to high ratio insured mortgage lending rules that will take effect July 9th, 2012.  These changes will help address Canadian household debt levels. Only a 25 year amortization is allowed, however a 30 year amortization is still available for conventional mortgages.

 

Calculated with 3.39%, 5 year fixed rate the difference in monthly payments with 30 year amortization is $ 883.21 and 25 year amortization is $ 986.94.

$ 103.73 more every month.( This is calculated without CMHC fee)

 The cumulative interest paid over 25 years is $96,082.  And over 30 years is

 $ 117,955.60.  Clients will save $ 21,873.60 in interest!

 

with thanks to...

 

Sari McPhail

Mobile Mortgage Specialist

TD Canada Trust 

P: 519-654-0783

 

Posted via email from Selling Cambridge with Clare DeJong

Happy Canada Day!

Canada Day for Clare's BLOG.docx Download this file

 

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Grilling Safety

        Now that the summer season is kicking off, it's time to get back in the grilling groove. According to the National Fire Protection Association, gas and charcoal grills cause more than 8,000 house fires each year. Before firing up the grill, homeowners should consider these safety tips:

• Grills should be located no closer than 10' (3m) from any structure. Never use a grill under a porch, deck, overhang, carport, or in a garage. Make sure the grill rests on a stable surface and can't be tipped over. 

•  Never use a propane or charcoal grill indoors.

•  Check hoses and connections on gas grills periodically throughout the grilling season. Replace any cracked or brittle hoses before using the grill. Propane cylinders should never be stored inside a garage or other structure at any time. 

•  Start charcoal fires using a chimney starter instead of charcoal fluid. Not only is a chimney starter safer, but your meal will taste better. If charcoal fluid is used, never add it to the coals once the fire has been lit.

•  Once the grill is lit, never leave it unattended. It can take just a few seconds for a serious fire to erupt.

•  While lighting and cooking on the grill, do not wear clothes that are loose-fitting or that have wide sleeves that could catch  fire. Use long-handled utensils to handle food while cooking. Wear close-toed shoes while at the grill - you can always change to flip flops later.

•  Control flare ups by lowering the heat on a gas grill. On charcoal grills, remove the food from the grill and distribute the coals more evenly. If necessary, a flare up can be put out with water from a spray bottle, but remove food from the grill first to avoid smoke contamination.

•  To help prevent grease fires, remove any accumulated grease and residue from inside the lid of the grill at least every 5-6 uses. Baking soda can be used to extinguish a grease fire still contained within the grill unit.

 Always keep young children and pets away from the grill during and after cooking. The grill's exterior can remain hot long for a long time.

via Pillar and Post

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Posted via email from Selling Cambridge with Clare DeJong

Quick shortcuts (in search of)

 

There aren't many actual shortcuts.

There are merely direct paths...

Most people don't take them, because they frighten us--too direct, I guess. It's easy to avoid the things that frighten us if we wander around for a while. Stalling takes many forms, and one of them looks like a shortcut.

Things that look like shortcuts are actually detours (disguised as less work).

 

via Seth Godin

Posted via email from Selling Cambridge with Clare DeJong

KW Multicultural Festival This Weekend

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Government changes mortgage rules

 

Flaherty to Tighten Canada Mortgage Rules to Avert Bubble

By Theophilos Argitis and Greg Quinn - Jun 21, 2012 7:02 AM ET

 

 

Canadian Finance Minister Jim Flaherty will tighten mortgage terms for the third time as the Group of Seven country with the soundest government finances tries to avert a household debt crisis, a government official said.

Flaherty will shorten the maximum amortization period on mortgages the government insures to 25 years from 30 years, and lower the maximum amount homeowners can borrow against the value of their homes to 80 percent from 85 percent, the person said, speaking on condition they not be identified because the decision hasn’t been made public. Flaherty will announce the changes at a press conference in Ottawa today at 8:15 a.m.

 

Canadian Finance Minister Jim Flaherty has already reduced the amortization limits twice since 2008, cutting them from 40 years amid concern historically low borrowing costs are fueling a housing bubble and pushing household debt to record highs.

Canadian Finance Minister Jim Flaherty has already reduced the amortization limits twice since 2008, cutting them from 40 years amid concern historically low borrowing costs are fueling a housing bubble and pushing household debt to record highs. Photographer: Nelson Ching/Bloomberg

Flaherty has already reduced the amortization limits twice since 2008, cutting them from 40 years amid concern historically low borrowing costs are fueling a housing bubble and pushing household debt to record highs. The shorter-term mortgages increase monthly payments for home owners, prompting them to take on smaller home loans.

The move extends a reversal for the Conservative government of Prime Minister Stephen Harper, which came to power in 2006 and initially lengthened mortgage terms to make it easier for Canadians to buy homes.

Homeowners have taken advantage of the longer-term mortgages to lower their monthly payments. The share of new mortgages with amortizations of more than 25 years was 41 percent last year, compared with 8 percent between 2000 and 2005, according to a survey by the Toronto-based Canadian Association of Accredited Mortgage Professionals.

The mortgage changes were first reported yesterday by the Canadian Broadcasting Corp. in a report that was confirmed by the government official. Flaherty will also cap mortgage payments as a percentage of personal income at 39 percent, the Globe and Mail reported today.

Line of Defense

Bank of Canada Governor Mark Carney, who has warned that monetary policy should be used to address rising levels of household debt only as a “last line of defense,” had been involved in the discussions on the matter and encouraged Flaherty to tighten regulations, the person said. The central bank has kept its benchmark rate unchanged at 1 percent since September 2010. Jeremy Harrison, a spokesman for the Bank of Canada, declined to comment on Carney’s role in the process.

Swaps trading suggests investors are placing bets that Carney may cut borrowing costs even further, with the odds of at least one rate cut by December at more than 25 percent, according to Bloomberg News calculations based on overnight index swap data.

Biggest Risk

Carney has said a surge in household debt has become the economy’s biggest domestic risk, with levels relative to income surpassing those in the U.S. and the U.K. Like other countries such as Australia that largely escaped the global financial crisis, Canadian banks continued to expand lending at a time when record low borrowing costs fueled demand.

The risk to Canada’s economy is that a growing number of Canadians taking on too much debt at low interest rates today may not be able to afford their payments when borrowing costs rise, Carney has said.

In a speech in Vancouver last year, Carney said the increase in debt over the past decade has been driven by households with the highest debt levels and the proportion of Canadian homes that would be vulnerable to an adverse economic shock is at the highest level in nine years.

Flaherty has also acted recently to reduce taxpayer exposure to the market. In April, he introduced legislation that prevents lenders from using government-insured mortgages as collateral for covered bonds.

Mortgage Cap

Flaherty has also refused to raise the C$600 billion ($587 billion) legal limit on mortgage insurance of the Canada Mortgage Housing Corp., and the federal housing agency has begun rationing bulk insurance for financial institutions. Canadians who make a down payment of less than 20 percent of the home’s value are required to insure their mortgages.

Some banks have already sought to cut the exposure to long- term mortgages. Bank of Montreal Chief Executive Officer William Downe said in March the trend toward smaller down payments and longer term mortgages coupled with low interest rates on mortgages had put more borrowers at risk.

 

 

 

Posted via email from Selling Cambridge with Clare DeJong

10 Things NOT To Do When Your Home Is For Sale And You Are Going On Vacation!

 

10 Things NOT To Do When Your Home Is For Sale And You're Going On Vacation!

You're home is on the market, ready for sale. Spiffed up and ready for the sellers at all times. Unfortunately our market isn't the world's fastest, so putting a sign in the yard and launching a full marketing blitz didn't sell it by Day 3. You're coming up on your family's annual vacation and you're not postponing until after the sale. We don't blame you, everyone needs some R&R time and we don't know if the buyer will show up tomorrow or next month, so go, have fun, relax.

But DON'T:

1) Say "No showings until we return". Like we said, your buyer might be showing up tomorrow, and if they can't get in they'll buy another home. And who knows how long until Right Buyer #2 may appear.

2) Drop off the grid. Don't go to the Himalayas or somewhere that Kinko's or equivalent doesn't exist. We need to be able to reach you if we get an offer. We don't expect you to answer your phone at all times, but don't go somewhere that your cell phone is in constant "Searching for Service" mode.

3) Set your thermostat to the extremes. Yes, you might save a little money, but you don't want buyers to be uncomfortable when looking at your home.

4) Forget to get your mail held while you're gone. And if you still get the newspaper, either stop delivery or ask a neighbor to collect for you.

5) Order anything from Amazon or the like to be delivered while you're gone unless you've made arrangements with the neighbors. Packages setting on the front steps for days are a signal you're not home.

6) Post about it on Facebook, or Tweet, or Blog, or LinkedIn or ANYTHING that announces to the world that you're going to be gone. Bad guys have access to social media too.

7) Forget that your flowers need watered and your lawn mowed. Hire someone if you need to, but don't let the hard work you've done on curb appeal go downhill while you've got your toes in the sand and a Corona on the table next to the chair.

8) Forget to tell your agent you're leaving town!! We'll probably need to alter the showing instructions so you don't have to approve the showings while you're gone.

9) Forget to take out ALL the trash before you leave. Get the kitchen, the bathrooms, ALL of them. You do not want the first impression of the buyers to be "EWWWWW" because you forgot about the leftover salmon you tossed before leaving. That also means take care of the dirty dishes and dirty laundry before you go. AND don't forget kitty's super atomic deposits in the litter box and Rover's landmines in the back yard.

10) Forget to ask a friend to check the locks after showings. Hate to say this, but sometimes agents aren't as careful as they should be about making sure a home is secure before they leave. Going by and checking post showing is something we've regularly done for clients out of town. Wish it wasn't necessary, but it's good to be cautious.
 
Please feel free to add your own suggestions to our list. Be careful, be available, and leave your home ready for the buyers to fall in love with it!

 

thanks to Liz and Bill Spear, Re/Max Elite, OHIO

Posted via email from Selling Cambridge with Clare DeJong

PROTECT YOUR VEHICLE!

The following was sent to me from a fellow agent and I thought it was worth passing along.

What will the car thieves think of next? They peer through the windshield of your car or truck, write down the VIN # from the  label on the dash, go to the local car dealership and request a duplicate key based on the VIN #.

I didn't believe this e-mail, so I called Chrysler Dodge and pretended I had lost my keys. They told me to just bring in the VIN # and they would cut me one on the spot! I could even order the keyless device if I wanted!            

The car dealer's parts Department will make a duplicate key from the VIN # and collect payment from the thief who will return to your car. He doesn't have to break in, do any damage to the vehicle, or draw attention to himself. All he has to do is walk up to your car, insert the key and off he goes to a local chop shop with your vehicle.

You don't believe it? It IS that easy. To avoid this from happening to you, simply put some tape (electrical tape, duct tape or medical tape) across the VIN Metal Label located on the dash board.

By law, you cannot remove the VIN, but you CAN cover it so it can't be viewed through the windshield by a car thief.

I urge you to forward this to your friends before some other car thief steals another car or truck.

Not to change the subject, but have you or one of your friends been  thinking about buying a home? With all the changes that are happening in the loan programs, why take the risk of waiting?            

Call me today and let's see how I can help!

And don't forget to cover up your VIN #! I look forward to talking to you soon!

Posted via email from Selling Cambridge with Clare DeJong

Canada home price boom to grind to a halt

 

 

By Cameron French

TORONTO (Reuters) - Canada's housing boom will grind to a halt next year, stopped by price declines in the condominium-saturated markets of Toronto and Vancouver, according to a Reuters poll, raising the risk of a broader economic slowdown.

On a national basis, Canadian house prices are expected to rise 2.0 percent this year before stalling next year with a negligible 0.5 percent gain, according to median results of the poll, which was conducted last week.

House prices have increased 37 percent since their trough in January 2009, The Canadian Real Estate Association index showed. All 15 respondents in the poll said the market was expensive, by varying degrees.

"Home prices are overvalued by slightly under 10 percent nationwide (and) most of the overvaluation is concentrated in Toronto and Vancouver," said Mark Hopkins of Moody's Analytics, citing a common concern about the two hottest urban markets.

House prices in Toronto, Canada's largest city and financial capital, are expected to rise 6.6 percent this year after rising almost 10 percent in 2011. But that will quickly fizzle into a decline of 0.2 percent next year, the first fall since 2008.

In Vancouver, the country's most expensive market and until recently clocking the fastest annual price rises, they are expected to fall 1.6 percent this year and 2.5 percent in 2013.

Canada's housing market avoided the U.S. sub-prime boom and bust that triggered the global financial crisis, in large part because its banks are more closely regulated and more conservative, requiring higher deposits for mortgage lending.

While property prices tumbled in the U.S., Ireland, Spain, and to a lesser extent, Britain, record low borrowing costs that followed the recession spurred another wave of home buying and property market speculation in Canada.

By early 2010, sales volumes and prices were rising by double digits on an annual basis. Figures from one industry group showed that since March 2009, the nadir of the financial crisis, Canada home prices have risen by nearly a third.

HIGH DEBT LOADS

While the housing boom helped pull the country out of a shallower recession much faster than the United States, it has also fueled fears a major correction could be in the offing.

Bank of Canada Governor Mark Carney and Finance Minister Jim Flaherty have both expressed concern with the high debt loads Canadians have taken on to finance house purchases, enticed by rock-bottom interest rates.

Household debt levels are approaching those in the U.S. before the housing meltdown there, where prices fell by more than a third and still have not shown meaningful signs of recovery. Canada's credit market-debt-to-income ratio hit a record 152 percent in the first quarter of 2012.

Some economists, like Bricklin Dwyer at BNP Paribas, worry that Canada's economy, which has outperformed its peers in the G7, could take a big hit if the housing market were to turn suddenly. Recent experience around the globe shows that is what booming property markets often do.

"Whether or not Canada will face a hard landing will be determined by whether or not household risk was correctly priced in the first place. In other words, when Canadians show up to refinance their mortgages, if their interest rates jump and/or the terms of their loans change dramatically, then households could default at a rapid rate," Dwyer said.

"If the demand for housing slows too quickly, then homeowners could quickly find themselves underwater and promoting a dangerous cycle as they try to unload their home."

Unlike the Federal Reserve in boom times, The Bank of Canada said last week the housing market and the threat of a correction was one of the main risks to the Canadian economy.

"The continued high level of activity and stretched valuations in some segments of the housing market are of increasing concern," it said in its semi-annual Financial System Review.

CONDO BOOM TO BUST?

Housing starts are also expected to retreat through this year, according to the poll. Starts are expected at an annualized seasonally-adjusted 216,000 in the second quarter, falling to 190,000 by the fourth quarter. Annualized starts were 211,400 in May, down from 243,800 in April.

Rapid condominium construction in Vancouver and Toronto - where the skylines are now crowded with high-rises - has raised fears that the market could find itself saturated in supply and become the trigger point to a larger crash.

High immigration to both cities has fed the condo boom, but has also helped stoke fears that the market is partly supported by foreign investors who may pull out their money if the market starts to reverse.

Finance Minister Flaherty has tightened mortgage requirements three times since 2008 to cool the property market and the market has rallied on. But half of the respondents in the poll said the government probably won't intervene again in the next twelve months.

"The government understands that we have a safe mortgage market and that further tightening would risk a policy-induced housing market slowdown that would have broader macroeconomic risk," said property market analyst Will Dunning.

Reuters polled Canada's big banks, independent analysts as well as international participants. Of Canada's major lenders, National Bank Financial declined to participate in the poll, as did CIBC, saying they did not provide forecasts on Canada's housing market. A few other primary dealers also declined to participate. (Polling by Sarmista Sen and Sumanta Dey; Editing by Jeffrey Hodgson and Ross Finley)

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Never thought of that!

Some good ideas!  Do you have any you can add to this list?   Use a (clean) dustpan to fill a container that doesn’t fit in the sink   Place a rubber band around an open paint can to wipe your brush on, and keep paint off the side of the can     Use a staple remover to save your fingernails when trying to add things to your key ring! Put wooden spoon across boiling pot of water to keep from boiling over.  Use bread clips to save flip-flops with split holes.  How to put shoes in the dryer    Use sunglasses or a small convex mirror to avoid people sneaking up on you while wearing headphones at work  How to keep the straw from rising out of your soda can Use a microfiber cloth to prevent frost from forming on the windshield.  Use a Comb to Keep a Nail Steady for Hammering  Use a post it note to catch drilling debris.

 

 

Posted via email from Selling Cambridge with Clare DeJong

June Newsletter

Real Estate News Clare DeJong Sales Representative Real Estate Centre Inc., Brokerage 766 Old Hespeler Rd. Cambridge, Ontario 519-623-6200 or 1-866-623-6205 www.SellingCambridge.ca

Hello Everyone! Smart homes are making our lives easier, safer and more comfortable. This month we highlight how innovative networking technology provides the homeowner greater convenience and control over their daily lives. We also discuss how a strategically placed water feature can evoke feelings of peace and relaxation in your garden as well as why it's important to have your air conditioner serviced on a regular basis. Thanks so much for checking out this month's newsletter. Please let us know if you have any questions or comments regarding the articles or real estate in general -- it'd be great to hear from you! Life is good, Clare In This Issue... Bank of Canada Stands Pat, Cautions on Europe Home is Where the Hard Drive Is Soothe Your Garden's Soul with a Water Feature Don't Get Left Out In the Heat Bank of Canada Stands Pat, Cautions on Europe The Bank of Canada kept its trend-setting Bank Rate at 1.25 per cent on June 5th, 2012. It was the 14th consecutive policy meeting in which borrowing costs have been left unchanged. While the text accompanying the announcement left the door open to future rate hikes, the language used was considerably less hawkish than in the previous announcement in April as the Bank sounded a cautious tone over the recent deterioration of the situation in Europe. The announcement begins, “The outlook for global economic growth has weakened in recent weeks. Some of the risks around the European crisis are materializing and risks remain skewed to the downside. This is leading to a sharp deterioration in global financial conditions.” The Bank also noted that while the U.S. economy was continuing to expand, albeit modestly, emerging economies were slowing faster and a bit more broadly than expected. That more modest global momentum combined with heightened financial risk aversion has led to lower commodity prices, which is weighing on Canadian exports. Canadian economic growth was slower than the Bank expected in the first quarter of the year, 1.9 per cent compared to a projected 2.5 per cent; however, underlying economic momentum remains in line with expectations. That said, the composition of growth has become less balanced. Specifically, housing activity has been stronger than the Bank had been expecting, and despite external risks, business and household confidence has remained resilient amid very stimulative domestic financial conditions. In contrast, the contribution to growth from government spending is expected to be quite modest going forward in line with recent federal and provincial budgets. Additionally, the recovery in net exports is likely to remain weak in light of the combination of reduced external demand and ongoing competitiveness challenges, including the persistent strength of the Canadian dollar. The Bank said the Canadian economy continues to operate with a small degree of excess capacity, and that even though headline CPI inflation was expected to fall below 2 per cent in the short term due to lower gasoline prices, the core rate inflation was expected to remain around the target 2 per cent mark. The announcement ended by reiterating that, to the extent that the economic expansion continues and the current excess supply in the economy is gradually absorbed, the possibility of a rate hike was not completely off the table, but that the timing and degree of any such action would depend heavily upon how current heightened downside risks play out in the months ahead. As of June 5th 2012, the advertised five-year lending rate stood at 5.34 per cent. This is down 0.1 percentage points from 5.44 per cent on April 17th, when the Bank made its previous policy interest rate announcement. The Bank will make its next scheduled rate announcement on July 17th, 2012. Home is Where the Hard Drive Is Imagine arriving home after a hard day's work and instead of agonizing over what to cook for dinner, your refrigerator offers you an array of delicious recipes based on what's inside! Then just for good measure, it detects food that's about to expire! Smart homes allow devices to communicate with one another in order to complement your daily routines. You can program your blinds to slowly open in the morning while at the same time the bathroom floor warms up and when you're done in the shower, your coffee will be ready and waiting! Smart features such as voice command systems help support independent living for the elderly and disabled. Having the know-how to sense scenarios such as the homeowner falling means help will arrive quickly as it automatically calls emergency services as well as other emergency contacts. This provides peace of mind for both the homeowner and their family members. Intelligent homes also provide exceptional security as lights and blinds can be enabled remotely and your smartphone can even notify you if someone's lurking around your property! These features are especially beneficial for those who own vacation properties. Keyless entry systems that use fingerprint sensors can also trigger certain home appliances and devices depending on who enters. Intelligent climate and light control saves energy and lowers bills so your home will be both the smartest and eco-friendliest on the block. The heating and cooling system can even create climate zones specific to individual family members preferences and can monitor how much electricity homeowners use in order to find ways to save even more energy. A smart home is like a personal assistant who handles all the odds and ends such as preheating your oven for your arrival home! You can now relax if you're not sure whether or not you set the alarm as you know it'll be taken care of. This type of technology is no longer for just the rich and famous. It's a major selling point and the higher your home's IQ, the higher the resale value will be! Soothe Your Garden's Soul with a Water Feature Your backyard is the perfect place to take a break from the busy pace of modern life. Installing a water feature will help transform your garden into an oasis of tranquility and may also increase the value of your home. Water attractions can be as simple or complex as your budget allows. Installing a pond is more involved since you have to dig and line a hole. Safety is of course a critical concern if you have small children and if you plan on digging, contact the appropriate utility companies to ensure you don’t break a line. Keeping fish and other aquatic life means you’ll create an environmentally friendly haven for wildlife such as frogs, birds and butterflies. There's also a wide range of green alternatives such as solar powered fountains to choose from. By utilizing the sun's rays you'll use less power, enjoy lower electricity bills and won't get in a tangle over electrical cords! It’s important to spend time during the planning stage to ensure your water feature will integrate with your landscape and environment. Once you’ve finished designing and implementing your new eye catching water feature, find a comfortable seat and enjoy the peace and tranquility. Don't Get Left Out In the Heat If something's going to go wrong with your A/C, it'll likely happen at the beginning of a heat wave. You'll roast for days until a technician’s able to come out and when they do, the repair cost will make your blood boil! A neglected air conditioner isn't as efficient or reliable so it's important to have it serviced every so often in order to ensure optimum performance. The service check will include cleaning the unit coils, checking the amp draw of the compressor, adjusting the belts and topping up the fluid. Regularly servicing your air conditioner will prevent wear and tear plus it will increase the efficiency of your unit which in turn will reduce your electricity bills. Don't let it slide again this year! Schedule your check-up today and avoid being left out in the heat.

Are you sick of scouring the paper and MLS sites looking for homes? Tired of playing telephone tag with agents only to hear the home's already sold? Sit back, relax and let me do the work for you! Just visit my website and check off the features you're looking for. Whenever a home matching your criteria hits the market, it'll be automatically flagged and emailed to you so you'll never have to worry about missing your dream home. This service is free and there's no obligation! Click here to get started. View Previous Issues

Posted via email from Selling Cambridge with Clare DeJong

Congratulations to the Re/Max Real Estate Centre Team!!

The Re/Max Real Estate Centre Cycling Team raised over $5,000 for the Heart and Stroke Foundation this past Tuesday.

The team also won the Spirit Award for being the most energetic and having the most team spirit.  WAY TO GO!

 

Posted via email from Selling Cambridge with Clare DeJong

Cambridge Mayor's Celebration of the Arts

Great family event happening downtown Cambridge tomorrow (Friday, June 15/12) and great weather in the forecast!

Posted via email from Selling Cambridge with Clare DeJong

Top 10 Home Improvement Myths

Not all home improvements are created equal. Even in a seller’s market, it’s important that homeowners make the right investments that will yield higher returns. 

Father’s Day is next week, and Dad is sure to get a few tools or gift certificates to a home improvement store that he’ll be itching to use, so make sure your clients are in-the-know before then!

Top 10 Home Improvement Myths

1. Any remodeling project will add value to your home.

While many remodeling projects will add value to a home, some can be seen as a negative by future buyers. For instance, combining two smaller bedrooms to create one larger bedroom may better fit one homeowner’s lifestyle today, but it may cause the home to lose value in the eyes of a future buyer who needs the two separate rooms.

2. Buying the highest-quality materials attracts more buyers.

Installing high-end materials may seem like a wise decision, but it can backfire. For instance, using the most expensive tile in a bathroom may create an impressive appearance, but value-conscious buyers may opt for a more affordable home if the seller has over-improved compared to others in the neighborhood.

3. Adding square footage always adds value.

A better way to think about this statement is to insert the word useable into the sentence. Finished attics and basements – even if considered liveable by local standards – may not be attractive to a buyer if they are not finished to the same standards as the rest of the home.

4. Colors and textures – safe and simple is better.

Keeping a home “vanilla” so buyers can choose their own style and décor might be a safe bet, but it ignores the fact that most buyers just don’t have the ability to visualize the home differently. Without splashes of color and mixtures of texture, sellers can lose value to others that have taken the time to consult with an interior designer.

5. Inside improvements are better than outside improvements.

Not necessarily. If a home’s exterior has been neglected or doesn’t offer a good curb appeal, a buyer might stop there – and then the seller’s efforts on on the inside may not net them any more dollars. To get the biggest bang for their remodeling buck, sellers should start from the outside and work their way in.

6. Adding a bedroom is better than adding a bathroom.

It depends on the starting point. If a seller only has one or two bedrooms to start with, adding a bedroom before adding a second bath is probably a wise choice since most buyers are more attracted to three-bedroom homes. On the other hand, if the home already has three bedrooms and only one bath, the sellers’s next investment should probably be in a new bathroom.

7. Paint hides a multitude of sins.

Dry rot? Fungus damage? Mold problems? Carpenter ants? Termite issues? Nothing a can of paint can’t fix, right? Wrong! Not only does this practice violate disclosure laws in most states, it can set sellers up for liability after the sale, as most buyers will want the sellers to foot the bill for these hidden issues.

8. Converting a garage to living space is a great trade-off.

Nope. A garage conversion is almost always viewed negatively by future home buyers unless the sellers replace the lost garage with another parking and storage space of equal size.

9. Sellers can save money by doing improvements themselves.

For some homeowners, wiring a new lighting fixture or plumbing a new dishwasher is a no-brainer, but for others it may end up costing more later if they have to have the work redone by a professional. Another consideration is local and state laws regarding remodeling work: In many states if a buyer has purchased a home to remodel and resell, they must either hold a contractor’s license or hire a contractor to do the work for them.

10. Pools add value to your home.

This is only true in areas where pools are must-have amenities. In most areas of the country, pools have more limited appeal – and the idea of maintaining a pool for ten months out of the year when it can’t be enjoyed won’t appeal to most buyers.

To keep your pulse on the amenities that are coveted most in your market, talk to local remodeling professionals, contractors, and home-improvement specialists on a regular basis.

via Trulia

Posted via email from Selling Cambridge with Clare DeJong

Either, not both

 

Stand out or fit in.

Not all the time, and never at the same time, but it's always a choice.

Those that choose to fit in should expect to avoid criticism (and be ignored). That that stand out should expect neither.

 

via Seth Godin

Posted via email from Selling Cambridge with Clare DeJong

Housing affordability getting worse

 

 

 

'

It became a little tougher on household budgets to carry the costs of owning a home at market prices at the start of this year,' RBC's chief economist Craig Wright says. (Canadian Press)

 

 

It's getting more difficult to pay for the costs of owning a home in Canada and the situation will likely worsen, the Royal Bank of Canada says.

The RBC said Tuesday rising house prices were responsible for a modest deterioration in home affordability in the first few months of 2012 after two quarterly improvements, but warns that rising interest rates are the more pressing concern long-term.

"It became a little tougher on household budgets to carry the costs of owning a home at market prices at the start of this year," said Craig Wright, RBC's chief economist said in a statement Tuesday.

"Strong buyer demand was a principal driver of the modest rise in home ownership costs. While the deterioration in affordability was felt to varying degrees across the country, it was mild in most cases."

Detached home eats up 43% of income

RBC's affordability index for a detached bungalow stood at 43.1 per cent of income nationally in the first quarter, up 0.8 percentage points from the fourth quarter of 2011 and up 1.5 percentage points from the first quarter of 2011.

That figure assumes an average home price of $360,500 for a 1,200 square foot, one-storey house and $77,900 in annual qualifying income. Based on those figures, an owner would need to spend 43.1 per cent of annual income to pay for mortgage payments, utilities and property taxes.

The deterioration of affordability — the proportion of pre-tax income required to service the costs of owning a home — was most acute in Vancouver, where the costs associated with owning a detached bungalow at market prices rose 3.1 points to 88.9 per cent of annual income.

There was a similar trend in Toronto, Montreal and Ottawa but the bank's affordability index was unchanged in Calgary and improved in Edmonton compared with the fourth quarter of 2011.

'Affordability headwinds are likely to increase next year'—RBC economist Craig Wright

In Vancouver, which is Canada's most expensive real-estate market, RBC assumes an owner would need $155,900 of annual income to make mortgage payments on a bungalow priced at $832,600.

Based on those figures, the owners would have to direct $8.89 of every ten dollars earned each year towards mortgage payments, utility costs and property taxes.

In Toronto, the index deteriorated by 1.2 percentage points to 53.4 per cent based on $110,000 in annual income; in Montreal, the cost of ownership increased 1.2 percentage points to 41.4 per cent of income at $64,100 and in Ottawa it was up 0.9 per cent to 41.8 per cent of income at $88,800.

In Calgary, by contrast, only about 36.7 per cent of pre-tax income would be required to pay for a standard bungalow — unchanged from the previous study — and in Edmonton the index improved by 0.4 percentage point to 32.4 per cent.

Qualifying income was also lower in the two Alberta cities than in Vancouver, Toronto or Ottawa, at $87,000 in Calgary and $73,000 in Edmonton.

Wright said the affordability challenge will likely increase once the Bank of Canada begins raising interest rates.

"Exceptionally low interest rates have been the key force in keeping affordability from hitting dangerous levels in Canada in recent years," Wright said.

"Affordability headwinds are likely to increase next year, as interest rates make their way towards more normal levels." He said RBC expects Canada's central bank will hike rates gradually, starting in the fourth quarter.

"A gradual pace of increases will allow income growth to provide some offset," he said.

However, there have been persist ant warnings from the Bank of Canada, federal government and many economists that Canadian household debt levels are precariously high.

There have also been concerns that prices for certain types of homes and certain local markets — condominium apartments in Vancouver and Toronto, in particular — have risen too quickly to be sustainable.

RBC's localized affordability measures are adjusted to reflect the different cost of real-estate and the amount of income that a buyer would need to qualify for a typical mortgage that would fix interest rates for five years.

In Toronto, the country's second-most expensive real-estate market, a buyer would require $110,000 of annual income to afford a bungalow, $129,800 a year to afford a two-storey house and $71,200 to afford a condo.

 

 

© The Canadian Press, 2012

Posted via email from Selling Cambridge with Clare DeJong

Preparing to Sell Your Home

     When preparing to sell your home, why not  take five or ten minutes to test the GFCI outlets and protection in the home? Doing so can help ensure both current and future residents are protected from wayward electrical current when working out of doors or near water sources.

     The typical electrical household circuit is controlled at 15 amps maximum by the breaker or fuse in the panel and may be operating at a level HUNDREDS of times the lethal range. In potentially wet areas if an appliance is faulty and “leaking” electricity, a properly working GFCI will detect the loss and stop the flow of power. Even a tiny amount of amperage (fewer than 18 milliamps) can begin to cause difficulty breathing and for anyone subjected to a range in excess of 50 milliamps, heart fibrillation and death is possible. If working properly, the GFCI will trip below 5 milliamps, reducing the chance of premature demise.

     A home inspector will almos tcertainly check the performance of Ground Fault Circuit Interrupters commonly referred to as GFCI outlets. Development of the code has been gradual with kitchens being the latest addition. Bathrooms, outdoor circuits and other “water”applications also require GFCI protection.  Inspectors will usually make note of the age of the home when commenting on the absence of GFCI protection.

    Even in newer homes and after majorrenovations we find a number of GFCI conditions that are not ideal and referthe client to a licensed electrician for repair, replacement or advice.

    Testing of GFCI protection should be performed regularly. The simplest test of outlets involves pressingthe outlet reset, plugging in a night light and pressing the “test”button. If the light turns off when the mechanism snaps, protection is working properly. Press the reset button to reactivate the circuit. There may be more than one outlet protected by a single GFCI outlet. Sometimes, all the bathrooms in the house are protected by a single “testable” outlet.

 

Thanks to Dan Marcotte

 

Posted via email from Selling Cambridge with Clare DeJong