What costs are associated with buying a home?

Saturday, March 29th, 2014

Unlike a lot of first-time home buyers, in 2009 Jesse MacNevin decided to go for a house that was less than the amount he was approved for.

“I started doing the numbers and talked to a few real estate agents,” he says. “Then I went to my credit union for a pre-approval. I realized then that I needed to focus more on what I could actually afford versus how much they would give me.”

While he was given the green light to aim for a $350,000 home, he settled on a condo for just under $260,000 instead. “I didn’t want home ownership at the expense of everything else. I remember looking at my budget at the time and thinking the last thing I wanted was not to be able to travel. It wasn’t exactly what I wanted, but it was cheaper and fulfilled all my needs. In hindsight, it was a good move.”

MacNevin says having a good real estate agent and lawyer helped him determine what he could really afford, where there might be potential problems and the ins and outs of closing the deal. A mortgage broker was also important when it came to the signing process and making sure there was flexibility in his mortgage terms.

Not everyone entering the home buying market is so diligent.

When doing the mortgage math, it’s not enough to plug some numbers into an online estimator, says David Stafford, managing director, real estate secured lending, for Scotiabank in Toronto. “This is probably the largest single financial transaction that most people do in their lives, and it can get very complicated. Online estimators typically won’t give you the full picture.”

He says buyers need to look beyond the actual purchase price and factor in a percentage (typically 1.5 per cent of the purchase price) for closing expenses from the outset. “Land transfer taxes, legal fees, title insurance and other things are all part of the math.” They also need to consider ongoing expenses that will be over and above monthly mortgage payments, such as utilities, property taxes, insurance, maintenance and condo fees.

Sometimes there are additional surprises that come into play in the initial stages of home ownership, such as reimbursement fees if the former owner has prepaid their property taxes and moving costs, says Toronto-based Richard Desrocher, a general legal practitioner and former real estate broker.

The immediate financial aspects are only part of the process, which is why a home inspection is a good idea, he says. “You won’t know what’s going on behind the walls and on the roof. It’s pretty scary after you close a deal to have to deal with drain problems.”

There are also ways people can reduce their costs if they talk to the right people, Desrocher says. “A lot don’t realize that many financial institutions are willing to negotiate down from their published rates. A mortgage broker is much better informed about where the best deals are and can shop the market for you.”

Source: Denise Deveau, Postmedia News

Some tactics to make first-time home buying easier

Friday, February 28th, 2014

The average cost of a Canadian home hit a record high of $388,553 in January. This price is 9.5 per cent higher than last year. The average cost of a home in cities such as Toronto and Vancouver rose to $526,528 and $606,800. Over the last ten years Canadian real estate prices have soared 84 per cent. With prices sky-high in some cities, the following tactics could help make buying your first home just a little bit easer.

Get a mortgage pre-approval before you start house hunting.

Before you start visiting open houses or checking out properties with a real estate agent, it’s important to visit your bank to see which houses you can afford. This ensures you’re shopping within the correct price range. Many people will need to take out a mortgage to buy property, but the amount you are eligible for is based on multiple factors including credit rating, household income and monthly expenses. Before you begin property hunting, visit a financial institution. This way you’re able to hold a competitive rate for between 30 to 120 days.

Buy a home with your parents or a buddy.

Young adults are increasingly relying on help from family members to buy a home. About 27 per cent now expect it. In a hot housing market, real estate agents have seen ‘gift letters,’ which detail the money a family member will contribute to assist them with mortgage approval, or simply thousands of dollars in hard cash. If a family member decides to loan the money rather than give it as a gift, parents should establish payment requirements in a legal document to ensure that everyone is satisfied.

Buy a home in a more affordable city.

House prices in Vancouver and Toronto are climbing to unaffordable levels for many people, but this doesn’t mean you have to live in these cities. Near Toronto, the housing markets in Ajax, Brampton, Milton and Mississauga are heating up. These are popular placees to buy a bigger lot, but potential homebuyers need to account for other costs (like gas and car insurance), as well as commuting times should their work remain in Toronto.

Buy a home that you can use as an income property.

You could buy a property you can live in but also split into a rental unit. The best outcome is if your renter’s payment covers your mortgage costs, but there are some important points to consider. First, you need to determine how comfortable you are living in close proximity with your tenants. For example, are you comfortable having a boarder live down the hall, or would you prefer to live on separate floors and use different entrances? Many people would prefer a semi-detached home with a separate entrance, bathroom and kitchen. If these don’t figure in the property you’re eyeing, you’ll need to budget for renovation costs.

Negotiate your house price and insurance.

Some people don’t feel comfortable negotiating, but it can save you a lot of money. First, the more information the better. Research the value of other houses. Chances are an identical house has been sold in the neighbourhood and you should check that property’s value against the one you’re considering. Understand why the seller is selling and shape your bid towards his or her plans. Also, understand that while the size of your bid is important, it isn’t always the deciding factor because some homeowners care how the new owner will treat the property.

When you purchase insurance, there are three types to consider: basic, standard and comprehensive. An independent broker can help you get the best rate and if you bundle your auto and home insurance with the same company you could receive up to a 15 per cent discount.

Tap into your RRSP for first-time home buyers.

First-time homebuyers can withdraw $25,000 from their RRSP as a part of the federal government’s homebuyers plan. If you’re buying a home with a partner, you can both take out $25,000 from your individual plans. If this equals a 20 per cent down payment, you can avoid mortgage default insurance, which tacks on several more thousands of dollars to your mortgage. If you do tap your RRSP, there is a tax loophole that lets you receive up to $20,000 in tax refunds. But one drawback with using your RRSP is that you must repay the amount you withdraw within 15 years or you will face a penalty based on your personal income tax rate.

Buy a smaller space.

One in eight households lives in a condominium. With the gap between the price of a house and a condo hitting record highs in Toronto, more families are becoming condo dwellers. The average size of a home in Canada was 2,300 square feet during the mid-2000’s. But that number has now dropped to 1,900 square feet and will probably keep shrinking. The size of your family will determine the size of your home. While you may have grown up in a single detached home with a backyard, in housing markets such as Vancouver and Toronto it’s important to manage your expectations.

Budget for your closing costs.

Tapping into a mortgage offers homeowners leeway in paying off their property, but along with your down payment there are other upfront closing costs you need to budget for. The Canada Mortgage and Housing Corporation suggests that you set aside an additional 1.5 to 4 per cent of your property’s purchase price to account for closing costs. Closing costs include a land survey that ranges from $1,000 to $2,000, an independent home inspection costing from $350 to $600, legal fees for a title search and paperwork that run to about $1,000, and a land transfer tax that varies based on your city and GST/HST.

Source: Josephine Lim, MSN Money

What to look for when buying a condo

Wednesday, October 2nd, 2013

Condo shopping can be overwhelming – a pre-shopping checklist can help limit your stress and visits to show homes.

To create such a list, start by visiting presentation centres and model units in person. Although the Internet is a great place to do some basic research, you will learn much more by assessing the quality of materials and construction in person. This will also give you a chance to ask your questions and evaluate the quality of the responses you get. Be consistent with the questions you ask in the showrooms so you can make accurate comparisons.

When visiting, try to speak with the show home’s specialist who assists buyers with their design choices, as they are often present. Take advantage of their expertise regarding upgrades and options. This will be helpful even if you eventually settle on another development.

Before visiting, make a list of those amenities that are important to you and that you are likely to use. Remember, the cost of amenities is embedded in the condo price and the cost of maintaining them in the condo fees.

Some questions to be answered:

• Who is buying units in the condo — singles, couples, students, young families, retirees? This will determine the condo’s culture. Be careful if the units are being sold to investors as rental units; tenants as a group may be less invested in keeping the property up and more frequent turnover will subject the common areas to wear and tear.

• Consider “curb appeal.” Is impressing your visitors with a beautiful facade, entry foyer and other common areas important to you? Not every condo owner cares about the width of the corridors or the decor in the elevators, but many do.

• Is there adequate and convenient visitor parking? A good way to deter friends from coming by is making parking difficult.

• Are the elevators fast and adequate for the size of the building? This is particularly important if you want to be on a higher floor.

• Parking is key. Consider ease of access, adequate space for your car and ease of egress into traffic. Fighting your way into rush-hour street traffic can get old quickly; on the other hand, you may be on a schedule that lets you avoid rush hours.

• It may be wise to purchase a parking space or two even if you don’t have cars — they can become more valuable over time and can always be sold. Parking spaces can be significant inducements when reselling.

• Check out the storage lockers for size, location and internal organization. You don’t want to have to unpack the whole locker just to get at your suitcases in the back.

• Location, location, location. As for all real estate, condo location is paramount. However, there are many factors that determine the value of a given location to a given purchaser. Convenience generally plays a significant role and convenience is a very personal thing. Some of the following points will help clarify this.

• When examining floor plans and fact sheets, make sure you understand the positives and negatives of the layout. If you have trouble visualizing this, educate yourself by quizzing the people representing the various developments about their layouts. You will soon be doing this automatically when you see a floor plan.

Flow is very important, especially if you are used to bigger spaces. Make sure the room sizes meet your requirements. This should include the kitchen, which needs to be more comprehensive if you plan to cook or entertain. Of course, some facilities have beautiful entertaining spaces and catering services. You might prefer this format.

• If cooking is a priority, find out which appliances are included and check them out. If they don’t measure up you may need to upgrade.

• Is a balcony important and will you actually use it? If you plan to garden, make sure you know the rules governing your balcony use. If you have no interest in balcony living, smaller is better than larger as it will save you money and upkeep.

• Are your critical amenities readily accessible? Of course, accessibility will depend on your level of mobility — committed walker, cyclist or driver. Some may require facilities within their condo complex.

• Make sure you know how bright your condo will be and determine how important this is to you. Orientation of principal rooms and window height are the two biggest factors.

• Does the level of security offered meet your expectations? This applies to building access, garage surveillance, and elevator and corridor security.

• Concierge service is both a security and a convenience factor. What will the concierge do for you and during what hours? If you travel a lot, this becomes more important — who accepts the deliveries and brings in the mail?

• What are the rules about pets, both yours and neighbours? How long does it take to get Fido to the grass and what do you do in winter? Or perhaps you don’t want to interact with pets on a regular basis.

• Is the condo on a flight path or adjacent to high tension transmission lines? This may not be important to you personally but may become an important issue on resale.

• Are there lighted recreational facilities nearby that may generate noise in the evening?

• Are there local events such as exhibitions or sports events that may overwhelm traffic circulation intermittently?

Source: Marilyn Wilson, Marilyn Wilson Dream Properties Inc., Ottawa

Where are the most new homes in BC being built?

Friday, December 9th, 2011

Multi-family housing starts were up in Greater Vancouver in November over last year, while single family starts were down, Canada Mortgage and Housing Corp. reported Thursday.

“We have seen a reduction in single-family housing starts so far this year, and sort of a resurgence in the multi-family sector,” said Robyn Adamache, CMHC’s senior market analyst. “We’re starting to see some of the larger condo projects starting again, but we’re nowhere near the levels we were in our peak year, 2007.”

Nationally, housing starts declined to 16,615 from 17,637, with B.C. one of only two regions showing an overall increase from 1,609 to 2,241. Urban Quebec also showed a small increase.

Adamache said immigration drives demand in British Columbia and job growth in Vancouver has kept demand for new homes up.

“I think part of what’s going on is we do have a fairly balanced resale housing marking out there, so there is fairly steady demand,” Adamache said. “Part of what’s driving this is ongoing population growth, or people moving here from other countries. In Vancouver, we get 35,000 or 40,000 people moving here every year.”

There were 1,686 housing starts in November in the Vancouver CMA, up from 918 in November 2010. Single-family starts were at 281 for November, down 10 per cent from 2010. Multi-family starts, which include semi-detached, townhouses and apartments, were at 1,405 for November, up a whopping 130 per cent from November 2010.

The year-to-date figures show an overall increase in the Lower Mainland of 23 per cent for 2011 so far over 2010; broken down, there was a 21-per-cent decrease in single-family starts, and a 44-per-cent increase in multi-family starts. This year-to-date shows a total of 13,295 multi-family housing starts, compared to 16,525 in 2007 when housing starts peaked.

The drop in single-family starts could be related to the referendum defeat of the harmonized sales tax, which applies to new homes and which the provincial government said will be phased out by March 2013. Multi-family developments would not be affected in the same way because of the time it takes to build them and because many condos and townhouses would be below the $525,000 threshold for HST.

Richmond and North Vancouver were hot spots for growth, each showing an 89-per-cent increase in housing starts for year-to-date over last year. North Vancouver had 920 housing starts this year so far compared to 486 at this point last year, while Richmond had 2,355 starts compared to 1,248 at the same point last year. The vast majority of those units were multi-family developments.

“Richmond is a big recipient of people moving here from other countries, so that could be driving the demand,” Adamache said.

Because there was a significant slowdown in housing starts in 2009, and because it takes at least two years to complete a multi-family development, there will not be a lot of completed condos flooding the market in the near future, Adamache said.

Source: Tracy Sherlock, Vancouver Sun

Recent property sales in Vancouver, Langley, Williams Lake and Kelowna

Thursday, June 30th, 2011

Vancouver Sun June 25, 2011

4763 West 2nd Avenue, Vancouver

Type: 4-bedroom, 5-bathroom detached
Size: 5,043 sq. ft.
B.C. Assessment, 2011: $6.078 million
Listed for: $7.68 million
Sold for: $7.16 million
Sold on: May 17
Days on market: 267
Listing agent: Bryan Yan at Regent Park Realty Inc.
Buyers agent: Bryan Yan at Regent Park Realty Inc.

The big sell: This Point Grey house was totally remodelled in 1992 with an understated elegance. It is on an estate measuring more than 32,000 square feet in an enclave north of Fourth Avenue and close to UBC’s Endowment Lands. Its new design boasts three levels that take advantage of the city and water views. The Italian-style garden has an outdoor, stone swimming pool, hot tub, tennis court and patios. The interior showcases a modern chef’s kitchen with granite countertops, Sub-Zero and Kohler appliances, dark oak wood flooring, vaulted ceilings, skylights, and a sundeck of almost 500 square feet. Tall, mature trees surround the property and provide complete privacy.

4230 196th Street, Langley

Type: 4-bedroom, 3-bathroom detached
Size: 2,519 sq. ft.
B.C. Assessment, 2011: $505,000
Listed for: $549,900
Sold for: $548,000
Sold on: May 6
Days on market: 6
Listing agent: Jeremy Sutton at RE/MAX Treeland Realty
Buyers agent: Will Rempel at RE/MAX Treeland Realty

The big sell: This Brookswood home is on a 81-by-135-foot lot on a no-through street with designated parkland opposite.The property was built in 1975 and expanded with family conveniences in mind, resulting in a larger kitchen and family room on the main floor, both with sundeck access to the front and rear of the house. Oak is a central theme throughout, and has been incorporated into the staircase design, the crown mouldings, the living area floors and the kitchen cabinets. Noteworthy details include the stained-glass window in the dining area, gas fireplaces on both levels, a double garage with workshop extension and side access for RV parking, and new appliances, windows, furnace and hot water tank, as well as a large, fenced rear garden.

614 East 11th Avenue, Vancouver

Type: 5-bedroom, 3-bathroom detached
Size: 2,283 sq. ft.
B.C. Assessment, 2011: $769,000
Listed for: $899,000
Sold for: $1 million
Sold on: May 3
Days on market: 6
Listing agent: Patrick Weeks at RE/MAX Select Properties
Buyers agent: Teresa Comeau at RE/MAX Select Realty

The big sell: This 1911 heritage house in the South Main neighbourhood sold for $1 million in just six days. The property provides an attractive combination of old and new. Original claw foot bath tubs, hardwood floors, and wood-trim windows showcase the history of the home, but there’s a nod to 21st-century design, with an open-concept plan on the main level that allows design opportunities for a growing family.As well, the home has been divided and contains a two-bedroom mortgage-helper on the lower floor. The south-facing position allows plenty of light and there is copious backyard space for children, dogs and barbecues.It is close to the popular shops and restaurants of Soma.

2448 Sutton Road, Williams Lake

Type: 3-bedroom, 3-bathroom detached
Size: 3,300 sq. ft.
B.C. Assessment, 2011: $523,000
Listed for: $569,900
Sold for: $563,900
Sold on: May 3
Days on market: 2
Listing agent: Tanya Rankin at Tanya Rankin Ltd.
Buyer’s agent: Tanya Rankin at Tanya Rankin Ltd.
The big sell: According to agent Tanya Rankin, lakeshore properties such as this secure some of the highest prices in this area. It is easy to see why, as the home is just feet away from the water, and the lure of water-skiing and beach activities. Set on a gently sloping lot, the rancher has a fully finished basement. The main reception rooms – including the master bedroom – are positioned so that the views pour in, and an oversized deck provides a venue for entertaining and summer gatherings. The sellers lived in the property for the past 30 years and there is evident pride of ownership.

2336 Selkirk Drive, Kelowna

Type: 4-bedroom, 3-bathroom detached
Size: 3,335 sq. ft.
B.C. Assessment, 2011: $570,000
Listed for: $669,000
Sold for: $650,000
Sold on: May 3
Days on market: 85
Listing agent: Krista Suchar at MacDonald Realty Kelowna
Buyer’s agent: Eric Prehofer at MacDonald Realty Kelowna

The big sell: This was a show home built by Dilworth Homes in 2006 on a private lot backing on to the edge of Dilworth Mountain to the north of downtown Kelowna. The interior has a contemporary design with espressocoloured cabinetry – a theme that reoccurs in many rooms throughout the home. An open-concept kitchen – with pendant and recessed lighting, a breakfast bar and Corian countertops -flows into the dining and family rooms, which have floor-to-ceiling windows that frame the expansive valley views below. There are ceramic tile and hardwood floors, carpeting in the bedrooms, a built-in vacuum, two gas fireplaces and balconies. The property has almost a quarter of an acre and has a double garage and parking for further vehicles.

For the full story, please click on Real estate sales in Vancouver and Langley and Real estate sales in Williams Lake and Kelowna

Real estate sales in Burnaby, Surrey, Vancouver and Fernie

Thursday, May 5th, 2011

Vancouver Sun April 30, 2011

4657 Victory Street, Burnaby

Type: 3-bedroom, 1-bathroom detached
Size: 1,021 sq. ft.
B.C. Assessment, 2011: $691,300
Listed for: $788,000
Sold for: $868,800
Sold on: March 8
Days on market: 6
Listing agent: Leslie Gray at Sutton Group – West Coast Realty
Buyers agent: Bonney Bao at Royal Pacific Realty (Kingsway)

The big sell: This 1935 bungalow has numerous pluses: the living space is on one level, the rooms are spacious and the property is in a central location with Metrotown, the SkyTrain, Crystal Mall and schools and parks within walking distance. Other attractions come in the form of the quiet neighbourhood, the treed outlook and the 60-by-106-foot south-facing flat lot that could provide future development possibilities. All this generated seven offers, with the winning bid coming in at more than $80,000 over the asking price. According to listing agent Leslie Gray, South Burnaby is fast becoming a serious contender for those buyers who have been priced out of nearby Richmond.

16316 92nd Avenue, Surrey

Type: 8-bedroom, 7-bathrooms, detached
Size: 5,403 sq. ft.
B.C. Assessment, 2011: $936,000
Listed for: $970,000
Sold for: $948,000
Sold on: March 16
Days on market: 69
Listing agent: Dennis Fung at Homelife Benchmark Realty
Buyers agent: Suki Bahi at Sutton Group – West Coast Realty

The big sell: Everything about this property is large, from the 12,414-square-foot lot to the twostorey family room. In fact, this home features plenty of room to fill any family’s requirements. Built in 2006 in Surrey’s Fleetwood/Tynehead neighbourhood, the house boasts eight bedrooms and six full bathrooms over three levels. The result? A flexible floor plan that includes a guest suite on the main floor, a gourmet kitchen with butler’s pantry and spice kitchen, a master suite with private deck that showcases the mountain and valley views, two additional spacious bedrooms with ensuites, and a large den. As well, the fully finished basement comprises a games room, hobby room, further bedrooms and a 23-by-18-foot recreation room. There is parking for six vehicles and the southern-exposed back yard has a deck.

#1004 -1616 Bayshore Drive, Vancouver

Type: 2-bedroom, 2-bathroom apartment
Size: 1,257 sq. ft.
B.C. Assessment, 2011: $930,000
Listed for: $999,900
Sold for: $990,000
Sold on: March 12
Days on market: 2
Listing agent: Holly Wood at RE/MAX Masters Realty
Buyers agent: Thomas Spencer at Royal Pacific Realty Corp.

The big sell: The story of the sale of this Coal Harbour condo would be a compelling tale for those who believe fate plays a hand in the direction our lives take. The buyers happened to walk past listing realtor Holly Wood’s agents’ open house and found themselves looking at exactly the type of property that they had been searching for. The Bayshore Gardens waterfront home has oak hardwood flooring, crown moulding and floor-to-ceiling windows framing the spectacular westerly views of the marina, Stanley Park and the seawall. The kitchen features a Sub-Zero fridge and wine bar, Bosch gas cooktop and dishwasher, and two eating areas. The master ensuite has a double sink with marble countertop, a soaker tub and separate shower with Kohler fixtures and heated floors. The building has 24-hour concierge, a gym, sauna, and meeting room.

1142 3rd Avenue, Fernie

Type: 5-bedroom, 3-bathroom detached
Size: 3,886 sq. ft.
B.C. Assessment, 2011: $644,000
Listed for: $544,500
Sold for: $518,000
Sold on: March 20
Days on market: 279
Listing agent: Candace Grey at Royal LePage East Kootenay Realty
Buyers agent: Marilyn Brock at Century 21 Maximum Realty

The big sell: Central to amenities and schools, this five-bedroom property is in the north end of downtown Fernie.
The home was custom built in 1997 and has more than 2,000 square feet on the main level and 1,800 square feet on the lower. The primary floor features a sunroom with beautiful mountain views, striking dark hardwood floors and trim, a family room off the kitchen area, solid oak cabinetry, three bedrooms and two bathrooms, and a rarity in most homes: an elevator that connects both levels. The finished basement -it could double as an in-law or guest suite -has a large recreation room, further bedrooms, a kitchen, abundant storage space and radiant heat. The exterior comprises a single attached garage and the property sits on a 60-by-120-foot lot.

For the full story, please click on Real estate sales in Burnaby, Surrey, Vancouver and Fernie.

Real estate sales in Sun Peaks and Powell River

Monday, August 9th, 2010

Vancouver Sun August 7, 2010

Sun Peaks
4120 Sundance Drive

Type: 4-bedroom, 4-bathroom detached
Size: 2,802 sq. ft.
B.C. Assessment, July 2010: $1.062 million
Listed for: $1.2 million
Sold for: $1.05 million
Sold on: July 19
Days on market: 431
Listing agent: Liz Forster at Sotheby’s International Realty Canada
Buyers agent: Liz Forster at Sotheby’s International Realty Canada

The big sell: Sun Peaks Resort enjoys one of those most sought-after amenities: a number of ski-in/ ski-out properties that mean you don’t have to haul your skis back home after the last run of the day. Located directly opposite the ski school, this log-and timber-accented property comes fully furnished with fir trim throughout. It has custom built-ins, a spacious ski equipment room, and a hot tub on the wraparound deck, which has expansive mountain views to Mount Morrisey. In addition, it has a great room with a tile-surround gas fireplace, hardwood flooring, granite countertops, a spacious master ensuite, double garage, an underground sprinkler system and a separate one-bedroom revenue suite. It’s within easy strolling distance to the village, making it a breeze to return home on the Carpet Lift.

Powell River
4885 Saskatchewan Avenue

Type: 3-bedroom, 2-bathroom detached
Size: 1,500 sq. ft.
B.C. Assessment, July 2010: $210,600
Listed for: $244,900 Sold for: $233,500
Sold on: June 30
Days on market: 18
Listing agent: Paige Anderson at Coast Realty Group (Powell River) Ltd.
Buyers agent: Dawn Adaszynski at Coast Realty Group (Powell River) Ltd.

The big sell: This split-level home has profited from quality finishing in the form of new hardwood and tile flooring throughout, fresh drywall, custom-made banisters, updated bathrooms, a master bedroom with ensuite and two walk-in closets, and sliding glass doors leading on to a large cedar deck that overlooks the private, fully fenced mature garden with its ample play area. The value added? A double shop with a nine-foot door, power and heating provided by an oil furnace. This is a centrally located property within walking distance to Powell River’s amenities. The town, situated on the Sunshine Coast, benefits from a strong community with recreation facilities, hospital, schools, an airport, ferry accessibility to Vancouver Island and daily flights to Vancouver’s South Terminal.

Read more: vancouversun.com/business/Sun+Peaks+Resort+property

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