Keep these tips in mind:
Banks and lawyers vacation too. Make sure if your lawyer is to preform a title search or close out the transaction in late Dec that he or another lawyer are physically available. Make these arrangements early. You may need to go a week or 2 early to sign some of the documentation.
Make sure as a Seller that you give as much notice as you can to utility providers to come do final readings for adjustment purposes. These large companies get stacked to towards the end of the year and doing these readings timely will help streamline the adjustments for closing purposes.
Call moving companies as early as you can. You will being paying a premium likely to do a late Dec or early Jan move. So more then any other time, price shop and ask for referals.
If you're a Seller leaving town after listing in December, be sure to have access to a dedicated phone line/fax line to deal with any offers and make sure someone is looking after your house. Awful time for a water pipe to burst. It won't happen...but be prepared for anything.
Shovel Sellers. It's already a pain in the butt when buyers arrive and the streets aren't plowed so they circle around for 10 minutes just to find a spot to come view your house. If you didn't shovel your driveway and front steps...you're going to leave a negative taste in the buyer's mouth...assuming they don't fall and eat snow.
Make certain that you leave lights on at all times. The days get grey and so do homes inside, no matter how many windows or the perfect exposure. Also, turn the heat on. Take it off the program while you're at work for the few weeks the house is being marketed. Yes, your bills will temp go up but the selling price should easily take care of those bills.
Buyers-open all the blinds and look for the condensation. It's there!! Home inspection will determine the need for replacing windows or simple sealing jobs.
Humidifiers should be on. Many older homes have mold in basement and do have an odor. Putting moisture in the basement air and opening up windows from time to time can only help.
There are many more things to know when purchasing into the winter season. If you have any further questions around this or the market...don't hesitate to ask me.
Michael Gruenstein MBA CSC
mgruenstein@trebnet.com
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGta.ca
Monday, November 29, 2010
Thursday, November 25, 2010
Let's pretend to be Economists for a sec...
A few weeks ago it was announced that October saw a solid rise in condo purchases, most falling in mississauga and richmond hill. Land getting more expensive, condo units get smaller. The smaller units have to attract end users by offering up good amenities and clever sleek designs. Apparently, we have an appetite for low rates still and don't mind living in close quarters to get out of our parents basements and build equity. I thinks that's a good move.
Other data saw September's TO market drop almost 2% in prices. Of course, this should be further identified by looking into specific areas as trendy blocks with little supply are hitting homeruns on sales prices.
Now, if the world is playing games with currency interventions to keep their exports fuelled and say buying up CDN dollars serving to strengthen the loonie while at home inflation remains beneath the target rate...basically you get a Cdn economy losing its power with a high currency as an exporter while still tempting home buyers into the market with low rates. When these rates go up the arguement is that is when the "bubble bursts". It's not imminent from what I understand. But that seems to be where were at.
Currency intervention by developed countries; low domestic rates; an appetite to own homes and a strong loonie create a challenging landscape. At least we're not choking off growth and playing austerity games that will almost undeniably slow growth elsewhere.
The biggest concern by most economists around housing is the sheer level of indebtness that personal households are holding and the future of employment.
The market for homes in TO is getting closer to balanced but prices albeit some small drops of late still take us above pre recession levels by about 3% (National Post source).
So its not cheap out there. There are good opportunities though and for those who are prudent....get in the market and leverage these low rates. Just don't blow your brains out!!
Michael Gruenstein MBA CSC
mgruenstein@trebnet.com
Re/Max Realtron Realty
Other data saw September's TO market drop almost 2% in prices. Of course, this should be further identified by looking into specific areas as trendy blocks with little supply are hitting homeruns on sales prices.
Now, if the world is playing games with currency interventions to keep their exports fuelled and say buying up CDN dollars serving to strengthen the loonie while at home inflation remains beneath the target rate...basically you get a Cdn economy losing its power with a high currency as an exporter while still tempting home buyers into the market with low rates. When these rates go up the arguement is that is when the "bubble bursts". It's not imminent from what I understand. But that seems to be where were at.
Currency intervention by developed countries; low domestic rates; an appetite to own homes and a strong loonie create a challenging landscape. At least we're not choking off growth and playing austerity games that will almost undeniably slow growth elsewhere.
The biggest concern by most economists around housing is the sheer level of indebtness that personal households are holding and the future of employment.
The market for homes in TO is getting closer to balanced but prices albeit some small drops of late still take us above pre recession levels by about 3% (National Post source).
So its not cheap out there. There are good opportunities though and for those who are prudent....get in the market and leverage these low rates. Just don't blow your brains out!!
Michael Gruenstein MBA CSC
mgruenstein@trebnet.com
Re/Max Realtron Realty
Wednesday, November 24, 2010
Random pieces of knowledge about homes and the market. Just throwing out some ideas. Easy read. You'll learn something!
Here's a random blog. Just some ideas that I've come across in a decade of buying and selling real estate that may be of interest (or not) to you. Let's do this:
1. For tepid sellers....there is a way of attempting a multiple offer scenario. The seller rather than asking for a clear date to review offers...asks for a 24-48 hr irrevocable (time to review the offer). During this period a good listing agent will attempt to draw in further business and have competing offers. Note, when this strategy is used..usually the ask price won't be on low end, like the more "bullish" seller who has underpriced with a pre inspection and an offer date.
2. Homes work in 20 year cycles. If you're lucky enough to purchase a resale house that has just undergone the correct maintenance you may be fortunate in that the sellers are taking goood care of their home and recently updated windows, roof, furnace, etc. If not, you may be looking at a healthy first and second year budget on top of your "welcome to" land transfer cost and closing costs in year 0.
3. Buying homes that are less then 7 years of age and Tarion warrantied...the warranty is transferrable. Though towards the last year or two of the warranty, the new owner has lost a lot of the warranty. At this stage, youre basically safe guarded should the house crumble if its demonstrated that its the fault of the poor construction. So don't take too much comfort in a warranty nearing the end.
4. When buying brand new...make sure in your offer you have a condition for a final inspection of the property. A walk thru with the builder to compile a deficiency list is important. By close or shortly thereafter its the hope of the buyer that the builder makes good on the list. Otherwise, Tarion may act as an arbitrator to ensure fairness in process.
5. Most asbestos tiles in older homes containe traces of asbestos as do water/boiler run furnaces. Removal of furnaces or tiles should be done by experts. It isn't a problem until its mishandled and then it becomes quite costly. This is not for the most part an insurance issue like knob and tube but it can become a saftety issue.
6. When caught in a multiple offer scenario, therte are strategies that may assist you. One such strategy works off the law of averages and determines for a like neighborhood and the number of offers in play, a percentage premium per offer that you'd tack on to the ask price to figure out where the house may sell at the end of the night. This is a crude benchmark, used in conjuction with adjusting comps and the ability of your agent to leverage relations with the listing agent (best to use an agent familiar with fellow agents in an area that they work). Timing of the presentation of your offer may also have a distinct advantage.
7. When going out to look at homes, namely a townhome or a semi..do not purchase until you've gone for a "dinner time" showing. Wait til the kids next door or dog are home. Then judge the level of noise. The listing agent will most of the time represent the house as very quiet and well constructed but best to learn on your own and go for a peak hour showing. Also when looking at a house, don't be shy to ask the neighbours. They're a wealth of info. You may find some who are very happy and others who aren't. Are the happy ones closer to your demographic and those not as happy perhaps older and liked the good ol' quiet days pre construction.
8. Canadian banks have recently raised draft fixed rates. With investors abroad seeking higher yields then those in other developed nations, the cost of borrowing has increased for our banks and in turn lending rates have had to go up on fixed mortages. Yesterday we had higher inflation data then expected. It's not clear when rates may work their way up. Tho Canada is looking relatively okay, Europe debt issues, US unemployment and potential deflation and emerging market bubbles may keep rates down domestically for some time. That said, locking in rates for a period if you're planning on hitting the pavement in the spring...is probably a good idea.
9. Many older homes have knob and tube wiring. A crude estimate of the cost to replace may be 1000 dollars a room. A room may be defined as a hallways as well. Some insurers will allow for a home to contain total k and t while other may ask for a percentage reduction and still others won't put up with any. You need to shop around and weigh insurance premiums relative to cost of doing work right off the bat.
10. Where can you save money and still live in a "trendy area". Here are some ideaas:
a) a townhouse or a semi will save you some money
b) if you have one vehicle and don't mind parking on street--typically these homes have less buyers in line
c) often corner properties are devalued
d) a house that shows poorly and has an unfinished basement (factoring in "over time") what needs to be done---it may represent a good opp for you
e) a smaller lot. yes, its a skinnier house for certain, but if its got an open layout and gets you into the school district and has a deep enough lot for further build out--this may be a good option
f) some estate sales or foreclosures
g)exclusive listings-if you're agent is tapped into the market, he/she may be aware of these kinds of opportunities. With fewer buyers and a seller not looking to "play the game", you may locate a house at fair market value and not be suckered into paying more and getting less.
This is a cross section of ideas. If you're getting into the market; have questions or want to learn more--please email or call. Also one of my sites...http://www.TheSmithsBuyAHouse.com is a great reference guide and may offer further insights.
Appreciate your time in reviewing the above.
Michael Gruenstein MBA CSC
416-271-2066
mgruenstein@trebnet.com
1. For tepid sellers....there is a way of attempting a multiple offer scenario. The seller rather than asking for a clear date to review offers...asks for a 24-48 hr irrevocable (time to review the offer). During this period a good listing agent will attempt to draw in further business and have competing offers. Note, when this strategy is used..usually the ask price won't be on low end, like the more "bullish" seller who has underpriced with a pre inspection and an offer date.
2. Homes work in 20 year cycles. If you're lucky enough to purchase a resale house that has just undergone the correct maintenance you may be fortunate in that the sellers are taking goood care of their home and recently updated windows, roof, furnace, etc. If not, you may be looking at a healthy first and second year budget on top of your "welcome to" land transfer cost and closing costs in year 0.
3. Buying homes that are less then 7 years of age and Tarion warrantied...the warranty is transferrable. Though towards the last year or two of the warranty, the new owner has lost a lot of the warranty. At this stage, youre basically safe guarded should the house crumble if its demonstrated that its the fault of the poor construction. So don't take too much comfort in a warranty nearing the end.
4. When buying brand new...make sure in your offer you have a condition for a final inspection of the property. A walk thru with the builder to compile a deficiency list is important. By close or shortly thereafter its the hope of the buyer that the builder makes good on the list. Otherwise, Tarion may act as an arbitrator to ensure fairness in process.
5. Most asbestos tiles in older homes containe traces of asbestos as do water/boiler run furnaces. Removal of furnaces or tiles should be done by experts. It isn't a problem until its mishandled and then it becomes quite costly. This is not for the most part an insurance issue like knob and tube but it can become a saftety issue.
6. When caught in a multiple offer scenario, therte are strategies that may assist you. One such strategy works off the law of averages and determines for a like neighborhood and the number of offers in play, a percentage premium per offer that you'd tack on to the ask price to figure out where the house may sell at the end of the night. This is a crude benchmark, used in conjuction with adjusting comps and the ability of your agent to leverage relations with the listing agent (best to use an agent familiar with fellow agents in an area that they work). Timing of the presentation of your offer may also have a distinct advantage.
7. When going out to look at homes, namely a townhome or a semi..do not purchase until you've gone for a "dinner time" showing. Wait til the kids next door or dog are home. Then judge the level of noise. The listing agent will most of the time represent the house as very quiet and well constructed but best to learn on your own and go for a peak hour showing. Also when looking at a house, don't be shy to ask the neighbours. They're a wealth of info. You may find some who are very happy and others who aren't. Are the happy ones closer to your demographic and those not as happy perhaps older and liked the good ol' quiet days pre construction.
8. Canadian banks have recently raised draft fixed rates. With investors abroad seeking higher yields then those in other developed nations, the cost of borrowing has increased for our banks and in turn lending rates have had to go up on fixed mortages. Yesterday we had higher inflation data then expected. It's not clear when rates may work their way up. Tho Canada is looking relatively okay, Europe debt issues, US unemployment and potential deflation and emerging market bubbles may keep rates down domestically for some time. That said, locking in rates for a period if you're planning on hitting the pavement in the spring...is probably a good idea.
9. Many older homes have knob and tube wiring. A crude estimate of the cost to replace may be 1000 dollars a room. A room may be defined as a hallways as well. Some insurers will allow for a home to contain total k and t while other may ask for a percentage reduction and still others won't put up with any. You need to shop around and weigh insurance premiums relative to cost of doing work right off the bat.
10. Where can you save money and still live in a "trendy area". Here are some ideaas:
a) a townhouse or a semi will save you some money
b) if you have one vehicle and don't mind parking on street--typically these homes have less buyers in line
c) often corner properties are devalued
d) a house that shows poorly and has an unfinished basement (factoring in "over time") what needs to be done---it may represent a good opp for you
e) a smaller lot. yes, its a skinnier house for certain, but if its got an open layout and gets you into the school district and has a deep enough lot for further build out--this may be a good option
f) some estate sales or foreclosures
g)exclusive listings-if you're agent is tapped into the market, he/she may be aware of these kinds of opportunities. With fewer buyers and a seller not looking to "play the game", you may locate a house at fair market value and not be suckered into paying more and getting less.
This is a cross section of ideas. If you're getting into the market; have questions or want to learn more--please email or call. Also one of my sites...http://www.TheSmithsBuyAHouse.com is a great reference guide and may offer further insights.
Appreciate your time in reviewing the above.
Michael Gruenstein MBA CSC
416-271-2066
mgruenstein@trebnet.com
Thursday, November 18, 2010
What the heck is "market value" on a home? Any basis for pricing these days??
Seeing that we realtors can't pinpoint an exact price on a house, (in fairness we don't know whose out shopping, how many parties may bid on house and we work for the sellers and sometimes are convinced for a period of time that they're price is "correct"---we default to "market value/range of value".
At the end of the day, the goal is to keep that range as tight as possible, unless we've priced at 999k and get lucky and sell for 1.3 million.
You should know that a few things make the calculation and arrival at market value more meaningful in most cases.
1. what have recent comps sold for?
2. how can you time adjust and adjust differences from one house to the next to make sense of a house asking price?
3. how long did it take this house to sell in similar environment over last many years?
4. Is this house being marketed after a recent termination?
5. whats the supply like of homes in the surrounding community. If low and in this interest rate environment...we'll market value is going to move upwards for sure (if house is priced okay and shows well)
6. what side of the street is the house located on? there is often a premium when backyard has southern exposure.
7. what renos/additions have been done? when were they completed. Even if they look great...you may need to depreciate the cost some to arrive at today's value?
8. Has there been a recent land sale on street. Trace back what a builder spent to put up new house when he purchased the land. Now tie in land value vs the full ask price of the house you're looking at. This should serve some basis
9. what are the mechanics like; electrical; plumbing; insurance premiums if any...take these into consideration relative to comps
10. don't discount the knowledge of a neighbour. some won't talk to you. others will tell you stuff that may actually make or break your decision to buy.
Theres so much more. I never saw this as ....person sees house. person likes house. person offers timely on house. person moves in.
But many do!
Michael Gruenstein MBA CSC
ReMax Realtron
mgruenstein@trebnet.com
http://www.TheSmithsBuyAHouse.com
At the end of the day, the goal is to keep that range as tight as possible, unless we've priced at 999k and get lucky and sell for 1.3 million.
You should know that a few things make the calculation and arrival at market value more meaningful in most cases.
1. what have recent comps sold for?
2. how can you time adjust and adjust differences from one house to the next to make sense of a house asking price?
3. how long did it take this house to sell in similar environment over last many years?
4. Is this house being marketed after a recent termination?
5. whats the supply like of homes in the surrounding community. If low and in this interest rate environment...we'll market value is going to move upwards for sure (if house is priced okay and shows well)
6. what side of the street is the house located on? there is often a premium when backyard has southern exposure.
7. what renos/additions have been done? when were they completed. Even if they look great...you may need to depreciate the cost some to arrive at today's value?
8. Has there been a recent land sale on street. Trace back what a builder spent to put up new house when he purchased the land. Now tie in land value vs the full ask price of the house you're looking at. This should serve some basis
9. what are the mechanics like; electrical; plumbing; insurance premiums if any...take these into consideration relative to comps
10. don't discount the knowledge of a neighbour. some won't talk to you. others will tell you stuff that may actually make or break your decision to buy.
Theres so much more. I never saw this as ....person sees house. person likes house. person offers timely on house. person moves in.
But many do!
Michael Gruenstein MBA CSC
ReMax Realtron
mgruenstein@trebnet.com
http://www.TheSmithsBuyAHouse.com
Condo In your near Future? Do you know what you're getting into?
A condo can be a great purchase. Why? Typically not because it offers wonderful upside potential relative to a detached home, but its the ease of lifestyle. For those who want to be pampered and have underground parking, lawns maitained, windows repaired and like amenities that require nothing but a change of clothes and an elevator to arrive at....condos are great.
When you go condo shopping, go armed with some knowledge of questions to ask:
1. How long on avg do units take to sell? If the cheaper units are taking some time, that's typically not a great sign.
2. How long has the building been standing? This will point to the reserve funds strenght. A newer building is gonna need to play catch up to get an ample reserve fund built?
3. What are the plans for the building over the next yr? Do they intend to create more amenties, redo the lobby, etc.? That's going to require you as a unitholder of common elements to beef up your monthly fees for some time. Be prepared
4. Are the heating/cooling mechanisms owned? When are they serviced? How old are they? Is it your borne cost to replace? Are the rented? Are the part of service contract and monthly fees?
5. If building is approaching say 20 years plus...it may be time to replace windows for example. How long will you have to live with drafty windows before they get to your unit?
6. What's going to be built around the condo if vacant land exists. If you're buying for that south west view of the lake..will you enjoy that for long? how will a new structure effect the resale value if you lose part/all of the view?
7. Whats the split between investors vs owners who reside in the condo. Remember, tenants have less of a vested interest to upkeep the units as well as the common elements. Also, in an older building, renos by multiple units will increase the value of the units. Tenants tend to not put any money into their units. Why would they? In a perfect world you'd like something like a 75% plus owner occuppied building.
8. How's the visitor parking?
9. What's the turnover? If it's high....why?
10. Final piece of advice (in this article..) interview anyone you bump into at the building during a showing from the doorman to the guy in the elevator to the girl walking her dog outside. They have more knowledge on the day to day then the agent and you combined.
Michael Gruenstein MBA CSC
Re/Max Realtron Realty
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
Call or email with questions anytime @ mgruenstein@trebnet.com
When you go condo shopping, go armed with some knowledge of questions to ask:
1. How long on avg do units take to sell? If the cheaper units are taking some time, that's typically not a great sign.
2. How long has the building been standing? This will point to the reserve funds strenght. A newer building is gonna need to play catch up to get an ample reserve fund built?
3. What are the plans for the building over the next yr? Do they intend to create more amenties, redo the lobby, etc.? That's going to require you as a unitholder of common elements to beef up your monthly fees for some time. Be prepared
4. Are the heating/cooling mechanisms owned? When are they serviced? How old are they? Is it your borne cost to replace? Are the rented? Are the part of service contract and monthly fees?
5. If building is approaching say 20 years plus...it may be time to replace windows for example. How long will you have to live with drafty windows before they get to your unit?
6. What's going to be built around the condo if vacant land exists. If you're buying for that south west view of the lake..will you enjoy that for long? how will a new structure effect the resale value if you lose part/all of the view?
7. Whats the split between investors vs owners who reside in the condo. Remember, tenants have less of a vested interest to upkeep the units as well as the common elements. Also, in an older building, renos by multiple units will increase the value of the units. Tenants tend to not put any money into their units. Why would they? In a perfect world you'd like something like a 75% plus owner occuppied building.
8. How's the visitor parking?
9. What's the turnover? If it's high....why?
10. Final piece of advice (in this article..) interview anyone you bump into at the building during a showing from the doorman to the guy in the elevator to the girl walking her dog outside. They have more knowledge on the day to day then the agent and you combined.
Michael Gruenstein MBA CSC
Re/Max Realtron Realty
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
Call or email with questions anytime @ mgruenstein@trebnet.com
Monday, November 8, 2010
blurred picture for residential market and pricing herein. what's going on?
First, we have the talk of the new commission structure. Most agents don't seem very concerned in the least. They look to the U.S. where homeowners have been offered discount brokerage/menju options for years now. It penetrated approx 3% of that market and this is before the housing crisis.
I've had top realtors in the city tell me that for an experiment they've spiced things up in their farm area and offered terribly low commissions and the phone calls and interest changed little.
Much as the public doesn't like paying the commission, its a sunk cost that sellers build into the pricing of their home and its equitable in that when they go to purchase a house they watch the sellers this time pay the commission out. It's an itch that gets scratched. Perhaps, like watching the Leafs no matter how awful a season its now turned into.
New home construction readings fell today. So the arguement may go that now there are fewere homes and some who would have looked at new construction will focus on the inventory of resale properties. Thus, the supply of homes will decrease and hence as the demand side goes..prices should stabilize if not rise.
This of course may be squashed by increasing rates tho with a dollar as high as it sits today and little inflation worries, it seems apparent that the rates may sit low for some time, helpping to prop up the prices of homes yet again.
What may disrupt the upward movement in prices may be the desire for Canadians with ever high household debt to become net savers and pay down theirt balance sheets making do with their current residence, though Canadians are comfortable with having mortages.
Klump from the CREA sounds like hes counting on a slower inventory year in 2011.
I suppose we have some news to sort thru in the US, commodity prices, deflation vs inflation and consumer confidence will all work their way into the housing market.
For the time being, inventory is low so in good areas we're seeing prices remaining quite high.
Best advice: get a strong agent, stay on top of the market and lock in rates with a preapproval.
If you have any questions I can help you with, don't hesitate to call or email. I still believe the site I've pieced together should be a great starting point for newcomers and those who haven't been in the game for some time.
But I'm always available.
Best,
Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
I've had top realtors in the city tell me that for an experiment they've spiced things up in their farm area and offered terribly low commissions and the phone calls and interest changed little.
Much as the public doesn't like paying the commission, its a sunk cost that sellers build into the pricing of their home and its equitable in that when they go to purchase a house they watch the sellers this time pay the commission out. It's an itch that gets scratched. Perhaps, like watching the Leafs no matter how awful a season its now turned into.
New home construction readings fell today. So the arguement may go that now there are fewere homes and some who would have looked at new construction will focus on the inventory of resale properties. Thus, the supply of homes will decrease and hence as the demand side goes..prices should stabilize if not rise.
This of course may be squashed by increasing rates tho with a dollar as high as it sits today and little inflation worries, it seems apparent that the rates may sit low for some time, helpping to prop up the prices of homes yet again.
What may disrupt the upward movement in prices may be the desire for Canadians with ever high household debt to become net savers and pay down theirt balance sheets making do with their current residence, though Canadians are comfortable with having mortages.
Klump from the CREA sounds like hes counting on a slower inventory year in 2011.
I suppose we have some news to sort thru in the US, commodity prices, deflation vs inflation and consumer confidence will all work their way into the housing market.
For the time being, inventory is low so in good areas we're seeing prices remaining quite high.
Best advice: get a strong agent, stay on top of the market and lock in rates with a preapproval.
If you have any questions I can help you with, don't hesitate to call or email. I still believe the site I've pieced together should be a great starting point for newcomers and those who haven't been in the game for some time.
But I'm always available.
Best,
Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
http://www.PropertiesintheGTA.ca
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