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
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