I'm going to throw out a bunch of random facts/ideas that may be of use to you if you're looking into the real estate market this spring: pt 4 in list below is a little out of context (just saying)
1. Bully offers are back.
There's been little supply in many areas and pent up demand. An urgency by some buyers to beat the March 18th deadline and keep their preapproved low rates is causing some buyers to do whatever it takes to get a leg up before the offer date.
2. Taxes-
there are 2 forms as a buyer. The first is the landing tax or the land transfer tax. A toronto portion and a provincial portion are paid by the buyer on closing. Note, there are rebates on both at source when you're a first time buyer
The second tax is property tax. Propety tax is little understood. In Jan 2008 the city did their appraisals from which to base a tax billing for the next 4 yr cycle. The increase of the 2008 amount over the prior period is then divided in 4 payments and each yr the value of the house increases and hence the taxes paid as a percentage of the house increase as well. Until we get to the 2012 cycle.
3. Order of Payments in an Offer-
If you successfuly bid on a home and win then you have 245 hrs to supply a certified cheque. It holds the house while you preform your due diligence. This deposit money is often approx 5% of the purchase price of the house. If you're taking this money from an RSP, make sure you order the funds out 90 days in advance or they won't be ready. The deposit forms part of the ultimate downpayment you will pay in addition to any adjustments plus land transfer plus moving costs plus borrowed funds on close.
4. I'm up to 2 afternoon delight showings now. I walk in with clients and find a couple of lovers showing the utility offered in the bedroom. Always fun!
5. A home inspection is limited and needs to be treated as such. Note obvious restrictions include in winter months-inability to study the foundation where it meets the earth, limited roof access, inability to check if a/c works and always limited ability to determine just how much knob and tube wiring is active. Really it's guess work. You're taking the house in similar condition to how it read the date of the inspection.
6. When you get a new mortgage on a property and take posession, theres typically a interest adjustment date for your first payment. you are paying an interest payment pro rated for that month. this may provide some breathing room.
7. if you're a commercial buyer right now---banks are tough to squeeze money out of and cap rates aren't very aggressive. but still a good investment if you can find the right one.
8. though we're seeing some positive numbers from the US, labor and housing markets are still not looking good. Most recently Canadian inflation looked tame and with the strong loonie, it doesn't look like there's imminent pressure to raise rates. Though the Middle east conflicts are certainly raising oil and gold prices and ultimately that could lead to globabl inflation. something to watch.
9. work out the scenario with your individual lender in terms of how bridge financing would work in the event you needed funds short term as you're taking posession before your current residence closes. don't leave this for last minute.
10. ask a lot of questions! there's so much more to know, including how to valuate properties in a market that should soon see prices all over the map!
Thanks,
Michael Gruenstein MBA CSC
http://www.TheSmithBuyAHouse.com
mgruenstein@trebnet.com
Tuesday, February 22, 2011
Sunday, February 13, 2011
why must you be such a "bully"? simple..to get the house I want!
It's back folks. It's Spring. It's buying season in the GTA. Interest rates are low with a push for the next little while with the new mortgage rules.
So you're looking in a hot neighborhood for your next or first house. You're out their hitting the pavement (hopefully scouting the inventory as early as you can with a competent and effective value adding agent).
I once wrote a blog and refer to this on my website http://www.TheSmithsBuyAHouse.com---those using MLS.ca are almost sure to be out of contention. You're just not buyers. You're lacing up your skates in the 3rd period frankly.
It's happening more then some would like whereby an offer date is set and then somebody swoops in and steals the house from right under you and its off the market. In most cases, you had a fair shot at it...so don't complain to me.
Get in and see homes early. If you're interested your agent should know how to make sure your in contention from the beginning. 2 homes this week decided to change the offer date because a "bully offer" (typically a verbal offer to listing agent giving the sellers the price they'd be willing to not wait around for the dogfight to get and the closing they require). In some cases, the listing agent ammends the listing an hour before and has no interest in calling the other agents to see if their interested buyers can mobilize. That's not good form.
Most other agents will call around to find out if any other interested parties would bring an offer in advance of the posted offer date (sorta in the best interest of their sellers to collect as many as they can). Sellers get antsy and if a number is dangled infront of them that makes sense and excites them, they realize it may not be their in a few days and so they oblige to look at the offer prematurely.
Voila...the house is sold! How you doing on MLS.ca. It's day 2 of this listing and guess what...chances are it didn't hit MLS.ca but it's already sold!
Not every seller or agent subscribes to bully offers. Infact most don't. But it's worthy of knowing about and taking precautionary steps.
How you ask??? I'm giving free (and pretty good) advice too often I'm told. I need to keep some competitive advantages for my clients!
If you're looking towards the market these days; new mtg rules; multiple offers; pricing and valuations have made the landscape a little tricky to navigate.
Call or email anytime. Be happy to speak.
Cheers-
Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
mgruenstein@trebnet.com
416.271.2066
So you're looking in a hot neighborhood for your next or first house. You're out their hitting the pavement (hopefully scouting the inventory as early as you can with a competent and effective value adding agent).
I once wrote a blog and refer to this on my website http://www.TheSmithsBuyAHouse.com---those using MLS.ca are almost sure to be out of contention. You're just not buyers. You're lacing up your skates in the 3rd period frankly.
It's happening more then some would like whereby an offer date is set and then somebody swoops in and steals the house from right under you and its off the market. In most cases, you had a fair shot at it...so don't complain to me.
Get in and see homes early. If you're interested your agent should know how to make sure your in contention from the beginning. 2 homes this week decided to change the offer date because a "bully offer" (typically a verbal offer to listing agent giving the sellers the price they'd be willing to not wait around for the dogfight to get and the closing they require). In some cases, the listing agent ammends the listing an hour before and has no interest in calling the other agents to see if their interested buyers can mobilize. That's not good form.
Most other agents will call around to find out if any other interested parties would bring an offer in advance of the posted offer date (sorta in the best interest of their sellers to collect as many as they can). Sellers get antsy and if a number is dangled infront of them that makes sense and excites them, they realize it may not be their in a few days and so they oblige to look at the offer prematurely.
Voila...the house is sold! How you doing on MLS.ca. It's day 2 of this listing and guess what...chances are it didn't hit MLS.ca but it's already sold!
Not every seller or agent subscribes to bully offers. Infact most don't. But it's worthy of knowing about and taking precautionary steps.
How you ask??? I'm giving free (and pretty good) advice too often I'm told. I need to keep some competitive advantages for my clients!
If you're looking towards the market these days; new mtg rules; multiple offers; pricing and valuations have made the landscape a little tricky to navigate.
Call or email anytime. Be happy to speak.
Cheers-
Michael Gruenstein MBA CSC
http://www.TheSmithsBuyAHouse.com
mgruenstein@trebnet.com
416.271.2066
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