While many areas of the economy have contracted, the housing market has stayed remarkably strong. But can the good news last?

When COVID-related shutdowns began in March, real estate brokers and clients scrambled to respond to the shift. Record-low interest rates caused some lenders to call a halt to new underwriting, and homeowners debated whether or not to put their houses on the market. However, those first days of uncertainty ushered in a period of unprecedented growth in the Canadian residential real estate market, which currently accounts for a record-setting 9% of the country’s overall economic output.1

Now, as the spring market approaches, you may be wondering whether the good times can continue to roll on. If you’re a homeowner, should you take advantage of this opportunity by putting your home on the market? If you’re a buyer, should you jump in and risk paying too much? Below we answer some of your most pressing questions.

Why are home prices rising during an economic downturn?

At the beginning of the pandemic, fears of an economic recession were top of mind for homeowners all across the country. Overall, credit product origination declined across a variety of sectors, including car loans and credit cards, and government forbearance programs were put into place to cushion the blow of anticipated economic hardships. However, strong demand —coupled with ultra-low inventory and interest rates—caused real estate prices to continue to rise. The national average resale price soared 17% during 2020, and mortgage originations showed year-over-year growth of almost 30% on the strength of renewals and refinancing in response to record-low interest rates.1,2

According to the Bloomberg-Nanos Consumer Confidence Index, confidence in Canada’s real estate industry reached its highest level on record during the thick of the pandemic.3 Montreal Chief Economist Douglas Porter attributes much of the ongoing strength of Canada’s real estate market to a simple matter of consumer choice and priorities while noting that the downside of the resulting rise in home values is increasing consumer debt.1

Are we facing a real estate bubble?

A real estate bubble can occur when there is a rapid and unjustified increase in housing prices, often triggered by speculation from investors. Because the bubble is (in a sense) filled with “hot air,” it pops—and a swift drop in value occurs. This leads to reduced equity or, in some cases, negative equity conditions.

By contrast, the current rise in home prices is based on the predictable results of historically low interest rates and widespread low inventory. Basically, the principle of supply and demand is working just as it’s supposed to do.

EFFECTS OF LOW INTEREST RATES

The Bank of Canada projects continuing low interest rates until sometime in 2023, aiding in economic recovery and increasing affordability.4 This helps offset the effects of high home costs even in markets where real estate might otherwise be considered overpriced. These low interest rates should keep the market lively and moving forward for the foreseeable future.

EFFECTS OF LOW INVENTORY

Continuing low inventory is the primary reason for higher-than-average home prices in many markets.5 This should gradually ease as an aggressive vaccination rollout and continuing buyer demand drive more homeowners to move forward with long-delayed sales plans and as new home construction ramps up to meet demand.6

Aren’t some markets and sectors looking particularly weak?

One of the big stories of 2020 was a mass exodus from attached home communities and high-priced urban markets as both young professionals and families fled to the larger square footage and wide-open spaces of suburban and rural markets. This trend was reinforced by work from home policies that became permanent at some of the country’s biggest companies.

Not surprisingly then, one of the hardest-hit sectors of the residential real estate market has been the rental market, especially in population-dense metropolitan areas. The rise in vacancies has been fueled by several factors, including less international migration, fewer student renters, and less tourist demand for short-term rentals.7

Interestingly, landlords have not responded to these vacancies with lower rental rates, which have actually risen nationally. Instead, most have used incentives like lower deposit fees, free utilities, and move-in bonuses to attract renters. This suggests that most property owners expect demand to return to normal quite quickly as the vaccine rollout begins to take effect.7

Some analysts predict a decline in the Canadian housing market at large due to the impending end of government emergency measures and lender deferrals. However, others point to the increased demand for homes in smaller markets and lower-density areas outside of the country’s urban centres as an optimistic indicator, especially since these distant suburban and rural enclaves don’t normally benefit from increases in home values or an influx of new investment.8 As many of these new residents set up housekeeping in their rural retreats, they’ll revitalize the economies of their adopted communities for years to come.

According to Susan Hosterman, a senior director at Fitch Ratings, another strength that may help to alleviate the effect of financial pressures brought about by the ending of emergency measures is the relationship lenders in Canada have with their borrowers. Canadian lenders tend to be proactive in offering modifications to make loans more affordable for struggling homeowners.8

How has COVID affected the “seasonal” real estate market?

Frequently, the real estate market is seen as a seasonal phenomenon. However, the widespread shutdowns in March 2020, coming right at the beginning of the market’s growth cycle in many areas, has led to a protracted, seemingly endless “hot spring market.”

The Canadian Real Estate Association (CREA) revised its 2021 Market Forecast based on more robust than usual figures for the second half of 2020. The new projection anticipates improvements even over 2020’s record-setting market figures, with potential sales limited only by the availability of inventory in most markets.9 Thus, we could be looking at another longer-than-usual, white-hot real estate market.

What’s next for the Canadian real estate market?

Projections vary widely, with some economists predicting a market correction and others predicting continuing strong growth. Overall, low inventory and lack of affordability appear to be the more negative factors applying downward pressures on the market, while pent-up demand and a return to normal employment and income levels, along with anticipated higher-than-average growth in the economy, point to ongoing good news in the sector.10

According to most indicators, the real estate news looks overwhelmingly positive throughout the rest of 2021—and possibly beyond. Pent-up demand and consumer-driven policies, along with a continued low-interest-rate environment and rising inventory, should help homeowners hold on to their increased equity without throwing the market out of balance. In addition, the increase in long-term work-from-home policies promises to give a boost to a wide variety of markets, both now and in the years to come.

STILL HAVE QUESTIONS? WE HAVE ANSWERS 

While economic indicators and trends are national, real estate is local. We’re here to answer your questions and help you understand what’s happening in your neighbourhood. Reach out to learn how these larger movements affect our local market and your home’s value.

Sources:

1. Huffington Post –
   https://www.huffingtonpost.ca/entry/house-prices-canada-bmo_ca_600c7a98c5b6d64153ac675b
2. Global Newswire –
   https://www.globenewswire.com/news-release/2020/08/18/2079742/0/en/COVID-19-Pandemic-Drives-a-Decline-in-the-Use-of-Credit-as-Canadian-Consumers-and-Lenders-Brace-for-Uncertainty.html
3. Weekly Bloomberg Nanos Canadian Confidence Index –
   https://www.nanos.co/wp-content/uploads/2021/01/2021-01-08-Bloomberg-Weekly-Report-with-Tabs.pdf
4. Bank of Canada –
   https://www.bankofcanada.ca/2021/01/fad-press-release-2021-01-20/
5. Toronto Star –
   https://www.thestar.com/business/real_estate/2021/01/27/supply-of-new-homes-in-the-gta-dwindling-amidst-sales-boom.html
6. Bank of Canada Monetary Policy Report –
   https://www.bankofcanada.ca/wp-content/uploads/2021/01/mpr-2021-01-20.pdf
7. CTV News –
   https://www.ctvnews.ca/business/cmhc-rental-vacancies-prices-edged-up-as-covid-19-spread-across-canada-1.5286012
8. Huffington Post –
   https://www.huffingtonpost.ca/entry/housing-forecast-canada-2021_ca_5fec942cc5b64e4421082979
9. Canadian Real Estate Association –
   https://www.crea.ca/news/crea-updates-resale-housing-market-forecast-7/
10. Canadian Mortgage Trends –
    https://www.canadianmortgagetrends.com/2021/01/canadas-energizer-bunny-housing-market-2021-forecasts/

We’ve all spent a lot more time at home over the past year. And for many of us, our homes have become our office, our classroom, our gym—and most importantly, our safe haven during times of uncertainty. So it’s no surprise to see that design trends for 2021 revolve around soothing colour palettes, cozy character, and quiet retreats.

Even if you don’t have immediate plans to buy or sell your home, we advise our clients to be mindful of modern design preferences when planning a remodel or even redecorating. Over-personalized or unpopular renovations could lower your property’s value. And selecting out-of-style fixtures and finishes could cause your home to feel dated quickly.

To help inspire your design projects this year, we’ve rounded up five of the hottest trends. Keep in mind, not all of these will work well in every house. If you plan to buy, list, or renovate your property, give us a call. We can help you realize your vision and maximize the impact of your investment.

1. Uplifting Colours

Colours are gravitating toward warm and happy shades that convey a sense of coziness, comfort, and wellbeing. This year’s palettes draw from earthy hues, warm neutrals, and soothing blues and greens.1

While white and gray are still safe options, expect to see alternative neutrals become increasingly popular choices for walls, cabinets, and furnishings in 2021. For a fresh and sophisticated look, try one of these 2021 paint colours of the year:

Aegean Teal (coastal blue) by Benjamin Moore

Urbane Bronze (brownish-gray) by Sherwin-Williams

Soft Candlelight (muted yellow) by Valspar

On the opposite end of the spectrum, indigo, ruby, sapphire and plum are showing up on everything from fireplace mantels and floating shelves to fabrics and home accessories. These classic, rich hues can help bring warmth, depth, and a touch of luxury to your living space.

To incorporate these colours, designers recommend using the “60-30-10 Rule.” Basically, choose a dominant colour to cover 60% of your room. For example, your walls, rugs, and sofa might all be varying shades of beige or gray. Then layer in a secondary colour for 30% of the room. This might include draperies and accent furniture. Finally, select an accent colour for 10% of your room, which can be showcased through artwork and accessories.2

2. Curated Collections

After a decade of minimalism, there’s been a shift towards highly-decorative and personalized interiors that incorporate more colour, texture, and character. Clearly-defined styles (e.g., mid-century modern, industrial, modern farmhouse) are being replaced by a curated look, with furnishings, fixtures, and accessories that appear to have been collected over time.3

This trend has extended to the kitchen, where atmosphere has become as important as functionality. The ubiquitous all-white kitchen is fading in popularity as homeowners opt for unique touches that help individualize their space. If you’re planning a kitchen remodel, consider mixing in other neutrals—like gray, black, and light wood—for a more custom, pieced-together look. And instead of a subway tile backsplash, check out zellige tile (i.e., handmade, square Moroccan tiles) for a modern alternative with old-world flair.4

4. Staycation-Worthy Retreats

With travel options limited right now, more homeowners are turning their vacation budgets into staycation budgets.8 Essentially, recreate the resort experience at home—and enjoy it 365 days a year!

Bedrooms should provide a soothing sanctuary for rest and relaxation. But this year, minimalist decor and muted colours are giving way to bolder statement pieces.3 To create a “boutique hotel” look in your own bedroom, start with a large, upholstered headboard in a rich colour or pattern. Layer on organic linen bedding and a chunky wool throw, then complete the look with a pair of matching bedside wall lights.9

Carry those vacation-vibes into your bathroom with some of the top luxury upgrades for 2021. Try a large, zero-entry shower for two, a floating vanity with hand-free faucets, or a radiant-heated floor for the ultimate spa-like experience.10

5. Outdoor Upgrades

From exercise to gardening to safer options for entertaining, the pandemic has led homeowners to utilize their outdoor spaces more than ever. In fact, backyard swimming pool sales skyrocketed in 2020, with many installers reporting unprecedented demand.11 But a new pool isn’t the only way homeowners can elevate their outdoor area this year.

 Composite decks have become a favourite upgrade for their low-maintenance and durability. And in 2021, creative design elements are on the rise, including unique inlays, wider planks, and multiple deck board colours. Add stair or bistro lights for a touch of ambiance while enhancing safety and visibility.8

DESIGNED TO SELL

Are you contemplating a remodel? Want to find out how upgrades could impact the value of your home? Buyer preferences vary greatly by neighbourhood and price range. We can share our insights and offer tips on how to maximize the return on your investment. And if you’re in the market to sell, we can run a Comparative Market Analysis on your home to find out how it compares to others in the area. Contact us to schedule a free consultation!

Sources:

1. HGTV Canada – https://www.hgtv.ca/decorating/photos/home-design-trends-for-2021-1942419/#
2. The Spruce – https://www.thespruce.com/timeless-color-rule-797859

3. The Kit – https://thekit.ca/life/home/home-decor-trends-2021-inspiration/
4. Houzz – https://www.houzz.com/magazine/36-home-design-trends-ready-for-takeoff-in-2021-stsetivw-vs~142229851

5. Zillow – https://www.prnewswire.com/news-releases/the-end-of-open-floor-plans-how-homes-will-look-different-after-coronavirus-301080662.html
6. HGTV Canada – https://www.hgtv.ca/shows/family-home-overhaul/photos/the-top-design-trends-for-2021-according-to-hgtv-canada-design-experts-1943092/#currentSlide=5
7. Pinterest – https://business.pinterest.com/content/pinterest-predicts/more-door/
8. Canadian Contractor – https://www.canadiancontractor.ca/buildwire/decking-trends-for-2021/
9. Homes & Gardens – https://www.homesandgardens.com/spaces/decorating/bedroom-trends-224944
10. Canadian Interiors – https://www.canadianinteriors.com/2020/11/26/top-trends-to-impact-kitchen-and-bathroom-design-over-the-next-three-years-nkba/
11. CTV News – https://toronto.ctvnews.ca/backyard-pool-sales-surge-during-the-covid-19-pandemic-1.4957596

The start of a new year always compels people to take a fresh look at their goals, from health and career to relationships and finance. But with historically low mortgage rates, increased home sales and price growth, and a tight housing inventory, the time is right to also make some homeownership resolutions for 2021.

Home buyers, is this the year you work to improve your credit score, pay down some debt, or save for a down payment?

Home sellers, we’ve laid out plans for you to get top dollar for your property, including timing your home sale, making your property stand out from the crowd, and investing in your extra living space.

And even if you’re staying put for awhile, homeowners, you can resolve to improve your status quo by evaluating your home budget, finalizing your home maintenance schedule, or maybe investing in a second property.

So no matter your homeownership status, we’ve got some ideas and advice for you to make this year your best one yet. Read on to learn more.

HOME BUYERS

Resolution #1: Qualify for a better mortgage with a higher credit score.

Your credit report highlights your current debt, bill-paying history, and other key financial information. Importantly for your home-buying journey, it is also used by lenders and companies to calculate your credit score, which partly determines if you are qualified to obtain a mortgage. Therefore, before you start house-hunting, make sure your finances are in the best possible shape by checking your credit report and credit score, available directly from Equifax and TransUnion.1

Your credit score will be a number ranging from 300-900. Generally speaking, a credit score of 725 or higher is considered very good to excellent.2 If your score drops below 725, you might need to work at boosting your score for a few months before you begin house-hunting. Ways to do this are to pay your bills on time every month, keep your credit card balances low, and avoid applying for new credit.3

Resolution #2: Improve your credit health by paying down debt.

Do you have student loans, credit card debt, or car payments tying up your income each month? That debt is hurting your “buying power,” or the amount of home you can afford. Not only is it money that you can’t spend on your new home, but your debt-to-income ratio also affects your credit score, which we discussed above. The less debt you have, the higher your score and the better mortgage you can obtain.

If you can, pay off some debt in its entirety—like a low balance on a credit card. Then apply that “extra” money you previously paid on that credit card to pay off bigger debt, like a car loan. Even if you can’t pay off all (or any) of your debt in full, reducing the balances of each account will help you qualify for the best possible mortgage terms.

Resolution #3: Create a financial safety net before applying for a mortgage.

Don’t forget that buying a home requires some cash as well. The down payment depends on the home’s price, but the minimum is 5% for a purchase price of under $500,000, and closing costs range from 2-3%.4,5 You’ll also need money for moving expenses and any initial maintenance tasks that might pop up. And as the pandemic taught us, you never know when an unforeseen event might cause a job loss, drop in income, or health scare, so having some liquid savings will ensure that you can still pay your mortgage if a crisis occurs.

Dedicate some effort to building up your reserves. Cut down on unnecessary expenses, and consider having a portion of each paycheck automatically deposited into your savings account to avoid the temptation to spend it.

HOME SELLERS

Resolution #4: Decide on the right time to sell your home.

In a typical year, spring is when home sales spike in Canada. This might be the best time to take advantage of the price increase predicted by the Canadian Real Estate Association, which says, “The national average price is forecast to rise by 9.1% in 2021 to $620,400.”6

But sales price isn’t the only thing to consider. You might not be ready to sell your home yet because you don’t want to uproot your kids during the school year or because you need to tackle some minor upgrades before placing your home on the market.

This means that there is no one month or season that is the perfect time to sell your home. Instead, the right timeline for you takes into account factors such as when you’ll earn the highest profit, personal convenience, and whether your home is even ready to put on the market. A trusted real estate professional can talk you through your specific needs to clarify when to sell your home.

Resolution #5: Boost your home’s resale value by making your property shine.

Housing inventory is at historic lows across the country, and that means the market is fiercely competitive.7 Selling your home in 2021 has the potential to net you a huge return right now, and you can maximize that amount with some simple fixes to make sure your property outshines your neighbours’ for sale down the street.

In your home, you might need to tackle a minor remodelling project, such as upgrading the flooring or adding a fresh coat of paint. According to one remodelling impact report, simply refinishing existing hardwood floors recoups 100% of the cost at resale, and completely replacing it with new wood flooring recovers 106% of costs.8

Outside, you might consider improving your curb appeal by removing a dead bush, trimming a tree that blocks the front window, or power-washing your moldy driveway and sidewalks. In fact, real estate agents say cleaning the exterior of your house can add $10,000 to $15,000 to a home’s sale price.9 And improving a home’s landscaping may increase its value by 15 to 25%.10

A good agent should provide custom-tailored suggestions to ensure your property pops inside and out. Ask us about our local insider secrets that will make your home stand out from others on the market.

Resolution #6: Invest in your “extra” living space to meet current buyers’ needs.

Due to COVID-19, more people are staying at home to work, go to school, exercise, and stay entertained. And these lifestyle changes are showing up in home buyer preferences. For example, according to one study, buyers are looking more and more for homes with formal, outfitted home offices, private outdoor spaces, and updated kitchen appliances.11

So if you’ve got an under-utilized room, consider turning it into an office, home gym, schoolroom, or multi-purpose room to meet current home buyer needs and attract better offers on your home. Got some underwhelming space outside? You could turn it into an outdoor entertainment area by adding a fire-pit, upgrading the patio furniture, or installing a grilling area. Be sure to consult with a local real estate professional before investing in a renovation, however, as each market’s buyers have different tastes.

HOMEOWNERS

Resolution #7: Evaluate your household budget to reflect financial changes.

After this past year, in particular, your financial picture may have changed. Maybe you were furloughed, had your hours reduced, or got a new job further from home. Perhaps you’ve kept the same job, but you’re now working remotely. A work-from-home arrangement could mean less money spent on gas, tolls, a professional wardrobe, and dining out for lunch.

But this could also mean new (or increased) expenses now that you’re working at home, such as new tech-related purchases, faster Wi-Fi, and higher energy bills. January marks the perfect opportunity to update your income and expenses and review last year’s spending habits, tweaking as needed for 2021.

For more specific ideas, contact us for our free report “20 Ways to Save Money and Stretch Your Household Budget.”

Resolution #8: Save money now (and earn more later) with a home maintenance plan.

Having a schedule of regular home maintenance projects to tackle will save you money now and in the long-term. You’ll avoid some surprise “emergency fixes,” and when you’re ready to eventually sell your home, you’ll get higher offers from buyers who aren’t put off by overdue repairs.

Even if nothing necessarily needs fixing right now, you can lower your energy costs by maintaining and upgrading your home. For example, consider upgrading some features to ENERGY STAR high-efficiency products. You could save 10% in energy costs if you switch out your gas broiler, and up to 45% if you change your windows!12,13

For a breakdown of home maintenance projects to tackle throughout the year, contact us for our free report “House Care Calendar: A Seasonal Guide to Maintaining Your Home.”

Resolution #9: Invest in real estate for a better standard of living.

Even if you don’t plan on leaving your current residence, real estate is a great way to improve your quality of life in 2021.

Have cabin fever from the long quarantine? A vacation home in a getaway location you love lets you safely spread your wings. And if you have been looking for a second stream of income, an investment property might be your answer. Just be sure to consult with a real estate professional to get a realistic sense of a property’s true income potential.

Want more information on how a second property fits into your 2021 plans? Request our free report, “Move Up vs Second Home: Which One Is Right For You?” 

LET US HELP YOU WITH YOUR 2021 GOALS

Without a plan and a support system, 73% of Canadians will break their new year’s resolutions.14 Whether you’re looking to buy, sell, or stay put in your home, it helps to connect with a trusted real estate agent to keep you motivated and on track.

As local market experts, we have the knowledge, experience, and networks to help you achieve your homeownership goals, whatever they may be. Reach out to us today for a free consultation and commit to a happy and prosperous new year.

Sources:

1. Government of Canada –
   https://www.canada.ca/en/financial-consumer-agency/services/credit-reports-score/order-credit-report.html
2. Equifax –
   https://www.consumer.equifax.ca/personal/education/credit-score/what-is-a-good-credit-score/
3. Government of Canada –
   https://www.canada.ca/en/financial-consumer-agency/services/credit-reports-score/improve-credit-score.html
4. RateShop –
   https://www.rateshop.ca/page-minimum-down-payment-in-canada
5. Bank of Montreal –
   https://www.bmo.com/main/personal/mortgages/closing-costs/
6. Canadian Real Estate Association –
   https://www.crea.ca/housing-market-stats/quarterly-forecasts/
7. Canadian Mortgage Trends –
   https://www.canadianmortgagetrends.com/2020/12/tight-market-conditions-keep-home-sales-and-prices-at-historical-highs/
8. National Association of Realtors –
   https://www.nar.realtor/sites/default/files/documents/2019-remodeling-impact-10-03-2019.pdf
9. House Logic –
   https://www.houselogic.com/save-money-add-value/add-value-to-your-home/adding-curb-appeal-value-to-home/
10. Ottawa Citizen –
    https://ottawacitizen.com/life/homes/landscape-tips-to-increase-your-homes-value
11. HomeLight –
    https://www.homelight.com/blog/top-agent-insights-for-q2-2020/
12. Government of Canada –
    https://www.nrcan.gc.ca/energy-efficiency/spotlight-energy-efficiency/2020/10/21/23081
13. Government of Canada –
    https://www.nrcan.gc.ca/energy-efficiency/spotlight-energy-efficiency/2020/11/26/winter-coming-top-tips-heat-your-home-less/23141
14. Ipsos –
    https://www.ipsos.com/en-ca/three-ten-31-canadians-will-set-new-years-resolution-yet-three-quarters-73-eventually-break-them

No matter if you’re in a buyer’s or seller’s market, there are a few critical steps you can take to make a smarter purchase. Since buying a home is likely the biggest single investment you will ever make, being prepared will help you make a better purchase. Here are the best tips to buying a home.

Know your buying power

What is your buying power? It’s the combination of your credit-worthiness and how much you can realistically pay for a home.

First, you need to understand the hidden costs of buying a home. You will need to save not only for the down payment of your home — which is typically around 20% of the offer price — but also for any additional transaction fees, such as land transfer tax, mortgage insurance (if needed), title insurance, and legal fees.

Then you need to know what you can realistically afford each month to understand how much house you can buy. Your mortgage rate will depend on your creditworthiness — if you have a high credit score, your lender will likely approve you for a lower mortgage rate, which can save you thousands of dollars per year in interest.

How much of your budget should go to your monthly home costs? According to SmartAssets, you can use the 36% rule as a rough guideline. This means that your monthly obligation shouldn’t be more than 36% of your monthly gross income.

A loan professional can help you figure out how much house you can afford.

Fix your credit with the help of a loan professional

According to CreditKarma, a good credit score is usually 720 or above. You want to clean up your credit as soon as you can, and definitely before you go to a lender for a loan preapproval.

When you apply for your mortgage pre-approval, you don’t want to have anything to hide on your application. So don’t lower your credit score by doing anything that will originate more inquiries into your credit. For example, don’t open any new credit cards. Also, don’t omit any debts or loans when you apply. If the loan officer discovers them in the application process, they may deny you a pre-approval.

Get a mortgage professional to check your credit score for you. A professional can give you a clearer idea if your score is in the ‘good’ range, or if you need to do some credit cleanup before getting a mortgage preapproval.

Work with a knowledgeable buyer’s agent

Do you understand what kind of market you are buying into? Even within a city’s limits, there can be micro markets that are increasing or decreasing in value.

That’s why it’s important to hire a highly competent real estate agent who knows the specific market. You want to make sure that the professional who you’re working with really understands what the market is like and will help you find the home that you want.

How can you tell if your agent knows the market? See if they can provide you with a buyer’s market analysis.

A buyer’s market analysis report outlines which neighborhoods are still up and coming — with potential for increased property value — versus those that have peaked with inflated home prices. Having this analysis at your fingertips will help you know if a home’s list price is above comparable properties so you don’t overpay for a home.

Don’t try to time the market…

Even in a hot market, there’s never a perfect time to buy a home. It can take a while to know exactly what you like, and you may have to look at 10 or more homes before you can recognize what suits your lifestyle best. While you’re shopping, take photos of your favourite properties and the details that you liked the best so that you can remember what you liked.

Another good reason to slow down the buying process: you might find a better deal if you do. Investigate expired listings. Expired listings may have gone off the market because they didn’t get any offers at the listed price, so you may be able to underbid the original listing price. It’s not likely worth your time to look at FSBO (for sale by owner) listings, though. Since they are not represented by a professional, they are often overpriced.

When you start shopping, have a one-hour initial consultation with your realtor. Give them every single detail that you know about your lifestyle, buying power, needs, wants and desires for your home. The more detail you can provide, the easier it will be for them to help you find your future home. Your agent may also know of exclusive, or “pocket”, listings not available to the general public.

… But make the offer as soon as you find the right home

If you love it, make the offer. Otherwise, that dream home may disappear faster than you think, especially if you’re buying in a hot market, as is the case in Toronto currently.

Your buying agent should contact the listing agent before you submit an offer so that they can decide what’s important to include in the offer. If you’re serious about it, you want to increase the chances that your offer is accepted.

Show that you’re serious about the purchase by creating a buyer’s offer package. It should include your lender’s pre-approval letter, proof of your down payment money in your bank account, and comps that support the rationalization of the offer you are presenting.

Get a home inspection

Once you’re ready to offer, it’s essential that you get a home inspector to conduct a thorough home inspection.  In Toronto’s current real estate market, the home inspection is oftentimes conducted by a reputable inspection company before the property even hits the market — and is paid for by the Sellers — this is what’s called a pre-list inspection.

The inspector always looks for major structural issues, including problems with the foundation, plumbing, and electrical systems. Keep in mind, you always have the option as a buyer to have your own home inspection done.

Protect your credit before you close

Don’t raise any red flags with your creditworthiness in the weeks before closing. Any one of these moves could mean that you’re denied the mortgage and the deal falls through — even if you’ve already been pre-approved!

• Keep your spending to a minimum and don’t make any major purchases before closing — that includes buying furniture, or a car, truck, or van, or any excessive charges on your credit card.
• Keep your bank accounts stable. Don’t change banks, spend any of the money you have set aside for closing, or make any large deposits to your accounts without checking with your lender first.
• Keep your employment situation stable — now is not the time to change jobs, quit your job, or become self-employed. Any sudden change in your income can have that pre-approval offer rescinded.
• Do not co-sign a mortgage for anyone. It will open an inquiry into your credit and add to your debt, which could raise your mortgage rate and cost you thousands of dollars over the life of the mortgage.

Looking for a home in our area? Let me help you find the home of your dreams. I’m well versed in our local real estate market, and I can provide you with a buyer’s market analysis, called the Market Edge Package™ — a system I’ve developed that will help me to assess your current situation and clarify your overall objectives/goals in order to find the right neighbourhood for you. Contact me today.

Top Homeowner Tax Deductions That Decrease Your Tax Burden

Sadly, you can’t avoid paying taxes, and we all need to pay our fair share. However, paying your fair share shouldn’t place an unjust burden on you. As a homeowner, your tax burden is doubled because you pay both income and property taxes. To decrease that burden and boost your tax savings, take advantage of these homeowner tax deductions…and use your tax savings to go on a vacation, increase your child’s college/university fund, build on your retirement fund, or complete another home improvement project.

First-time Home Buyers Tax Credit

First-time home buyers may be eligible for a 15 per-cent income tax credit for closing costs.  This 15 percent credit is based on a maximum of $5,000 of home purchase costs (e.g. legal fees, land transfer taxes, etc.), meaning a maximum tax relief of $750.

Typically, an individual is considered a first-time home buyer if neither the individual nor the individual’s spouse or common-law partner owned and lived in another home in the calendar year of the home purchase or in any of the four preceding calendar years.

RRSP Homebuyer’s Plan

If you buy the qualifying home together with your spouse or other individuals, each of you can withdraw up to $25,000.  This means that up to $25,000 per person could be withdrawn tax-free from RRSPs to buy or build a principal residence. Couples — including common-law — will be able to withdraw up to $50,000.

Home buyers withdrawing funds do not have to pay income tax on the amount withdrawn, as long as the funds are repaid into an RRSP in the future.

The 15-year repayment period will begin in the second calendar year following the calendar year in which the withdrawal is made. In addition, a qualifying home must generally be acquired before October 1 of the calendar year following the year of withdrawal. For example, those making withdrawals under the plan in 2009 will have until October 1, 2010 to acquire a qualifying home and their first annual repayment will be due by the end of 2011 or the first two months of 2012.

The one key thing to note is this: you have to meet the first-time buyer’s condition. You are not considered a first-time home buyer if you or your spouse owned a home that you occupied as your principal place of residence in the past 5 years. To determine past 5 years, the 4 years preceding the year you make your withdrawal plus the period in the year you make your withdrawal ending 31 days before your withdrawal is the rule adopted.

HST New Housing Rebate

You may be eligible to claim a rebate for a part of the HST you pay on the purchase price of a newly constructed home or the cost of building your home if:

1. you buy a new or substantially renovated home (including the land or if you lease the land) from a builder;
2. you buy a new mobile home (including a modular home) or a floating home from a builder or vendor;
3. you buy a share of capital stock of a co-operative housing corporation;
4. you construct or substantially renovate your own home, or carry out a major addition (or hire another person to do so); or
5. your home is destroyed in a fire and is subsequently rebuilt.

Land Transfer Tax Rebates

First-time buyers of new and re-sale homes are eligible to receive rebates of the provincial and Toronto land transfer taxes. The maximum provincial land transfer tax (LTT) rebate for first-time buyers is $2,000 and the maximum Toronto LTT rebate for first-time buyers is $3,725.

Rental Income

If you rent a property you own or that you have use of, when you report this rental income, you can claim allowable expenses such as advertising, insurance and interest on money you borrow to buy or improve the property.

Taxpayers Who Work From Home

If you work from home, there are a number of expenses that you can deduct if you are either self-employed, a commissioned employee or a professional.  Examples of the type of expenses that you can claim include heating, home insurance, electricity and cleaning materials.

Appealing Your Assessment to Lower Your Property Taxes

City of Toronto 2016 interim property tax bills were mailed to property owners between January 7th and January 31st, 2016. The 2016 interim property tax bill was the first of two bills issued for 2016. The 2016 final property tax bill will be mailed in May, 2016.

Although property taxes in Toronto are here to stay, you should make sure that you are paying a reasonable amount based on the true value of your home and land. Many homes get overvalued because assessors misjudge in valuing a home and homeowners don’t pay attention to these mistakes. Consequently, homeowners unwittingly pay more than they should in property taxes.

There are 3 steps to take if you don’t agree with your property’s assessment:

1. Visit aboutmyproperty.ca to check all the information that the Municipal Property Assessment Corporation (MPAC) has on file for your property and also get a detailed Property Profile Report.  This is a great opportunity to check if any information is out of date or incorrect (if so, you can send updates to MPAC directly through the website). You can also obtain detailed information on up to six properties MPAC believes to be comparable to yours, free of charge, by submitting a request.
2. Request a copy of the home appraisal from your lender. Your appraisal will include everything you need: comparable properties, photos and the estimated value.
3. Reach out to your real estate agent/broker and request a report of similar properties that have recently sold in your neighbourhood. Typically, we can find three to five approximate values of comparable properties similar to yours, and these comps can then be used to support your claim that your home is overvalued. This is especially useful if the assessor used poor historical sales data.

The good news is that if you feel your assessed value as of the valuation date or property classification is not correct, MPAC will review it free of charge – this is called a Request for Reconsideration. For the 2016 tax year, your deadline to file a RfR with MPAC is March 31, 2016 . You can potentially lower your property tax burden by filing an appeal, which essentially shows that your home has been overvalued, meaning that your tax assessment claims your property is worth more than it is.

Once you are ready to file your appeal, you will need to make sure to include as many reasons as possible as to why you believe your assessment should be lower. It is always a good idea to include a copy of your property’s appraisal and photos of your neighbourhood.

Even if the number on the tax assessment seems close, you should still consider appealing your property tax. The typical savings from a successful tax appeal can be over 15%!

In January 2016, the average sale price in the GTA was $631,092. So, if you’re able to reduce your assessed value by 15 percent to $536,428 and consequently save 15 percent on your tax bill, your new tax bill will be about $3,785.06 (down from $4,453.01). That’s a savings of $667.95!

Need help getting information to protest your property taxes? 

Contact me directly and we’ll schedule time to produce some comparable property values to use for your documentation, ultimately leading you in the right direction towards saving you money on your taxes.

Lawrence Park is one of central Toronto’s most affluent, exclusive, picturesque residential neighbourhoods. Toronto Life does an excellent job of summing it up: “It’s the perfect neighbourhood for people (increasingly young families, according to the latest census) who like the quietude and big-lawned openness of suburban life, with all the amenities and excitement of the big city within a five-minute drive”.

Located within the City of Toronto’s neighbourhoods known as Lawrence Park South, this north Toronto community is bordered by Yonge Street to the west and Bayview Avenue to the east, and from Blythwood Ravine Park, Sherwood Park & Sunnydene Park to the south and Lawrence Avenue to the north.  Lawrence Park is known for its quiet, tree-lined streets. It emerged in the early part of the 1900’s, but did not fully develop until after the Second World War.

Centred on Mount Pleasant Road, the neighbourhood grew slowly with medium-sized houses on narrow but deep lots. Homes that are typically found in Lawrence Park include Tudor, Edwardian, and Georgian designs.  Newly constructed homes tend to range from those staying true to existing older homes surrounding them to the ultra modern.

Since Spring 2013, the list prices of detached homes in Lawrence Park ranged from a low of $899,800 to a high of $7,295,000 with an average list price of $2,713,580.  Sold prices ranged from a low of $845,000 to a high of $5,500,000 with an average sold price of $2,478,496.  Average time on market was 35 days.

One of the various attractions of Lawrence Park is the caliber of both public and private schools that surround it.

PUBLIC SCHOOLS

• Bedford Park – Ranking
• Blythwood Jr PS – Ranking
• Glenview Sr PS
• Lawrence Park CI – Ranking
• Northern SS – Ranking
• York Mills CI

PRIVATE SCHOOLS

• Toronto French School
• Havergal College
• St. Clement’s School
• Crescent School
• Crestwood School
• Crestwood College

Parks in the area abound.  Alex Muir Memorial Park is located at the south-east corner of Yonge & Lawrence along the Northern Ravines and Gardens Discovery Walk Route. The Memorial Gardens are a beautiful spot to spend a quite summer afternoon and are also the western gateway to a long trail that eventually leads to Sunnybrook Park. Walking trails open all year.  Other parks in the vicinity include Blythwood Ravine Park, Sherwood Park, and Cheltenham Park.

Residents of Lawrence Park are minutes to some of Canada’s most prestigious institutions, including the Granite Club, the Rosedale Golf Club, and the Cricket Club.

One of the many draws to the area is the extremely strong and vibrant Lawrence Park Athletic Association, which is a neighbourhood recreational organization designed for children and teens from the ages of 4 – 16 who want to belong to a sports team in their community.  The LPAA promotes fun, camaraderie, teamwork and skills development through its baseball, hockey, soccer and swimming programs.  The LPAA also organizes the much anticipated Family Fun Day held annually in Cheltenham Park.

The George Locke Public Library – located at the south-east corner of Yonge and Lawrence – offers the community a rich array of programs, classes, and exhibits. From story time for toddlers, to crafts, hobbies, book clubs, and computer training for adults, this library is one of the city’s best.

Restaurants, pubs, cafes and retail shops abound – there is a strong sense of community in this area also known as Yonge Lawrence Village.  For a comprehensive listing of all the amenities the area has to offer, please visit the Yonge Lawrence Village BIA. Neighbourhoods that surround Lawrence Park include Lytton Park to the west, Bridle Path to the east, Bedford Park to the north and Sherwood Park to the south.

Living and working in your area has its benefits
If you’d like to be informed of recent sales in Lawrence Park and to be kept in the know, feel free to contact me by filling out the form below.

If you are thinking of selling
Call me to arrange a complimentary SELLER’S PACKAGE that includes tips & tricks on how to get your home sale-ready and a current home evaluation.

The Market Edge Package™ helps you build equity from the sale or purchase of your property, whether it be a house, condo, or loft, while investing in your future. Created by Chestnut Park’s Marian Keriakos, a Toronto real estate broker with an education finance and marketing, The Market Edge Package™ is for individuals who are looking for real professional business and market expertise in making one of life’s biggest purchases and investments.

“I work primarily with successful business professionals who want a lot more from their Toronto real estate agent” says Keriakos. “My clients are time-stretched and have a hectic lifestyle. They are looking for exceptional market and investment knowledge, along with that element of professionalism and being catered to that comes from paying attention to every detail. They may be concerned about securing accurate and trustworthy information. They haven’t quite determined what strategy to take, and they want to be really well taken care of during every step of the process. They also want to avoid making a bad investment decision.”

“That’s why we created The Market Edge Package™, a step‐by‐step process for listing or purchasing your Toronto property,” says Keriakos. “We provide you with a checklist of all of the services that you can expect to receive, as well as a lot of extras – complimentary value that we have added in order to make your experience enjoyable and stress‐free.”

“Working through our process, you will understand all the steps that you need to take. You will be getting accurate and responsive information. You will feel confident about the Toronto real estate market. You will receive the most professional market and investment advice. You will have a strategy that makes good business sense. You will be able to follow the steps in a logical and simple manner. In fact, we look forward to pampering you as we help you make that next big investment in your future.”

If you are thinking of listing or purchasing
Contact me today. I approach things differently with my clients – we can sit down and go through my complimentary Market Edge Package™ that will help assess your current situation and clarify your overall objectives/goals.

Bedford Park is one of central Toronto’s most vibrant, self-contained residential neighbourhoods. Toronto Life does an excellent job of summing it up: “With Avenue and Yonge providing commercial activity, a library, a subway stop and a community centre [Bedford Park] is the sort of neighbourhood you only have to leave to go to work, see a movie, or visit friends who live in other parts of the city”.

Located within the City of Toronto’s neighbourhoods known as Lawrence Park North, this north Toronto community is bordered by Avenue Road to the west and Yonge Street to the east, and from Lawrence Avenue to the south and Brooke Avenue to the north.  It also extends further east of Yonge: from Lawrence Avenue to the south and Snowdon Avenue to the north, and from Yonge to the west and Ronan Avenue to the east.  Bedford Park is known for its quiet, tree-lined streets. It emerged in the early part of the 1900’s, but did not fully develop until after the Second World War.

Centred on Yonge Street, the neighbourhood grew slowly with medium-sized houses on narrow but deep lots. Homes that are typically found in Bedford Park include Tudor, Edwardian, and Georgian designs.  Newly constructed homes tend to range from those staying true to existing older homes surrounding them to the ultra modern.

Since Spring 2013, the list prices of detached homes in Bedford Park ranged from a low of $599,900 to a high of $2,525,000 with an average list price of $1,222,112.  Sold prices ranged from a low of $584,000 to a high of $2,025,000 with an average sold price of $1,183,066.  Average time on market was 17 days.

One of the various attractions of Bedford Park is the caliber of both public and private schools that surround it.

PUBLIC SCHOOLS

• Bedford Park – Ranking
• John Wanless – Ranking
• Lawrence Park CI – Ranking
• Northern SS – Ranking

PRIVATE SCHOOLS

• Toronto French School
• Havergal College
• Crescent School
• Crestwood School
• Crestwood College

Parks in the area abound.  Wanless Park – the largest park in the area – is located at the end of Wanless Ave just east of Mount Pleasant.  It includes a wading pool and children’s playground, in addition to a baseball diamond, a basketball court, and five tennis courts.  Woburn Park – west of Yonge at the corner of Jedburgh and Woburn Ave – also has a wading pool and children’s playground.

One of the many draws to the area is the extremely strong and vibrant Fairlawn Neighbourhood Centre, which is a truly unique place that works hard to blend wellness and education under one roof.  Children’s programs offered include music, fitness and arts & play.  Also offered are after-school and teen programs, in addition to a myriad of energy-filled adult fitness classes.

The George Locke Public Library – located at the south-east corner of Yonge and Lawrence – offers the community a rich array of programs, classes, and exhibits. From story time for toddlers, to crafts, hobbies, book clubs, and computer training for adults, this library is one of the city’s best.

Restaurants, pubs, cafes and retail shops abound – there is a strong sense of community in this area also known as Yonge Lawrence Village.  For a comprehensive listing of all the amenities the area has to offer, please visit the Yonge Lawrence Village BIA. Neighbourhoods that surround Bedford Park include Lytton Park to the south, Wanless Park to the east and Lawrence Park to the south & east.

Living and working in your area has its benefits
If you’d like to be informed of recent sales in Bedford Park and to be kept in the know, feel free to contact me by filling out the form below.

If you are thinking of selling
Call me to arrange a complimentary SELLER’S PACKAGE that includes tips & tricks on how to get your home sale-ready and a current home evaluation.

In Toronto, a second suite is a self-contained rental unit in a single-detached or semi-detached house. Most second suites are basement apartments. They have also been called “granny flats”, “in-law suites” and “accessory” apartments. The new by-law permits second suites in all single-detached and semi-detached homes throughout the City of Toronto with certain conditions. Toronto has prepared an information kit that provides easy-to-read information on how to create a legal second suite.

Although second suites often take the form of basement apartments, they can be located on an upper floor, or the back part of a house. In order for a second suite to be considered legal, the following must be met:

– residential zoning requirements
– property standards
– occupancy standards
– health and safety requirements
– fire and electric codes

If you’ve ever put in an offer on a property containing a second suite, you may have noticed that real estate agents frequently insert a clause stating that the “seller does not warrant the retrofit status of the basement apartment” to signify whether the basement unit is or is not fully “legal”. But in this context, the term “retrofit” only refers to fire code — one of the five requirements.

According to an article written by Toronto real estate lawyer Bob Aaron in March 2012, the provincial fire code is a subset of the Ontario building code. The building code applies only to the day the unit was constructed. Only the fire code is retroactive — and this gives rise to the term “retrofit”.

In 1994, the provincial government set new fire code rules with which all basement apartments, new and existing, must comply. A unit upgraded to comply with the fire code is called a “basement retrofit”. Compliance with the fire code involves four requirements: fire containment, means of escape, fire detection and alarms, and electrical safety. Once a unit has been inspected and any deficiencies corrected, the fire department will issue a retrofit certificate to verify compliance.

But a unit that has been fully retrofitted may still not comply with zoning, building code and other requirements.

Identifying whether a municipality’s bylaws permit basement apartments is also important when buying a house with a basement unit.

The building code, which prescribes minimum requirements for the construction of buildings, for the most part, applies only to the day the house was built, and not retroactively.

Electrical safety refers to the required inspection by the Electrical Safety Authority.

Buyers of houses with basement rental apartments should do their due diligence to investigate whether the unit does or does not comply with the fire code, building code, electrical safety requirements and municipal zoning by-laws.

If you’d like to speak with me about Toronto basement rental apartments, or second suites, please fill out the form below and I will connect with you shortly.