Buy or Rent – What’s right for you?

A key reason many people choose to rent instead of buying their own home is their reluctance to sign their name to a long-term mortgage agreement. But when you come right down to it, very few of us can expect to go through life without paying the cost of a place of residence in one form or another. As a renter, you’ve probably already made a commitment to a fixed schedule of payments for housing – but instead of a mortgage, it’s a lease or rental agreement. In reality, rather than being a negative, one of the major advantages of a mortgage agreement is that payments can be locked in for an extended period—which can work in your favour. Since no one can guarantee what your rental payments may be three or even five years down the road, your mortgage agreement can actually protect you from the unexpected increases you may experience when you rent.

Still, some people are intimidated by the large amount of debt that is represented by a mortgage agreement. Yet if you added up all the rental payments you could expect to pay over a space of many years, you may find that going the mortgage route is actually the more affordable of the two options. And at the end of the process, renters are left with nothing to show but a pile of receipts. With today’s low mortgage rates and some creative financing, the cost of buying a home may be lower than you think. Your Coldwell Banker real estate professional can show you how owning your own home may be more affordable than you ever imagined.

While making mortgage payments may actually be more affordable than paying rent, let’s not lose sight of the biggest financial benefit of all. The simple fact is, when you rent, you’re building someone else’s ownership equity in the property where you live. On the other hand, when you buy a home, you’re making an investment in your future, while a portion of your mortgage payment builds personal equity for you. If you decide to sell sometime in the future, that equity is something you’ll take with you as you make your next move.

Lastly, let’s not forget the creative freedom and pride of ownership that comes with owning your own property. When you buy, you decide about the home improvements and decor changes you want to make. You decide colour schemes and where to hang that favourite picture. And you’ll also earn the added equity that any such improvements may add to your home. Spending money to improve a rental property just puts value in someone else’s pocket.

If you’re tired of paying off someone else’s mortgage for them, then why not call The Mash Teaml for a no obligation consultation to help you find out how to make your dream of home ownership a reality.

 

Buyer Beware – of the Low Down Payment! 

If you’re looking to get into the housing market, a listing that’s advertised as requiring little or no money down can sound like a great deal. But is it really?Before you decide, you should consider who this type of advertising appeals to and why this pricing tactic is being used. You may just find that what sounded like a great deal can actually end up costing you a lot more money than you needed to spend.Low or zero-money down payment listings will most appeal to those buyers who don’t have a lot of financial resources to work with. Such buyers will typically have difficulty qualifying for a mortgage loan from a traditional lender. So why would a listing want to attract this kind of buyer? There are many different reasons. It may just be that the homeowner is anxious to sell quickly, particularly if they’ve already bought another property. Or it may be that there’s a lot of competition for sale in that particular area, or even on the same street and the sellers want to offer something extra to help their home stand out from the rest.However, there are other reasons that will not benefit the buyer. One such reason is that the home’s price has been somewhat inflated, but the seller is hoping that the ‘zero money down’ tactic will attract those buyers that have few other options to choose from. They want to focus buyers on the aspect of how affordable it is to get into the property, rather than on the final cost. Whether or not the listing may be overpriced, a low down payment offer is often tied to the buyer taking out private financing – sometimes with the seller or someone connected to the seller – at a very high interest rate. In cases like this, what first sounded like a ‘bargain’ can, over time, cost you much more money than you’d pay for another comparable property with traditional financing.The bottom line here is that you should exercise caution where properties advertise a low down payment. Here’s where your Coldwell Banker real estate professional can help, by providing you with a Comparative Market Analysis (CMA) of other homes in the area. This will help you determine if a home has been properly priced within today’s market. Your Coldwell Banker professional can also advise you on current mortgage rates and creative financing options. There’s no reason why you shouldn’t consider a low down payment listing – just go into it with both eyes open! With some expert advice from your Coldwell Banker professional, you can make an informed decision that’s right for you.

How to pay off your mortgage quickly 

Many financial planners will tell you that one of the best investment strategies you can adopt is to pay off your mortgage in the shortest time frame possible.  Here are a few tips to put your mortgage repayment schedule on the fast track, and with a minimum of hassle and stress.

  • Select the most frequent payment option available.  By choosing to make your mortgage payment on a bi-weekly, or better still, a weekly basis versus monthly payments, the result is making extra payments every year.  Over the life of your mortgage loan, this approach can save you thousands of dollars in interest, and pay off your mortgage years earlier.  Best of all, you’ll hardly notice the difference, since you’ll simply be making regular payments.
  • Consider a closed mortgage.  Getting the lowest rate mortgage available just seems like common sense, yet a great many homeowners choose open mortgages versus the lower rate closed versions.  Unless you’re expecting a windfall and are planning to pay off your mortgage before the end of it’s term, closed mortgages may be your best choice.  Although you can’t add extra money whenever you wish, most closed mortgages allow for an annual lump sum payment, perhaps ten percent of the loan.  Talk to your lender to find out what provisions their closed mortgages offer for repayment.  In most cases, you’ll find that the lower rate closed mortgage offers you the best alternative.
  • Shop around for mortgages.  Gone are the days of “one-stop financial shopping” when people routinely arranged for mortgages at the same place where they did their banking.  Your mortgage represents one of the biggest financial commitments of your life, so it pays to do some research and a little comparison shopping.  There may also be some financing options available to you that you haven’t even considered.  Ask your Coldwell Banker real estate professional to tell you more.
  • Lock in rates while they’re at their most affordable.  A good way to protect yourself against a potential increase in interest rates is to get pre-qualified for a mortgage, and lock in your interest rate now with your lender.  A difference of even a quarter percent in interest can add up to thousands of dollars over the life of a mortgage.  Rates are very favorable right now, so why not protect yourself and lock in the current rates while you look for a home, and avoid the risk of paying a higher mortgage payment if rates go up before you close. 

 

 

Going green’ is a growing trend in real estate

Until recently, the term “greenhouse” meant a building made of glass, where plants aregreenhouse picture cultivated.   But for today’s prospective homebuyer, the terms “green” and “house” can conjure up very different meanings—that of a home that uses sustainable building materials and energy efficient design.  And now, according to the Canadian Real Estate Association (CREA), the growing green housing movement is significantly changing how property is marketed and managed.

In a global shift towards ‘eco-friendly’ housing, people are now recognizing that a green building is efficient, and this efficiency has real economic, as well as social and environmental value. No longer is ‘green’ housing just a trendy buzzword.  It is quickly becoming a measurable standard throughout the world.  For building construction, organizations in the UK, the US and Australia have agreed to cooperate and develop common metrics for measuring CO2 emissions. These leading green building ratings are now available internationally for measuring the environmental sustainability of new and existing homes and buildings.

As you might expect with a newly-emerging field, right now there is little consistency or standardization amongst the various degrees of ‘greenness” within a market.  There is already a growing demand for some type of consistency which will make it easier for property developers and building owners to monitor and compare the energy performance of their buildings.  But when it comes to individual homeowners—that is not so easy.

Consumers looking to purchase eco-friendly homes have limited options to obtain detailed information on the green aspects of a home, often relying on the information provided by the current homeowner which may or may not be accurate.  So, while going green is good for consumers and for our planet, this is another area where homebuyers can benefit from the advice of real estate industry professionals.  Whether it’s a professional home inspector or your local Coldwell Banker sales representative, they can point out aspects of a home that will help save you money on your energy costs.  And if you plan on selling, talk to your Coldwell Banker professional about how to showcase the ‘green’ features in your home to appeal to today’s eco-conscious consumer.

 

Closing Costs and Moving Expenses

How Much Home Can You Afford?

After you’ve estimated your mortgage payment and other ongoing costs for carrying your first home, you’ll also need to consider the one-time expenses associated with the purchase of a property.  This includes your closing costs, as well as your moving 9lyusbzc4su1_manwithboxesD4-thumbnailexpenses.

Be aware that there is no set rule for what’s included in closing costs, or how they’re calculated.  Closing costs can vary significantly from property to property, but may include home inspection fees, appraisal fees, title search, survey costs, home insurance and lawyer’s fees.  Some of these costs may be shared with the seller, while others are payable by the buyer only.  Your Coldwell Banker salesperson can give you helpful advice about specifying a cost-sharing agreement for some of these related costs within your offer to purchase. You will also be required to reimburse the seller for a proportionate share of specific housing expenses that have been pre-paid by the seller and continue after your closing date.  These pre-paid expenses usually include property taxes and utilities, and the amount is typically equivalent to only a few months service.  Your real estate lawyer will give you an exact accounting of these expenses upon closing, so be sure to discuss this with your lawyer in advance, so you will have sufficient funds available to cover these costs at that time.  After these one-time adjustments are made, and the transfer of ownership is completed, you will pay for such expenses directly in future. In addition, you’ll also have to budget for your relocation costs.  This could include such costs as a moving company truck and labor, packing charges, boxes and wrapping materials, or rental of a vehicle or trailer if you’re doing all or part of the move on your own.  There can be a wide variation of costs for these types of services, so you should start planning well in advance, and obtain comparative quotes from more than one mover.  Get the quotes in writing and ensure that all the required equipment, staffing and materials are documented.  Ask the provider to specify what charges may apply if your move does not proceed on schedule.  Be sure to read all the fine print carefully, so you understand upfront what other charges, such as waiting time, or a late return charge you might incur that are not planned for in the initial quote. Your Coldwell Banker salesperson can be a valuable resource here too.  Not only can they help you estimate carrying and closing costs, they can also recommend experienced and trusted service providers to help you keep the cost of moving and home ownership affordable and keep your move hassle free.

How to choose a real estate professional

Whether you’re buying or selling a home, it can sometimes be a difficult task. You can make it that much easier by choosing the right realtor. Successful real estate professionals know that today’s informed and techno-savvy customers need service that goes far beyond the transaction itself. In order to succeed in today’s market, the best real estate professionals are emerging as facilitators of a comprehensive service process that encompasses the entire homeownership experience – before, during and after the sale.

When choosing a realtor, you can start your selection process by examining their track record. What companies and what salespeople have already proven their success in your marketplace? Ask lots of questions of anyone soliciting your business. Do they have experience working with your type of property and in your price range? What other business background or special skills do they have that puts them in a better position to understand and respond to the needs of today’s consumer? Are they well connected to the community and how do they keep abreast of local events that may impact property values? What other home related services can they assist you with? Can they help with creative financing options? Can they recommend trusted and reliable service providers for your home inspection, legal or moving services?

One thing you can rely on is that today’s real estate salesperson is a true professional. Industry standards and licensing requirements demand that every real estate professional completes a rigorous course of instruction and examinations before they are entrusted with your business. Ongoing education from company or industry programs further enhances their skills. When choosing a real estate representative, ask them about their training, experience and performance history. That information, combined with how clearly and how convincingly the representative builds their own case, will help you to make the right choice. After all, if a representative does a good job of convincing you, they’ll probably be just as convincing when they represent your best interests.

But while a good salesperson will offer good service, the best salesperson offers service that changes with the times. They use cutting edge technology to respond more quickly and more knowledgeably to their customers’ needs than would have been thought possible just a few years ago. They market their customers’ properties not only by posting a listing on a company website, but also through innovative vehicles as Personal Retriever?, an online property search engine from Coldwell Banker that matches thousands of listings against your dream home wish list. Other digital marketing tactics such as personal websites and e-newsletters are all part of an effective agent’s online campaign.

Finally, you’ll want a sales representative who listens to you, who understands your needs, and ideally a representative who will commit to your customer satisfaction.

How Much Home Can You Afford?

Budgeting your Carrying Costs

Finding the right property at an affordable price can sometimes be a challenge.  When it comes to deciding just how much home you can afford, there are two kinds of expenses you’ll need to consider – the ongoing or ‘carrying’ costs of the home, and your closing costs.

The first step in determining your carrying costs is to get pre-approved for a mortgage.  By pre-qualifying for a mortgage, you can find out up front what your maximum mortgage payment might be, even before your home search begins.  Your lender will look at your earnings, credit history and any outstanding debt, and help you determine what size loan you qualify for, at what rate, and what your regular mortgage payments would be.  Being pre-qualified offers another advantage, since it puts you in a stronger negotiating position when you go into an offer with pre-approved financing.

Once you’re pre-approved, the next step is determining what you actually want to spend on your mortgage payments.  Remember, your pre-approved mortgage establishes the maximum amount of loan you’d qualify for, but you may decide that you want to aim at a smaller loan, with a lower payment.

Be realistic and think about your lifestyle.  Although it may seem feasible to handle a sizable mortgage payment at first, keeping it up may eventually require cutting back on other expenses, such as clothing, or entertainment.  Make sure that if you plan to make any concessions in these areas, you’re prepared to live with your decision until there’s a change in your income.  Owning a home can give you a tremendous amount of pleasure and personal satisfaction, as long as you plan for adequate resources to enjoy it with some peace of mind.

With your estimated mortgage payment in mind, the next step is to determine your total carrying costs.  Add up all your estimated monthly costs, such as the mortgage payment, property taxes, insurance, heating costs and other utilities.  Then add a figure to cover yearly maintenance and upkeep.  Consider both the interior and exterior of the house, as well as the garage, driveway, landscaping and all other aspects of the property when you arrive at this figure.

When preparing your budget, be sure that you also make allowance for a “contingency fund” to cover unexpected expenses such as a major repair or the replacement of a large ticket item, such as an appliance. Life sometimes has a way of surprising us, and you don’t want to start out with a budget that’s so tight, there’s no room for the unexpected.

 

Get your property ready for Fall

While some people equate Fall with a time of ending and relative quiet, for many savvy blackberry 660homeowners, it’s anything but! Whether landscaping or exterior tasks, Fall is the ideal time to invest some effort to pay you big dividends next year.

Fall is the best time to take stock of how your lawn and garden fared over the summer and determine what needs adjustment. Don’t wait until spring to try to remember what didn’t do well in its current position. Evaluate what changes you need to make to optimize the beauty and function of your garden and do it now. Transplant what needs to move to more sunny or shady locations and cut back on overgrown beds. Don’t forget a good weeding to stop them from reappearing with a vengeance. Write down the tasks you postpone until next year and pack it away on top of your gardening tools, so you won’t forget when Spring arrives!

Fall isn’t just a time for raking up; it can still be a time for new plantings too. Evergreen trees and shrubs can add to your enjoyment of your property during the winter months and autumn is the optimum time for such plantings. Since they’re in a more dormant phase, evergreens have a far better chance of surviving if planted now versus in hotter months. Check with your nursery for details on evergreen care. Most will recommend that you wrap new evergreens and bushes in burlap to protect them, at least for their first winter.

Fall can also be a good time to plant many varieties of perennials – most of which are on sale now at local garden centres at greatly reduced prices. If you’d like a burst of late season colour, some of the hardier, late-blooming perennials such as asters or mums can extend your garden’s beauty right into Thanksgiving! Of course, planting bulbs such as daffodils and tulips will deliver a gorgeous floral display to herald the arrival of Spring. Your Fall landscaping efforts should also include renewing your soil’s resources to ensure healthy growth next year. A Fall fertilizing treatment of your lawn and garden will bring your soil to optimum levels and ensure a welcoming environment when things come back to life!

In addition to landscaping, your exterior plan should include a walk-around to see what’s in need of maintenance or repair before harsh winter months set in. A thorough power-wash of your walk and driveway will remove harsh chemicals and loose material and let you inspect for cracks and fissures. These should be sealed before freezing temperatures turn water into ice and cause more damage. Do-it-yourself driveway sealers are available from most home improvement outlets or you can contract the job out for a reasonable cost. Your exterior wood surfaces also need protection. Fall is the optimum time for painting and staining, untroubled by insects and oppressive heat. Most paints and stain will dry in any temperature above 10 degrees Celsius. Make sure you ask your paint store manager about the minimum temperature required for the product you choose.

 

“His and hers” homebuyer tips for couples  

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For most couples, buying a home is the most significant purchase they will ever make together.  While the prospect of owning a home is an exciting one, it can often seem overwhelming, especially for those who are new to the real estate process.   From selecting a neighbourhood to deciding how to use a spare room, navigating the world of homeownership together requires some extra work. However, couples will be thankful they put in the additional time and effort when the “sold” sign is posted on the home of both of their dreams.

For those couples looking to purchase a home, Coldwell Banker offers seven simple tips for ‘His and Hers’ homebuying that will help to ensure a “harmonious house hunt” without rocking the relationship:

Get pre-approved for a mortgage. There are few things worse than finding the perfect home, only to find out that it costs more than you can afford. Before beginning the house hunt, Coldwell Banker recommends getting pre-approved for a loan. A pre-approval lets you know where you fall financially while informing the mortgage company that you’re ready to buy. Additionally, being pre-approved for a loan can help speed up the closing process once an offer has been accepted.

Set a budget. Beyond basic income and savings, there are a number of other financial elements to consider before setting a price range for the new home. Once a couple has decided on a location, they should consider its proximity to their family, jobs and children’s school and then gauge travel costs. The next step is to add up monthly bills, including the couple’s car payments, phone bills, insurance costs, groceries, and credit card payments. This total estimated cost of living should be factored into the couple’s overall budget.

Get on the same page. Whether it is a quiet neighbourhood or a two-car garage, everyone has their own “must haves” when it comes to the home of their dreams. For a couple looking for a home to share, it is important to discuss each of their essentials before beginning the search. Keep in mind that agreeing on all of the features of a future home will likely be impossible, so be prepared to compromise. Once the list of “must haves” is finalized, your Coldwell Banker real estate professional can help you determine if your expectations are realistic given the homes currently on the market. 

Allocate additional funds. The down payment on a new home is just one of the significant financial aspects of a move.  Even after both people’s belongings are combined there will likely still be a need to purchase furniture and other items like a washer and dryer which will require additional budget. The last thing a couple will want to do is start out their life together with nothing in the bank! 

Be patient. A recent Coldwell Banker survey found that women are likely to make up their minds faster than men. Almost 70 percent of women surveyed decided the day they walked into the house that it was right for them, while 32 percent of men needed two or more visits. It will likely take multiple trips to the home before both members of the couple decide it is “the one.” If a spouse needs more time, be patient and try not to pressure them.

Take inventory of everyone’s belongings. Before a couple moves into a new home together, each person should make a list of the furniture they plan to keep and compare it with their partner’s. There may not be a need (or a place) for three televisions and two kitchen tables in the new house. Consider selling unwanted pieces of furniture online, or holding a garage sale.  The money made is sure to be put to good use on purchases for the new home.

Sign a contract. For a couple who has yet to walk down the aisle, it is important to contact a real estate attorney before closing on a home. A contract should be drawn up outlining who is responsible for what expenses and how assets will be divided in the event of a split.

 

Home Energy Saving Ideas

Energy costs can take a big bite out of any homeowner’s budget, so you need to know how to be energy-wise.  Here are a few quick and easy ways to cut your energy bills with a minimum of time and effort.

One of the biggest energy expenses is your home heating bill, so let’s start there.  You can significantly reduce your energy costs by installing a thermostat with an automatic timer that allows you to set the temperature back by a few degrees at bedtime, and returns the temperature to a more comfortable level before you get up.  After all, why heat the whole house, when an extra quilt will keep you toasty and warm for a lot less money?  On the flip side, when the temperatures ramp up, pre-set timers can reduce air conditioning costs too.

Similarly, if you have a room that isn’t used every day, such as a guest room or workshop, consider shutting the air register, and closing the door until you plan to use the space. Your furnace or air conditioning system won’t have to work so hard and you’ll pocket the savings while the rest of your home environment stays in the comfort zone.

You can also reduce the effect of ambient solar heating in summer and heat loss in winter with lined draperies or installing window blinds.  Adding weather-stripping to seal drafts around doors can also result in big energy savings.

Insulation is an energy saver that works hard for you all year long.  A one-time investment keeps your home cooler in summer and warmer in winter and the cost of installation can be recaptured in energy savings.  Many local utilities and  government bodies offer special incentives or rebates to help offset the cost of energy-saving improvements, so be sure to investigate what options are available in your market.  Your Coldwell Banker real estate professional may also be a helpful source of information about local programs.

Old appliances may also be draining more power than you might think.  Did you know that a refrigerator is one the biggest energy users in the house?  So, if you have an old appliance that needs repair, don’t just look at the cost of fixing it, also think about how much energy it uses. Today’s newer appliances are far more energy efficient than their predecessors, so buying used appliances or repairing an old unit may not be the bargain that you think it is!

With You Every Step Of The Way

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