• Category: Blog

    3 Ways to Stand Out in the Spring Market

    Posted on by Trisha Wilson

    Spring – the flowers are blooming, the birds are chirping, and the “For Sale” signs are sprouting up on lawns all around you. This can be one of the best times to list your home, which also makes it one of the most competitive times.

    So, how can sellers stand out in a busy spring market? We asked RE/MAX affiliates across Canada to share their top tips.

    Clean up Outside

    Pressure washing your driveway, sweeping your front walkway and picking up winter debris such as twigs and branches are incredibly important steps to take to make your property look its best once the snow has cleared.

    It’s important to wash windows and frames on the outside of your house and touch up exterior doors and trim with paint if necessary. Roof gutters and siding should also be cleaned and maintained.

    Any extra cars should be parked away from the property, and spring toys and bikes shouldn’t be left outside.

    Steps can also be taken to improve landscaping. Adding flowering plants and shrubs will add colour to your home. Be sure to tidy flower beds and maintain your lawn. If you have a pet, be sure to clean up any droppings on a regular basis.

    A well-manicured curb appeal can make a difference when everything is in full swing. Don’t overdo it with the flowers and plants, as there are also people thinking about high maintenance yards when buying a home, which could end up being a turn off, even when it looks pretty.

    Freshen up Inside

    The inside of your home should be tidy with no clutter. Light fixtures, appliances and windows should be cleaned. Be sure to move large appliances and clean in and around where they usually sit.

    If you have a garage, make sure you keep the floor swept. Make sure doors and windows throughout the house aren’t squeaking.

    You might want to consider purchasing a new welcome mat at the front door, adding new bedding and purchasing candles with a nice smell that’s not overwhelming. A fresh bouquet on your kitchen table or counter is a great way to keep the space smelling and looking great.

    Once your house is clean, get professional photos taken to make each room look its best. Good photography can go a long way in helping a home stand out from the others.

    Be Sure the Price is Right

    The spring market is an incredibly popular time of year for sellers to list their homes. If you have priced your home too high, buyers will likely opt to look at similar, more reasonably priced homes. A good REALTOR® will take in many factors to help you list your home at a price that is competitive with other listings, yet a fair deal for you.

    Also, consider putting the home on the market a bit earlier than the regular spring crowd. This will limit the amount of competition and get the eyes of serious buyers on your property first.

    Courtesy of REMAX.ca

    The Benjamin Moore 2024 Color of the Year is…

    Posted on by Trisha Wilson

    The Benjamin Moore 2024 Color of the Year is…

    Every year, the design world waits with bated breath for the announcement of the Color of the Year, and 2024 did not disappoint. Stepping into the spotlight is a colour that has long captured our imaginations and emotions: the cosmic and magical Blue Nova.

    Blue Nova CC-860, shimmering with celestial undertones, captures the mystery and expansiveness of a night sky aglow with distant stars. Its deep yet luminous shade bridges the ethereal and the tangible, creating spaces that feel both boundless and grounded. When juxtaposed with muted pastels or rich, earthy tones, its true brilliance shines through, adding depth and wonder.

    From serene interiors and avant-garde fashion statements to its ripples in art and décor, Blue Nova symbolizes a cosmic blend of tradition and innovation, grounding us in the familiar while propelling us into the uncharted. As we journey through 2024, Blue Nova promises to inspire homeowners, designers, and enthusiasts to reimagine spaces with enthusiasm and flair.

    Pair Blue Nova with the 2024 Colour Trends

    The year 2024 promises a variety of hues that work in harmony to set the tone for contemporary design. From muted pastels and earthy tones to vibrant splashes and subdued gradients, here are the colours that will redefine our visual landscape this year:

    White Dove – White Dove, a classic and versatile shade, transcends fleeting design trends. It’s neither stark nor overly warm, striking a delicate balance that makes it a favourite among interior designers. Its soft, creamy undertones exude a sense of tranquillity, making spaces feel larger and more open.

    Pristine – With its crisp and unblemished hue, Pristine effortlessly breathes life into any space. Its neutral character makes it versatile, serving as a serene backdrop that can be paired with both vibrant tones and muted shades.

    Topaz – Topaz, with its warm and lustrous hue, captures the heart of golden moments just as the sun graces the horizon. This gemstone-inspired shade exudes an earthy elegance reminiscent of autumn leaves or the warm glow of a fireside evening. Its richness adds depth to interiors, offering luxury and a sense of coziness.

    Teacup Rose – Teacup Rose paints a picture of timeless elegance reminiscent of delicate porcelain patterns and sunlit afternoon tea gatherings. Its soft, blush hue embodies innocence and romance, creating intimate and inviting spaces. When paired with muted neutrals or antique furnishings, it truly comes alive, harking back to bygone eras while still feeling fresh and modern.

    Honeybee – Honeybee is a hue that buzzes with life, embodying the zest and energy of its namesake. Its golden-yellow tone exudes warmth and positivity, instantly illuminating spaces with a touch of nature’s brilliance. The colour shines even brighter when combined with earthy neutrals or contrasting cool shades, bringing balance and vibrancy.

    Regent Green – Regent Green transports one into the heart of an ancient forest or the quiet corridors of a historic manor. Its deep, rich hue resonates with an air of timeless sophistication and quiet authority. Regent Green provides a moody backdrop that pairs beautifully with rich woods, metallic accents, or soft, velvety textiles.

    Antique Pewter – With its muted grey-silver hue, Antique Pewter transports one to bygone eras where craftsmanship was revered, and details cherished. Its understated elegance lends sophistication and quiet confidence to any space it graces. Perfect for modern minimalist designs or classic vintage settings, this versatile colour seamlessly bridges the gap between the past and present.

    Polar Sky – Polar Sky’s subtle blend of blues and greys captures the tranquil essence of a horizon where day meets night. This shade exudes a calming, introspective quality reminiscent of serene winter mornings or the muted tones of a twilight sky. When paired with cool neutrals or shimmering metallics, it brings out a contemporary, airy feel.

    Hazy Lilac – A soft and dreamy shade, Hazy Lilac evokes memories of springtime blooms and twilight’s gentle embrace. Its muted purple undertones, tinged with the faintest hint of grey, create an atmosphere of serenity and whimsy. When paired with creamy neutrals or deep jewel tones, it becomes a harmonizing force, adding depth and emotion to any design palette.

    How to Incorporate Blue Nova in Your Living Space

    Whether you’re looking to make a dramatic statement or infuse subtle pops of vibrancy, there’s an art to using Blue Nova in ways that enhance your living space:

    Accent Walls – Use Blue Nova as a feature wall colour. Its rich hue can serve as a stunning backdrop, making your furnishings pop and creating a focal point in the room.

    Soft Furnishings – If you’re hesitant about committing to paint, incorporate Blue Nova through textiles. Think velvety throw pillows, plush blankets, or elegant curtains. These can add a touch of modernity without overwhelming the space.

    Art and Décor – Hang artwork that predominantly features Blue Nova tones. Alternatively, seek out decorative pieces in this shade, like vases or candle holders, to sprinkle throughout your living area.

    Colour Trends 2024

    As Benjamin Moore’s Color of the Year, Blue Nova exemplifies the essence of modern home design—bold, vibrant, and unapologetically alive. It’s not just about painting a wall; it’s about creating experiences and memories within our homes. In an ever-evolving world of design, colours like Blue Nova stand as a testament to our collective quest for depth, meaning, and beauty.

    Courtesy of REMAX.ca

    How to Assess the Quality of Schools When Buying a Home

    Posted on by Trisha Wilson

    How to Assess the Quality of Schools When Buying a Home

    When purchasing a new home, there are numerous factors to consider. From the location and price to the size and layout, the list can seem endless. However, one crucial aspect that often gets overlooked is the quality of schools in the area. Whether you have children or not, the quality of nearby schools can significantly impact your property value and overall satisfaction with your new home.

    One of the livability factors to consider when purchasing a home is the proximity to reputable schools. Even if you don’t have school-aged children, the quality of schools in your neighbourhood should still be a top consideration. A strong school system is an indicator of a thriving community and can positively influence property values. Homes located in areas with highly regarded schools tend to appreciate faster and hold their value better over time. For families with children, this can make or break their decision to purchase a particular property.

    Create a Checklist

    Remember, every child has unique needs and capabilities. What may be an excellent school for one child may not be the best fit for another. Always consider your child’s specific needs and interests. Does the school offer programs or resources that align with your child’s passions? Are there opportunities for extracurricular activities or specialized education? Finding a school that can cater to your child’s requirements and provide a well-rounded education is essential.

    Research School Ratings and Rankings

    When searching for quality schools in your chosen area while purchasing a home, one of the initial steps is to research school ratings and rankings. There are numerous online resources available that provide valuable information regarding schools’ academic performance, teacher qualifications, student-to-teacher ratios, and overall school reputation.

    Consult with Real Estate Agents

    Real estate agents in Canada are an invaluable source of local knowledge. They can offer valuable insights into the schools in the area where a potential homebuyer is looking to make a purchase. They are knowledgeable about the reputations of school districts, the quality of education they provide, and any recent updates or advancements within the schools. Homebuyers can seek guidance from real estate agents to better understand how schools might impact property values and ensure that their desired locations align with their educational preferences for their children.

    Evaluate Extracurricular Activities

    A quality education is not just about academics but also active involvement in extracurricular activities. When evaluating schools, it is essential to consider the variety and accessibility of extracurricular programs. Seek out schools that provide a diverse range of activities, including sports teams, music and arts clubs, debate teams, and community service opportunities.

    Get Feedback from Parents

    Gaining input from parents with children enrolled in local schools can offer valuable perspectives on the daily experiences and difficulties that students may encounter. Online community forums, social media groups, and local parent-teacher associations are excellent avenues to engage with parents and gather insights about their impressions of the schools.

    Use Your Network

    Your network can be valuable for finding a good school district. They might know a specific school district you are unaware of or have come across the school you are considering during their house-hunting endeavours. You can also utilize your social media accounts by posting on Facebook or in trusted community groups and pages to inquire if anyone has any experiences or insights to share.

    Visit the School

    Visiting the school is one of the most effective ways to assess the quality of schools. While online research and feedback from others are valuable, they cannot replace the impression gained from an on-site visit. During your visit, observe the physical condition of the school, the classroom environment, the availability of educational resources, and the overall atmosphere. Moreover, engaging with students and staff during your visit can provide deeper insights into the school’s culture and values to determine if it aligns with your expectations and aspirations for your children’s education.

    Conclusion

    When purchasing a home, assessing the quality of schools in the area is a crucial aspect that directly impacts the overall well-being and future prospects of the family. According to the Housing Affordability in Canada: 2022 RE/MAX Report, 38% of respondents emphasized that house affordability means a home that meets their basic needs, including proximity to school.

    Prioritizing the quality of schools alongside other homebuying considerations, families can lay a strong foundation for their future, fostering growth and prosperity within a supportive community.

     

     

    Courtesy of REMAX.ca

    The Pros and Cons of Buying vs. Renting in Toronto

    Posted on by Trisha Wilson

    The Pros and Cons of Buying vs. Renting in Toronto

    What’s the difference between buying vs. renting in Toronto? Rental pricing is through the roof, and tenants might not see any relief in sight, whether rising mortgage rates or the supply-demand imbalance. According to the September 2023 Rentals.com report, the average asking rent in Canada climbed nearly two per cent on a month-over-month basis and skyrocketed close to ten per cent to a record high of $2,117. 

    “Over the last three-month period between May and August, asking rents in Canada have increased by 5.1 per cent, or by an average of $103 per month,” the report states. 

    What are the two most expensive rental markets? You guessed it: Vancouver, British Columbia, and Toronto, Ontario. Researchers found that the typical one- and two-bedroom apartments in Vancouver were $2,988 and $3,878, respectively. In North America’s fourth-largest city, the average one- and two-bedroom apartments are $2,620 and $3,413, respectively.  

    What makes the data even more fascinating is that the asking rent for roommates in Toronto is $1,300. In Vancouver, it is $1,455. 

    This will undoubtedly be fodder for the age-old debate: Is Toronto more affordable than Vancouver – or vice versa? 

    Meanwhile, the three cheapest rental markets in the Canadian housing sector? Saskatoon, Saskatchewan ($1,005) and Regina, Saskatchewan ($1,121). 

    The good news coming out of all of this is that construction activity for purpose-built rentals has accelerated. The bad news? “Despite rental apartment completions in Canada over the past 12 months reaching their highest level since the 1970s, rent growth has remained exceptionally strong,” the report stated. 

    “This can be attributed to the country’s record-high population growth and sharp deterioration in homeownership affordability,” the report added. 

    The latest conditions have many families stumped as to what to do next. Buy or rent? 

    Are you trying to decide whether to buy or rent in the Toronto real estate market? Let’s break down the benefits and drawbacks of both options so you can make the right choice for your financial situation and lifestyle. 

    The Pros and Cons of Buying vs. Renting in Toronto

    Here is a breakdown of the pros and cons of buying versus renting in Toronto. 

    The Price 

    First, let’s get down to the brass tacks. Here is a breakdown of home prices in the Toronto real estate market: 

    • Detached: $1.416 million 
    • Semi-Detached: $1.067 million 
    • Townhouse: $935,800 
    • Condo Apartment: $705,572 

    Renters do not have to bear the plethora of taxes that buyers do, such as the municipal land transfer tax or the HST, or become (directly) vulnerable to rising interest rates. 

    “While higher interest rates have certainly impacted affordability, the prospect of higher taxes will also hit households’ balance sheets, especially younger buyers with limited savings,” said Toronto Regional Real Estate Board (TRREB) CEO John DiMichele in a report. 

    Cost of Ownership 

    Indeed, one of the advantages of renting compared to owning is the amount of savings you can enjoy for monthly expenses. 

    Renters do not need to worry about replacing appliances or taking care of the property (though this can vary from property to property). On the other hand, homeowners routinely have monthly expenses that can set them back by vast amounts. 

    So, by comparison, for owners of condominium suites, there is the condo fee, utilities, property tax, and property insurance. For renters, there is the rent, utilities, and renters insurance. 

    In an environment where the cost of everything has increased significantly, renters can find considerable savings by not having to maintain their properties regularly and pay out of pocket to replace a broken refrigerator. 

    Flexibility Versus Responsibility 

    Renters enjoy something that owners do not: flexibility. Homeowners have much more responsibility for owning property, from regular upkeep to unexpected expenses. It is easy for renters to budget since the rent is a fixed monthly cost. Plus, if you wish to relocate to another building or another area of the city, renters can do this once their lease is up. 

    Who Has the Advantage? Buyers or Renters 

    A core component of the Canadian Dream has been homeownership. The idea of owning your own home while building equity to fund your retirement or children’s education is an appealing one. 

    Is this an outdated concept? Not necessarily, but accomplishing this objective will depend on where you live, household income, interest rates, public policy, and the broader Canadian real estate market. From a long-term perspective, homeownership is superior to renting because home prices generally trend higher over time, and, as a result, your equity grows over time. In the short term, it can be advantageous to rent, wait out the market, and wait for the right opportunity. 

    Ultimately, the renting versus owning debate boils down to personal circumstances and overall economic conditions.  

     

     

    Courtesy of REMAX.ca

    Land Transfer Tax Impacting Home Buying Decisions

    Posted on by Trisha Wilson

    Land Transfer Tax Impacting Home Buying Decisions

    Many prospective homebuyers often think that the only costs they will incur are the home’s asking price and interest on the mortgage. However, there are additional costs involved, especially in certain jurisdictions across the country. Mortgage origination fees, closing costs, taxes, and other charges are the norm. And when buying a home in the Toronto real estate market, the land transfer tax is a hefty levy you must budget for – and the municipal portion of the tax is due to rise as of January 1, 2024.

    Regardless of the property type, all homebuyers will be subjected to a land transfer tax on closing.

    There are five tax brackets that you need to be aware of:

    • Up to $55,000: 0.5 per cent
    • Up to $250,000: one per cent
    • Up to $400,000: 1.5 per cent
    • Up to $2 million: two per cent
    • More than $2 million: 2.5 per cent

    So, for example, if you are buying a $950,000 detached house in the downtown core, be prepared to dole out nearly $31,000. The good news is that you will receive a rebate if you are a first-time homebuyer. So, as another instance, if you are purchasing a $700,000 condo suite, the land transfer tax will be nearly $21,000, but the rebate will reduce it to below $13,000.

    Regardless of any tax brackets or rebates, new research has found that the land transfer tax is a barrier to entry for many households attempting to achieve the dream of home ownership.

    Land Transfer Tax Impacting Home-Buying Decisions

    Is the land transfer tax impacting your home-buying process?

    According to a new survey conducted by Leger on behalf of RE/MAX Canada, more than one-quarter of Canadians (28 per cent) say that the land transfer tax has affected their decision to participate in the real estate market. Young Canadians are most impacted by the levy, with 40 per cent of Generation Z and 35 per cent of millennials reporting that the land transfer tax had a role in their journey toward home ownership. The penalty had less of an impact on older generations, including Generation X (26 per cent) and baby boomers (21 per cent).

    Ultimately, this has eroded housing affordability at a time when home ownership is becoming out of reach for many younger households.

    Recent data highlight that detached home sales skyrocketed in York Region in the second quarter of 2023, rising more than 100 per cent from the first quarter. One of the reasons? Buyers in this part of the housing market do not face the municipal land transfer tax.

    Because many facets are pricing younger families out of the housing market, policymakers are exploring various mechanisms to bolster homebuying opportunities, including the land transfer tax.

    Are Changes Coming?

    The City of Toronto recently published its revenue tools report assessing different property tax approaches. Officials contend that property tax is a more stable and fair form of taxation for city hall than the land transfer tax. When North America’s fourth-largest city first introduced the first-time land transfer tax rebate, it was introduced to mirror the average price for a residential property in Toronto.

    In 2008, the average price for a home in the city was $400,000. Believe it or not, officials have not raised this threshold, meaning that very few buyers qualify for this rebate since the going price for a house is north of $1 million and about $750,000 for condominiums.

    That said, the Toronto Region Real Estate Board welcomes any proposal that advances the opportunity for more people to enter the housing market.

    “Our position has always been that the concept of a Land Transfer Tax doesn’t benefit homebuyers, due to the unfair nature of the tax which has to be paid upfront. With the City raising MLTT rates for the higher-end housing market as a revenue tool, it must also consider helping first-time home buyers who are struggling to buy a property,” said TRREB President Paul Baron in a statement. “Council’s decision to approve a graduated increase of the MLTT on properties over $3 million may impact our housing challenges and supply shortage in a negative way by deterring move-up buyers from freeing up supply.”

    Not only Toronto is looking at making changes to property tax policy.

    The Real Estate Board of Greater Vancouver (REBGV) is urging the province of British Columbia to abandon the property transfer tax, or PTT, on any home that costs under $755,000 for both new and resale.

    Like Toronto, it is challenging to come across any dwelling in Vancouver priced below $800,000.

    “You could look at this and say, ‘Should there even be a threshold? If we’re talking about getting first-time buyers into the market, why does it really matter?’ We’re trying to be reasonable and give the government something they can work with,” said Andrew Lis, the director of economics of the REBGV.

    The real estate association also suggests establishing a provincial rebate program for the GST mandated on new rental construction and an “ultra-low-cost” loan program for rental property developers.

    Meanwhile, there is skepticism that the B.C. government would consider abolishing the levy since it generated more than $2 billion in revenues from this tax in the current fiscal year.

     

    Courtesy of REMAX.ca

    Toronto’s Most Affordable and Undervalued Area for Detached Homes

    Posted on by Trisha Wilson

    Toronto’s Most Affordable and Undervalued Area for Detached Homes

    In the dog days of summer, the Toronto real estate market was not as hot as the previous year, driven by rising borrowing costs, economic uncertainty, and limited inventories available in the housing industry. According to the Toronto Regional Real Estate Board (TRREB), residential property sales tumbled slightly more than five percent year-over-year in August, totaling 5,294 units. Within detached homes, sales declined at an annualized pace of 11.2 per cent in August, with 451 units exchanging hands. Semi-detached properties also experienced a drop in sales, totaling nearly 13 per cent with 138 transactions.

    Townhomes and condominiums enjoyed a robust 15.6 per cent and 6.5 per cent year-over-year increase in August.

    Despite the drop in sales activity, prices remained elevated. Detached home prices advanced nearly three percent to $1.416 million, semi-detached prices swelled 6.9 per cent to $1.067 million, and townhome costs jumped close to four per cent to $935,800. Condo units slipped 0.9 per cent to $705.572, TRREB figures reveal.

    “In the short term, we will likely continue to see some volatility in terms of sales and home prices, as buyers and sellers wait for more certainty on the direction of borrowing costs and the overall economy,” said TRREB president Paul Baron in a statement.

    With the lackluster performance to finish the summer, does this mean prospective homebuyers might come across detached homes located in affordable and undervalued areas? If so, where can households potentially find these listings?

    Bathurst Manor: Affordable and Undervalued

    For many young professionals and families searching for affordability and an undervalued property in the Toronto real estate market, one area of the central core that has been a popular destination for years is Bathurst Manor and Clanton Park. Prospective homeowners will see a wide array of bungalows and two-story residential properties throughout the Bathurst Manor and Clanton Park neighbourhoods.

    The average price for detached homes sold in this part of the city is about $1.7 million, the lowest average price point in the central core. In the first half of 2023, the area enjoyed a modest increase in homebuying activity compared to the same time a year ago. Despite fewer detached home sales in 95 per cent of surveyed markets in August, Bathurst Manor and Clanton Park were two of the few places to buck this trend in the housing market, with sales climbing 1.4 per cent.

    Indeed, for those individuals who are price-conscious, Bathurst Manor and Clanton Park maintain a larger supply of detached properties situated on 50-foot lots, providing modest price relief for buyers.

    Moreover, market analysts note that Bathurst Manor and Clanton Park can potentially increase the home’s value in the future through demolition or renovation, particularly if housing stocks do not improve in the Toronto housing market anytime soon.

    Based on the latest real estate association data, this is likely to be the new normal for a while. While the latest numbers show that new residential listings were up a little more than one per cent month-over-month in August, they are down year-to-date.

    And industry leaders note that governments are not showing signs of doing what is necessary to bolster supply, leaving prices to maintain their upward trajectory, especially in the downtown core.

    “All three levels of government need to be focused on the key issue impacting affordability in the GTA: lack of supply,” said TRREB CEO John DiMichele in a statement. “Right now, there continues to be a policy mismatch between population growth through immigration and temporary migration and bringing online enough housing to accommodate this population growth. If we can’t house newcomers, they will look elsewhere, and Canada and the GTA will lose its competitive edge on the global stage.”

    Supply Continues to be the Main Issue

    This year, many headlines have spotlighted just how dire the supply situation has become in North America’s fourth-largest city and the rest of the country. In the spring, the Canada Mortgage and Housing Corporation (CMHC) warned that prices could accelerate again due to an “alarming” shortage of new construction.

    From the Toronto Star:

    “In Toronto the report forecasts between 28,500 and 33,500 housing starts for this year, 60,000 to 74,000 sales, and an average MLS price of $1.043 to $1.107 million.

    CMHC economist Dana Senagame said that in pockets of the GTA’ anecdotally at least we’ve heard reports of properties being sold within hours of being listed and bidding wars.’ Buyers who’ve been holding back may now be more comfortable making a purchase. But overall, ‘the market is still very, very unaffordable.’”

    Be it Canada or downtown Toronto, supply is failing to keep up with demand. If the reports are accurate and homebuyers are snatching homes that have erected for-sale signs on their properties as fast as you can say the Toronto Blue Jays, prices are unlikely to come down to their pre-pandemic levels.

    Courtesy of REMAX.ca

     

    A Step-by-Step Guide to Refinance Your Mortgage in Canada

    Posted on by Trisha Wilson

    A Step-by-Step Guide to Refinance Your Mortgage in Canada

    Is it time to refinance your mortgage?

    With the average conventional five-year fixed-rate mortgage rate approaching six percent, homebuyers who might have purchased a home at rock-bottom rates recently might not want to refinance their mortgage. Others, especially those who are on a variable-rate mortgage, may need to refinance their mortgage.

    Whatever the reason may be, it is important to understand the steps involved with refinancing your mortgages.

    Let’s take a deeper dive:

    Refinancing Your Mortgage in Canada

    Here are six steps to refinancing your mortgage in Canada:

    Evaluate Your Current Mortgage

    Here are four questions to answer as you assess your current mortgage:

    • What are your current mortgage terms?
    • What is your mortgage rate?
    • What is the remaining balance?
    • What are the penalties or fees?

    Understanding why you want to refinance is critical during this process. You need to identify the purpose, whether to access equity, solidify your monthly payments or consolidate your debt. It is not something to take lightly.

    Check Your Credit Score

    Your credit score plays a crucial role in getting approved for a new mortgage with favourable terms.

    As a result, it is vital to access and obtain a copy of your credit report and score from a reputable credit bureau. By doing this, you can ensure that the data are accurate, and you can identify any areas for improvement if required.

    Research Lenders and Mortgage Rates

    When you are considering refinancing your mortgage, should you stick with your current lender or find somebody else? This depends on what your research shows. Therefore, comparing offerings from other banks, credit unions, and mortgage brokers is imperative to locate the best deal that matches your objectives.

    After this is achieved, you need to calculate the costs and savings:

    • Estimate the possible savings and costs associated with refinancing.
    • Consider factors such as closing costs, appraisal fees, legal fees, and prepayment penalties for your existing mortgage.
    • Compare these costs to the long-term savings from the new mortgage to ensure the refinancing makes financial sense.

    Pre-Approval

    Once you have selected a mortgage lender, be sure to apply for pre-approval. Doing this lets you know how much you can borrow and streamlines the borrowing process. A pre-approval application typically involves extending your personal and financial information, income verification, employment information, credit reports, and other associated documents.

    Processing

    Yes, the refinancing process is a tad difficult. The first is the underwriting endeavour, which includes the lender reviewing your application, evaluating the residential property’s value, and assessing your creditworthiness. The lender could request additional documentation for clarification purposes. The second will be an appraisal of your property that might be needed to determine the present market value, a vital step to determine the loan-to-value (LTV) ratio. The third is that you will need to hire an attorney or notary to manage the legal components of the refinancing process, as this professional will review the agreement, prepare the documents, and arrange the mortgage closing.

    The Final Steps

    The three final aspects of mortgage refinancing will be like this:

    Mortgage Closing: You will need to sign the paperwork, like the new mortgage agreement, either at a lawyer’s office or through a remote online notarization platform. Funds Disbursement: The new mortgage funds will be allocated that will be used to cover closing costs, offer funds to access equity, or pay off the current mortgage.

    Begin Repayment: You will now start to make payments on your new mortgage using the updated terms and conditions in the new mortgage agreement.

    The Growth of Mortgage Refinancing

    Considering that interest rates are at their highest levels in over two decades, it might be befuddling why anyone would want to refinance in today’s rising-rate climate. However, research has found that homeowners will do so for debt consolidation reasons. A recent Angus Reid Institute study found that the percentage of mortgage holders struggling with their payments rose to 45 per cent since 2022. At the same time, growing credit card and loan debt was the main source of financial stress for mortgage holders.

    “Many homeowners will have outstanding debt, whether it be on HELOCs, LOCs, credit cards, or loans,” said Victor Tran, a RATESDOTCA mortgage expert, in a statement. “Rising interest rates will push up the amount of interest they have to pay to service the debt, and it can be more affordable to refinance a mortgage and roll all of the debt into one payment instead of several.”

    Is it time to refinance?

     

     

     

    Courtesy of REMAX.ca

    Deposit vs. Down Payment on a House

    Posted on by Trisha Wilson

    Deposit vs. Down Payment on a House

    Deposit and down payment–two words that are commonly used and often interchanged. While they’re both upfront costs in the home buying process, the two terms are entirely different.

    A deposit is money you attach to an offer to show a home seller that you’re interested in buying their property. A down payment is a percentage of the home price you pay upfront to close the purchase of a house.

    The two payments sound similar but vary widely in a few distinct ways. Read on to find out more.

    Deposit

    A deposit is the money you present to a home seller during the offer stage to show your commitment to buying their property. It gives the seller confidence in your willingness and financial capacity to buy the property.

    Most times, you cannot retract a deposit; you just add it to the down payment to purchase the house.

    Down Payment

    A down payment is a percentage of the home price you pay to seal the deal after the seller accepts your offer to buy a house. It is paid at closing, and the balance is then paid through your mortgage.

    The size of a down payment varies but usually starts at 5%. A down payment of less than 20% normally requires a mortgage loan insurance plan. This protects mortgage lenders from the risk of a home buyer defaulting on their mortgage payments.

    Key Differences Between a Deposit and a Down Payment on a House

    The major differences between a home-buying deposit and a down payment are in the amount and timing of payment.

    Deposit Down Payment
    ●      No standard required amount.

    ●      Paid along with the offer

    		 ●      Typically ranges from 5% to 20% of the home’s purchase price.

    ●      Paid on the closing day of the home purchase

    Amount of Down Payment

    The deposit you pay to your seller is not set in stone. Your real estate agent may come to an agreement with the seller’s representative to establish a fair deposit amount and due date.

    Down payments are a little different. The minimum home down payment in Canada ranges between 5% to 20%, depending on the home’s purchase price.

    Home Purchase Price Minimum Down Payment
    Below $500,000 5%
    $500,000 – $999,999 5% on the first $500,000 and 10% on any amount above $500,000
    Above $1,000,000 20%

    On the lender’s side, the home purchase price isn’t the only determinant of the amount of down payment you pay. Other things that affect the minimum required down payment include:

    • Your credit history
    • Whether you’re self-employed

    As mentioned, your mortgage lender will also charge you a mortgage insurance premium if your down payment is below 20%. The amount of insurance premium you pay varies from 0.6% to 4.5% of your total mortgage amount. This is your lender’s way of covering their bases in case you fail to pay your mortgage in the future.

    Keep in mind that your lender will also appraise the home value before they decide how much they want to lend you to buy the house.

    The three private companies in Canada that provide mortgage insurance are the Canadian Mortgage and Housing Corporation (CMHC), Sagen, and Canada Guaranty. CMHC is government-backed and therefore remains a favourite among the three.

    Timing of Payment

    A deposit typically comes before a down payment. When you see a house you like, you and your real estate agent will write an offer to purchase the property and send the offer to the seller along with a deposit. You can make the deposit via money order, certified cheque, or bank draft.

    But the seller doesn’t receive the deposit immediately. If the seller accepts your offer, the deposit is held in trust by the seller’s brokerage until the house sale is complete. Think of the trust as an escrow account where funds are held until they’re safe to release to their rightful owners.

    After the sale of the house is completed, the deposit will be added to the down payment amount. This is a legal requirement of the Real Estate and Business Brokers Act, 2002 (REBBA).

    However, deposits often can’t be recovered if the house sale doesn’t close. For example, if you change your mind about the house, the seller isn’t legally required to return your deposit unless the offer includes specific clauses about this. In such cases, you would sign a Termination and Mutual Release form and get your deposit back.

    A down payment happens on the day you close the deal on buying the house. On this day, the funds are released from the trust account into the hands of the seller.

     

     

    Courtesy of REMAX.ca

    What is a Buyer Representation Agreement?

    Posted on by Trisha Wilson

    Whether you’re looking at a condo in the city or a detached home in the suburbs, the search for your dream home is an exciting time! For many prospective buyers, the period between the decision to buy and the day you get the keys to your new home takes a back seat to your dreams of the exciting times ahead. As a buyer, you need to be informed and educated through every step of the process. It can be challenging to set aside your search for the perfect window treatments when your agent is asking you to sign a document you don’t understand: the Buyer Representation Agreement (BRA). To help you tackle this, we are going to give you the short and sweet explanation of what a Buyer Representation Agreement is, so you can get back to the decisions you’re excited about making!

    What is a Buyer Representation Agreement?

    This document is a written contract that defines the relationship between you and the brokerage, and how the agent will represent your best interests. It outlines the services your real estate agent provides and what they expect from you, including:

    • The agent’s duties and obligations to the buyer
    • Agency relationships
    • The scope of the agent’s duties
    • Buyer obligations

    Homebuyers will sign a BRA when they’re working with a real estate agent and are ready to make an offer on a home.

    What are the benefits and drawbacks of a BRA?

    By signing a BRA, you enter into an agreement in which your real estate agent will represent you in the home buying process. Advantages include:

    • Representation – A BRA ensures that your real estate agent works in your best interests and abides by the services listed in your contract. They can handle much of the home-buying process on your behalf, including negotiating, inspecting, and paperwork.
    • Clarification – A BRA formalizes your professional relationship by clearly laying out what your real estate agent expects from you and what you can expect from them.
    • Negotiable – Most of the terms in a BRA can be negotiated with your real estate agent.

    Disadvantages of a BRA include:

    • Locked term – By designating a real estate agent as your representative, your real estate agent will always receive a commission if you purchase property during the contract term.
    • Exclusivity – With an exclusive BRA, you will not be able to use another real estate agent. If you are unhappy with your current agent, there are steps you can take to break your agreement and engage another agent.

    How is a BRA presented?

    While the agreement can be written, oral, or implied, it will ultimately be required by law to be reduced to writing with your signature in order to protect everyone involved.

    When should you sign a BRA?

    Like anything else you place your signature on, it’s important to fully discuss and understand the services provided, the cost related to the services, and that the written agreement is clear. Typically, a BRA is signed before you begin working with the real estate agent.

    What will happen if you don’t sign?

    According to the Code of Ethics, the broker and salesperson must protect and promote your best interest as their client on top of being fair, and honest. While you can choose to be a customer rather than a client, be aware that there could be some differences in how you are represented.

    What is multiple representation?

    Multiple representation means that a brokerage represents both the buyer and the seller of a property. There are no standard terms of service for multiple representation, so you need to consult the representation agreement before any offer is submitted. Multiple representation must be consented to in writing, so make sure you ask questions and are comfortable with how it may affect the services provided to you.

    What is a holdover clause?

    A holdover clause is an optional clause in your BRA. It means that once your BRA expires if you purchase a home after a certain number of days (usually 30 to 90 days) that came to your attention during the BRA, you must still go through the agent to purchase the home, and they will still receive a commission on the home purchase or lease.

    Learn more about the many other important home buying steps so you can spend time where it really matters! Are you ready to take the next step? Contact us!

     

    Courtesy of REMAX.ca

    How to Save for a Down Payment While Renting

    Posted on by Trisha Wilson

    Renters across Canada have been struggling with rising rent costs and wondering how they will be able to save for a down payment while renting. With some money management tricks and adjustments to your daily living, you can save for a down payment. It might go slowly, but every little bit helps. Here are some tips to save for a down payment while renting.

    1. Make a Budget and Stick to It

    Making a budget is the easiest way to make your financial goals happen. When you have a plan for where your money is going, it puts the power back in your hands and gives you an idea of how long it will take to save for a down payment.

    To make a budget, write down your monthly income. Then, list your monthly expenses, including your savings goal. Your expenses should always be less than your income; otherwise, you are going into debt. Track your spending to ensure your budget is accurate. But the trick is that if you want to save enough for your down payment, you must ensure you stay within budget as much as possible.

    2. Get Rid of Your Existing Debt

    Qualifying for a mortgage does not end with saving enough for a down payment. Mortgage lenders will also look at your debt-to-income ratio (DTI), the percentage of gross income used to pay minimum monthly debt payments. If you have a high DTI, you are a risk to the lender, who will be less likely to approve you for a mortgage. However, if you work to cut down your existing debt while saving for your down payment, you can get approved for the house you want.

    3. Cut Unnecessary Spending

    Another way to boost your down payment savings is to cut back on a few luxuries. For example, consider buying groceries and making meals instead of ordering in, working out at home for free instead of paying for a gym membership, or taking public transit. Then, take the money you would have used on those splurges and put it into your savings account for the down payment.

    Some people might be willing to sacrifice just about everything to have their house sooner, but most of us would rather not sacrifice our quality of life. Make a line in your budget for fun things like a night out with friends, and ensure you don’t go over budget. Saving for a down payment is not worth sacrificing your mental health.

    4. Lower or Eliminate Rent Costs

    Your most considerable monthly expense is likely your rent, so an effective way to save for a down payment is to cut your rent costs. Although moving is not fun, it can save you thousands of dollars annually. Renters who work from home can choose a location with a lower cost of living, while those who work in an office can find a cheaper apartment closer to their work, saving them expenses for both housing and transportation. Then, take the difference in your expenses and put it in your savings account for your down payment.

    5. Add Extra Income

    While cutting expenses is an effective way to create room in your budget to save for a down payment, another way to save is to take on a side hustle. There are many opportunities for part-time work, such as driving for Uber or Skip the Dishes or becoming a tutor. You could also start your own home business cleaning houses, pet sitting and dog walking, or doing yard work. It doesn’t have to be fancy if it earns you extra money for your down payment.

    6. Immediately Save Any Bonuses or Gifts

    If you receive regular bonuses at work or a tax return each year, these can easily be contributed toward your down payment savings without sacrificing your quality of life. To take it up another notch, ask for down payment contributions in place of gifts for your birthday or Christmas. If you feel you are missing out on fun for yourself, set aside a predetermined percentage or amount to use as you want, and put the rest in savings.

    With these tricks, you can save up for a down payment while renting. Set up a savings account dedicated solely to your down payment and watch as your efforts pay off – literally!

     

    Courtesy of REMAX.ca

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