By:  Phillip Dumoulin

Resale value is now always considered when a potential buyer is deciding upon a home to purchase. The ongoing debate is always – where is one’s money best spent to increase the value of the home? Budgets play a big part in a renovation and I see too many “all-in” renovations… In other words, homeowners blow their entire budget on one room and neglect the rest of the home. At “for sale” time this can leave a bad taste in a purchaser’s mouth, mainly due to the renovation of the one room having dated the rest of the home even more so. Unless you have an unlimited budget, here are some helpful do’s and don’ts that should assist you when coming to the renovation decision.

1. Never…ever…proceed with a cosmetic renovation when there are structural or plumbing/electrical issues with the home. I know these aren’t sexy fixes but they should always be a priority when doing renovations. Let’s face it, there is nothing worse than redoing your master en suite and then having a roof failure and water damage to the ceiling etc. I’m sure you have heard of the expression “good bones”…make sure you start any renovation with a solid foundation/structure.
2. The biggest mistake I see in renovations are the disconnects, an example being granite counter tops installed on 40 year old bathroom cabinets. You may consider this an upgrade but to a potential buyer they see this as putting “lipstick on a pig”. If you are trying to sell the bathroom as updated, good luck, no buyer will pay for poor renovations, especially when they have to be completely redone.
3. On a limited budget? Be smart! – consistent renovations are by far the best bang for your buck. In other words, do some mild updating in all of the rooms. You would be surprised how fresh a home looks with new paint, light fixtures/switches and modern baseboards. In most cases, for the average size home this will cost under 10K but it will most certainly add value when it comes time to re-sell.
4. Changing a traditional floor plan of a home and creating a more functional one is great for resale. Tearing a wall out can create that “open concept layout” one desires and it doesn’t have to be expensive.
5. Timeless design – when renovating, choose styles and fixtures that will remain current, what you like may not be appealing to the masses.
6. The kitchen is always the most expensive room in the house to renovate, so proceed cautiously! It can make or break the resale of the home so choose your layout, design and fixtures with care and hiring a designer for input, wouldn’t be the worst decision one could make.

So remember to always have a plan before starting a renovation. There is nothing worse than a half finished kitchen and no money left in the budget to finish it!

http://www.hgtv.ca/urbansuburban/article/what-key-elements-of-the-home-will-increase-resale-value/

By: Kevin Kittmer

Selling a house in a slow real estate market can be difficult. In times like these, it’s not enough to simply list your home and wait; you actually have to sell your home. No one really wants to sell anything when the market is bad, however, it’s not impossible to sell your house in these conditions. Even though the market’s not favourable to sellers and widespread economic recovery may be months, even years off, there are a number of tactics available to increase the likelihood of a sale. It just takes a positive attitude and a different kind of game plan. Here’s eight tips from a real estate sales rep to get you started.

Know Your Market

One of the most important things you can do to get your house sold is to learn your market, the value of your property and your competition. Most sellers operate in the dark, simply offering the property for the price they want, without regard to what other homes have sold for and are currently selling for. Undervaluing or overpricing your home can cost you tens of thousands of dollars.

Price Your Home Right

With homes sales slowing and prices plunging, there’s little doubt that selling for a good price in today’s market is going to be tricky. For example, the median existing home price across the Vancouver Island Real Estate Board area dropped more than 11% compared with the same month last year, according to the  Board. So if you try to ask as much for your property as your neighbour got a year ago, you’re going to turn off potential buyers. Instead, price your home conservatively by looking at similar houses currently on the market. Also look at the homes that aren’t selling. Chances are those owners priced their homes too high.

If you really want to stimulate a sale, you should under price your property by just a little. Trimming the price by a few thousand dollars can generate more foot traffic and create a buzz.

Make Your Home Presentable

Keep your house looking good at all times, repair things that are broken, and replace things that are rundown. Add a fresh coat of paint (neutral colors preferred), freshen up landscaping, trim trees, clean up clutter and remove personal items, so that prospective buyers can picture themselves in the home rather than seeing you there.

To stimulate a quick sale, consider using a professional home staging service. Your property must make a strong, positive impression. Staging a home is the cheapest way to make a house look different from your competition so it becomes the most memorable one that the buyer saw.

Be Flexible with Showings

It only takes one buyer to get your home sold. Don’t make your real estate professional feel as though their request for a showing is an inconvenience.

Play Up Your Home’s Best Features

If you have fireplaces, make sure that you have fires burning so that there is a beautiful warm glow and the sound of crackling. If you have a gourmet cook’s kitchen, have some great-smelling treats baking in the oven. Turn on soothing music. Set all lights and lamps if the home looks dark or feels heavy. Lighting is crucial.

Offer Flexible Terms

Often, the best way to sell a home more quickly in a buyers market is to adjust the terms of the sale instead of the price. While it may sometimes be necessary to adjust the asking price downward, or to negotiate a lower price with the buyer, sometimes offering an extended closing date will go a lot further.

Be Patient

Selling your home may take longer than in recent years, so it’s important to be patient and keep a positive attitude.

The First Offer Rule

If you get an offer within the first few weeks, the tendency is for sellers to try and hold out for a better offer. This is generally a mistake. Usually the biggest fish bite first, so keep in mind that your first offer will often be your best.

Kevin Kittmer is a Sales Representative for Royal LePage in British Columbia.

http://www.hgtv.ca/realestate/article/eight-tips-on-selling-in-a-slow-market/

Homes Staging Helps Bring Top Dollar Sales

The Top 5 C’s To Help You Get  Multiple Offers

By: Phoebe Chongchua

 If your house could be sold looking the way a model home does, do you think it might bring in more money? Chances are it would. That’s why home staging is a growing profession that’s rapidly changing the way homes are sold.

Scott McGillivray’s Tips on Winning A Bidding War

By: Scott McGillivray

With over a decade of investing in real estate under my belt, I’ve learned a few things about thebuying and bidding process. Whether you are a first time buyer, looking for a bigger home, or downsizing, investing in real estate is a smart decision – but only if you do it wisely.  Bidding wars, unfortunately, may be here to stay, so here’s some advice that may help you to secure your next property.

1. Crunch the Numbers
   One of the most important elements in the process of buying a home, particularly if you enter a bidding war, is getting pre-approved by your bank or mortgage company so you know exactly what you can carry – and how high you can go in your offer.
2. Do your Homework
   Buying a property is the most expensive financial decision most people will ever make in their lifetime so spending time to research the neighbourhood is so critical. There is so much emphasis on house inspections, and there should be, but the same amount of care should also be spent checking out local schools, transportation links, parks, crime rates, medical offices, family activities, seniors programs, daycares and even future housing developments.
3. Nail the Timing
   I try to get into properties on a Wednesday so I can put in an offer on Thursday and avoid the weekend open house competition –  or before they are on MLS. By beating out the weekend competition, I might not have to enter into a bidding war. There’s no law that states that you can’t make an offer before the official offer date and a good agent should send you properties as soon as they are available and preferably before they go public.
4. Pick the Right Agent
   Having an agent who has your best interest in mind is key to winning a bidding war. Your job as a buyer is not to seal the deal, it’s your agent’s job and they need to know what your limit it is – and respect it. If your agent tries to up sell you on the price and encourage you to go beyond your budget, it’s time to find a new agent.
5. Keep your offer clean

   Surprisingly, not everyone is after top dollar when it comes to selling their home. I’ve put in a lot successful offers that may not have been the highest, but they were the cleanest. A clean offer with pre-approved financing, especially in a multiple offer scenario, shows theseller that you are serious.  Conditional sales and offers that are contingent on financingjust don’t fly when there are other offers on the table.

http://www.hgtv.ca/incomeproperty/article/scott-mcgillivrays-tips-on-winning-a-bidding-war/

Here are some interesting facts and statistics about the real estate market that may have you interested.

According to REALTORS Association of Edmonton: 

• Sales of residential properties are up in double digit increments in all categories when compared to last year.
• Total residential sales in July were up 2.4% year-over-year
• Prices were also up year-over-year in all categories
• The average price for a single family detached (SFD) property in the Edmonton Census Metropolitan Area (CMA)  in July was $410,372, down 0.5% from June but up 3.4% from a year ago. Condominium average prices dropped 7.4% m/m but were up 2.6% y/y at $242,516. Duplex/row house prices were up 8.6% y/y (down 2.5% m/m) at $330,906.
• The residential average price in the Edmonton CMA in July was $350,726 ( down 2.5% m/m, up 3.3% y/y)
• These are the highest figures for July that we have seen since 2009″ said the President Darrel Cook of  REALTORS Association of Edmonton. “Prices and sales have peaked for the year and the  month-over-month numbers are lower than June but when compared to last year our market is very robust”
• Environics Analytic’s, a Toronto based date analytic ‘s firm, reported last week that the average net worth of an Edmonton household** was $433,970 in 2012, up 1.6% from 2011 as compared to the Canadian average net worth of $400,151.*
• Cook as well said ” Edmonton has jobs, house options, and an economy that is attracting newcomers to the city and ensuring that current residents have an appealing lifestyle”

For all of those who have wondered what the statistics look like on what the sales market in St. Albert looked like for the month of July 2013 verse the prices of  July 2011

SFD Sales …                          2013:  96                                                            2011: 71

SFD Average Price …       2013:  $447,897                                             2011: $445,229

Condo Sales…                     2013: 29                                                               2011: 15

Condo Average Price…   2013: $ 263,007                                              2011: $263,027

 By: Jonathan Whiting

You may or may not be aware of this fact, but more people are choosing to use a real estate agent than ever before. In correlation to the increased demand for real estate agents is the so-called democratization of information – the opening of the web, a.k.a. the Google factor, and the general trend of consumers choosing how and when they purchase products. When you analyze the statistics surrounding Internet adoption and demand for real estate agents, an untold story unfolds.

Let’s start with the number of home buyers working with a Realtor, as published in a recent U.S. report issued on Realtor.org. In 2001 about 69 per cent of all home buyers worked with a real estate agent. Dramatically, by 2012 that number increased to 89 per cent, according to the National Association of Realtors (NAR). That’s a whopping 20 per cent increase.

That’s a good news story for Canadian real estate. After an onslaught of news about an uncertain economy over the last four years, along with a general opening up of information online, you would be forgiven for assuming that Realtors’ future in the marketplace might be at risk. The numbers are not reflecting that, and the story doesn’t stop there.

The increased demand for real estate agents may be related to a surprising factor.  A growing demographic of home buyers is adopting the Internet and technology in their home-buying process. An analysis of the 2012 Profile of Home Buyers and Sellers released by NAR found that home buyers using the Internet were more likely to work with a real estate agent. Twenty per cent more likely, to be exact. This is counter to a common assumption that the more access a home buyer has to information online, the less they will need to work with a real estate agent.

In reality, “91 per cent of home buyers who used the Internet to search for a home purchased through a real estate agent, as did 71 per cent of non-Internet users,” says the study.

Data released by the Parliament of Canada reveals that since 2000, Internet usage in Canada increased by 35 per cent. Today 80 per cent of Canadian mobile phone users are on a smartphone and 93 per cent of Canadians go online for product information. These latest statistics divulge an interesting outcome. With the ability to search for homes online Canadians have spoken through their actions. They like using the Internet to search for information about property and real estate agents when purchasing.

Perhaps the greatest value a real estate agent provides for the home buyer is a sense of security that they are making the right decision and that the deal is put together correctly. With the increase in accessible information online, it is likely home buyers are realizing just how much information is available and are recognizing the need for an expert in the purchasing process

According to NAR, 87 per cent of buyers surveyed viewed real estate agents as a source of valuable information. Another study by Mustel Group Market Research found home buyers believe that the greatest value a real estate agent provides is dealing with the details and negotiating the best price.

One can conclude from all this that with the rise of technology, Canadian home buyers are embracing real estate agents. That’s not to say there isn’t uncertainty. But the numbers expose strong demand for real estate agents from the most promising of all consumers groups, the emerging home-buying demographic. Canada’s youngest home buyers using the Internet are also the most likely to work with a real estate agent. The future of Canada’s real estate agents is remarkably good.

Jonathan Whiting is a founding partner of StreetText.com, a text message and web marketing platform that serves Canadian real estate agents and mortgage brokers coast to coast.

http://www.remonline.com/demand-for-real estate professionals-is-increasing/

Lately on the news stories have been erupting of the news of the CHMC cooling down the mortgage market. In the article written by Julian Bel Trame from The Canadian Press ; He talks about what this means for the mortgage market and what the outcome may be.

CHMC cap on mortgage-backed securities to hike home costs, cools market. 

August 6, 2013

OTTAWA – Canadians may soon be paying more for new home loans as Canada Mortgage and Housing Corp. begins to clamp down on guarantees for mortgage-backed securities.

The government agency has notified banks, credit unions and other mortgage lenders that they will each be restricted to a maximum of $350 million of new guarantees this month under its National Housing Act Mortgage-Backed Securities (NHA MBS) program.

This year, the federal Crown corporation was given authority to guarantee up to $85 billion under the program but by the end of July, $66 billion had already been committed.

“As a result of this unexpected increase in issuance volumes to date and to better manage volumes going forward, CMHC will be introducing a formal allocation process in late August,” CMHC said in an Aug. 1 note to lenders.

Analysts say the cap will make it harder and more expensive for banks to obtain funds to lend to their customers, which would likely be passed on by way of a bump in mortgage rates.

“The combination of steps the government has taken in the last year, coupled with the beginnings of a sell-off in the bond market… will put a bit of upward pressure on mortgage rates,” said CIBC chief economist Avery Shenfeld.

“Overall, the days of very cheap mortgages are going to be replaced by cheap mortgages.”

TD economist Diana Petramala, who specializes in the housing market, estimated rates could rise anywhere from 20 to 65 basis points, or the equivalent of 0.2 to 0.65 of a percentage point.

She noted that historically, this is a minor increase.

“Affordability will still remain in the housing market,” she said.

The conversion of loans into securities with CMHC backing is a way for lenders to tap funds from a broad range of investors and enable banks to issue more mortgages at a lower cost.

Analysts said Canadian banks should have no difficulties securing international markets for funding, but it will come at a higher cost. CMHC-backed securities are attractive for both banks and investors since they are largely default-proof.

Fearing an overheated housing market could infect the larger economy, and result in defaults which the government must bear, Finance Minister Jim Flaherty has taken a number of steps in recent years to stem the flow of mortgage credit.

Last summer, he introduced tighter rules for mortgage lenders and borrowers — a change that the real estate and lending industries say was the main reason for a slowdown in residential property sales that began last August and continued through the first part of 2013.

As well, the finance minister acted to limit taxpayer exposure to a housing crash by setting limits on banks’ ability to buy bulk insurance from CMHC.

Still, Flaherty has been frustrated that banks were priming the house mortgage pump too aggressively, oblivious to the fact that Canadian household debt continued to climb. At 165 per cent of annual income this spring, household debt reached heights similar to the peak in the United States prior to the 2007 crash that literally broke several banks.

This spring, the minister went so far as to publicly chastise some banks for dropping their mortgage rates too low.

The moves worked for awhile, but in the past few months, housing has been on an upswing, with starts again reaching unsustainable levels near 200,000 annually, sales picking up and prices continuing to record new highs.

“We are starting to see the impact of the changes wearing off… prices in most markets are now rising faster than income,” Petramala said. “So it makes sense that the federal government, CMHC, may want to limit some of the risk-taking in the housing market.”

In last month’s monetary policy report, the Bank of Canada cited the recent developments in the housing market as the top made-in-Canada risk to the economy.

“This renewed momentum would produce a temporary boost to economic activity and inflation, but more importantly, it would exacerbate existing imbalances and therefore increase the probability of a more severe correction later on. Such a correction could have sizable spillover effects to other parts of the economy,” the central bank concluded.