Brampton Real Estate Blog

Call toll free 1-800-631-5216 or email me with your WISH LIST and I'll send you a list of homes currently for sale in your neighbourhood.

Tuesday, May 17, 2011

HOW TO CALCULATE A HOME BUYING BUDGET

When house–hunting, some factors, like the features of the home, can be adjusted once you've made your purchase, while other factors, like the location, cannot be. Finding the right home is about getting the right balance and at a price you can afford. Of all the factors that go into choosing a home, according to the recent TD Canada Trust Home Buyers Report, 97% of Canadians agree that cost is the most important consideration.
“Canadians realize that in order to truly be comfortable in their home, they need to comfortably be able to afford it,” says Farhaneh Haque, regional manager, mobile mortgage specialist, TD Canada Trust.
Haque offers her advice on how to calculate a home buying budget:
Learn about your options: When house–hunting, you look for places that suit your needs and lifestyle. Do the same when deciding on your mortgage. Know the differences between fixed and variable interest rate mortgages and decide what amortization period best suits your situation. Payment flexibility is also important when deciding on a mortgage, to know what you can prepay, as well as options to pay less at a later date if something unexpected comes up.
Calculate your mortgage numbers: Run the numbers and settle on a price range you can afford. TD Canada Trust offers a convenient online mortgage calculator, which factors in your income and the size of your down payment and compares different mortgage options and payment plans. Understanding what you can afford lets you narrow your search and shop with confidence, knowing that the houses you view fit within your budget.
Get pre–approved: The home–buying process can happen very quickly, so be prepared when you find a home you want. Getting pre–approved for a mortgage puts you in a good position to make an offer when you find the right home. There's usually no cost or obligation, and it's a good opportunity to come in and talk to a mortgage expert to clarify any questions.
I welcome your questions or comments regarding this or any other posts contained in this blog.  If you or someone you know is thinking about buying or selling, call me for information about your desired neighbourhood or a FREE market evaluation of your property.
Look forward to hearing from you.
Lina

Sunday, May 15, 2011

Mortage Terms Explained, Part I


We all wish that money grew on trees but since we live in the real world, we know it doesn’t. So, when contemplating one of the biggest purchases you will ever make, a home, dealing with a lending institution to provide the money necessary to make that purchase is a must. The problem is that many of us have little or no knowledge about the terminology that gets thrown around in the world of mortgage financing and you may feel a little lost.

Here are a few terms that will help you navigate this wonderful new world when dealing with mortgage brokers, bankers and realtors:

• MORTGAGE TERM Lenders will only loan you money for a specific period of time called the mortgage term. The term can range from six months to five years (although some lenders may offer longer terms). When the term is completed, the remaining principal amount is payable in full, unless you renew the mortgage (or arrange new financing) for another term.

• AMORTIZATION Few of us can pay off the entire principal of a large mortgage in a six month term, or even a three-year term. Imagine your monthly payment if you did! So, to make it easier, lenders calculate or “amortize” the mortgage payment over a much longer time, often as long as 25 to 30 years. They are not loaning you the money for a single 25 year period, they’re just calculating the payment schedule as if it will take you that long to pay back the principal, plus interest. During the amortization period you will probably renew the mortgage for several terms. The longer the amortization period, the more money you pay in interest. Conversely, the shorter the period, the more you’ll save in interest costs.

• INTEREST RATES As you probably already know from credit cards or car loans, interest is the cost of borrowing money. Over years or months, the interest rate that lenders charge can rise or fall by several percentage points. Although interest rates fluctuate with the economy, the rate charged on your mortgage, and therefore your monthly payments, will be fixed for each term of the mortgage except in the case of variable rate mortgages. This is important to you because the rate of interest to which you commit at the beginning of the term can have a huge effect on the amount you pay monthly for your mortgage. This is especially true in the early years of a mortgage, when almost all of your payments is used to pay the interest, and very little is applied to the principal.

• PAYMENTS Most mortgage payments consist of two parts: 1. Principal and 2. Interest. This is known as a ‘blended’ mortgage payment. Each payment reduces the balance owed on the mortgage by the portion of the payment that is credited to the principal.

• PREPAYMENT PRIVILEGES The total amount of interest you pay over the life of a mortgage may surprise you. For example, a $50,000 mortgage, amortized over 25 years at a 7% interest rate, will cost you $55,061 in interest alone over the mortgage amortization period. That’s more than what you initially borrowed. Decreasing the total amount of interest paid, would make you happier, right? To do that, simply make extra payments toward reducing the loan’s principal whenever you can. The lower your principal, the less overall interest you’ll pay. But remember that for many mortgages, principal prepayments will not reduce your monthly payment amount during the current term. Fully open mortgages (those with no prepayment restrictions) let you make extra payments towards the principal anytime you want. Fully closed mortgages don’t allow prepayment privileges. Partially open mortgages (or partially closed) allow you to make very specific prepayments at certain intervals. For example, they may let you make one additional payment of no more than 10% of the principal each year.

Because I know that all of this information could be overwhelming, especially if you are a first time homebuyer, I will leave it here for now. Keep coming back to my blog and look for Part II of Mortgage Terms explained.

I welcome and look forward to your questions and comments. If you or anyone you know is thinking about buying or selling, please call me. I will be happy to provide a FREE market evaluation of your existing property or a list of homes that fit your budget and style.

Lina

Friday, May 13, 2011

Home Staging Tip #2: It's All about Compromise

We’ve talked about some of the things that you need to do outside to make a big impact when you sell your home. We know that it all starts from the curb side when a potential buyer drives up to your home. But, with all good relationships, like the one you probably have with your home, there is always a compromise to be made.


Something you should not compromise on is your commitment to get your property staged by a certain date.  Set a timeline and be accountable to that time line. Your real estate sales representative can be the perfect accountability partner in this process. Remember that your goal is the same as your realtor’s, to sell your house in the shortest time frame and for the best possible price. In order to accomplish that goal, your home must be ready to show at its best for the length of the listing contract. Don’t procrastinate on anything you can do right away. Enlist the help of friends and family if necessary and for the big jobs, assign a due date and stick to it.

Life is a series of compromises. Staging can present you with situations where you must compromise. If your budget is limited, deciding where the money will be best spent isn’t always easy. For example, your kitchen floor is vinyl, looks very worn and has some tears in it. The main bath has green tile that is in good condition but looks dated. Your compromise comes in choosing to do the job that will give you the highest rate of return since you know you don't have the budget to change both. In this case, the choice is obvious; the kitchen will give you best overall look to sell your property for the highest price. As for the bathroom, let’s compromise. You can stage it with a neutral wall colour, white towels and accessories. In order to give it a crisp fresh look remove bottles, brushes, and other items from all counter tops. So now we have created the biggest impact by replacing the kitchen floor and we’ve given the bathroom a great new look.

This is a win-win situation where compromise worked to give you the best results all around.

I welcome your comments and questions on this post or any other information contained herein. For a FREE market evaluation of your property, call me today.

Lina

Tuesday, May 10, 2011

Garage Sale for Shelter-Saturday, May 14, 8:00 a.m. - 12:00 p.m.

Do you ever wonder if there were something you could do to change things in your community?  Do you ever wonder what certain choices could have meant for you or someone you know and what road you/she might be travelling down right now if you had made different choices?

I think that many of us ask ourselves these very questions and find the task of changing our community daunting.  It's not.  It can be easy and you can be a part of that change.  The Garage Sale for Shelter is coming up this Saturday May 14th.  It is a national event that happens each year and participating Royal LePage offices raise funds to benefit their local women's shelter and help put abuse out of commission!

Donate items for the sale or come out and bargain hunt for hidden treasures at our sale.  One hundred per cent of the funds we raise go directly to benefiting the women's shelter and local programs.  We are located at 272 Queen Street East in Brampton and we will be there from 8:00 a.m.  until 12:00 p.m.

If you have any questions about this or other fund raising events for The Royal LePage Shelter Foundation, please call me at 905-796-8888.

I look forward to your feedback and comments on this post or any other information contained herein.

Lina

Monday, May 9, 2011

TOP FIVE TIPS FOR FIRST-TIME HOMEBUYERS

(NC)—More than ever, first–time homebuyers are weighing their options before embarking on the Canadian dream of owning a home. “We want consumers to be comfortable with the financial responsibilities of owning a home, so it's important to determine what they can afford in order to maintain a reasonable lifestyle once they've made the leap,” says Phil Soper, president of Royal LePage Canada. As such, Soper offers these guidelines for first–time homebuyers:


1. Determine your net worth. Take your assets (cash, investments, savings, vehicles and other items you own) and subtract your liabilities (car loans, lines of credit, overdrafts and credit cards). A positive number is a good sign that you may be ready to purchase your first home.

2. Obtain mortgage pre–approval. There are many different mortgage options available on the market today. Thoroughly investigate the terms and rates available, and once you have settled on a rate, term and amortization period, apply for mortgage pre–approval with your lender. Mortgage pre–approval presents you as a serious purchaser, to both real estate agents and sellers.

3. Hire a real estate agent. Top agents have extensive experience and demonstrate dedication and commitment to helping their clients. Ask your family and friends for a referral, or explore real estate sites such as www.royallepage.ca to read profiles on agents, including their areas of expertise and languages spoken. A real estate agent will have knowledge of accurate, real–time market data to leverage your negotiating position, as well as access to properties often even before they are listed on MLS.

4. Be realistic. Choose a home that is within your means. Keep in mind that you will need to set aside extra funds for ongoing home maintenance and potential increases in utilities, taxes and mortgage rates.

5. Rent out a portion of your home. Consider buying a home with the potential to provide added income. Renting a basement apartment or a spare room can put extra money in your pocket, helping you to pay down your mortgage faster.

www.newscanada.com

Friday, May 6, 2011

KEEP, TOSS OR SELL: DECLUTTER FOR A CAUSE

THE FIRST STEP IN HOME STAGING
Home staging is an effective tool for owners wishing to sell their house. By taking time to improve the appearance of their home, sellers can attract potential buyers.

De-cluttering is an important step in the home staging process. When listing a home for resale, removing unnecessary items and depersonalizing the space maximizes square footage and helps potential buyers visualize the space as their own.

De-cluttering is also a great way to give back while getting rid of unwanted household items. Consider hosting a garage sale in support of a worthy cause or donating items to the National Garage Sale for Shelter – an annual event presented by the Royal LePage Shelter Foundation benefiting women’s shelters in Brampton.

This year’s event will be held on May 14, 2011. For more information visit www.royallepage.ca/shelter or call me at Royal LePage Innovators Realty, 905-796-8888.

Here are some tips on de-cluttering and staging your home:

1. Creating the illusion of space and neutralizing your house are two important aspects of house staging.

2. Look at your home as though you're seeing it for the first time. Make sure every room neat, spotlessly clean, dusted and uncluttered.

3. Pay special attention to your bathroom and kitchen as they are key selling points. Make sure counters are free of small appliances and personal effects – buyers want to envision space how they like it regardless of how expensive your appliances might be.

4. Organized storage space is a key feature when selling a home. De-clutter your closets and sell unwanted items – this will also help sellers during their own move.

5. De-clutter by removing excess furniture to make rooms feel more open and replacing any items that are not appropriately sized for the room. Create the illusion of space to sell.

6. Ensure that the d├ęcor of your home is modern and tasteful. Part with pieces that are past their prime and most people’s taste.

7. Don't forget about your backyard – rid your property with old tools, pool toys and gardening equipment. Interested buyers may decide to look inside your shed, so make sure that it is organized and clean.

Wednesday, May 4, 2011

Finding Your First Home at a Price You can Afford

(NC)—Attractive mortgage rates and home prices are making 2011 a good year to look at buying your first home. There are a number of factors that you should take into consideration to make certain your first home is truly one you can afford.


“Buying your first home is one of the biggest life decisions you will ever make and you want to ensure you are both financially and emotionally prepared,” said Kavita Joshi, director, Client Strategies, RBC. “Your first step should be to determine how much you can afford while still maintaining your chosen lifestyle.”

Here are some tips for getting started:

• Know how much you can afford – before beginning your house search in earnest, take time to review down payment options, household income, current debt, estimated monthly housing–related costs and closing costs. You can visit the RBC online calculator to help determine how much you can afford (www.rbcroyalbank.com/cgi–bin/mortgage/tools/howmuch/afford.pl).

• Work with a budget – budgeting and setting a maximum amount on how much you are willing to spend are key to ensuring you can buy your first home and still live within your means. Online budgeting tools such as myFinanceTracker (www.rbcroyalbank.com/myfinancetracker) can help determine exactly where your money is going and how much you have to spend within the parameters you've set for yourself.

• Do your research – friends, family members and online websites can offer you helpful tips and personal advice. Also, consider reaching out to an RBC mortgage specialist (https://mortgage.rbc.com) who can give you insights into your finances.
For further budgeting tips and to join the discussion on purchasing your first home visit the RBC Facebook page at Facebook.com/rbcroyalbank.

www.newscanada.com

Tuesday, May 3, 2011

Additional Costs of Moving

You've decided that moving is in the cards for you.  In addition to the actual cost of your dream home there are several other, not so hidden costs, that you should consider and budget for.

• Mortgage Loan Insurance: If you are putting less than 20 per cent of the house value down, you're going to need mortgage loan insurance. Depending on the lender, the premium can be added to mortgage payments.

• Insurance: The lender will require proof of property insurance for the replacement value of the house and its contents from the day you take ownership.


• Title insurance: Provides coverage in case of problems with the property title among other things. The cost is relatively low, usually a few hundred dollars. Talk to your lawyer and/or lender about title insurance

• Appraisal Fee: Lenders typically loan a percentage of the home's purchase price or the market appraisal of the property. Talk to your financial institution about the cost since it depends on the size and complexity of the assignment.

• Land Survey: The lender may ask for a current survey or certificate of location before signing off on the loan. There can be a substantial cost for having a new survey done on the property.  Always make sure that the Agreement of Purchase and Sale has a clause that asks the seller for a copy of any current or up-to-date surveys that they may have in their possession.  Always get it in writing.

• Deposit: A deposit normally goes with the formal offer to purchase and is usually payable to the Listing Brokerage where it is held in the brokerages trust account until closing.

• Application Fee: Some lenders will pass on the cost to process your application. These fees vary and some lenders will waive entirely if you have other accounts with them.

• Mortgage Broker's Fee: If you use a mortgage broker, a fee may be charged to arrange a mortgage on your behalf.

• Home Inspection Fee: An inspection protects the buyer by revealing any problems in the property that you'd want to know before you move in.  Depending on the inspector, an inspection of a typical 3-4 bedroom, 2 storey, detached home can cost you somewhere in the range of $350.00 to $450.00.

• Legal Fees: You can save some of the legal fees usually charged by the lender if your lawyer draws up the mortgage. You'll also pay for disbursements which are the costs involved in drawing up the title deed, conducting a title search, and preparing and registering the mortgage.

• Land Transfer Tax: The LTT calculation is as follows for Ontario (Ciy of Toronto LTT is not included):  The tax rates on the value of the consideration are:

0.5% amounts up to and including $55,000
1.0% amounts exceeding $55,000 up to and including $250,000
1.5% amounts exceeding $250,000
2.0% amounts exceeding $400,000 where the land contains one or two single family residences

First time home buyers qualify for a maximum $2,000 (LTT on a $227,500 home) provincial rebate and a maximum $3,725 (LTT on a $400,000 home) City of Toronto rebate.

• Goods and Services Tax: The purchase price of resale homes is exempt from the HST. The purchase price of newly constructed homes is subject to HST. New home buyers can apply for a 36% rebate of the federal portion of HST applicable to the purchase price to a maximum of $6,300 for homes costing $350,000 or less. For new homes priced between $350,000 and $450,000, the rebate on the federal portion of the HST rebate would be reduced proportionately. New homes priced $450,000 or higher would not receive a rebate of the federal portion of the HST. New home buyers can apply for a 75% rebate of the provincial portion of the HST applicable to the purchase price to a maximum of $24,000.

• Other Costs: These include moving costs, fees charged by utilities for service hook-ups, property tax and other adjustments (an adjustment takes place when the seller has already paid for something in advance and wants to be credited for the unused portion on the date the house becomes yours), and ongoing maintenance (condo fees etc) and utility costs.

I welcome your questions and comments.  Call or email me today for a FREE market evaluation of your home.

I look forward to hearing from you soon.

Lina

Monday, May 2, 2011

I'm thinking about selling my home….what are my options?

When making the decision to sell your home, there are important questions you must ask yourself:

• Why am I selling and are there any alternatives to selling?
• What is the best time to sell and how do I know what fair market value for my home is?
• How much money do I need to have in my pocket after expenses i.e. lawyer’s fees, land transfer tax (if purchasing an alternate property), commission, etc.?
• What other goals do I expect to achieve through this sale i.e. paying down debts, putting money into the bank for retirement, downsizing, etc.?

With the help of your realtor, you can pin point these goals early on in the game.  There are many reasons home owners sell and they can include one or several; job transfer, a change in your financial position, a lifestyle change, or a change in marital status. Whatever the reason(s) major changes in our lives are often the catalysts for a selling decision.

If a job change or transfer is the reason for the decision, be aware that employers will often help. They may offer to pay the real estate commission for your existing home and/or pay for moving expenses. Some employers may even offer to buy your home so that your equity (the difference between your home’s selling price and your mortgage) is available for the down payment on the next home. This can be very beneficial, especially if you must move quickly.

Changes within a family are often the most common reason for deciding to sell. An upcoming marriage or the birth of a child might mean that you’ll need three bedrooms instead of two. Children leaving for university, retirement, separation, or even a death can suddenly change your financial situation and your mind about where you would like to live. Talk to your financial institution about your options. You may find that selling your home will provide you with adequate funds for your child’s university education or; that a smaller home or a condo will continue to afford you the option of home ownership after retirement, a separation, or a loved one’s death.

Although the focus here is how to help you sell your home, remember that there are alternatives to consider if you are unsure about selling. You can consider refinancing, renovations or renting a portion of your home for income.

Whichever alternative you choose, make sure you go into it with your eyes open. There are several things in each scenario that you must consider before moving forward and your realtor can help shed some light on each one.  I welcome your questions or comments.

Are you or someone you know thinking about selling? Call me for a FREE market evaluation of your home. 
I look forward to hearing from you.

Lina

Sunday, May 1, 2011

Staging Tip #1: Start Outside

It’s finally SPRING and you’ve decided that it’s time to sell. You know that you’re going to need to make some changes. It’s been a long winter so the first place that you should start is the exterior of your home.

Your first step begins by walking across the street and having a look at your home from a buyer’s perspective. What do you see? Are the gutters coming loose? Is the front yard in bad shape? Does the garage door or the front door need a new coat of paint? You’ll likely notice things you haven’t seen for months or possibly years.

Buyers can be brutal when assessing your property so make it worth their while to get out of the car and come inside. If you don’t stage the exterior people might say it looks too small or it’s overpriced just because there are too many trees or the bushes have grown up over the windows. You must merchandise your home to make it appealing to potential buyers and that starts by staging the exterior.

Here are just a few of items on a checklist you should use when you are staging the exterior of your property:

• FRONT DOOR: To make your house look crisp and in good condition, paint or stain the front door. This is an inexpensive way to make a great first impression.

• FRONT ENTRANCE: Add colour by planting flowers. Remove ornamental lions, frogs and bunnies that could be distracting buyers from the focal point, the entrance itself.

• ROOF: Ensure the roof is in a good state of repair, remember that a roof is not an upgrade in a home, it’s a prerequisite. Make sure that the gutters are free of debris and/or branches to keep animals, insects and foliage off the roof.

You have a very small window of time in which to make a great first impression, so stage your home inside and out. Whether your house sits on several acres or a small urban/suburban lot, it still needs to be done.

Call or email me today for a FREE market evaluation and staging consultation with a complete outdoor checklist containing detailed tips and ideas for staging the exterior of your property.