Reasons To Buy Now

It's still a great time to buy despite the new mortgage rules and predictions about the real estate market via the media. I give you some food for thought as to why it's a good time to buy now in my guest post for the Streetseed blog, just click here.

What are your thoughts?

Buyer Round Up!

I have gone through all my blog posts and rounded up all the posts that I have done to help buyers. So whether you're a first time buyer or veteran buyer, these posts will be of great help to you and provide you with some tips and tricks. Grab a coffee or maybe an alcoholic beverage and enjoy!

Mortgages:
-Want mortgages simplified before you begin your hunt, then check out my Back To Basics post, just click here
-Need some further education on mortgages and rates, the internet and social media is your best bet find out why, Social Media & Mortgages, just click here
-Not sure about the new mortgage rules, or that there are new rules in place, then check out my post on the New Mortgage Rules, explained, just click here
-Ok, now that you read the new mortgage rules and have some questions, check out the FAQ's, just click here

House or Condo:
-Now that you're pre-approved and understanding mortgages, what do you buy, a house or condo? Check out my guest post on RateHub for some food for thought, just click here

Neighbourhoods:
-next decision to make as a buyer is which neighbourhood to live in, check out my post on the Top 10 Neighbourhoods To Buy In Toronto Now, just click here

Bidding Wars:
-do you and everyone else want to purchase the same property? Then check out my tips and tricks on How To Win A Bidding War, just click here

Closing Costs:
-you've found your dream home and are waiting to close on it, know the full costs of closing up front, by getting the facts, just click here

Renovations:
-thinking of renovating the property you just bought, but don't know where to begin, which renovations will increase your property value and never worked with a contractor? Here are some posts to help get you started

• 5 Renovations That Pay
• 3rd Project, what I've learned so far from my renovations
• Update: Recent Project (scroll to the bottom of the post) key points on the process and design

Hope this round up has been helpful. I will be posting more buyer content in the next couple of weeks, so if there's anything you would like me to discuss, make sure to contact me. Seller round up is in the works!

Social Media & Mortgages

Brennan Valenzuela from RateHub is back this month for his guest post. In case you're not up to speed, Brennan and I decided to swap articles once a month on each other's blogs. If you missed his last post, no worries, just click here and if you missed mine, just click here. Now that you're up to speed, Brennan will be discussing the importance of the internet and social media for mortgage shoppers, how appropriate!

Take it away Brennan........

The internet is one of the most important communication tools on the planet. It plays a large role in how we discover, research and share information.  And it’s usage is growing at a phenomenal rate. One “internet minute” yields:

·         6 million views on Facebook

·         2 million search queries on Google

·         1.3 million videos watched on YouTube

·         100,000 new Tweets on Twitter

Social media is increasing the rate at which information is shared and now more than ever, consumers are spending more time visiting and engaging on social networks. This is no different for the mortgage industry.

According to the annual CMHC Mortgage Consumer Survey, seven in ten mortgage consumers use online sources, with an astonishing one in three relying solely on the internet to source their mortgage information.

Facebook is the most popular social media platform among mortgage consumers. In fact, social media for first-time home buyers  is an important aspect of their mortgage process. Two years ago, only 3% of first-time buyers used social media for their mortgage needs; however, today the number of users increased to 20%, or one in five first-time home buyers. Even more interesting is that 43% of social media users engaged in interaction to solicit a mortgage opinion.

Home buyers are not only using the internet to feed their mortgage queries, but to also improve their financial literacy. About four in ten recent buyers did a financial self-assessment online. Even more impressive, over 80% of those people felt they had a better understanding of their affordability and the mortgage options available to them after taking the online assessment.

Examining what mortgage consumers search for reveals what’s truly important to them. It’s no coincidence that the most searched topic was current interest rates as consumers look to acquire the best mortgage rate. Other popular search topics included mortgage options, mortgage calculators and general mortgage information.

The mortgage industry can seem complex to the average home buyer, but by using the internet, mortgage education is only a few clicks away. As social media flourishes, its popularity as a resource will grow among Canadian home buyers too.

The following article was written by Brennan Valenzuela for Ratehub.ca, a mortgage rate comparison website that is dedicated to helping and educating first-time home buyers.
Thanks Brennan, that was really an eye opener! Are you surprised at the facts? Do you begin your mortgage search online first? Brennan and I would love to hear from you!

For more information make sure to follow RateHub on Twitter @RateHub_Canada and like them on Facebook. 

See you next month Brennan!

Source: http://www.intel.com/content/www/us/en/communications/internet-minute-infographic.html

It's War!!! Now How Do You Win?

So it's definitely no surprise that bidding wars have become the norm in today's Toronto real estate market. As a buyer, you either prepare yourself to get ahead of the game or sink with the rest of the fish on offer night. As much as bidding wars are very frustrating, as a realtor, I also get an adrenaline kick out of it and must say there is no better feeling then winning one of these wars for my client.

I compiled a list of what to do when preparing for battle. Please note, there are no guarantees, even if you follow all these tips:

1. Research the neighbourhood and see what similar homes have sold for and when they sold, pay extra attention to the homes which are very similar and were listed for the same price as the home you are preparing to bidding on because if the home sold over asking, the sellers will expect the same price minimum, if not higher
2. Once you completed tip #1, ask yourself if you're willing to pay this amount or higher and establish a cut off point where you are willing to walk away comfortably without regret. At the same time remain a bit flexible especially if your offer is in the running and other offers have been sent home
3. Mortgage preapproval, even though this does not guarantee that the bank or CMHC may think what you paid, is what the home is actually worth and what they are willing to lend you, it gives you a general scope of affordability and how you look in the banks eyes
4. Pre-home inspection, if there is a recent one that has been provided by the sellers, then request a copy and go through it in detail, maybe even revisit the home and pay extra attention to the details that caught your eye in the report to gage how bad the problem may be, try even bringing a general contractor
5. If there is not a pre home inspection done already by the sellers or if you think it may be bias and you really want the house, then hire a home inspector before offer night
6. As a buyer agent I always talk to the selling agent beforehand and try to get as much information about the proceedings, the sellers, the house, etc so I can prepare my buyers
7. As a buyer agent, I always call throughout the day to see how many offers are registered and keep my buyers up to date, again to mentally prepare them for the night ahead
8. Try to register your offer as close to the cut off time as possible so that your offer is not used as ammunition for the seller's agent to gain more offers, remember people want what they may not be able to have
9. Bring a certified cheque or bank draft to offer night for at least 5% of the purchase price you're offering, if not higher, the bigger the better as it shows the sellers you're very serious and the seller's agent feels more comfortable advising their clients to accept your offer rather then worrying about chasing after the deposit the next day
10. As a buyer and buyer agent, show up to the offer presentation, again shows the sellers how serious you are and that you want to strike a deal tonight! Try to avoid faxing offers unless the sellers are being very insistent, always request a presentation
11. Further to tip #10, by being there, you can observe the type of people that are bidding on the house and how long the seller's agent is holding the other buyer agents hostage. The quicker one comes out, the worse their offer is, it's all about observation and reading body language
12. Come in strong, sellers hate when people play games and give low ball offers, it's insulting! Your first round should be 80%-90% of the price you're willing to pay. A weak offer may not get a call back for a second or third round, plus if there are a lot of offers to contend with, you want your offer to leave a lasting impression on the sellers
13. Be flexible with your closing date, offer the exact or as close as possible date to what the sellers are looking for, once again, it will make your offer look really favourable
14. Firm offers are always best, meaning no conditions on financing or home inspection, amoung others. If you feel comfortable doing so, then why not? 9 out of 10 sellers will choose an offer that is firm, even if the price is a bit lower because it guarantees them that the house is sold firm once they sign on the dotted line
15. Write a hand written note to the sellers expressing how much you like their home and how excited you are for the possibility of living their with your family.....pull on the seller's heart strings as people make decisions based on emotions all the time and real estate is no different
16. If you're approaching the last round, never offer whole numbers ie. $445,000, offer numbers such as $445,600 or $446,100, (I think you catch my drift here), to separate yourself from the others, I've seen people win bidding wars by $100-$500!
17. Trust your agent, if you don't, then why are you working with them in the first place, this is one of, if not the biggest purchase of your life, by trusting your agent to do the best job possible gives your agent the confidence booster they need to negotiate the s**t out of the offer and potentially win the war!

Just remember as a buyer, to look at the situation from the sellers perspective, constantly. The selling agent is hopefully doing their best to get their client the BEST terms, price and conditions, always!

Let me know if these tips help or if you have any of your own, I would love to hear from you!
***Image via Move***

Closing Costs-Get The Facts!

I'm often asked by my clients, what are closing costs and how much should they budget. It is a very common question, especially among first time buyers and there are a lot of myths out there about what your closing costs include. The other day, one of my buyer clients told me that they heard from a friend that they should budget 7% of the asking price for closing costs, that's a lot, especially since they are first time buyers!!!

So I thought I would set the record straight for everyone out there scratching their heads. This only applies to resale properties, not new homes or condos as there are other factors to consider. I will start by doing a break down for 1st time buyers...

First Time Buyers:

• Lawyer fee to close the deal, $1000-$1500, make sure to shop around, also ensure the quote given includes all disbursements and title insurance
• Title insurance, $250-$650, this one is a no brainer people and should be taken by ANY buyer (done through your lawyer), this is a one time fee and the best and cheapest insurance you will ever buy! If the previous seller has something on the title of the property that your lawyer didn't discover during the title search (mortgage liens, etc) and costs money to reprimand or any outstanding property taxes or water bills, title insurance will pay for it in a heartbeat, no battling it out with your typical insurance companies, so why not take it and give yourself a peace of mind! I've had to use my title insurance a few times in the past and it was a pleasure and took no time at all.
• Ontario Land Transfer tax, for any property purchased in Ontario, you must pay this tax, good thing for first time buyers is that you can receive up to a $2000 rebate, just remember, all buyers on the agreement of purchase and sale must be first time buyers! This tax is a percentage of your purchase price so it's hard for me to estimate here, but I have a great LLT calculator you can use on my blog, just click here. Keep in mind this tax is only paid on the closing date and not before!
• Toronto Land Transfer Tax, this tax is paid only on properties purchased in Toronto and again it's a percentage of the purchase price. The good news for first time buyers is that they can receive a rebate up to $3,725 (equivalent to the Toronto LLT payable on a $400,000 property). First time buyers are NOT exempt completely, it all depends on the purchase price!
• Insurance tax, if you are receiving a high ratio mortgage (less then 20% down payment) the bank automatically insures your mortgage, either with CMHC or Genworth. An insurance premium is charged to the buyer, this premium is a percentage, but lots of factors, that I won't be getting into, come in to play when deciding what percentage the buyer will be paying. Not to worry as this premium gets added to your mortgage amount, but what doesn't get added is the HST the buyer has to pay on the premium. The buyer must pay the HST on the premium during closing and therefore should be factored in as an important closing cost. Please also keep in mind that some banks even insure mortgages with a 20% down payment or more, but the bank will usually absorb the cost.
• Mortgage broker fees, all banks and most mortgage brokers do not charge a fee to the buyer when arranging a mortgage, but there is some that do and this cost must also be considered in a buyer's closing costs, as the fee, if any, will need to be paid on the closing date

Non-First Time Buyers:

• all the same fees apply like above
• the difference is that as a non first time buyer, there will be no rebate on the Ontario Land Transfer Tax
• as a non first time buyer purchasing property in Toronto, the rebate for the Toronto Land Transfer Tax will not apply, the buyer will have to pay both taxes, Ontario and Toronto, yuck!

I hope that has helped you solve some of the questions and myths you may have regarding closing costs. Please keep in mind that other various costs associated in purchasing a property apply. Those are, but not limited too, movers, cleaners, deliveries, etc, but these are the main ones that always stay consistent, unfortunately, unless our Mayor Rob Ford does good on his promise and eliminates the Toronto Land Transfer Tax, but I will leave that discussion for another day!

Let me know if you have any questions or comments and I will do my best to answer them!
***Image via San Francisco Chronicle***