Waiting until you’re married to buy a home together isn’t necessarily standard practice for couples anymore. These days, almost a quarter of long-term relationships are common law, according to Statistics Canada. In fact, Canada has the highest share of couples living together without being married, driven by Quebec, where 43% of couples have common law unions.

Whatever the reason, buying something together is a big decision, and it’s important for couples to be ready for the financial and emotional commitment—and to be aware of some considerations unique to unmarried buyers (because there are definite differences in the eyes of the law.) 

We talked to a REALTOR®, a mortgage agent, and two couples’ therapists who all shared helpful insights for unmarried couples thinking about buying a home together. All four of our experts agreed that couples must:

• be emotionally ready;

• be financially aware;

• understand legal considerations; and

• be able to talk everything through before making the decision to buy.

Be transparent about your financial situation

Money is one of the biggest sources of conflict in a relationship, says Emily LeMoine, a registered psychotherapist at Grey Couch Counselling. Before making any big decisions, it’s crucial to have an honest conversation about your full financial pictures: be transparent about your income, debt, credit scores, and financial goals. Do the two of you have similar savings priorities and spending habits? How much of a strain will financial stress put on your relationship?

Not being up front about debt or a less-than-stellar credit history will only result in conflict—especially since applying for a mortgage means any issues will come to light pretty quickly.

“If anyone has a poor credit score or a lot of debt, it will come out in the mortgage application,” says Amanda Dindayal, mortgage agent, financial coach, and owner of RedPocketBook.ca. “All assets and debts need to be disclosed, so being honest about money now can reduce stress later.” 

She also says whoever is on title has to be on the mortgage application, so if either partner has a credit score that can impact their eligibility, it’s good to know that going in. Plus, if one of the partners is self-employed, it’s important to ensure all their taxes are up to date and they can show proof of consistent income.

Discuss how you’ll split living expenses

If you feel you’re ready to take the financial leap of buying a property together, it’s time for part two of the financial conversation: the specifics of how you’ll pay for the home and cover ongoing costs. Will you split the down payment and mortgage 50/50 or come up with a different arrangement? It’s up to you, but whatever you decide, be sure to document everything so you’re on the same page. 

“Couples should decide in advance how they will split the down payment, mortgage payments, maintenance costs, and other expenses,” says LeMoine. “A joint account for shared costs can work well, but it’s important to set clear guidelines before you buy, especially if you have significantly different salaries or have different priorities when it comes to purchases, renovations, and other big expenses. If one partner contributes more, documenting it can help prevent misunderstandings down the line.”

Have conversations about future financial goals

“A home is a big financial investment, but it’s also a significant emotional one,” says Ria Gulati, who’s also a registered psychotherapist at Grey Couch. “Explore everything from why you want to buy to how ready you both really feel. It isn’t uncommon to find that one partner is a lot more gung-ho about the idea than the other.” 

She recommends you also discuss your expectations for the future: while you may or may not be planning to get married, it’s important to talk about other things that will impact your future. 

• Do you plan to have kids?

• What are your career trajectories?

• Do you want to stay in the same place long-term?

• What would happen if one of you lost your job, got sick, or if your relationship ended?

Most couples don’t want to talk about money or the negative stuff like what happens if they break up—that’s understandable. They want to remain optimistic, but avoiding the negative now can mean unspoken differences and expectations, and a bunch of unpleasant conflict down the road. It’s crucial to make sure you’re on the same page from the beginning. 

Couples who have effective, consistent, open conversations about their emotional needs are more equipped to purchase a home together than those who avoid, suppress, or withhold emotional content, says LeMoine.

Should you put both names on the home title?

You might think laws around common-law relationships would entitle both partners to half if there’s a split, but that’s actually not the case. Common law couples aren’t automatically required to split property acquired during their relationship. Being listed on the title is the only way to ensure legal ownership of the home.

So what happens if, say, one person covered the whole down payment or paid more of the mortgage? If there’s no agreement in place from the start, things can get messy. 

“I would encourage an unmarried couple buying a property together to discuss each person’s financial contributions,” says Julian Kashani, a broker and REALTOR® at Property.ca. “They should draw up a contract based on these financial responsibilities and include future buyout terms.” 

He recommends unmarried couples go with one of two options: 

1. A joint tenancy, where both own the property 50/50.

2. For unequal ownership shares, a Tenants in Common agreement allows percentages to be specified.

Talk to a lawyer about your joint homeownership

Nobody plans to split up, but it’s prudent to protect yourself in case things don’t go according to plan. A legal professional can help you navigate the complexities of property ownership, draft a fair cohabitation agreement, and ensure both partners’ rights are protected.

Find a REALTOR® you both like

Are you working with a real estate professional who represents both of your interests? If one partner has a close connection with a REALTOR® who’s a friend or family member, the other partner might feel left out, resentful, or as though their needs and wants won’t be taken into consideration. It’s a good idea to select someone neutral who prioritizes both partners’ interests. Ask friends and family for a recommendation—or search REALTOR.ca for a REALTOR® specializing in your area.

Buying a home together is a wonderful milestone in your relationship. To ensure the purchase is one that works for both of you now and in the long term, thoughtful planning and plenty of open communication will help ensure you end up in a place that works well for both of you. 

The information discussed in this article should not be taken as financial or legal advice. This article is for informational purposes only.

Source: https://www.realtor.ca/blog/the-unmarried-couples-guide-to-buying-a-house-together/8142/1363

We often strive to decorate, organize, and make our space our own, but we don’t usually consider the impact design elements, layout, or lighting have on our moods and well-being. 

We asked two experts to share insights on how your home’s interior affects wellness, and tips for small, but effective ways people can adjust their existing spaces to improve them.

Keep flow in mind when you design your living space

Colin Ellard, PhD, a cognitive neuroscientist and design consultant at the University of Waterloo, studies neuro architecture and architectural psychology. He says environmental psychologists have looked at home interiors and their geometry to understand how the designs of spaces at every scale influence how we feel and what we do. 

“The way a space is laid out, and the way the areas of a space are connected to one another, will have an influence on how much time we spend in them and what kinds of things we do in those spaces,” says Ellard.

One concept researchers have discovered is the ideal locations in a space are those from which we can see and not be seen. 

“In evolutionary history, people preferred those kinds of spaces for pragmatic reasons like avoiding predators and being able to see where there’s food in a landscape. In the interior of your home, it’s more about that ephemeral feeling of comfort—being in a space where we feel the protective arms of something behind us where we can look out over the space and see what’s going on,” he explains.

For example, you typically wouldn’t put a comfy armchair smack in the middle of your living room; you’d put it to the side.

Mastalic suggests creating a cozy nook by placing an armchair, standing lamp, and potted plant in an unused corner.

Annabelle Mastalic, principal designer and founder of ADM InteriDesign, Design Trends, Interior Designers in Calgary, Alberta, takes a holistic approach when working with clients. A former nurse, Mastalic assessed patients by looking at everything impacting their physical, emotional, mental, and social health. Now, she brings those skills to her wellness design work.

“There are so many unconscious things happening when we’re scanning the environment; we don’t think about it, but it’s how the body’s responding,” says Mastalic. “Colour, the layout of the space, how much natural light is coming in—all those things are affecting the body.”

Open-plan living, which tops many home buyers’ wish lists, can be a love-hate concept, notes Ellard. 

“There are good reasons for wanting to have an open plan: young parents like to be able to see where their kids are all the time, and it’s very nice for entertaining. But it’s not for everyone,” he says. “Depending on your personality type, you might rather have a space that has some cozy nooks and quiet refuges. The ideal is to have the ability to move from an area where they can see lots of areas of their homes, to quiet locations of refuge.”

Even homeowners who love the idea of open plan living need zones, adds Mastalic. 

“If you’re walking into a home and you want it to feel welcoming, safe, and comfortable, clearly defined spaces in open layouts are perceived as more aesthetically pleasing and easier to navigate,” she explains.

Pro tips: 

• Ellard suggests creating a nook with privacy screens, area rugs, or lighting to suit your needs.

• Mastalic says create a cozy corner by adding a custom window seat where you can relax with a book, or placing an armchair, standing lamp, and potted plant in an unused corner.

Select design elements that promote wellness 

Materials, textures, patterns, and colours will all evoke a certain feeling and mood in that space, says Mastalic. She also suggests limiting your palette to one or two colours and adding textural elements with rugs and throws to create depth and interest. 

“In a bedroom, for example, if the desired feeling is relaxation, tranquility and peace, I’m going to choose colours that are more subdued and calming versus something that’s energetic like orange or red,” she explains.  

While warmer colours are known to promote energy, that depends on how you pair them, notes Mastalic.  

“If you’re pairing complementary colours like blue and orange, that will feel a lot more vibrant and energetic versus colours that are right beside each other on the colour wheels. Blue and green will feel a little bit more subdued if you pair them together versus colours that are opposite of each other,” she says.

A fresh coat of paint in a mood-boosting hue—even just on one wall—instantly changes a space, she adds.

“Painting the ceiling adds another dimension; I just did a project with a client where we painted the ceiling the same colour as the walls. It looked stunning and automatically made the room feel cozy,” she says. 

Soft bedding and blackout curtains can help improve your sleep and overall health.  

“The heavier the blanket, the cozier it feels; the brain’s unconsciously processing that this feels safe,” she says.

Pro tips: If you want serenity, soft greys and muted neutrals reduce visual distractions, allowing your eyes to rest. Incorporating soft textiles like an upholstered headboard or fur blankets make spaces feel more comforting, inviting, and cozy.

Clear out clutter to restore calm

Piles of stuff spread out around a home can cause stress and create visual distractions, says Mastalic.  

“Get rid of anything you don’t need. Then, look at creative storage solutions like built-ins and little nooks where you can include shelving—anything that would make a space feel more organized,” she explains.

Storage solutions that combine open and closed shelving, like built-in units, can help declutter our space and give our brains a chance to rest.

Because excess items remind us of tasks we need to tackle, donating unused items, organizing things we use daily, and stashing most things out of sight gives our brains a chance to rest and refocus. 

Pro tip: Use a mixture of closed storage with cabinet doors and open shelving above. Invest in furniture items that do double duty, such as an ottoman with a lid that can hold toys or side tables with drawers and shelving.

Bring in elements of nature 

Scientific evidence shows that biophilic design—bringing the outdoors in—significantly affects our moods, says Ellard.  

“One of the earliest pivotal studies in this area was conducted in a hospital. In the experiment, the scientist compared recovery in surgical patients who had a view of nature from their windows as opposed to those who didn’t. And there were differences between the two groups in terms of the time to discharge and the number of requests for pain relief,” he says. 

Since then, there’s been a movement about the importance of natural elements at every scale – from urban environments to home interiors, adds Ellard, who advises incorporating the patterns of nature into our spaces. 

“You don’t have to build a rainforest in your living room; a few house plants will work, and a view from a window is fantastic,” he explains. “Even if you have objects of art that incorporate patterns of nature, like landscape paintings, there’s some evidence it would induce a measurable effect not just on your mood but on your health.”

According to a study conducted in 2019 entitled, “Effects of Biophilic Indoor Environment on Stress and Anxiety Recovery: A between-Subjects Experiment in Virtual Reality,” biophilic design can lower blood pressure, reduce anxiety, and lower your heart rate.

Sheer drapes, natural textures, wooden elements, and houseplants by the window can all help boost your mood, according to Mastalic and Ellard.

Increasing natural light, highlighting nature views and choosing natural materials like wood, stone, cotton, and linen, also invoke a healthy connection to nature, says Mastalic.

“Try to maximize the view of a window: Instead of heavy drapery covering a window, use sheers. If furniture is blocking part of the window, move it out of the way,” she suggests. “Wallpaper or even prints in artwork that mimic nature is going to have a boosting effect because we’re intuitively more responsive to things found in nature.”

Pro tips: Replace heavy drapery with sheers to allow more light to filter through. Potted plants, fresh flowers, or even textural branches in a vase can all boost wellbeing.

Tweaking our physical surroundings can improve our overall mental and physical wellness, creating pleasing spaces that help us relax, focus or recharge. With a little creativity, you can incorporate these ideas to make the most of your home.

Source: https://www.realtor.ca/blog/how-our-interiors-affect-our-moods-and-well-being/38075/1367

As home prices and interest rates increased this year, some Canadian families are choosing to help their kids get a foothold in the real estate market. One of the ways they’re doing that is with gifted down payments.

A 2021 CIBC report said 30% of first-time buyers in Canada got a boost thanks to receiving money as a gift for a down payment on a home. James Harrison, Mortgage Broker at Mortgages.ca estimates that, in some markets, that number is a lot higher, with gifts ranging anywhere from $10,000 to more than $1 million. There is no limit to the amount that can be gifted.

“At least two-thirds of my clients are getting a gift of some amount,” he says. “Parents just want to help their kids buy, with the goal often being a 20% down payment.”

According to the CIBC report, in 2015, the average Canadian gift was $52,000. In 2021 it was $82,000. Gifts in Vancouver lead with the highest average in Canada, clocking in at $180,000, and Toronto a close second at $130,000.

What are gifted down payments?
A gifted down payment is exactly what it sounds like: a monetary gift from a parent, grandparent, sibling, or other close relative, towards the purchase of a home. It isn’t a loan; it’s non-repayable. The person doing the giving should have zero expectations of getting that money back, and will often be asked to sign an agreement to that effect.

How are gifted down payments different from co-signing?
When you give a gift, you don’t own any part of the property, but you also don’t assume any of the risk. If you co-sign, you are on the title—and 100% liable if the homeowners default on their mortgage. Co-signing can also impact your ability to borrow: whatever amount you have co-signed for will look like you borrowed it yourself.

Do gifted down payments have any impact on a mortgage approval?
No. Your income determines the max you qualify for, and the down payment is on top of that. Of course, the more of a down payment you have, the less you’ll need to borrow. So if you only qualify for a smaller loan, a gift can help you buy something bigger than you could otherwise afford.

“A gift can also get you from an insured purchase (less than 20% down) to a conventional one,” says Harrison. “Insured only gets you a max 25-year amortization, with strict debt ratios. But with 20% or more down, you could potentially qualify for a 30-year amortization with more give on the ratios. That can make a big difference in the total mortgage you qualify for.”

What are the rules around gifted down payments?
Everyone needs to sign a mortgage gift letter (each lender has their own template). Harrison says you must also provide proof that the gifted funds have been deposited into your account, and they should be there no later than 15 days before closing. For funds coming from outside Canada, lenders want to see those in your (Canadian) account 30 to 90 days before closing.

Depending on how gifted funds are used in the transaction, there may also be obligations to comply with Canada’s anti-money laundering laws, according to Canada’s Financial Transactions and Reports Analysis Centre (FINTRAC). For example, if the gifted funds are provided directly to the REALTOR®, the REALTOR® would have an obligation to verify the identity of the individual providing the funds.

Can we use borrowed funds to gift money to our kids?
Yes, you can. However, it’s probably not as common as you think: only about 5.5% of gifting parents use debt to finance gifting. If you’re considering using your line of credit, just be careful about your debt load, especially if you’re looking to retire anytime soon.

Are there any tax implications to gifting a down payment?
In Canada, gifted down payments aren’t taxed. Immediate family members can provide the gift without either side being on the hook taxwise. Of course, it’s always prudent to check with a tax professional for info pertaining to your specific financial situation.

That being said, Harrison suggests to his clients they consider protecting the gift in the event the recipient splits from their partner. Otherise, half your gift could end up with the departing spouse/partner.

Getting into the real estate market can provide plenty of benefits, like housing stability, an investment opportunity for yourself, and numerous social benefits. Helping your immediate family members with a down payment, if you’re able to, can be a great way to get them into the market so they can begin their homeownership journey.

The information discussed in this article should not be taken as financial or legal advice. This article is for informational purposes only.

Source: https://www.realtor.ca/blog/everything-you-need-to-know-about-gifted-down-payments/34688/1363

For most people, buying a home will likely be the most significant investment of their lives. With the emotional and financial aspects tied to purchasing and/or selling a home, it’s important to complete all due diligence to ensure your investment is protected.

This article will explore what conditions are, typical conditions you’ll encounter during the offer process, how they can affect the sale, and what happens if they’re not met.

What is a conditional offer and who benefits from one?
Simply put, “a conditional offer is when a buyer makes an offer on a property that contains conditions,” explains Duncan McDougald, REALTOR® with RE/MAX Executives Realty in Whitemouth, Manitoba. “Conditions are put in place to protect the buyer or seller as both have the right to include them in an offer to purchase. Realistically, conditions can be anything, as long as both parties agree to them. As a REALTOR®, it’s important to know what conditions to recommend to buyers and sellers in various scenarios.”

“Conditions don’t have to be accepted by either party, but if they’re reasonable and there’s no better offer on the table, it’s a very typical part of an ‘accepted conditional offer’, which is the status of a sale when the public sees it as ‘pending,’” he continues.

More often than not, conditions are put in place by the buyer because it facilitates a safety net for them.

“If a buyer’s condition(s) can’t be satisfied, they’re no longer under any legal obligation to move forward with the conditional deal,” explains McDougald.

In an offer, a buyer will include a time frame for their condition(s) to be satisfied. If they’re not satisfied by the end date, the deal becomes null and void unless both parties agree to extend the timeframe or the buyer gives notice that the condition(s) won’t be satisfied. In most cases, the buyer is entitled to a return of their deposit money if the conditions aren’t satisfied, but do keep in mind that there is an obligation to make an effort to satisfy the conditions.

It should also be noted here that “a condition made by either party is for the benefit of that specific party and they’re entitled to waive their condition any time before the condition’s deadline if they feel it’s no longer required,” emphasizes McDougald.

One of a seller’s favourite offers to receive is an unconditional cash offer. If they like the terms, they sign the acceptance and the property is legally sold.

“There are times, however, when an unconditional cash offer is made as part of a lowball offer in hopes it’ll tempt the seller into signing. Sometimes it works, sometimes it doesn’t,” shares McDougald. “As a REALTOR®, it’s also our job to advise in those situations, but it’s ultimately up to the seller as to what they’ll accept.”

Common conditions

There’s a lot to consider beyond the price point of a home, and agreed upon conditions help ensure protection and a smoother sale. These are some of the more common conditions you’ll encounter during a home sale, though they won’t all be present in every offer.

Appraisal contingency

Buyers have the right to request an appraisal of the home to compare its true value to the asking price. If the home is appraised for less than what the seller listed in the contract, the buyer may not be approved for the mortgage asking price, re-negotiations may commence, or the buyer may walk away with their deposit.

Home inspections

While not a legal obligation, one of the most important and highly recommended conditions to include is a home inspection to ensure the property is structurally sound. Though sellers will occasionally foot the bill, home inspections are usually paid for by the buyer with an inspector of their choosing so they feel confident in the results.

Financing

A financing condition or clause lets a seller know the buyer’s offer to purchase the property is conditional on obtaining their financing. The condition affords the buyer time—usually five to seven business days—to confirm their ability to obtain mortgage approval. This protects the buyer in the event the home appraisal comes in low and they’re not approved for the amount offered.

Escape clause

Usually stipulated by the seller, this clause allows the seller to “escape” or terminate the agreement based on a condition. A common use of the escape clause is when a seller has accepted a conditional offer on their home whereby the buyer requires 10 days to secure their financing. If the seller is receiving better offers during this time, the escape clause allows them to provide the original conditional offer 48 hours to complete the sale and if they can’t, the sellers have the right to go with a new buyer.

Land survey review

A survey review differs from a home inspection by way of surveying the grounds the property is on and again, while not required, it’s strongly advised to pay for a qualified, chartered professional to survey the property.

Cleanliness

Who doesn’t want to move into a clean home? This condition specifies the requirement for the home to be professionally cleaned before you move in.

Fixtures and chattels

If you expect to have appliances when moving into the new home it’s important to write it in the contract so you’re not met with an unexpectedly bare home on moving day. Make sure everyone is aware of what’s staying and what’s going.

Always consult your REALTOR®

During the negotiation period, most buyers will have at least a few conditions they present to a seller.

“Buyers and sellers should always discuss conditions with their REALTOR® for their specific purchase or sale and if uncertain, they should never be afraid to obtain sound legal advice from a lawyer,“ insists McDougald.

The conditions you include in your offer will vary depending on your situation, but with the help of a REALTOR® you can make sure you include the ones that make the most sense for you.

Source: https://www.realtor.ca/blog/typical-conditions-youll-encounter-during-a-home-sale/32326/1363

When you buy a home, you’re probably not thinking too much about where life will take you five, 10, or 20 years from now. At the time, you’re more preoccupied with getting moved in and settling into your new space. But as your personal, professional, and financial situations change over time, you might need to re-evaluate your mortgage, too. That’s why it’s smart to consult a mortgage expert every few years to find out how you can optimize your payments as your lifestyle evolves. Here’s what to keep in mind throughout the amortization period of your mortgage.

Why are regular mortgage check-ins important?

Reviewing your mortgage frequently, especially if your financial needs, personal circumstances, or homeownership goals change, is a good idea, says Craig Howie, Durham Region Mortgage Agent for Dominion Lending Centres in Whitby, Ontario.

During these check-ins, your mortgage specialist will review your finances, income, employment status, debts, and personal life events, such as divorce or illness. They’ll also want to discuss your short- and long-term homeownership goals. This can help you decide whether to change your mortgage strategy or structure, such as paying a lump sum, negotiating interest rates, or increasing your payment frequency.

What happens when your mortgage is nearing renewal?

You can renew with your current lender without the need for a credit check or income verification, but that’s not always the best financial move, says Howie.

“Lenders often don’t send out their best rates in a renewal letter because they know people are busy or their credit situation could have changed,” he explains. “Somebody who lost their job or has extra expenses will value the idea of paying a slightly higher rate without another credit or income check.”

You could switch to another lender to get a better rate, but if you’ve made big purchases (car, vacation, taking out loans, etc.) your debt-to-income ratio increases, and that can affect your ability to get another mortgage.

“Once you have a mortgage, you’re only qualified for that mortgage; if you take that mortgage to another lender, they view it as a completely new one,” says Howie.

Five years into your mortgage: kids and jobs can factor in

Five years in, homeowners may have started a family, which impacts your finances, says Howie.

“You can often end up in higher debt due to maternity or paternity leave and daycare expenses, so we can look at a potential refinance and consolidating credit card or line of credit debt and adding it to the mortgage at a much lower rate,” he explains.

Amortizing those costs over a longer period lowers your monthly expenses and increases your cash flow, he adds. Or, if you’ve changed jobs and boosted your income, you may decide to change the frequency and size of your payments.

“When rates were 1.5%, nobody was really itching to pay their mortgage off quickly, but if interest rates stay where they are now—in the 5% range—it does make sense to pay it off faster by changing monthly payments to biweekly, taking advantage of lump sum payments, or doubling up your payments,” says Howie.

These are the things your mortgage expert can walk you through, identifying what makes the most sense for your personal situation. Mortgages shouldn’t be a “set it and forget it” situation. It’s important to keep on top of things to see where and how you can optimize your payments.

10 years into your mortgage: time for some TLC around the house

After 10 years of living in your home, you may be thinking about renovations or repairs. You may want to add the cost of a remodel or a new roof onto your mortgage, or switch the home equity you qualified for over to your mortgage. Reviewing your mortgage with an expert will help give you the bigger picture so you can see what your options are.

15 to 20 years into your mortgage: tapping into your equity

Fifteen to 20 years into your mortgage, you might have kids who are learning to drive, getting ready to go to university or may want to travel for a year—all things parents often help support financially. Or maybe you long to buy a vacation property or retirement.

“Although previous generations had a mentality of paying off debt as fast as possible, for the past 20 years, we’re seeing more people refinancing their mortgage to use funds as investments,” says Howie. He has many clients who leveraged their mortgages to buy rental properties or condos for university-aged children—who then charge rent to their roommates to help pay the mortgage.

“Some people are also thinking about retiring and wondering how to use the equity in their home to buy a cottage or help their children purchase a home.”

After spending the time to build equity in your home, you should be exploring all the options on how it can work best for you. You can also take this time to look at your long-term goals and consider what your priorities are as you near retirement.

Into the home stretch

A mortgage specialist will guide you through your final payment and advise you of any paperwork to be done along the way. Right up to the end, it’s important to maintain good credit so you can have an option to requalify if you need to, advises Howie. He adds that many mortgage brokers reach out to their clients annually to make sure things are going smoothly and any questions are answered.

“We make sure to address any questions or concerns ahead of time, so when the mortgage comes up for renewal, they don’t just sign the renewal; we always see what else is out there.”

Once you’ve paid your last mortgage payment, you still have a few things to do. This process, called discharging a mortgage, also involves your lender and provincial land title registry office. First, you’ll request confirmation from your lender that your mortgage has been paid in full. Then, your notary or lawyer sends these documents to the land registry office so changes can be made to your property’s title. There are fees involved, which vary depending on where you live. Find out what’s required in your province to be sure you’ve followed all the steps.

Your situation in year one of your mortgage is almost guaranteed to be different from your situation in year five, 10, or 20. Regularly looking at your mortgage options—with the help of a mortgage expert—can help save you money in the long run and even achieve some of your goals sooner. If you’re not sure where to start, your REALTOR® will be able to point you in the direction of other trusted professionals.

Source: https://www.realtor.ca/blog/checkpoints-you-should-consider-over-the-course-of-your-mortgage/31638/1361

From creating a warm, inviting space in your home, to clearing your driveway for potential viewers, to making sure any essential home renovation and repair is complete, we’ve compiled some ways to prepare your home in the winter and help maximize your selling potential.

If you think selling your home in the winter is the same as selling your home in the summer, well, that’s a cold take. Each season has its distinct benefits when it comes to listing a home, so how can you take advantage of the snow and frigid temperatures?

“There’s less competition on the market during these slower months,” she says. “As a seller, you have the focused attention of all the buyers hunting for a home in your area, or even outside your location. When supply is low, demand for your property can be high simply by being the only option.”

If you’re thinking about selling your home in the winter, here are some tips on how to prepare for a successful sale.

Make the most of the outdoors

Landscaping

Despite not being able to appreciate the lusciousness of your garden or lawn in the winter, landscaping shouldn’t be neglected.

“Landscaping is your ultimate first impression,” said van den Broek. “A buyer makes their initial decision of like versus don’t like in approximately 60 seconds, so the walk up or drive by shouldn’t be underestimated. A buyer will feel confident that seasonal maintenance has likely been completed, and that you’ve taken care of your home inside and out.”

As a rule of the proverbial green thumb, remove anything that’s unlikely to survive the winter so there aren’t dead plants in the garden. If you’d like to add plants and shrubs, be sure they’re the evergreen kind such as Blue Holly or Winter Heath. If you have pets, ensure you’ve removed any droppings and yellow snow before potential buyers show up. Even if your area doesn’t get much snow, make sure your front yard is well-kept, with any dead leaves raked up and thrown away.

Clear your driveway and pathway

Shovelling snow is twofold in terms of safety and removing the thoughts buyers conjure up of having to do it themselves. Consider installing solar-powered lights to help illuminate the path and be sure to salt/sand any walking paths to lower the risk of a fall for potential buyers.

Lessen the chances of icicle formation

Icicles are very pretty to look at, but they can wreak havoc on your home. Melted snow from your roof contributes to ice dams being formed in gutters, which in turn can cause water to back up into your home. The formation of icicles can also indicate issues with your roof or ventilation, which could be a red flag to potential buyers. While you can remove small icicles yourself—make sure to take all safety precautions if you need to venture onto the roof–it’s best to leave the removal of larger ones or hard-to-reach icicles to the experts.

Winter-resistant furniture in the front and backyard

Create a welcoming first impression by staging your front porch with durable furniture and winter-resistant blankets and rugs. Warm lighting provided by lanterns that can withstand the cold will also add to the charm. The backyard is just as important, so be sure to shovel patios and decks, and set it up in a way that highlights how the space can be used year-round.

Cleaning the front entrance

This is technically an inside task, but it does involve elements from the outdoors. Salt, dirt, and snow all get tracked into your front entrance in the winter months, which isn’t visually appealing to potential buyers. You only get one chance at a first impression! Clean up any salt and dirt from your front entrance, and keep coats, mittens, boots, etc. in a closet so there’s no clutter when people come in.

Highlight the cozy indoor appeal

Create a warm and inviting space

“Selling in the winter months gives home sellers an opportunity to create a very welcoming, cozy vibe to their space,” van den Broek explains. “Staging works, and winter is certainly a time to get creative. Ensure the home is at a comfortable temperature, and if there’s a fireplace, make sure it’s turned on, or lit if it’s wood. We always use candles at our open houses in the winter time, nicely scented like gingerbread, baking, apples, or pine.”

“Having a tray of treats always makes buyers feel at home, and if it’s closer to the holidays some decorated cookies or candy canes for kids. The more your house feels like a home, the more a buyer will start to feel AT home!”

Did you know the World Health Organization recommends a range of 20 C to 22 C as the ideal temperature in your home to maintain overall good health and wellbeing? Aim for this temperature during an open house to keep things comfortable. No need to go too warm—people will likely be wearing jackets!

Round off any essential renovations

Be proactive with ensuring cosmetic renovations such as chipped paint and drafty windows are complete prior to listing your home. For van den Broek there are some common red flags buyers look for when purchasing a home in the winter. These include:

• leaking window seals;
• condensation inside the window panes, which can indicate humidity is too high in the house;
• drafty windows and doors;
• temperature differences in basement rooms;
• no snow on the roof, which could indicate insulation issues in the attic;
• back drafts of a smoky ash smell from a wood-burning fireplace; and
• cracked corners of the foundation which can indicate a structural issue.

Sealing windows to reduce air leaks, adding further insulation where required to prevent drafts, ensuring the weather stripping around your front door has no leaks, checking the insulation levels in your attic, and updating old furnaces can be beneficial upgrades for homeowners and enticing for potential buyers. If possible, consider having your furnace serviced by an HVAC professional to be certain everything is in tip-top shape.

Certain provinces are currently offering rebates to improve your home’s energy efficiency, which could help with the costs of some of these repairs or updates. For example, Enbridge is offering Ontarians “up to $5,000 in rebates for insulation, air sealing, new windows/doors, water heaters, boilers, furnaces, and home energy assessments.” British Columbia has a similar program through BetterHomesBC for up to $6,000. Check with your provincial energy provider to see what’s available to you!

Embrace neutral seasonal décor

If you’re planning festive celebrations, it’s best to avoid flashing lights and large decorations that could shrink the size of your space, as well as overtly religious ornaments.

“For outside it’s nice to have some winter décor welcoming buyers to the property—a simple wreath, flower pots with birch branches and twinkle lights, solar powered walkway lights, and pay attention to overall lighting outside.”

Showcase your home’s versatility

Even when you’ve succeeded in transforming the exterior and interior of your home to be both charming and inviting, if possible, show photos from other seasons in your listing because, the more guesswork you take out of the equation, the more a buyer can make an informed decision they feel comfortable with.

Source: https://www.realtor.ca/blog/selling-your-home-in-the-winter-how-you-can-make-the-most-of-it/29038/1363

Condos are often attractive to buyers, not only because they can be in a more favourable price range than single family homes, they can provide easier access to amenities and a low-maintenance lifestyle.

However, these benefits don’t come without a cost. In addition to your mortgage, you’ll need to plan for the maintenance fees, also known as condo fees. This article will look at what condo fees are, when they can be reassessed, and what they mean for your mortgage, specifically related to an apartment-style condominium building.

What are condo fees?

To put it simply, condo fees are monthly contributions made by unit owners to a condo corporation (the organization that runs the condo building). This money is then pooled together and goes toward funding maintenance and general upkeep of the building. Every condo has a condo board, made up of people from the building, who manage the property on behalf of residents and owners. They’re responsible for making decisions in the best interest of all parties.

While every building is different, the most common costs included in the monthly fees are:

• Utilities—A condo corporation may pay some or all of a building’s utilities. For example, it may pay for water and electricity, but not heat.
• The reserve fund—A portion of condo fees will go toward maintaining the building’s reserve fund, which is essentially a sum of money set aside for unexpected repairs. For example, if the roof or boiler in a building needs to be replaced, the condo board can use some of this cash to pay for it. Before you buy into a building, knowing how much money is in its reserve fund can also help you understand the building’s financial health.
• Common area maintenance—Condo fees can also go toward paying for garbage pick up, snow removal, and the upkeep of common spaces in the building or property including hallways, lobbies, elevators, and the grounds around the building or buildings.
• Amenities—The more amenities your condo building has to offer, the higher your condo fees will usually end up being. Pools, reception services, saunas, shared rooftop patios, and parking all add to the cost of your condo fees, while admittedly offering a lot in return.

The size of the condo building can also be a factor in your overall condo fees. A building with 20 units will likely not have the same fees as a building with 200 units, as the required maintenance and utilities will be different.

Do townhomes have condo fees?

Not all townhomes have condo fees—owning a freehold townhome is the same as owning a freehold single family home. That being said, certain townhome communities will have condo fees as well which can cover gardening, fences, garbage pickup, shared amenities, and other general maintenance fees as laid out by the condo board. When looking at homes with your REALTOR®, they’ll tell you whether or not the townhome is a condominium or freehold.

When can your condo board reassess your fees?

When you’re looking at condos for sale, it’s definitely easy to gravitate towards ones with lower condo fees. However, lower fees could come with a catch. If the fees are too low, the condo corporation may not have enough cash flow to pay for larger repairs which, in turn, may lead to a special assessment. Your REALTOR® can help provide a more clear picture of the building’s history as they know the area well. They can also recommend properties with better track records to help make you feel more comfortable with your choice.

A special assessment is a payment unit owners must make to the condo corporation, on top of their regular monthly condo fees and mortgage payment. The terms around special assessments will vary based on provincial legislation, so it’s always important to understand what your board can and cannot do.

As an example, the Condo Authority of Ontario (CAO)—an organization that aims to improve condominium living by providing services and resources for condo owners, residents, and directors—indicates special assessments can occur for various reasons, but the most common include:

• Unforeseen expenses—A major expense may arise unexpectedly, such as the roof needs to be replaced. The CAO says this might happen during a critical year for the reserve fund, which is when the condominium board has depleted its reserve fund to complete major projects. As a result, the remaining balance is too low to cover the unexpected expenses and the special assessment has to be paid.
• Under-budgeting—A special assessment can also be paid if an expense or major repair ends up costing more than expected.
• Losing a lawsuit—Finally, the CAO says unit owners must “bear any judgment against the condominium,” which means if the condominium can’t pay the judgment from the operating fund, the board must turn to a special assessment to cover the costs.

Do condo fees affect your mortgage?

When you’re looking for a condo, it’s always a good idea to double check your monthly spend—mortgage payment, property tax, insurance, utilities, and condo fees—and ensure you can afford everything before applying with your lender.

In short, Alex Obradovich, a REALTOR® and sales representative with Chestnut Park® Real Estate Limited Brokerage in Toronto, says condo fees can affect your mortgage.

“When applying for a mortgage or a pre-approval, the lender will most definitely account for condo fees when looking at how much debt they are willing to supply to a client,” he explained. “Condo fees are just one of many factors taken into consideration when determining the amount of debt a lender is willing to supply.”

Furthermore, when it comes to condo fees, Obradovich says they may also have an impact on an owner’s condo insurance.

“Not all condo fees are created equal. Each property may have different costs associated with it. Some condo fees may cover some sort of insurance and the type of home insurance policy you may want to secure may change,” he explained. “Conversely, the home insurance may or may not take into consideration what is provided by the condo or maintenance fees.”

If you’re unsure how to interpret what the condo fees represent, you can request for the condo board to share their status certificate with you. This report contains all the details about the current financial state of the condo maintenance corporation, as well as mention any details of the existing size of their reserve fund and if there are any ongoing lawsuits.

Regardless of whether you’re a first-time home buyer or not, it’s all about asking questions and keeping informed. Your REALTOR® can help navigate condo fees, status certificates, and every other aspect of your condo buying journey.

The information above is for informational purposes only and should not be used as investment or financial advice.

Source: https://www.realtor.ca/blog/condo-fees-and-what-they-cover/25935/1362
Photo: pexels.com

For Stephan Gardner, buying the home in Calgary's Greenwood Village didn't feel like settling. 

Buying a mobile home has made Stephan Gardner's life measurably better, especially from a financial perspective.

Gardner lives with his wife and son in Greenwood Village, a mobile home park, in Calgary, Alta.

"I don't feel I settled here," he told CBC's Cost of Living. "We just walked in and we were like, 'This place is amazing."

The family had been renting a home in the city, and feared they would be evicted after it was sold to a new owner. They were paying $2,100 a month rent, plus utilities. That high cost was preventing Gardner from putting money toward his personal debt.

"I know what it's like to have only, like, cans of tuna to feed your kid, you know, and you [don't] eat for two days or three days just to save money," he said.

Skyrocketing housing costs

During their house hunt, Gardner and his wife weren't impressed with the houses and condos available to them. Some seemed like "money pits," he said. But they didn't want to keep renting because it didn't feel like a good financial decision.

Gardner didn't know that any mobile home communities existed in Calgary, until he stumbled across an MLS listing and was impressed by what he saw. 

Pollen, dust, pet dander, mold spores, bacteria, and many pollutants are so small that they float through the air. When people breathe in, touch, or consume these particles, the body recognizes them as foreign invaders and releases histamines. This natural chemical is produced in white blood cells and released into the body triggering allergic reactions such as sneezing, itchy eyes and runny nose. Sometimes, people have a dangerous reaction called anaphylaxis, which can involve swelling of the airways.

If you have a cough, itchy skin/eyes, or a runny nose throughout the year, then you are likely allergic to a substance within your own home. This puts unnecessary stress on your immune system and may sap your energy.

A clean home is essential to health, but how do you know when your home is clean? Common allergens range in size from 0.1 to 5 microns and most of us can’t see anything smaller than 40 microns without the aid of a microscope. For comparison, a typical human hair has a diameter of 70 microns. No wonder there can be a jungle of allergens inside our homes.

How do you reduce allergens?

• First, use a vacuum that has a HEPA filter and follow the manufacturer’s directions to clean or replace the filter.
• Clean your indoor air with a HEPA filter air purifier.
• Carpeting harbours all sorts of allergens, so ideally, replace wall-to-wall carpeting with solid floorings such as wood or vinyl. If that is not an option, vacuum often and steam clean in the summer months when the warm, dry air speeds up the drying process.
• Fabric curtains also attract allergens, which get stirred up each time the drapes are opened and closed. Better options include smooth slat blinds and washable curtains made of non-porous, synthetic fabric.
• Solid wood, plastic, leather, or metal furniture is easy to keep clean compared to upholstered styles; however, consider using washable slipcovers if you like the comfort of plush couches and chairs.

Allergen-specific precautions:

Mold spores

Mold thrives in humid environments such as bathrooms and basements. You can purchase a hygrometer for as little as $20 online or at your local hardware store. According to the Mayo Clinic, the ideal relative humidity is between 30-50% humidity, which means that the air holds between 30-50% of the maximum amount of moisture it can contain. If your indoor air is too humid, be sure to run the bathroom fan when showering and install a dehumidifier, if needed.

Pet dander

Mammals naturally shed tiny flakes of skin. These flakes typically contain proteins secreted by sweat glands and these proteins are what cause allergic reactions in some people. If you love animals and can’t imagine life without them, try washing your pet frequently, keep your dog or cat out of your bedroom, vacuum your home often with a HEPA filter vacuum, and use a HEPA filter air purifier.

Dust mites

This is one of those times we can be thankful we can only see items as small as about 40 microns! Dust mites are frightful pests that live in warm, relatively humid areas such as our beds and pillows and feed off our dead skin cells. Although they do us a service by tidying up after us, many people have allergic reactions to proteins in the dust created by dust mite feces, urine, and their decaying bodies.

To reduce dust mites

• Use airtight covers for your pillows and mattress
• Vacuum your mattress with a HEPA filter vacuum
• Wash your bedding in hot water
• Lower the heat and humidity in your home

Pollen

Trees, grass, and flowers can all release pollen, making spring and summer challenging for allergy sufferers. In addition to using a good quality air purifier, especially in the bedroom, close your windows on days when the pollen count is high. Many weather stations provide daily information about the local pollen concentration.

Allergens are Common

According to the Cleveland Clinic, approximately one in six people suffer from allergies, but it is possible that many more people unknowingly suffer from mild, ongoing reactions to allergens in their homes.

Source: https://www.sutton.com/blog/home-safety/reduce-household-allergens
Photo: pexels.com

In recent years, it’s likely you’ve heard the media, your colleagues and even politicians speak about “inflation.”

You also may have noticed prices for regular everyday items including food, gas, or larger purchases such as homes, furniture and vehicles have risen sharply since the start of the COVID-19 pandemic.

Up until a few months ago, when government officials and the media spoke about the current rise in inflation, they often defined it as “transitory”. Now, officials at the Bank of Canada are stating inflation may actually be more persistent, and have signaled the future path for Canadian interest rates may be a series of rate hikes to help bring inflation back down to within its target range of 1% to 3%. In fact, last month, the Bank of Canada announced that they would raise the policy rate from an all-time low of 0.25% to 0.5% and they are considering an end to their Quantitative Easing program.

What is inflation?

Before we get ahead of ourselves, I think it’s important we take a step back and understand what inflation is and how it can impact our daily lives.

Inflation is a persistent rise in the average price of goods and services over time—or the increase in the cost of living. It can also be looked at as a reduction in the purchasing power of your money; as the prices of goods and services rise, your money can afford less. Therefore, the level of inflation has a major effect on the overall Canadian economy.

Part of the Bank of Canada’s mandate is to keep inflation low, stable, and predictable. The target aims to keep the total Consumer Price Index (CPI) inflation rate at the 2% midpoint of the target range of 1% to 3% over a medium-term horizon. The Bank raises or lowers the policy interest rate as it deems appropriate by either raising it to control inflation or cutting it to help encourage spending and borrowing in economy. This was seen at the beginning of the pandemic to help support the Canadian economy devastated by pandemic-related lockdowns and monetary policy continues to remain accommodative.

How do we track inflation levels?

There are a few ways to track and measure levels of inflation in the economy, one being the CPI which is produced by Statistics Canada.

The CPI is calculated by comparing the cost of a fixed basket of goods and services purchased by consumers over time. The CPI is a widely used by government agencies and private organizations as an indicator of the change in the general level of prices experienced by Canadian consumers. The goods and services in the CPI basket are divided into eight major components: food, shelter, household operations, clothing/footwear, transportation, health/personal services, recreation & education/reading, and finally, alcoholic beverages.

There are various measures of CPI that Statistics Canada produces, some include the price of more volatile costs such as energy and food which can be influenced by changes in weather patterns and other factors. When setting monetary policy, the Bank of Canada looks past these volatile and sometimes transitory moves in total CPI inflation and tries to focus on more “core” measures of inflation that may better reflect underlying trends in inflation. There are three core inflation measures the Bank focuses on: CPI-trim, CPI-median and CPI-common.

When looking at the chart, we can see Total CPI is well-above the target range for the Bank of Canada while the measure for CPI-common is within the target range but looks to be rising quick. Lingering supply-chain effects from the pandemic as well as rapidly growing/changing geopolitical tensions across the globe continue to drive inflation higher and could stay well above the Bank of Canada’s target rate for the foreseeable future. This has forced the bank to raise rates earlier than they were forecasting, and they are now forecasting the beginning of a period of “quantitative tightening” to try to bring inflation back closer to 2%.

Inflation and housing

In terms of how the Canadian housing market has matched up against inflation over time, I conducted an analysis to see how average home prices compared to overall consumer price inflation from 1971-2021.

First, I deflated the Canadian residential average price to remove the consumer price inflation amount, giving us the “real” average home price. This calculation is simply taking the Canadian annual average price and dividing it by the CPI number for that year. I then looked at the compound average annual rate of change in home prices broken out by decade over the last 50 years. Unfortunately, these decades do not all line up perfectly with housing booms/busts, but they do a decent job. There are probably many ways to present this data, but I think the chart below helps to capture both home prices and inflation for a reasonable time period going back with some historical differences, all just in six bars! So, what you’re looking at, is the real average price growth for Canadian real estate (that is, over and above inflation) compounded at an annual average rate for each decade since the 1970’s.

The chart above shows how the growth rate has differed over the past 50 years, with healthy levels of real growth in the 1970s when inflation was high. There was decent growth in the 1980s owing to the housing boom in the second half of that decade and negative real price growth in the 1990s, when home prices were basically flat. The highest amount of growth in the 2000s when the market boomed, up until 2007. And finally, another period of strong growth in the 2010s, all backloaded in the years 2016-2020, with 2020 being the second largest year for price growth on record (after 2021).

Throughout the last 50 years, the overall real growth rate over time has been in the 2.5% to 3% range, showing that over time, real estate has generally been a safe long-term and reliable hedge against inflation. One caveat worth mentioning, is that because inflation has been relatively subdued over the last few decades, we haven’t had much inflation scares in which our central bank had to react strongly to. If the current rate of inflation were to persist above the Bank of Canada’s target range going forward, the upcoming rate tightening cycle which would be needed to control that inflation could seriously slow down the housing market from its currently elevated levels.

There are many reasons why home prices would grow faster than inflation over time outside of those cyclical ups and downs. Canadian housing markets are influenced by a multitude of factors, including population growth, demographic factors, employment growth, the rate of new housing being built, the type of new housing that is being built, speculation, zoning, density, physical/natural constraints—the list goes on.

Keep up to date on the latest interest rate changes, consumer confidence and more on CREAStats.ca.

Source: https://www.creacafe.ca/what-you-need-to-know-about-inflation-and-real-estate/
Photo: pexels.com