GETTING YOUR HOME READY FOR MARKET

When the thought of selling your home comes to mind, what repairs and maintenance are needed, allowing your home to show at its best?   Most likely the repairs are the items already on your to-do list.   These are not major renovation items; general maintenance. 

Top to bottom take a look at 

• Bedrooms and bathrooms 
• Kitchen, living, dining and main floor laundry room
• Basement, whether finished or unfinished 
• Garage 
• Outside exterior of home
• Lawn and gardens

Trust your gut, if you think it needs repair, it most likely does. 

Attend to the items that you are able to do yourself, and hire professionals for the things you are not able to complete, such as electrical or plumbing.

Paint - Paint gives a fresh clean look.

Replace and Repair - Door handles, drawers, cupboards, window hinges, missing tiles, light fixtures, faucets, to name a few. 

Clean - A deep clean and declutter, including window cleaning.   If you don’t want to dispose of items, store them in a designated area or rent a storage locker temporarily.

Lawn maintenance - Ensure shrubs, trees, flower beds are cut back and not over grown.  Clear your walkways - curb appeal is an actual thing.  You want your home to be lovingly manicured. 

Garage - Declutter, organize and clear the floor.

Beyond general repairs, maintenance and cleaning, there may be other items you feel will bring you optimum price by doing a renovation of a kitchen and/or bathroom.   Speak to a Realtor, who will be able to advise you on whether doing a major renovation is a good idea in your area.

Once minor repairs and cleaning are done, it makes way for the Realtor to advise you further on the details of making your home look its best, whether working with your own accents and furniture,  or possible staging as an option. 

Investing with a Partner 

Whether it is your first purchase or one of many, investing with a partner can be a viable way to afford a purchase, especially in today’s market. 

You share the costs involved based on your percentage of investment. 

You may qualify for a higher mortgage based on combined income, allowing you more purchasing power. 

Ownership does not have to be a 50/50 split, the percentage can be what is agreed upon.

The purchase could also potentially involve more than two people.  

There are different ways to hold title, you may want to consider a limited partnership, specific to the property being purchased. 

Another option, other than holding title in your personal name, is to incorporate a company that would take title to the property.  

Documenting in writing by way of an Agreement what the ownership responsibilities will be, and how expenses and profits are shared is very importance.  Avoids any possible misunderstanding now and at a future date. 

In addition to the shared expenses based on ownership, it is smart to set out in the agreement how the sale of the property will be handed at some future date.   Irrelevant at the time of purchase, but down the road, a huge benefit. 

What happens if one party wants to sell and the other does not?  A first right of refusal clause, would allow the party to the agreement that does not want to sell, the right to purchase the interest of the party wishing to sell before the interest is sold to someone else, if permissible. 

When looking at investing with a partner,  there are many things to consider.  Once you have outlined the basis terms of the partnership,  it is a good idea to speak to a lawyer to prepare an agreement outlining the terms agreed upon.

It is an added expense, which in the long term is a priceless document.   Don’t take shortcuts and rely on verbal agreements, know what your expectations are and your potential partners. 

BUYER REPRESENTATION AGREEMENT 

This may look like a fearful document, but it really is not.

You are hiring a Realtor to work with/for you.  It is a commitent by both parties to work together for a specific period of time, with specific goals, while outining the compensation afforded to your Realtor.

The Buyer Representation Agreement sets out your relationship with your Realtor, what you want to accomplish, and outlines the timeframe from the start date to end date.  (If the contract is for a longer period that 6 months, you need to acknowledge this in the Agreement, by initialling the start and finish date.) 

The Agreement sets out the type of property you are looking for, an example would be residential purchase, and the geographic area you are looking to buy, such as Toronto or Vaughan.  The Agreement can encompass more than one area and more than one type of property.

The Realtor and Buyer will establish a commission that the Buyer would pay, in the event the commissions are not paid by the Seller or Listing Brokerage, or any shortfall that is established in the Buyer Representation Agreement.  

An example would be, if you established that 2.5 % of a purchase price is the commission your Realtor is entitled to, and the Seller is paying 2.5% commission, there is no commission payable by you to your Realtor. 

However,  if your Buyer Representation Agreement is for 2.5 % commission, and the Seller is paying 2 % commissions, under the Buyer Representation Agreement you would pay the .5% commissions to your Realtor.  

The Agreement covers in detail the obligations of each party.  

It is best to ask your Realtor for a copy of the Agreement for review, always know what you are signing, and don’t be afraid to ask questions.   

BRIDGE FINANCING

What is bridge financing?  Bridge Financing is arranging an interim loan with your lending institution, to “abridge”, to have the money needed a few days in advance of the sale of your home, to close on your purchase by way of a loan from the bank. 

By bridge financing, you eliminate the stress of waiting for the sale of your home to close on the same day as your purchase, in order to have the money to close on your purchase.

Bridge financing gives you the luxury to close on your purchase, and a few days later you close on your sale.   When your sale takes place, you then pay back the bank the bridge financing loan from the sale proceeds.   

The cost of bridge financing is not as absorbent as may be anticipated, and may be well worth eliminating the anxiety of closing both deals on the same day. 

There will be an interest charge on the monies borrowed, and with today’s interest rates, may be well worth the while bridging.   Be sure to enquire if there would be an administration fee.  This would be dependant on your lender. 

It is always good idea to deal with the same lending institution that you are using if you are arranging a new mortgage on your purchase, or the bank that you typically use with your daily banking.   By using the same bank, they already have all your income verification, debt to income ratio and any other information needed for you to qualify.

Selling and buying can be a stressful time, why not take advantage of mechanisms to make the experience more enjoyable. 

Breaking Into Property Investment.  Things to Consider. 

Investing in real estate is intriguing, and can be intimidating if it is your first investment property.  Where do you begin is a big question. 

Know the area where you want to make your investment.   Drive around, see what is in the area that is relatable to the property, such as schools, transit, work place, stores. etc. 

Be informed of any rental restrictions that may be imposed in the area.  Check with the City of Town to see if there are any by-laws restricting rentals.  

Know your financing.   You will require a minimum of 20% downpayment of the purchase price for an investment property. 

Know what your expenses will be in addition to the purchase price of the property. 

Calculate your rate of return on the investment.  

Purchase a property that is manageable.

If you are looking at a residential rental, think of starting with a single rental property,  a condominium, or single family home with a front and back yard.

Being a Landlord comes with responsibilities, in particular maintenance and repairs.  Educate yourself to know these responsibilities. 

Familiarize yourself with the standard Residential Tenancy Agreement, which is a standard lease agreement to be entered into in Ontario for all residential tenancies.  This form can be obtained at www.forms.ssb.gov.on.ca.  and search Residential Tenancy Agreement. 

If you are looking at a commercial investments, most of the same steps would apply.  

Hire the right realtor to help you with your investment and potentially find you the right tenant.

RENEW YOUR MORTGAGE OR REFINANCE.

Much to consider.  Make informed decisions!

At renewal time, take a close look at your current financial situation, and the costs related to some other current debt you may be carrying, such as credit cards.

Do you need to consolidate some existing debts to reduce overall payments,  taking advantage of the current low interest rates. 

Would you like to take some equity out of your home to purchase another property. 

Would you like to renovate.

Do you have added children expenses to cover.

Are you happy to renew your mortgage and continue to pay down your mortgage at the current balance. 

Think about speaking to your existing Lender to see if they are able to offer you a better interest rate than what is currently posted by the banking institution.  Chances are they would like to keep you as a client, and will do their best to give you the best possible rate they have to offer.    This too could potentially save you some added costs. 

Do some reach with other Lenders to see what rates they have to offer.   Have a conversation with a Mortgage Broker, who would have access to more than one lending institution.  

Take the time to investigate and ask questions, the extra effort may potentially save you money.  

Never Underestimate the Value of Cleanliness when Selling Your Home!

You may feel overwhelmed with everything when it comes to selling your home.  

One very important item, which can often be overlooked, is the importance of house “detailing”. 

Everything from the front to the backyard should provide potential Buyers a sense of zen.  It is often the untidiness that Buyers cannot see beyond, or items left behind in the basement that could add to clutter, and it can reflect onto you the Sellers, as to how you valued your home.   Remember, people are looking to your home to be their comfort zone.   Take the extra steps, 

-       Power wash the front and back yards

-       Clean windows

-       Clear away front walkway and front door entrance

-       Remove any cluttered items and personal belongings

-       Donate items not being used 

A tip to seeing it through the eyes of a lens, take pictures of your home, and then take a look at what the pictures look like, which can highlight things that may need to be taken care of.  

As it is said, “Cleanliness is next to impossible”, so if this becomes overwhelming, consider hiring a window cleaner, a landscaper to trim bushes and clear out flower beds, a cleaning service to help with the interior cleaning.  

RENOVATE OR NOT TO RENOVATE PRIOR TO SELLING 

The idea of spending on items you may not completely enjoy yourself for a long time may be difficult, but may be the best decision to capitalize on a selling price.  

Most potential Buyers value move-in ready homes, unless you are that handyman wanting a project.

For  many, it is a difficult decision to put a large amount of money to renovate prior to selling.   It has been proven to show positivity in your selling price. 

Things to consider prior to this expenditure would be, 

1. Location of your home
2. The current market conditions in your area
3. How extensive your renovation will be to give that added value 

A qualified Realtor and an expert Contractor would give you sound advice.   Always ask questions before you proceed. 

TO STAGE OR NOT TO STAGE

Staging has become a cost familiar to the contemporary Seller, and has actually proven to increase the value of your home in the eyes of potential Buyers.  You may wonder why your sophisticated taste can’t eliminate the need for this seemingly expensive item.  

The truth is there are trends you may not be aware of, and professional stagers on top of their game, made it worth every cent, translating to more dollars to you. 

The costs for staging are based on what is needed to showcase your home to its best, and the length of time to sell your home. There are options for every budget,  a qualified home stager would give you sound advice on what would work well with your home.