5 Tips for First-Time Homebuyers

Unlike renting, buying a house is a financial investment that can appreciate substantially over time.

Linda White
Special to QMI Agency

Family in a Box

Family in a Box

Thanks to historically low interest rates, now may be a prudent time for first-time homebuyers to get a foot on the property ladder. But do your homework before taking the leap to that first rung.

“Generally speaking, buying a house has historically been a good investment,” says David Stafford, managing director of real estate secured lending of Scotiabank. Here are some tips every first-time homebuyer should know:

  1. Determine what you can afford: Sure it’s obvious, but the more you can put towards a down payment, the less you’ll need to borrow and the more you’ll save in interest over the years. By law, Canadian banks can only provide mortgage financing if you have a minimum of 20 percent down payment unless the mortgage is insured against default. “You need to contemplate all of the pieces before you figure out what you can really afford,” says Stafford. The true cost of a home is much more than its sticker price – it also includes closing costs like land transfer taz in some provinces and utility connections. Determine monthly expenses, including mortgage payments, maintenance and property taxes. On-line calculators can help you figure out how much you can comfortably afford.
  2. Apply for a pre-approved mortgage: There are many benefits to getting pre-approved for a mortgage. For starters, you’ll define your price range so you can focus on affordable homes. It will also give you the power to make an immediate offer when you find the home you want, which can be a significant advantage if several buyers are interested in the same property. You’ll need to provide a mortgage professional with information about your employment history, gross annual income, assets and liabilities, and an estimated down payment. Under a pre-approved mortgage, a lender will guarantee financing for a set period of time (typically 90 to 120 days) under no obligation.
  3. Build your home-buying team: Before signing on the dotted line, make sure you have the right team of experts, which should include a real estate agent who specializes in the area and type of property you are looking at, lender or mortgage broker, lawyer, home inspector, insurance broker, appraiser and land survey if the seller does not have a current survey or certificate of location.
  4. Select a home right for you: The house that;s right for you will depend on a number of factors, including your current lifestyle and future goals. “If you’re a young, single professional, the kind of property you’re looking at could be quite different than a young couple about to have kids and considering things like schools,” says Stafford.
  5. Heed the example of second-time homebuyers: Many fire-time homebuyers are wooed by stainless steel appliances, granite counter tops, hardwood floors and open concepts, while second-time homebuyers are more apt to check the furnace, air conditioner, plumbing and roof because they’ve learned structural integrity trumps wells and whistles.”In the mortgage business, first-time homebuyers are generally focused on interest rates and payment schedules,” says Stafford. “Second-time homebuyers want to know about the pre-payment schedules, interest rate penalties and if the mortgage is portable if they choose to move.”

Using RRSPs for a down payment: Under the Home Buyers’ Plan (HBP) first-time buyers can use up to $25,000 in registered retirement savings plan (RRSP) savings ($50,000 for a couple) for a down payment. Generally, you have to repay all your withdrawals to your RRSPs within 15 years. You have to repay an amount to your RRSPs each year until your HBP balance is zero. If you don’t repay the amount due for a year, it must be included in your income for that year. – Source: Canada Revenue Agency

Who you need on your team: The Canada Mortgage and Housing Corporation recommends your home buying team includes the following professionals:

  1. Real Estate Agent: This professional will help you find a home, provide information about the community, write an offer of purchase and negotiate a purchase.
  2. Lender or Mortgage Broker: Many different institutions lend money for mortgages. An independent  mortgage broker can find the lender with terms and rates that best meet your needs.
  3. Lawyer: A lawyer ensures the property is clear of liens, charges or clean-up orders, and reviews all contracts and your offer to purchase.
  4. Home Inspector: A home inspector informs you about the property’s condition, including what repairs need to be done and any past problems.
  5. Insurance Broker: An insurance broker helps you find property and mortgage life insurance. Lenders also offer mortgage life insurance.
  6. Appraiser: An appraiser assesses your property’s worth and helps protect you from paying too much.
  7. Land Surveyor: You may want a land surveyor if the seller doesn’t have a current survey or certificate of location.

The Right Stuff: Choosing a contractor well saves time, money & grief

If you are dealing with a major renovation following the devastating June floods, you simply can’t take chances when hiring a contractor.

It may not be a sure thing, but a little homework to identify issues and verify information can be just the thing to save you time and money.

Here are ten tips to help you choose the right contractor:

  • Visit the Better Business Bureau website at www.bbb.org to view unbiased business reviews or use the free Request a Quote on-line service to obtain estimates, proposals and general information from BBB Accredited contractors. Your BBB has an extensive data base designed to help you make an informed choice
  • Solicit bids from two or three different companies – all bids should be based on the same criteria
  • Request all estimate be submitted in writing
  • The lowest bid is not necessarily the best
  • Excessively large down payments can be a warning sign – the work should be completed to your satisfaction prior to the final payment
  • Ask a lot of questions – never sign a contract with blank spaces or information not fully understood.
  • Determine whether permits or inspections are required through your local municipality.
  • Ask to see any required provincial or municipal permits or licenses; contact Service Alberta for information on licensing required in this province.
  • Determine whether the contractor has the proper insurance
  • Work with contractors who have a verifiable track record

Businesses accredited by the BBB must meet a strict set of standards including building trust and maintaining a positive track record in the marketplace.

BBB President and CEO Sandra Crozier-McKee says, “We’ve been working very hard to get information to home-owners on how to avoid being scammed and how to go about choosing the right contractor.”

“When home-owners engage a BBB Accredited Business, they can have confidence in their choice.”

Sandra adds, “BBB should be top of mind for both consumers and businesses.”

Remember: be savvy – check before you buy at 403-5631-8784 or www.bbb.org.

– Article Courtesty of Better Business Bureau

Renovations CAN Increase your Home’

If your home was damaged by the June floods in southern Alberta, you are likely facing a major renovation project.

The good news is, renovations can be an opportunity to enhance your family’s quality of life, improve your home and increase its resale value.

Once you factor in the money you could save on heat, electricity and water, many renovations can also offer a great return on your investment – up to and including paying for themselves.

To help you decide which renovations are right for your home, Canada Mortgage and Housing Corporation (CMHC) and the Appraisal Institude of Canada offer the potential “payback range” that some of the most common home improvement projects will typically have on the resale value of a home.

The best returns on your renovation investments are projects that target your kitchen and bathroom.

Expect to recover between 75-100% when you overhaul either of these rooms.

Your next best investment is interior/exterior painting. You will see between 50-100% return on those jobs.

The lowest payback range involves renovation projects where you install a pool or skylight.

Expect to recover about 10-40% of a pool and up to 25% of a skylight and related costs.

Other payback ranges include:

  • Roof shingle replacements: 50-80%
  • Furnace and heating systems: 50-80%
  • Basement: 50-75%
  • Adding a recreation room: 50-75%
  • Flooring: 50-75%
  • Constructing a garage: 50-75%
  • Window and door replacement: 50-75%
  • Building a deck: 50-75%
  • Installing central air conditioning: 25-75%
  • Landscaping: 25-50%
  • Interlocking pavings: 25-50%
  • Building a fence: 25-50%
  • Asphalt paving: 20-50%

For more information or a free copy of the ‘About your House’ fact sheets ‘ Hiring a Contractor’ and ‘Sample Renovation Contract’, or other fact sheets on virtually every facet of owning, maintaining or renovating your home, you can visit www.cmhc.ca or call CMHC at 1-800-668-2642.

Other valuable resources for home owners planning a major renovation include the RenoMark (TM) program and the Better Business Bureau.

RenoMark (TM) members belong to the Calgary Home Builders Association – Calgary Region, abide by a code of ethics and must provide proof of licensing, warranty and insurance.

The BBB has extensive data designed to help you make informed choices including online and print listings of our Accredited Business, which must have proper licensing, a responsible history of operating in their region and a commitment to upholding the eight BBB standards of trust.

For more information visit www.renomark.ca or www.calgarybbb.org.

– Canada Mortgage and Housing Corporation

Using Less Energy

Canadian households consumed 1.4 million terajoules of energy in their homes in 2011, up to 4% from 2007. With increased energy use comes larger bills to pay; by making a few easy changes around your home, you can keep more money in your pocket.

  1. Keep garage closed as much as possible: This retains warmer air against garage-side wall and acts as a buffer against outdoor air.
  2. Lower the thermostat: Dropping it by 2 degrees could save 4% on heating costs. Programming it lower at night and while you’re at work could drop costs by 10%!
  3. Don’t heat unused rooms: Close doors & heating vent(s).
  4. Check attic insulation: If there is less than R-22 (7 in. of fibreglass/rock wool or 6 inches of cellulose), you should get more added.
  5. Use blind effectively: Open them up on sunny days and close them when the sun sets.
  6. Use plastic on drafty windows for insulation
  7. Conserve energy: Installing automatic timers, motion sensors or dimmers can help.
  8. Check door insulation: If the inside of a door feels colder than the walls, you should install one that’s better insulated
  9. Use throw rugs to insulate floors
  10. Check furnace filters once a month: Could save you 5% on heating costs.

Energy Saving Practices:

  • 47% used a programmable thermostat
  • 33% used 5 or more CFLs
  • 58% washed/rinsed laundry in cold water
  • 58% turned computer monitor off when not in use
  • 44% turned fireplace pilot off in the summer
  • 14% Air dried dishes in dishwasher
Save Energy

Save Energy

Article found in Calgary Sun: 20/09/2013


Kid-Proof Your Design: Helping your descendants and your decor get along

Author: Lori Andrews
Source: CREB Now

One of my frequent requests from clients is to design a “kid-proof” home. I must tell you, If I am completely honest about this, it’s impossible. I don’t have children, but daily life (and the occasional party) have provided plenty of visible damage in my home – like the time someone danced in stilettos on my beautiful hardwood floors, or the red wine I spilled on the day my new white carpet was installed. Or that time I knocked over my brand new custom credenza because I opened all the drawers at once and damaged four of the drawer fronts. Spills and scratches are going to happen. I like to remind my clients of the five-foot rule. If you can’t see damage from a standing position, it doesn’t exist.

All types of flooring are subject to possible damage; try to consider your new hardwood scratches as a natural and charming authentic aging process. Tile can break, carpet can stain and Marmoleum can get damaged. Whether it’s you moving the fridge for cleaning or the kids riding their skateboards in the house while you are out in the backyard, make sure you choose the best quality you can afford and don’t worry about life’s little accidents.

When you are furnishing the living room, consider investing in pieces that will last. You can always re-cover the chairs or sofa once the little ones are grown. This is a far better option than purchasing disposable furniture that will end up in a landfill when you are ready to buy your “real” furniture.

– See more at: http://www.crebnow.com/kid-proof-your-design/#sthash.k15zplOO.dpufKid-Proof-Graphic-web

Calgary Weekly Real Estate Update

4106 homes for sale in metro Calgary

1947 homes sold in the last 30 days

2.10 months worth of inventory

47% of the homes statistically to sell in the next 30 days

Market Conditions: Sellers Average List Price : $462,690

Average Sale Price : $452,568

Average days on market : 36

Average list to sale price ratio : 98%

Although we are seeing our absorption rate increase, translating to our markets softening, I do not believe this will be a long term trend. We have many factors that are currently happening that should keep our market strong and busy for the next 60-90 days. With interest rates at banks rising, home buyers will need to purchase before the expiration of rates that are no longer available. We are also entering our seasonal fall peak that typically happens after children go back to school. This fall peak is generally motivated by home buyers trying to purchase homes and move in before temperatures become too cold. Also, with children back in school it allows parents to get back into normal routines and focus on future family endeavors.

Preparing your home for winter

We know… we said the dreaded word `winter`. But better to be prepared than not, right!? Here are 13 easy steps to prepare your home for winter:

  1. Prepare your fireplace: Clean out ashes, build-up, pests etc. Look for cracks, ensure the damper opens and closes and is sealed property and stock up on wood and kindling. Perfect for a warm cozy night when it’s cold outside!
  2. Seal the windows.
  3. Clear the gutters and downspouts: Make sure the downspout is five feet from the house to prevent flooding and leaking when the snow melts in the spring.
  4. Prepare for winter storms: Have an emergency kit at hand with three days worth of supplies and food for each individual in the household. This is meant to prepare you for power outages etc.
  5. Don’t forget about your heating maintenance! Get a professional to check your heating system. Clean your furnace, venting system & chimney. Also, don’t forget to replace all batteries in smoke detectors and carbon monoxide detectors just in case your heating systems are over working.
  6. Pad your pipes to keep them from freezing which creates cracks and leakages.
  7. Clean out your garage: Organize the remaining summer projects, store gardening tools and push what you do not need to the back, while pulling forward the winter supplies and necessities. Set out gravel and salt containers in an easily accessible spot. You’ll thank yourself when the first ice hits.
  8. Wash Windows: This will reward you with sparkling views, unobstructed light and opportunity to check for cracks and damaged caulking.
  9. Prepare your yard: Trim overgrown branches, aerate the lawn, reseed and apply winterizing fertilizer to promote deep root growth when spring comes.
  10. Flower Bulbs: Dig up all flower bulbs, brush off soil and label them accordingly. Store in a bag or a box with peat moss and place in a cool, dry place for spring replanting.
  11. Water: Shut off exterior faucets and drain water from outdoor pipes, valves and sprinklers. Also, remove any attached hoses & store appropriately.
  12. Air Conditioners: Remove air conditioners from windows or cover them with insulated liners to prevent drafts.
  13. Roofing: Check for damaged, missing or warped shingles and replace as necessary before you get stuck with a leak.

    Winter Preperation of the Home

    Winter Preperation of the Home