In terms of house prices, we’ve all witnessed huge price increases over the last couple of years.  In Markham, the average price of a home increased by 6.7% in 2010 and by 5.6% in 2011.  What can we expect of future home prices in Markham?  Well, you should still expect home prices to rise, but likely by a smaller amount.  3-4% is what many experts are predicting.

If you’ve been waiting for prices in Markham/Stouffville to drop…then you might have to wait a really really long time before that happens.  We can definitely expect some “cooling” in the market this year, but prices will still rise.  A slightly more balanced market combined with ultra low borrowing costs should make for an ideal time to buy your first home or upgrade to a larger home.

For a more in-depth analysis of the market, please watch the “long term outlook” video and feel free to contact me with any of your questions.

How do stagers work their magic? They teach sellers to think of their home as a marketable commodity. The key is to make your home as generically appealing to as many potential purchasers as possible by helping them to imagine themselves living there.

In the same way that a personal makeover does, the key is to emphasize the positive and minimize the negative aspects. Staging is popular because it takes very little time and has proven to be extremely cost effective.

Very often, a real estate agent will suggest staging a home, because they know exactly what most buyers seek. No, you don’t need a pool or a Viking stove. To put prospects in a buying mood, your house or condominium must be as shipshape as a model home-or close to it.

Curb appeal is all-important. If a buyer sees unattractive piles of newspapers on the porch as they drive up, they may not even get out of their car. Buyers get tired of trooping from listing to listing, and seek a home that they can easily visualize themselves living in.

Many stagers claim that they can obtain a premium price for almost any house. It’s just a matter of motivating prospects with a few simple steps. The major attributes of effectively staged homes are:

• Scrupulously clean and odor free everywhere. Hire a cleaning service to power wash your front steps, front door, windows and everything that creates a first impression.  Air the place out daily. Paint your rooms with a neutral palette that   looks expensive. Don’t forget the front door.

• In good repair. The little things do matter. Leaky faucets won’t sell your house!

• Uncluttered, including outdoors, by pruning and eliminating excess greenery. Edit ruthlessly, removing bedroom and living room furniture and kitchen tables. Consider renting a few modern (small-scale) pieces. Remove paper clutter, plus any knick-knacks smaller than a basketball. Box up half of your book collection.

• Impersonal”no personal mementos on display. Store the bowling trophies and family photos out of sight.

• Bright, sunny and inviting. Switch to higher watt bulbs. Turn on all the lights, especially in hallways.

• A few tasteful touches, such as paintings and flowers. A stager can advise you.

• Don’t forget to have chocolate chip cookies baking when your showing begins.

What is the typical cost/return ratio of hiring a stager? The fee runs between $100-$150 per hour, and your pre-listing improvements could run another several thousand dollars. A recent Markham sale netted its owners almost 16% above their asking price in Canada’s booming and competitive market! Staged homes can sell as much as six times faster.

As part of his listing package, real estate agent Martin MacFarlane always includes a free staging consultation to maximize your home’s appeal and ensure your home sells quickly and for top dollar.  Whether you live in Markham, Stouffville, Unionville or any surrounding areas, be sure to give Martin a call before selling your home.

Buying a fixer-upper can be a great way to get into a desirable neighbourhood at an affordable cost. It’s important to recognize though, that all renovations involve some inconvenience and a lot of elbow grease. While you’re rolling up your sleeves, it’s wise to maximize your efforts, go green, and remember that what may no longer suit your lifestyle, might be of use to someone else.

Renovating Benefits Others as Well!

A great way to renovate for you while supporting a charitable cause is to consider your local Habitat for Humanity ReStore. This building supply store accepts and resells quality new and used building materials. Funds support Habitat’s building programs while reducing the amount of used materials that are headed for overflowing landfills. Check ReStores out online at http://www.habitat.ca/en/community/restores/location.

Regardless of the upgrades you undertake, keep in mind that you can reduce the amount of waste you generate by donating or recycling construction materials. Certainly don’t dismiss the old for the new, if there are items to be reused, refurbishing them can add greater character to your home.

If you are looking for some great tubs and sinks you may have to go no further than your current bathrooms and kitchens. Techniques for resurfacing and countertops made of more recent materials like Caesar Stone, recycled glass, concrete, steel, stones, and the myriad of tiles will give you lots of options for upgrading the look without replacing the whole bathroom or kitchen.

Paint and paint techniques can change the look of a kitchen in a few afternoons, save you money and improve your investment: The Appraisal Institute of Canada says that upgrading kitchens and bathrooms is a smart choice, potentially offering a 75 to 100 per cent return.

Greening your Renovations!

Energy efficient lighting, appliances, faucets, toilets and showerheads are a few of the options for increasing the green factor in these two essential rooms and you can watch your monthly expenses drop.

When it comes to flooring, cork and bamboo are among the greenest options, as they are derived from renewable resources. While bamboo is also an excellent choice for cabinets, wood that is certified by the Forest Stewardship Council of Canada is another responsible option.

Visit the Appraisal Institute of Canada’s RENOVA, an interactive web-based guide to the value of home improvements. RENOVA is designed to give consumers a better idea of the return on investment they can expect for a variety of home improvements.

Household drafts will increase your heating bills and make those lovely spacious rooms an expensive proposition in our colder months. Window and door replacement may offer a more limited return of 50 to 75 per cent, but if your existing units are broken or have been installed for fashion rather than performance, this upgrade should take priority.

When purchasing windows, look for low-E argon-filled units with the Energy Star symbol to achieve the highest thermal efficiency. Note: if you wonder how old your thermo pane windows are, most are stamped with the year and month they were made on the metal piece between the panes of glass.

Similarly, replacing an aging roof may only offer a small return but it’s an upgrade that should not be deferred due to the potential for water damage. Fortunately, roof shingles made from a variety of recycled materials are widely available and sometimes the life expectancy of your new roof is worth paying the extra costs. Housing is a long term investment.

Heating systems can offer a 50 to 75 per cent return, while central air conditioning can deliver 25 to 75 per cent on your investment, but given the extreme temperatures of our climate, these are also wise investments, particularly when you choose models with the Energy Star symbol. We replaced our workable 60 percent efficiency furnace with a high efficiency furnace that, with our new windows and doors keeps us toasty all winter.

While decorating choices may be subject to taste, you’ll find that when it’s time to move again, energy efficient, money-saving upgrades have universal appeal. Renovating can be helpful to you, others, and reduce your carbon footprint all at the same time. Enjoy!

For Greening, Renovating or finding the right home, talk to a Greater Toronto REALTOR® and visit www.TorontoRealEstateBoard.com for neighbourhood profiles, open house listings, market updates and more.

Richard Silver is President of the Toronto Real Estate Board, a professional association that represents 31,000 REALTORS® in the Greater Toronto Area.

The report is the third from a major market forecaster in the last week. The Canadian Real Estate Association and Royal Bank of Canada also predicted small gains through 2011 and 2012.

“The existing home market will remain in the balanced to sellers’ market range in 2011 and 2012,” CMHC economist Bob Dugan said. “As a result, growth in the average [Multiple Listing Service] price is expected to remain in line with economy-wide inflation in 2011 and 2012.”

Meanwhile, housing starts will be in the range of 157,300 to 192,900 units in 2011, with a point forecast of 177,600 units. In 2012, housing starts will be in the range of 154,600 to 211,200 units, with a point forecast of 183,800 units.

“Modest economic growth will continue to push employment levels higher this year and next. This, in conjunction with relatively low mortgage rates, will continue to support demand for new homes,” he said.

Source: Globe and Mail

Stouffville has also been very popular with first-time homebuyers and young families as the population has grown very quickly in the last few years.  Stouffville is located just North of Markham and offers many newly built homes at a slightly lower cost.  Stouffville has been considered by many to be one of the best investment opportunities in Ontario over the next 5 years.  Homeowners who live in Stouffville enjoy a “country in the city” type of lifestyle.

There are many great pockets to live in within these neighbourhoods and one of the best things you could do is to drive the streets yourself and get a personal feel for the areas on your own.  Of course your best “first move” would be to secure the knowledge of a Realtor who is local to your prefered location.  For example, real estate agents in Markham will have better knowledge of the schools, transportation, activities and house prices in Markham than real estate agents who works in Toronto.

How Much Can I Afford?

Knowing how much you can afford to spend on your first home is extremely important to know before you start looking.  The last thing you want is to fall in love with the perfect home, only to find out that you can’t afford it.  You should always obtain a pre-approval from a mortgage lender before you begin viewing homes.  Knowing how much you can spend will help you narrow in on the best homes that suit your needs.  It will also improve your chances of getting your offer accepted by the home sellers. 

The most widely used calculation for determining how much you can afford is known as your Gross Debt Service (GDS) ratio.  This basically means that your housing costs shouldn’t be more than 32% of your gross household monthly income.  Housing costs include the principal and interest of your mortgage payment, annual property taxes as well as heating expenses.  If you plan to buy a condominium, it will also include half of your monthly maintenance fees.  You can use a mortgae calculator to give you a better idea of what you can afford before you attempt to obtain a pre-approval.

Another Calculation your lender will consider is you Total Debt Service (TDS) ratio.  This basically means that your entire monthly debt load shouldn’t be more than 40% of your gross monthly income.  This includes all the housing costs in you GDS plus other debts such as car loans and credit card payments.

Down Payments and Mortgage Insurance

The minimum down payment required to obtain a conventional mortgage is 5% but the more you have to put down, the better.  Home buyers who have less than 20% of the purchase price as a down payment will have to obtain mortgage loan insurance from companies such as Canada Mortgage and Housing Corporation (CMHC) or Genworth Financial.  The following table is taken from the CMHC website and provides the insurance rates depending on your loan-to-value ratio and amortization.

 Closing costs

In addition to having enough money for a down payment, you’ll want to make sure you have enough money to cover your closing costs and you’ll probably want to furnish your home as well.  Closing costs will vary from home to home but you should expect anything from 2% to 4% of the purchase price.  Your lender will also want to see that you are able to cover all related costs involved.  The following will give you a rough breakdown of what you can expect to pay.

• Deposit:  This amount is negotiable and can range from $5,000 to $50,000.  The deposit is usually submitted with an offer to purchase and forms part of your down payment to be paid at closing.
• Legal Fees: You lawyer will cost you about $1,000 to $1,500.
• Appraisal Fee:  Your mortgage lender might require an appraisal of the property at your expense which would normally cost between $250 to $350.
• Mortgage Loan Insurance:  If your total down payment is less than 20% of the purchase price, your mortgage will be considered high ratio.  Your premiums will depend upon your loan-to-value ratio and may be added to your mortgage in most cases.
• Land Transfer Tax:  A pre-determined percentage of your purchase price.  First-time home buyer are usually entitled to a partial refund up to $2,000.  Please use a land transfer tax calculator to determine your costs.  If you are a first-time buyer your lawyer will usually take care of the rebate on your behalf.
• Adjustments:  Your lawyer will make adjustments on your closing statement in regards to mortage interest or taxes and utilities that may have been pre-paid by the sellers.
• Home Inspection:  It is normally recommended that you hire a certified home inspector to inspect your home as a condition forming part of your offer to purchase.  This will cost you $300 to $500.
• Title Insurance:  Your lawyer will arrange this which protects you from any defects to the title of the property and will cost approximately $350.
• Survey:  Your lender may require you to provide an up-to-date survey and if you cannot get one from the seller, you might have to pay $1,000 to $2,000 for one.  Although in most cases, title insurance will suffice.
• Status Certificate:  You might be require to pay up to $100 for a status certificate if you are purchasing a condominium.



Other Home Ownership Costs

• Home Insurance:  You will also be required to purchase a home insurance policy which will cover the cost of replacing your home and its contents.
• Property Tax:  Amounts will vary but you should expect about 1% of your home’s appraised value (annually).
• Appliances:  Depending on what comes with the property.
• Window Treatments:  Many first-time homebuyers can overlook this cost if they are not included with the house.
• Service Connection Fees:  You will usually incure extra charges for setting up your cable, telephone, gas, electricity and other various utilities.
• Condominium Fees:  If you are purchasing a condominium you will have monthly maintenance fees to pay.
• Moving Expenses:  Will vary depending on distance, size of truck and whether or not you hire a company to do it for you.
• Miscellaneous Expenses:  You should also expect many more miscellaneous expenses such as decorating, gardening equipment, snow-clearing equipment, tools, repairs, etc.

  As you can see, there are many expenses involved when buying a home in Markham, Unionville, Stouffville or anywhere in Ontario for that matter.  And these costs are not listed here in an attempt to scare you, but rather to help you become better prepared.  The advantages of homeownership far outweight its disadvantages.  After all, you’re putting money back in your own pocket, which is surely better than throwing it all away to rent.  Apart from all these costs, there are certain government programs that you should be aware of.

Home Buyers’ Tax Credit (HBTC)

As of January 27, 2009 qualified home buyers are eligible to claim $5,000 for the Home Buyers’ Tax Credit on their personal tax returns.  To qualify for this amount, the closing date for your home must be after January 27, 2009 and you (and your spouse or common-law partner) must be first-time home buyers.  For more specific information visit the Canada revenue website.

Home Buyers’ Plan

The homebuyer’s plan allows first-time homebuyers the opportunity to withdraw up to $25,000 from their Registered Retirement Savings Plan (RRSP) to purchase a qualifying home.  Your RRSP contribution must remain in your account for a minimum of 90 days before being withdrawn.  Generally, you must begin repaying the funds the second year after your withdraw them.  You will have 15 years to pay it back with 1/15th being due each year.  If you fail to repay any amount for a specific year, that amount will be added to your income.

H.S.T. On New And Resale Homes

Many home buyers are still confused about how the new HST applies to the purchase of your home.  If you are buying a resale home (not a brand new home from a builder) your purchase is NOT subject to HST.  That’s right, you are completely exempt from HST.

It’s a little more complicated if you are buying a new home directly from the builder.  If you are purchasing a new home under $350,000 before tax, you are entitled to a 36% rebate of the GST portion of the tax up to a maximum of $6,300.  If you are buying a home between $350,000 and $450,000 your GST portion of the rebate would be reduced on a proportional scale.  If the home you want to buy costs more than $450,000 before tax, you would not be entitled to a rebate.

First-time home buyers can apply for a 75% rebate of the PST portion of the HST up to a maximum of $24,000.  It may all sound a little confusing but the important area to note is that there is no HST applied to resale homes. 

If you have any questions regarding HST, buying your first home in Markham or surrounding areas, closing costs or anything to do with real estate, please feel free to contact Martin MacFarlane.  He’s here to help!

A condominium garden that would illustrate how a community garden can be integrated into higher density developments is one of several environmental projects granted funding from the Town of Markham last week.

 
“There’s going to be more density in Markham, so it’s good that people have access to local foods. That’s what our growth decision has determined,” said Katie Burns, the town’s sustainability co-ordinator.

  
The public garden, to be situated on a private 58-townhouse complex at Bayview Avenue and Hwy. 407 next spring, received more than $3,000 from the town under an application from Markham’s sustainability office.

  
Staff initially expressed concerns about the use of public funds for a garden on private lands as well as matters such as public parking and accessibility, but the project was eventually endorsed by the town’s environmental issues committee and approved by town council.

  
Outgoing Councillor John Webster declared a conflict of interest because his family has donated land for the use of a public community garden in the Markham village for the last 35 to 40 years without town funding.

  
Organized by the York Food Network, Mr. Webster said he recently spent $35,000 of his money to upgrade the garden entrance.

  
He said he wouldn’t want to give the impression he voted in favour of the town funding a public garden on private property just so he could later benefit from such funding.
Another community garden that received about $1,800 will be at Baythorn Public School in Thornhill. The garden will serve as a demonstration model for the community and could offer tours and workshops for parents, teachers and school administrators interested in starting similar projects.

 
A portion of the harvest will be donated to the local food banks to emphasize the importance of food security and giving back, said Lynne Koss, executive director of a grass-roots community group in Thornhill called Seeds for Change, which is assisting with both community garden projects.

 
Ms Koss said while the school food garden will be the first of its kind in York Region, the condo garden will promote cross-cultural and intergenerational relationships among families from China, Iran, Iraq, Jamaica, Kenya, Pakistan and Ukraine living there now.
Other environmental projects that received funds this week include a green spin studio to be located at the Thornhill Community Centre.
The proposal is to install energy generators on 15 stationary bicycles in the fitness centre, converting the cyclists’ energy into electricity to be applied directly to the facility.
This has been done in many other facilities with positive results and Markham would be the first municipality to do so, according to the application.
The project received more than $33,000.

 He projects that the typical variable-rate mortgage will be more expensive over five years than the typical 5-year fixed. That’s based on forward swap rates and a closing date in January 2011, says Tal.

 Tal was careful to point out that this isn’t a blanket recommendation of fixed rates; it’s more of a commentary on how narrow the gap has become between fixed and variable mortgages, based on market rate expectations.

 Some people will undoubtedly look at this and see no point in assuming the risk of a variable rate mortgage given the minimal projected cost difference.

 Others will remain skeptical, with the belief that North America’s economy isn’t strong enough to spark sustained 3%+ inflation (and the rapid rate increases that would come with it). This minority would rather plow their up-front payment savings back into their VRM for 1-2 years, and take their chances later in their term.

 Whatever the case, rates are near the bottom and the market is clearly betting on future hikes. However you look at it, going variable is no longer as clear-cut a strategy as it once was.

 In determining what’s best for you, check suitability first. Then have your mortgage professional run some rate simulations. If a 3% increase in prime would stress your cash flow, a VRM is absolutely not worth the risk.