All Cash Offer

by Darrin DeRoches October 24 - 30, 2013

What is the big deal about an all cash offer? It sounds impressive and some people like to brag but does it have any advantage? An all cash offer is supposed to be exactly like it sounds. The buyer is paying cash for the property and there are no conditions of getting a mortgage arranged. There are a few agents out there who watch a little too much television and throw around this term “all cash” to sound impressive but then they start to do some backtracking.     The best offer to make on a property is all cash with no conditions. This means if the seller agrees with the price and closing date they can just sign the deal and it is done. The buyer cannot back out and you do not have to wait a week to see if they can arrange a mortgage, do an inspection etc. These types of offers gives the buyer a great advantage since they usually will offer a little lower than the seller is willing to take but the idea of the property being sold – this minute – is very enticing. The agents love it since it is done and nothing can come up to kill the deal and the seller can stop showing the house and move on.     Some agents use the term “all cash” but then add in a clause or two which gives them the out in case they are unable to get the mortgage. I know it is hard to believe agents may be less than truthful but they like to use the term to reap the benefits of the lesser price and appear to have the upper hand. In the past I sold a “fixer upper” which brought a ton of interest and competing offers. This one agent thought his “all cash” offer which was about seven grand lower than the competing offers would win. In most cases a true “all cash offer” would be the best offer to take in a multiple situation since the money may be less but the property is sold and you are guaranteed the number on the paper. If you took another offer that had conditions and they may come back to you asking for a rebate etc. The only problem with this agent was his “all cash” offer was bullshit. After asking a few questions and the agent asking to have the buyer’s son take a look at the property again, the red flags started to pop up.     The agent then calls and making complaints about the roof and this and that. I stopped him in mid–sentence called his bullshit and we went with a true all cash offer for the same price and sold the property to another buyer. This agent was trying to use the “all cash” offer to get our attention then he was trying to negotiate the price down further since they had this big bag of money – supposedly. Their loss, since it was a fixer upper and the second group went on to fix the property. They then sold it for a very nice profit which made them “a lot of cash”. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.

Hamilton Condos

by Darrin DeRoches October 17 - 23, 2013

For over the last six years we have been hearing about how Harry Stinson was going to revolutionize the condo market in Hamilton. I have written about his projects and plans over the years and I was skeptical in his progress and outlook. The word on the street is the first occupants will be moving in to the Stinson Lofts on October 24. I can insert a few skeptical lines about no occupancy permits and ongoing construction but why knock a guy who is delivering a beautiful if not gorgeous condo product to our city.     It is so easy to complain about the time it took and the promises that came and went but have you ever done a major renovation or building? It takes a lot of time and delays happen daily. The Stinson Lofts are not a cement and glass building you can build in months; it’s a heritage building with amazing architecture and grand designs. The fact they have kept the integrity of the building intact and did not just use the structure as a façade for a new build, as others do all the time, should be not only applauded but appreciated. The next great build in Hamilton condo market is the Royal Connaught where they are also preserving the grand beauty of our heritage with the newest in today’s building techniques. If all goes well they will add towers to the property but the grand lobby will always be the jewel of the city. The Witton Lofts kept the old and mixed in the new in the condo market with great success. There is talk now of the Tivoli with keeping the theatre with new construction that is already facing criticism from people who would never buy a condo anyways and do not even know how the project will be built.     Harry Stinson was recently quoted as saying “Hamiltonians have a schizophrenic relationship with the city,” Stinson says. “There’s a great deal of boosterism and talk of how much they like the city. But there’s not much confidence...” And I agree whole heartedly. I love to knock Toronto guys who tell us their opinions on our city but “boosterism” is probably the best way to explain it. These condo builders need to sell their units and when the project is announced everyone shows up for the free champagne, they all start to tweet about it and then? Nothing.     The point is, stop jumping on the bandwagon of the newest and latest condo project or even worse, criticizing the developers for doing it. It takes a lot of guts to create a Witton Lofts, Stinson Lofts, Royal Connaught as well as building any condo project. These projects are increasing our tax base and bring new people to our community. Support them as they do their part to grow our city. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.

Strong September in Hamilton Market

Strong September

by Darrin DeRoches October 10 - 16, 2013

Sales are up for the month of September and came close to setting a ten year record. The best news is the average sale is a whopping $392,013 and this is a 6.7 increase from the same time last year. The total sales of homes were 1207 for the month. Luckily, listings increased since they have been scarce in the last while so the market is still a little shy on listings but homes sure are selling. If you read all the stats there are adjustments for seasons etc. But, the big news is homes average time on the market is down by eight days and the year to date increase is 7.7 per cent higher than last year.     This means your home just made you a 7.7 per cent return on your investment and all you did is live in it. Hamilton is continuing to be a front runner in the real estate market and outside interest is strong. The best part of all these stats is not just the increase but that they are real increases. Hamilton is not flooding the market with thousands of condos that are bought up for the purpose of flipping which inflates the market which does not give a true reading when looking at the market. Our numbers are showing actual houses selling for top dollar. The future looks good and the market is staying strong. So when should you jump into the market? Yesterday.     The interest rates are supposed to stay low until at least 2015 but most likely longer. If you look at mortgage rates the lowest are the two year rates since the banks know this is the time it will rise. They want you to be re–mortgaging at this time to pay a higher rate. The savvy investor can play the two year rate and hope it has not jumped up too high by the time it comes to negotiate a new mortgage. All these indicators are showing a strong market with continuing great rates. This is why you should make the move soon. Of course you can look back ten years and say what if I bought then my property would be worth so much now. Instead, you should look ahead ten years and figure out how much a property should be worth then.     The Hamilton market has been steadily increasing for over the last 15 years and it will continue to grow. We are in a resurgence that will most likely weather any storm the market will bring us. Larger cities with inflated prices and unaffordable mortgages will feel the hit, but we should be able to stay on course to “catch up” with the surrounding market. Be smart, buy the right property at the right price and you will see a great return in this city. Put a little bit of work into a property and you can cash out even higher in today’s market. More on that next week. Happy Thanksgiving! V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.

Baby Daddy Drama

by Darrin DeRoches October 3 - 10, 2013

Lately I have been involved in the sale of the matrimonial home in a couple of messy divorces. Divorce is a big part of real estate; they saying go with the big three D’s “Death, Divorce and Debt”. These are the main reasons for selling property. Moving on up to the bigger home and the first time buyer are the other half of all real estate deals.     I am currently selling a home where the one partner does not want to sign the deal. We have a great offer ready to close, greater than their expectations, one wants to sign but the other will not. We spoke with her lawyer and he advised her to list and sell the house since it was in her name and they have not lived “as a couple, for over two years”. We took the lawyer’s advice and listed the property a week ago. Within three days we had a great offer and she accepted it. Then, let’s call him “baby daddy” who is not involved made a fuss over the sale and asked how much did “we” get for the house. She informed him of the price and that was that. A day later he started to ask a ton of questions about the house and she told him to speak to myself or the lawyer to answer all his questions.     Within a day he had a lawyer and was claiming the home to be the matrimonial home. He did not pay one mortgage payment, gas bill or hydro bill. His lawyer is calling it the matrimonial home and he is claiming 50 per cent ownership. His name is not on the title but when they started out together three years ago, they had a child and they lived in the home as a couple. Two years have passed but he is now trying to get 50 per cent of a property he has paid nothing into. The women’s lawyer now changed his tune and asked us to get him to sign the agreement. Problem is the deal is accepted and we are waiting for them to remove conditions. We ask the “baby daddy” to sign and of course he says, “No, and I want 50 per cent of the profit”. They have never been married, he has never paid a dime into the house and he has now almost killed the deal since he will not sign. They are going to sit down with their lawyers and try to work it out but if he does not sign the deal will be dead. In all fairness, he legally may have a right to try and get money out of the house but morally, I think he is in the wrong. It just goes to show you the biggest issue in divorce is the money and it usually involves the biggest asset; the home. I would usually get both parties to agree before listing a property but in this case the lawyer instructed her that he had no legal claim. The lawyers may be the ones making all the money in this case. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.