DEBT

DEBT.DIVORCE.DEATH

by Darrin DeRoches November 13 - 19, 2014

These are the three D’s we deal with in real estate most often. We do get first time buyers, investors and families moving on up but Debt.Divorce.Death come up daily.  The problem with these three D’s are each have their own set of circumstances and each need to be dealt with on their own.  So I will write three consecutive articles on these occurrences in real estate. First comes debt.     There are many reasons why we get into debt and they all come down to one thing and one time – you have to pay. I have dealt with this personally over my lifetime, and professionally all the time.  The important part to remember is you are going to have to pay sometime. It is amazing how long you can put it off but sometime, somewhere, debt is going to raise its ugly head and bite you in the asset – your house.  You probably thought I was going to say ass but eventually it comes right down to your house, since it is usually the last asset.  Car companies will repose your car by simply towing it away but your house is harder to remove.  It is very emotional and it can get hard to remove a family from a home – emotionally and physically.  The creditors will send letters and letters and hope you will respond but if all else fails they will send a sheriff to the property to give you five days to vacate.     This last attempt to remove you from your home is very harsh, but you should be aware of your rights, and how to handle the situation.  Once you receive letters from the bank or creditors you should contact a debt counselor and try to remedy the situation.  They can knock down your debt by upwards 80% and help make a plan to keep your house and pay down the debt.  In some situations you may not be able to bounce back from debt and that is where you should call a reputable broker.  We can help sell your property and keep the bank at bay.  The bottom line is the bank does not want your house, they want you money. Put all the emotions aside and realize they just want your money, which they believe is their money, with interest and everything.  If you contact a broker who knows how to deal with the banks you can also save a ton of money in the short term.  If the bank takes hold of the property with bailiffs, sheriffs and property managers someone has to pay them.  That someone is you.      Take control of your debt and try to resolve it or call a great broker who can put your house up and sell it fast to pay the debt and come out ahead with money in your hand instead of the banks. We know how to deal with the situation before it is too late and you can take control of the situation and save your house or sell and walk away with debts paid and money in your hand.

Mortgage News

by Darrin DeRoches September 18 - 24, 2014

It’s a busy time of the year for the real estate market and mortgage brokers and banks are hustling and bustling.  I recently spoke with a few mortgage specialists and a few comments got me thinking.  I was surprised to hear people are still shopping around their deals.  Of course you want the best rate out there even though the rates are so low — why not get the best.  Sometimes it does not come down to the rate — it comes down to service.     It is really easy to go online and email several brokers looking for the lowest rate.  Sometimes you might save a few bucks and you might even believe you got the best deal but you may be sadly mistaken.  Personal service and creative ways to structure a deal can not only make or break a deal it can save you tons of money. An example of this is a person was bought a new house and went in firm with no conditions even though they had to sell their house to make the deal work. Weeks pass and their house does not sell. Six days to closing they call the bank and inform them about the deal and say that they need money to buy the new house. The bank had spoken with them two months ago and laid out a plan but they figured it would all work out and ignored the plan from the bank.  Luckily they have enough equity in their home they can arrange a short term mortgage with a line of credit and virtually “bridge” the two mortgages. Sounds good and they can move forward. The problem is that is comes with higher rates, costs and fees and will end up costing about five thousand dollars. Had they kept the personal contact with the broker, and not shopped around, he would have been able to set a line of credit for a new mortgage at a low rate and save them thousands and thousands of dollars today plus more in the future.     People have to realize that some banks can do things others cannot and that some brokers will do some things others will not. A client of mine was told they are approved for half a million but only spent $400,000 but the broker could not “bridge” finance. This seemed a little out of sorts to me so when I presented it to their bank they were approved for a bridge mortgage in hours. Fortunately we did not need the bridge and their house sold in the first week but if we did need it and listened to the broker they may have lost their dream home.     Work with those who work with the right people and you will not only get the best rates you can make deals others cannot.  When it comes to money — stop shopping on line — renew or create your relationships with lenders and brokers.  A great real estate broker knows when to call bullshit and help you find the right bank or broker!   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

Be Ready To Sell

by Darrin DeRoches September 11 - 17, 2014

When selling your property you must have “real expectations”.  The biggest mistake is to list your property at a price that you believe you need rather than the price that is right.  A real estate agent cannot create showings for your property out of thin air; the property has to sell itself. There are tricks to sell properties but tricks can be exactly that — tricks.      You can create urgency or inflate a property’s value but in the end everything you do to sell your home will have to answer to someone.  If you overprice your home and someone actually pays the exuberant price one would believe they will be laughing all the way to the bank but the bank may be laughing at you.  In today’s market banks are requesting more and more appraisals because the property may sell to some over eager buyer but the bank will not lend the money just because the buyer was “tricked” into the price.  Banks are approving a mortgage but when it comes time to hand out the money they are asking for appraisals to insure the numbers add up.  If they don’t the bank will require the buyer to come up with more money or they will outright refuse to provide the mortgage.  The mortgage clause use to be all about the buyer being approved but it is leaning more towards the property being approved. There was a time banks would not lend in certain postal codes but now they will not lend in certain price ranges in certain areas.     Another real expectation is that it still takes on average about 45ish days to sell a property. That is an average so your property could be on the market for months if you are not realistic.  Everyone reads about how hot the market is but that does not mean your overpriced, bad location, beat up house will sell in days.  Sellers like to blame their agents when no one calls about their house but maybe it has to do with price and location.  You have to be realistic and work with your agent to get your house sold.  Instead of complaining about the progress, make some changes and create some momentum.      Be realistic about your property and listen to your agent.  It is easy to just keep dropping your price to get a property sold but it does not always work. You hired an agent to sell your property so maybe you should listen to them and follow their lead and experience.  Timing has a lot to do with it.  The last three weeks have been a little slow due to school, work etc. but the market is still strong and will be moving fast in the next month or so.  Be ready to sell now or you will find your property sitting on the market while everyone else is on the move!  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

Pricing It Right

by Darrin DeRoches September 4 - 10, 2014

I may repeat myself a few times in this article but one of the most important things to do is price it right. The market is moving fast and if your property sits too long no one will pay it any  attention. Pricing the property right the first time can make a huge difference in the final outcome.  I did a deal this week where the property was priced at $415,500. The property was on the market for over a month and we were pretty surprised when we viewed the property. It needed some work but you would have thought it would have had some action on it during the month. My clients were really interested in the property since it was on a great street and had all the must haves on their wish list. So they wanted to do an offer and we started to negotiate.     I spoke to the neighbour and he gave me all the background on the property and what he thought it was worth.  A few things he told me were just his opinion but some of the information was very valuable.  I went back to the office and did a history on the property and then discussed our game plan with my clients.  We knew the house needed some work and factored that into our offer and then pushed the agent to do an offer on Labour Day.  Most people are relaxing and getting ready for the school year but we were trying to buy a property before the market starts to heat up once again.  The property had been reduced by ten thousand but it still was not priced right.     The only reason no one had bought the property was it was over $400,000 dollars. If you look at the MLS site you can pick properties in increments and anyone looking for a house at $450,000 dollars would not consider this property since it is a $400,000 dollar house.  The people who can afford a $400,000 dollar house did not even see this property since it was priced at $405,000 and did not come up on their search.  Most real estate agents do not do searches over the approved amount for their clients since they may fall in love with them and then not be able to afford them.  The only real issue with this property was it was priced wrong.     We had spoken to the agent and knew another price drop was imminent and we did the deal fast so the house would not come on the market under $400,000 and draw attention. We brought an offer far under the asking and settled five thousand less than my clients were willing to pay.  If the sellers had priced the property originally at $399,900 they would have had more interest and sold it for a higher price faster. Knowing your market and doing your homework can be the difference in this real estate market. 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.

Where You Are Buying

by Darrin DeRoches August 28 - September 3, 2014

It amazes me that certain properties are getting a lot of interest and multiple offers on them even though you would not find one Hamiltonian putting an offer on them. Recently there have been a lot of posts on the internet to “expose” properties that have had murders, meth labs or deaths in them. These posts get their information from either police reports or newspaper reports and then they tag them as “undesirable” properties. The interesting part is not these deaths etc. but properties that look so amazing but are on less desirable streets or areas.     This week clients of mine got a great deal on an income property and were willing to go into competition to get it. There were over twenty viewings on the property but when it came to offer day – we were the only ones. The funny part was on the same street, a similar property went through the same thing a few weeks ago. The big question is why? The house needed no work. The area is prime for rentals and as I stood outside waiting for the sellers to sign back the offer I had three people stop and ask me the price, condition etc. Everyone was looking at the property but no one was offering? The simple answer is timing and vision. This area was a mess ten years ago and it is not only an up and coming area it is already there. There are new condos and townhouses being built and sold for top dollar but people from Hamilton still look at the area as old and undesirable. Out of Towners take a look and they see the downtown feel, walkability and great price for what you get. Hamiltonians look at it as old, no parking and overpriced for what you get. My clients will be making money the second they move in and in ten years people will be saying “I wish I’d bought in this area ten years ago!”     On the other hand, the same agent had multiple offers on another cool, Victorian property in an area that will be still rough and undervalued in ten years. If you were to look at both properties and invest your money –the one my clients bought will bring you more return today, tomorrow and definitely in ten years. The house may be smaller but the numbers don’t lie. You have to be aware of the area and be realistic in how the market will grow. Out of Towners were making offers on the other property and their agents just do not know the market. I would not go into Toronto and pick the next great neighbourhood and their agents are coming here without doing their homework.     Be aware of where you are buying and better yet, hire a local broker who knows the market and has a proven track record. Ask the right questions or you will end up in a cool house in a terrible neighbourhood. Remember the three most important words in real estate – location, location, location! 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

Huge Jump In July Market

by Darrin DeRoches August 14 - 20, 2014

The Hamilton–Burlington real estate market saw 1559 property sales during the month of July, which is a 21.5 percent increase over last year’s sales in July. The average sales price broke the $400 thousand mark to $409,538 for the month. The average days on market dropped from 42 days to 36 days. In a nutshell, this means that the market is moving fast and selling for top dollar!     If you look back at the market in recent years, July is typically a little slower and you do not see sales at this level let alone over a 20 percent increase.  At the beginning of the year I wrote that the average house sale will be over $400 grand and it took six months to do it.  At this rate we will have record sales by the end of the year at top prices. The local papers are starting to write about the “condo boom”, which seems a little late to the party but the proof will be in the sales of the units which will take time to prove such a change in our landscape.  If the condo builders keep prices in line then they can compete in this fast moving market when you realize a home is hitting over $400 grand and if they price them in high $200’s then they will sell.  Everything is relative to what the market is doing on a day to day basis.     This week two properties came up on Herkimer and one sold within hours and the other on the weekend.  Both of these properties were priced on the top end of the market and both had about 9 out of 10. Unfortunately they were not what my clients wanted and we will wait for more to hit the market, but August is usually a quiet time and properties are still selling fast and for top dollar. The problem is that not all of the market is moving as fast.  If you listed two homes in the east end on the same street they will sell but it will take some time and more effort. The market is hot in Hamilton but in certain areas it is scorching hot — like the west end.     Last week I had several inquiries on student homes, investment properties, homes in west end, cottages and properties in the east end.  As I said before, August is usually pretty quiet but these calls and listings are showing that the fourth quarter of the year is shaping up to be strong.  Listings are still the issue and quality properties will sell fast! So if you are thinking of selling, take the time to call us to get things ready for a scorching hot end of the year to the real estate market. Be prepared so you don’t get burned! 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.

Bidding Wars

by Darrin DeRoches August 21 - 27, 2014

All of a sudden there seems to be an epidemic of hold back offers in Hamilton. A hold back offer is when the sellers decide that they will not look at any offers until a certain date. They want the market to have a week or so to look at the property and then, on a certain date, send in offers. The real intention is to create a “bidding war” which makes buyers compete against each other. This works in some cases but it seems to backfire more often than not.     I have several clients that will not even look at properties if there is a hold back date. They do not want to be “duped” into a false sense of urgency and over pay for a property. These hold back dates are causing more harm to a property than good. It also gives clients a week to change their minds — over and over again.     I showed a great little cottage in the west end and we left feeling pretty good about the property but had four days until offers accepted. The night before it was time to make offers, my clients decided not to write an offer. They fell out of love with the property and if we could have made an offer the first day, I am sure we would have closed. The property hit all the boxes on their wish list but when you have time to think about it, you think “there might be better coming out”. I checked today on the property and it is still on the market. I guess all of the other buyers felt the same way.     On the other side of the spectrum, I see good agents putting up properties that sell within days for top dollar and everyone wins. The agent makes a quick sale. The sellers get it sold without weeks of showings and disruptions. The buyers are excited and pay the market value. Everyone wins. If you really think about it, are you selling a property or are you squeezing out every penny you can? A good agent will negotiate the best price with one buyer instead of multiple offers that may or may not close the deal.     The hold back does bear fruit in some instances but lately I have seen more failures than successes and agents are over using a tactic that can hurt a property’s sale and make them sit on the market and go stale. This time of the year is usually pretty slow for real estate, as everyone is on vacation and getting ready to go back to school. Often you can find a good property while everyone is too busy, and I have seen a listing that would work great for my clients, but then I saw a hold back. These properties should wait a couple of weeks for the market to pick back up and then it would work. We are going to wait to pass the date and then see if it is still on the market and scoop it up for a better price. Timing can be everything! 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

Competing In Today's Market

by Darrin DeRoches August 7 - 13, 2014

If you want to sell your home for top dollar, you have to understand your market. Just because you hear the media saying it is a sellers’ market and Hamilton is having a boom in real estate does not mean your house will sell fast for top dollar. You have to understand your competition and beat them!     I recently did a home evaluation in the central part of Hamilton and once we did the walk through we discussed the renovations and possible price. The house needed paint and touch ups throughout and the seller was already doing the work. We discussed how they were going to finish the bathroom which was already under renovations. The final point was the kitchen which was in need of repair. The homeowner was going to try to match more recent renovations and do the paint, update hardware and simply “put lipstick on a pig”.     We sat down and looked at the comparables and came up with a price and a game plan. Some agents would have the sellers paint the entire home and put thousands of dollars into renovations when a simple cleaning and minor update would sell the property. This particular property had several homes for sale in the neighbourhood and all were recently renovated. We had to renovate the kitchen, do less painting and spend the time and money wisely as there is a limit to what the market will pay and you do not want to over improve the property. We saw the renovations that they had already done themselves and the quality was impressive so we discussed doing a total remodel of the kitchen by going to Ikea and slapping it together in two weeks. The kitchen was small and with new cupboards and counter it would only cost around $2500 dollars but the impression on perspective buyers would be priceless.     We convinced them to leave the upper floors with the paint that is there and spend the money and time on the kitchen. The house will then be ready to compete within its market with the other homes that have been on the market and are not selling. Everyone thinks houses are selling fast and for top dollar in Hamilton and in some areas that is true.     The last part of the game plan once the house is ready to hit the market is timing, price and commissions. I recently closed a condo that had its corporation collapse and no one else in the building has sold. We found a buyer and negotiated a deal and sold it. We have other agents calling us asking how we sold it and the answer is simple. We did our homework, presented the property properly, priced it right and offered the right commission. Five other units are sitting unsold, some are going power of sale and none of them are selling. Know your market! 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.

The Value Of Pools

by Darrin DeRoches July 31 - August 6, 2014

The idea of adding a pool and spending close to $50,000 once it is installed and landscaped is based on emotions, not economics. This time of year we all wish we could come home to a pool and we dream of having one installed. I have been thinking about it year after year and every time I try to justify it, economics win out over emotions. If I spend $50,000 on a pool and landscaping will it increase the value of my house?     The pool is just part of your landscaping and if it is just sitting there in the backyard all by itself then it really does nothing to add to the value of your home. If it is part of a great landscaped entertainment backyard, then it helps to sell your home, especially in the summer and fall. The emotions of a pool and the part that it plays in the landscape of a great yard will increase the value of your house but nowhere close to the tune of the total investment. It comes in around 10 per cent of the value of the pool if it is incorporated in a great back yard. Everyone who buys a home with a pool falls in love with it until it costs them money and this emotion helps sell a home.     If you had two exact homes in a neighbourhood — which is very common these days — with new builds and one had a pool, which one would you buy? Think about a finished yard with a pool and a totally landscaped yard that is priced higher than the competitor without the pool. If you could afford to buy the one with a finished yard with pool, your emotions would take over as well as your imagination of summer fun. If the agent explained the owners spent an extra $50,000 on the pool and yard but are only asking and extra ten or twenty grand, you would perceive its value and buy the house with the pool. The reality is that you would pay more for the house with the pool and they would get closer to their asking price than the house without a pool. This does not make you money, since you spent the $50,000 on the yard, but if you spent the same money on the kitchen, would it bring you the same return? A kitchen would bring you maybe an extra ten grand in return but you cannot swim in your kitchen sink!     The bottom line is that paint and flooring are the only two improvements you get a full return on its investment when it comes to improving your property. A pool can bring you years of enjoyment and in the end it will help sell your home, not hurt it! 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.

The Art Of Debt

by Darrin DeRoches July 24 - 30, 2014

This week I had client who wanted to offer on a house that just came out and was set up for competition. They would not accept offers until one week later, after the open house. We viewed the property and I tried to show them that the house was not worth the asking price. I saw a lot of work and the price did not reflect the scope of work and market value. We left the showing and I thought that they would not want to make an offer, but they went to the open house and figured they were up to the task of doing the work if we got it for the right price.     The day arrived for offers and I called the company to register our offer, and asked if there were any other offers coming in. They said that it was early and no other offers were registered. I called again a half hour before presentation time and still no other offers. This just proved to me that the house is not worth its asking price and no one else was going to make an offer. We wrote up our offer just about 5 per cent below asking and drove to the office to present it. We were the only ones there and we presented the offer and waited for their response. They did not counter our offer and decided to put the house back on the market for 5 per cent higher than it was for the last week.     This is where the Art of the deal comes in and before the agent could even explain the reason, I stepped in and explained it. The sellers are so far in debt that they figured if they created “competition”, they would get over asking and be able to sell. Obviously my clients will not pay over asking and putting it back on the market higher than asking is only going to make the property sit for a long time. The agents are only doing their job for their clients but who is going to pay over market value for a property that needs a lot of work?     It is not my clients, I or the seller’s agent’s job to pay the debts of the sellers. They convinced the bank to lend them money on the property and ran up their debt and credit cards to a point that they now want a certain price to clear all the debts. Problem is, the property is not worth it. The only solution for this type of deal is to talk with a debt councilor and clear enough of the debt so that you can then sell the property – pay off all of your debts and even walk away with some money. The strategy they are using will just create a ton of time wasted and no sale. I cannot get involved with their clients and make the deal come together but I have done this for clients of my own and everyone walks away with money in their pockets! 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.

No Inventory In West End

by Darrin DeRoches July 17 - 23, 2014

I have clients who are looking to spend $400,000 dollars for a property in the west end and we are unable to find a suitable property. Ideally we would like an investment property and if not they would spend a little less and buy a single family. The inventory is so low and we have looked at everything that has hit the market, so we started to re–look at what is out there and it amazed me how out of whack some properties are priced.     This week an investment property dropped their price again to $399,000 so my clients got excited and figured it was a deal since it was originally priced around $490,000 months ago. We booked a viewing and were ready to make an offer before anyone else noticed the drop in price. Once we viewed the first unit we realized the property was in need of major repairs. On paper the property hit all the right boxes and it should have an income on $2400 a month and would work at the $399,000 price. Once we viewed the second unit it would take over $50,000 to update the property but its layout would still be an issue and it would be hard to rent the property at full value.     We moved on to another property that was listed last week and it was over our budget but we figured we could get the bank to go higher if the property was move-in ready. The listing did not mention anything about “as is” or “renovation” so again we were hopeful. Once we walked into the open house the agent immediately explained that the house needs about $50,000 in renovations. New furnace, kitchen, bath and the list went on. I was again amazed at how they could list a property that seems to be a little overpriced for the market but since inventory is low maybe they could get it. Now it needs over fifty grand which brings the house to at least $70,000 dollars higher than what we can afford, but in reality at least fifty thousand over what the market will pay.     I noticed that there were a lot of real estate cards on the mantle and asked the agent how the showing was going and he mentioned that there was an offer but that it was “low ball”. I had to bite my tongue since the amount of agents through the property tells me that they also believed the house was move in ready and the low ball offer was probably on the money.     This time of year the market slows down and what is left up for sale tends to be a project or overpriced. My clients are eager to buy and they will move fast to get a deal done but you have to step back and wait until the market starts to move again and enjoy the summer. A few good properties have come up and have sold quickly. We will keep on the ball and wait until the right one hits the market. I am pretty sure that the ones that are sitting on the market will still be there. 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.

Sales Up, Inventory Low

by Darrin DeRoches July 10 - 16, 2014

The month of June has shown big numbers in Sales and Listings. The market is strong and people are on the move. There were 2215 properties listed in June which was an 11.5 per cent increase over last year but the inventory was down by 5 per cent by the end of the month. The sales for June were 1572 properties with and average sale price of $399,917. This represents a 15.6 per cent increase in sales from the same time last year.     This is showing how strong the market is plus the fact that people are making moves in the market. Prices are rising by about 5 per cent from last year and everyone is reaping the rewards from this strong market. The average time that a house sits on the market is about 35 days which is down from last year. This all points to a strong market which creates a low inventory and this means that if your house is not selling, it can be due to one of two things. Either it is overpriced or your agent is not marketing it properly.     Every house has a buyer out there but in some instances it may be hard to find the buyer if you are priced wrong or not being serviced properly. Some agents just put the house on the system and wait for the phone to ring. The problem is that the phone is not ringing because the house is overpriced. Then there are the properties that are priced properly but the agent is not actively working the leads and making a sale happen. Some agents do not help the process along and buyers decided to purchase competing homes instead. If your home is sitting on the market longer than the average home, you should take a serious look at your situation. Is it the price, the agent or the home itself? You may need to do some painting, landscaping, change the price or change your agent.     This strong market does not create dumb buyers or huge competition. Buyers are still informed and you have to present your property in its best light to get the fast sale. Top dollar and quick sales only happen when everything is working in alignment. The agent and the seller work together to make the property presentable, priced right, and marketed properly. This time of year you have to watch out for long weekends and weather to hit the market at the right time. Having an open house on a long weekend and asking for offers that same week is a huge mistake. You cannot do a price drop when nobody is paying attention.     The sales are up and inventory remains low but you still have to work to get the best price. There are still good deals in the market you just have to know when to make an offer and see what the market has missed since everyone is about to either go fishing or take a vacation. Timing can be everything. 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.

No Inventory In West End

by Darrin DeRoches July 17 - 23, 2014

I have clients who are looking to spend $400,000 dollars for a property in the west end and we are unable to find a suitable property. Ideally we would like an investment property and if not they would spend a little less and buy a single family. The inventory is so low and we have looked at everything that has hit the market, so we started to re–look at what is out there and it amazed me how out of whack some properties are priced.     This week an investment property dropped their price again to $399,000 so my clients got excited and figured it was a deal since it was originally priced around $490,000 months ago. We booked a viewing and were ready to make an offer before anyone else noticed the drop in price. Once we viewed the first unit we realized the property was in need of major repairs. On paper the property hit all the right boxes and it should have an income on $2400 a month and would work at the $399,000 price. Once we viewed the second unit it would take over $50,000 to update the property but its layout would still be an issue and it would be hard to rent the property at full value.     We moved on to another property that was listed last week and it was over our budget but we figured we could get the bank to go higher if the property was move-in ready. The listing did not mention anything about “as is” or “renovation” so again we were hopeful. Once we walked into the open house the agent immediately explained that the house needs about $50,000 in renovations. New furnace, kitchen, bath and the list went on. I was again amazed at how they could list a property that seems to be a little overpriced for the market but since inventory is low maybe they could get it. Now it needs over fifty grand which brings the house to at least $70,000 dollars higher than what we can afford, but in reality at least fifty thousand over what the market will pay.     I noticed that there were a lot of real estate cards on the mantle and asked the agent how the showing was going and he mentioned that there was an offer but that it was “low ball”. I had to bite my tongue since the amount of agents through the property tells me that they also believed the house was move in ready and the low ball offer was probably on the money.     This time of year the market slows down and what is left up for sale tends to be a project or overpriced. My clients are eager to buy and they will move fast to get a deal done but you have to step back and wait until the market starts to move again and enjoy the summer. A few good properties have come up and have sold quickly. We will keep on the ball and wait until the right one hits the market. I am pretty sure that the ones that are sitting on the market will still be there. 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.

Thirty Day Closing

by Darrin DeRoches July 3 - 9, 2014

The market is moving very fast and this week I spoke to two different sellers who have thirty days to close their property and move on. Where are they going to go? The first seller sold their home by themselves and figured they could do it without an agent. They received an offer from someone who had to sell their present home and waited for months to see if the deal could come together. Last week they had a second offer to close the home in thirty days. They were very stressed and had to figure out who was going to buy the property, when, for how much and most importantly, if they took the second offer with a quick closing – where were they going to go?     As a broker I would have handled the whole deal in a different manner and dealt with all of those issues. The property is listed for $589,000, when it is worth over $630,000, and they would have had more offers – especially in this market – if they used a broker who would have marketed it and had a lot more exposure. This alone would have brought better offers and a higher price. They went with the quick closing and lower price and now have to find a place to live temporarily as they wait on their next move. Again, we could have arranged a better time frame to align their move and dealt with other agents to accommodate the right terms etc.     The second seller is a guy who split with his common law girlfriend who sold their property and now have thirty days to close. His situation is a lot simpler as he will just pack his bags and couch surf until his next move. This situation happens all the time. It seems men just want to “get out” of a situation and have no real need to make the next move. Then they realize it is time to buy another property as they do not want to rent forever. Once the deal is closed and they have the money figured out and a big cheque gets deposited in their bank, then they want to buy. Even though they know the money is coming they usually do not want to make the move until they actually have the cheque in their hand. Then we get the call to buy and buy something quick.     The market is still moving fast and you have to have a game plan to deal with it. This time of the year is when thirty day closing happens more often as people want to take the summer to make the switch and get into a new property before school starts. Think ahead and communicate your plan with your agent. Time and money are what most deals come down to so being prepared will bring the best results. 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.

Cooling Off Period

by Darrin DeRoches June 26 - July 2, 2014

When buying a new condo in Ontario there is a ten day “cooling off” period where you are allowed to walk away from the deal. This is when you can take stock of what the condo has to offer and if you bought the right condo. Your deposit has to be returned to you in full and you can walk away from the deal with no deductions. This only applies to “new” condos and not resale condos, but if you are working with a real estate professional they would have similar clauses to enable you to rethink your purchase.     This cooling off period is a time to get your lawyer to look at all the documents. A condo developer can put in a lot of clauses and descriptions that may or may not be what a buyer wants. There can be hidden fees; costs etc. and a buyer will want to have their lawyer take a good look at all the documents. The buyer will also want to check out other developments around the new condo to make sure their views, amenities and overall prosperity of the development will be delivered as laid out in the sales brochure. During these ten days, a buyer should also get their bank involved to make sure that they will have a mortgage on the unit once it is completed. If a bank does not like the development, they may not fund your mortgage.     Most of the legal and financial things will work themselves out during these ten days but buyer’s remorse may kick in. This is usually the biggest problem with people walking away. In most new sales of condos there is a big kick off and frenzy can occur. New buyers get caught up in buying a condo and they do not really take into consideration all of the factors. A couple of days later you tell your friends and family about your new purchase and someone who thinks they know it all starts to put doubt in your mind. They ask how much did you pay per sqft? What floor is it on? Do you know what else is in the neighbourhood? You answer all their questions and no matter what you tell them – you are a sucker!     No one is happy that you just bought a new condo and most likely will make thousands if not tens of thousands of dollars on your investment. They will tell you that you paid too much per sqft. Who is going to live there? You have no view. Everything and anything to discourage you from completing the deal. You can tell them the project sold out and that you made thirty to sixty thousand dollars on the unit once it is completed. They will still give you an opinion on why you should walk away because they are jealous.     During your ten day cooling off period, take everyone’s opinion into consideration but remember why you made the decision to buy in the first place and close on the deal. Trust your gut, do not be influenced by others’ opinions, and look at the numbers – they do not lie. 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.

Downtown Condos

by Darrin DeRoches June 12 - 18, 2014

This past week the condos at the old Royal Connaught went up for sale and a few other projects also made some announcements. The Tivoli released a picture of their renderings of the upcoming project and the tower seems pretty big. The Artizen condos beside the Lister Block also put up a sign to announce their project. Both of these projects are still far away from selling and are announcing their project because the Royal Connaught was on sale.     My client is very interested in buying condos in Hamilton since we’re named number one city to invest in. For years, people have bought condos as an investment in Toronto and their condo market is so huge that some fear that the capability to make money in prospecting condos has come and gone. This has then brought attention to the Hamilton market, but after this weekend I wonder if we get it. The idea of buying a condo below market rate and then reselling it in 18 months to two years when the project is completed only works if the original price is low enough and the resale market raises enough to make a profit. If you were to buy a condo at $390 per sqft and then sell it two years later at $410 dollars per foot, then on a 1000 sqft foot condo you can make $20,000. This speculating buying process helps the condo builder’s ability to sell all the units and get the project built and at the same time allows for investors to make a better return on their money than sitting in the bank. The problem is that the builder has to be willing to sell at the right price and the market has to continue to rise. This is why it is called speculating.     The Connaught, Tivoli and Artizen condos are all big projects and will have to sell a lot of units. Collectively they will bring in over eleven hundred units to the downtown plus the other projects that are being built will bring a huge influx of people living in the downtown in the next two years. The first question people ask is “who is buying these units?” and the answer is simple – everybody. I spoke with young and older people who have the desire to buy condos and live downtown. The downtown area is changing in the right direction and the Royal Connaught will be the turning point.     Sales are the answer to everyone’s questions and sales are happening. Condos have been in the downtown for many years and different projects have had different levels of success. Over the next six months to a year, you will see the success of these projects selling. The next 18 months to two years you will then see the influx of people moving into these condos and downtown will have the biggest growth it has seen since the Royal Connaught was first built. 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.

A Piece Of The Connaught

by Darrin DeRoches June 5 - 11, 2014

This Saturday, June 7 2014, the sales for the Royal Connaught condo will be available to the public at 9am. Over 3,000 people have signed up on their mailing list and I am curious to see the response to the sale. Personally, I will be there with a client looking to snap up several units but there are only 122 available in the original building with more to come in the future towers. They have not set out prices or announced the amenities and all of the focus is on one demo suite and the grand lobby. I believe this is the best project in the city for today and the future and it will be very interesting to find out how it will be received. The property has sat empty for over a decade and in this time we have had a few condo projects built with varied success and failures.     The Core lofts were the fastest selling condo when they came to market and made a huge splash, and then a few years ago it made another interesting mark when the condo owners had to pay out 20 to 40 thousand dollars per unit in a special assessment. The Witton lofts are the most recent and they were also well received and are a great success.     I predict that the Royal Connaught will be an overwhelming success and only hope that everyone gets a fair chance at buying a unit. Some want them as an investment and others as a piece of history. This sale of our downtown will set the standard for our future condo development.     There are other projects happening and selling but all eyes are on the Royal Connaught. The last special project of this magnitude would have been the Piggott building in the 90’s. The building is grand and well–appointed with well thought out units. Unfortunately, the builder went bankrupt and the receiver came in and sold the units under value. They were surprised how quick all of the units went and took their money and moved on. These same units have increased over the years but never reached their full potential.     The pricing on the Royal Connaught will be important not only to the condo market itself but the future of downtown. You only get one shot at getting it right and hopefully they will not undervalue or overvalue the units. The units will be from 550 to 1050 sqft and you have to decide what is the best size and value when speculating on a project that is 18 months from completion.     The risk is there but so is the reward. I will be there with cheque book in hand making the decision for my client to buy one, two, three or even four units if it all makes business sense. If it does not add up then we would have to walk away and wait for the next opportunity, but when can you own a piece of Hamilton history? Saturday morning in downtown Hamilton, that’s when. 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.

Renew With Someone New

by Darrin DeRoches May 29 - June 4, 2014

One would think being loyal to a lender or insurance company would bring the best results in premiums and rates but you are totally naive to think this. Every time your renewal comes up for your mortgage or insurance policy, change companies! I have been with CIBC for over thirty years and that means absolutely nothing when my mortgage comes due. They have two of my mortgages and that fact also means nothing to them. Insurance companies tell you about these multiple savings and I just questioned them about my renewal and their solution was to increase my deductible by $2500 to five grand and they would give me a 4 per cent deduction or about $130 a year or just about $10 off a month to stay with them. Remember they are already over charging me and have three houses, a commercial property and vehicle insured so their solution is to up my deductible so that if I actually ever use the insurance, I will be out $2500 more and they will drop my premium by $10 per month. So if I was to do the math, that would save me about $1,300 in ten years so if in the next 20 years I would save the increase of $2,500 in deductible to a plan that is already overpriced on just one property of several they are insuring.     There was a study done to prove that staying with your mortgage company upon renewals is the worst case situation. They may give you a so–called discount but if you took that same mortgage to a broker they will get you a better discount and it costs you nothing but time and energy and that is the real issue. Taking the time and energy to send some paperwork and make a few calls to a broker is why most people just renew thinking they are getting the best deal. In some cases you may only save a little and in some cases a lot. Why? The time you renew certain lenders may have some great deals to “drum up some business” and if your timing is right you can save a ton of money. Most people are afraid that the bank or insurance company will not cover them while they shop around but it only takes broker hours to find a better deal. A couple of days if it is a busy time.     I have to get on the phone once I finish this article and find a new broker for my insurance since their solution of increasing my deductible is not only insulting to my intelligence it made me realize how much I hate dealing with insurance – but it is time to make the move. First time buyers get better deals than anyone with loyalty so if you are up for renewal give us a call and we can guarantee you a better deal with brokers we deal with. It takes a little time but it will save you money! 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.

Pre-Approval

by Darrin DeRoches May 22 - 28, 2014

The infamous line that “my clients are pre–approved” holds a little weight in a typical negotiation and might sometimes help you win the sellers over, since you are truly able to buy their property. The funny thing in today’s market is that pre–approvals are a thing of the past and most people are not aware of it. A few banks still do pre–approvals, but most do not spend the time and effort to do so. In the past, you would provide the mortgage broker with all of your information and they would basically work the deal to get you the most money that a lender would “approve” you for. The lenders realized recently that they were doing all of the work twice and in a lot of cases, they would “pre–approve” you even though you would go with another institution. In today’s market, the pre–approval is more like a general over view of your income and major debts to give you a so–called ballpark rough idea of how much you can afford.     The problem arises when you ask the client to describe their income and debts and in most cases they leave out a couple of crucial items. It goes back to the old saying “buyers are liars” but this seems a little harsh. All banks have a tab on their websites that say “how much can I afford” where you list your basic information. The problem is that you want to buy a home that you probably cannot afford, so if you adjust things by a little — maybe you can afford it. You then get the idea in your head that you can afford a property in the $400 thousand dollar range and in reality, you cannot even be approved. So how can this be?     Everyone has different credit scores, issues and income so there is no secret sauce to figure out what you would be approved for until the broker inputs all your information. The problem is that this is only a general scope of what you can afford. If you are thinking of buying an income property or a second home, then other rules fall into place and you may not be approved. This is causing a lot of deals to fall through since you believe the client or the mortgage broker but the bank has the last word and they will not commit until you send them a “real deal”. So sellers have to be aware that the best deal on the table may not be the highest offer but the one where the buyer can actually close the deal. If you are considering buying in the coming months, make sure that your credit and debts are all in order so that you can get approved. Your agent will have to know even more information about your financial position to be able to sell your deal to a seller, since the phrase “don’t worry they are pre–approved” holds no weight in negotiations. 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.

Agents Acting Crazy!

by Darrin DeRoches May 15 - 21, 2014

I recently wrote about multiple offers and how some are working while others are falling flat on their faces. This is a little more insight into how agents are acting crazy.     I was in a multiple offer situation with two other offers. The usual back and forth happened and it came down to my offer and another offer which had conditions. The sellers were trying to get top dollar, which is understandable. The next move was where the crazy part came in. The agent asked us to go up another ten thousand and the property would be ours, since we did not have conditions. My buyers did not want to raise their price, but the agent told us it would be ours. I stepped into the office and told them that we would go up the ten grand and sign the deal. I stepped out so that they could do the paperwork, and twenty minutes passed. The agent walked out and told me that they were going to go with the offer that had all the conditions. I asked about her ethics and the seller’s word but greed stepped in and they wanted every dollar out of the deal. Again, no sour grapes here but you told me it was ours and then you figured you could squeeze out a few more dollars and take a chance on the deal with the offer that may not close due to conditions.     The agent then has the balls to ask if we would wait the five days for the conditions to play out and if the other offer did not close, would we still be interested? It the old adage “that a bird in the hand is better...”. This agent and seller just bold faced lied to me and now they want us to wait with another ten grand in our hand to buy their property if the other offer falls through. I told them that my clients still wanted the house, but that we would not pay the extra ten grand and told them to call me when the other deal falls apart since they were over paying with conditions and I doubted that the bank would approve the deal.     I spoke with another agent who had the same type of issue this week with the same company who did a “hold off” offer where no one made an offer. This agent then made an offer just ten thousand under asking since there was no competition. The seller’s agent brought back a full price counter offer. So, you overpriced the property to where no one wanted to make an offer and you promised your sellers that they would get competition and top dollar and now you want the buyer to pay full price to make you look like you know what you are doing. The buyer agent tore a strip off the agent and then countered with just under asking. Another property this week that did not get any offers after holding off offers dropped 20 grand and the agent is calling around begging for offers. Crazy agents – price your property right and let it hit the market – cause excitement and garner multiple offers if it is worth it. 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.

CHMC Cuts Second Mortgage

by Darrin DeRoches May 8 - 14, 2014

Here we go again with the mortgage rules getting tougher and tougher. The CHMC has decided, in all their wisdom, not to insure a second home for individuals looking to buy either a cottage, income property or even a second home in a divorce. They will not insure the mortgage to a second property and without insurance you cannot secure a mortgage unless you put down 20 per cent, which in turn will save you thousands of dollars on the insurance.     So what are you options with this new rule? As we just mentioned, you put down 20 per cent and you can get a mortgage just about anywhere. You put the second mortgage into a family member’s name and gift them the down payment. The last option is not to buy the second home. Actually, there is another option by using private–sector mortgage insurers.     Genworth is the most popular insurer who will still allow a second mortgage but they tightened up their lending practices. The property can only have one unit in it. So no income properties with them. You can buy the cottage but no duplex or even a nanny suite for your aging parents if it has a self–enclosed apartment in the house. Genworth would allow you to buy a property for yourself to live in or a family member, but not now. Think of a divorce situation and you would like to have income coming in with a second unit — not now. Rent or hope your ex–spouse can qualify on their own.     This new rule will allow the secondary market to charge even higher insurance rates for these second homes and devalue the price of income properties since only those with 20 per cent down will be able to buy them. If you are thinking of buying a home in the near future, you may want to consider buying an income property first and qualifying with as little down as 5 per cent. This will then create a great investment and in a few years look to buy a second home for yourself since it will be only one unit and all of the insurers will give you insurance with 10 per cent down instead of paying 20 per cent and higher rate of insurance.     I have clients this week who are using this strategy so that they can look back in 20 years with a great investment property and a family home. This may seem simple but it can make them over a half of a million dollars by buying the income property first and qualifying for more and putting down less.     This change of insurance by CHMC happens on May 30th so most people would not be able to do anything about it and worst of all, most people do not even know anything about it. Information is key and using a broker who is on top of the market can save you thousands today and make you a million over the next 20 years. 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.

Multiple Offers

by Darrin DeRoches May 1- 7, 2014

It’s the time of year for the event of bidding wars which bring multiple offers. Many agents try to drive up the price by “holding back” offers until a certain date and create multiple offers. The problem is that it can also backfire on you and actually cost you money.  This past week my clients looked at three properties that came on the market with a fixed date for offers.  All three were good homes and two of them should sell over asking.  The dates for offers came up and all three agents called me to see if we had any interest on making an offer and the funny thing was, all three had only one offer registered.      When you get into a multiple offer situation, you must call the brokerage and “register” your offer and then the agent will present “all offers” at a determined time.  The properties were all priced properly but many people in Hamilton do not want to get into a “bidding war”.  The fact that there were not more offers registered and the agents were calling around trying to drum some up makes the whole industry look a little desperate.  There was a story about a property going 195% over asking and everyone gets excited that the market has gone crazy and you can sell your property for top dollar.  The problem with this agent pricing the property was it was priced at a selling price from 15 years ago.  The property got a ton of attention and it also brought 70 plus offers but what did that really prove? Yes, there is a shortage of listings and obviously there are a lot of buyers out there looking for a property but the buzz he created was exactly that – created.     If I was to list a property at a price level from 15 years ago, it too would create a buzz in the Hamilton market but that buzz would be other agent talking shit about me. It would actually hurt the sale of the property and it may even garner a lower sale price.  Everyone keeps saying the “Toronto buyer” will come in and pay the higher price but that is total bullshit and if their agent is even remotely good and can work a computer they will realize it is overpriced and move on to another property.  A properly priced property will create its own buzz in this sellers’ market and garner multiple offers which will hopefully result in a great price and a quick sale.  If your strategy is to get multiple offers and your agent comes up with these far out strategies — kick them out of your house.  A home located in the west end will not sell the same way as a home on the mountain. Different buyers react to pricing and buzz in many different ways so what works in Toronto will definitely not work here.  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.

Lobbyist Registry

by Darrin DeRoches April 17 - 23, 2014

The Lobbyist Registry will go right up beside the ‘bus lanes’ as the biggest blunders of the year, and it is only April. For those who do not know what a Lobbyist Registry is, it is a “sign in sheet” for anyone who wants to do business with the city. Its intention is to create transparency and eliminate the opportunity for “back room deals”. The only thing it will create is more “red tape”. Have we not learned the lessons from our past, when no one wanted to do business in our city? The numerous complaints about the city moving at a snails pace to get things done. So let’s add another level of red tape and scare away potential business from our city.     The best example of doing it right was the deal to bring Canada Bread to our community and create jobs and new taxes. The councilors had no idea about the deal until they needed to know and vote. That is their job, to vote – not to make the deal but to vote on a deal. A politician is not a business man and should stick to being a politician. A businessman wants to open a business without politics. By creating this registry, it will only bring unwanted attention to proposed deals which may or may not come to fruition. The registry will become public information where politicians will try to use it as a “grandstand” and the media will use it as a honey pot to write about businesses that are coming to town. The thing is, neither the media nor a politician understands how business works. They do not want to be announced to the community or their competition until they are ready to open. Several new restaurants in downtown have been announced by the media and city but they still are not open until a year later. This brings negative buzz before they even open and everyone wonders what is going wrong with these locations and King William. The best thing is for you to do is a soft opening and let the buzz build, then have an announcement with the mayor cutting the ribbon and the media exposes it – not the other way around.     A registry will not help our city and its negatives will outweigh any possible positives of these so–called backroom deals. Do you really think they exist? Is there a line of people, with millions of dollars to invest, missing out on opportunities in the city? Hell no. Let the businessmen do business and stop adding more red tape to the process. Everyone can have an opinion on the matter but those who have created business in this city and deal with the process of doing business on a daily basis know that investors will move on to another city if they keep running into red tape. They do not want their competitors knowing what they are doing until it is time to open and compete. 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.

April Fool!

by Darrin DeRoches April 10 - 16, 2014

I went to look at a property to be listed today and when I drove down the street, I could see four other homes being worked on, ready to hit the market. The seller of this particular “flip” house had several agents come to look at his property and the first one to “bite” at his proposal would win.     The property is about 70 per cent complete and he wants to list it at a 20 per cent premium without even finishing the work. He believes that people with money can see past the unfinished work and will be willing to pay a premium for his property. It was one of those meetings where even if he was willing to give you the listing you would still have to turn it down. The outside looked great, the workmanship is good, the location is perfect but once you walk through the doors and see the unfinished work and discuss their expectations, you just have to walk away.     I have sold properties in all stages of completion. I do not believe that a property has to be finished and staged to get top dollar. I have sold homes for top dollar with swearing tenants, leaking roofs and foundations but they sold with full disclosure and fair pricing. This seller believes it is such a “hot market’ that he can sell a property that is unfinished, badly designed for a hundred thousand dollars over comparables. It has been over a year since they tried to sell before and the work is still not finished. Once you walk in the door, all the red flags start to fly. After a five minute conversation, another dozen red flags pop up. The seller believes that agents do not have vision and he wants to sue past brokers over certain promises and all the time offering a game plan to sell the home of 4 per cent commission with 3 per cent going to the buyer agent. Then a bonus if you get his ridiculous price. All I could think of was how would I get out of the house with my ethics and real estate license still intact? Any agent who would take such a listing is risking a fine, a lawsuit, or worse. I have worked with all types of sellers and I always find a way to make it work for everyone but sometimes you have to walk away.     The problem is that he did sign with an agent who agreed to his insane plan. There is no way that they can get this home sold for this “fools price”. The agent will lose money just listing the property but since it is in a great area they will risk taking a losing proposition. The listing went from a For Sale By Owner to an agent who chases FSBO to an agent who will list at any price. It is a hot market but buyers are not fools and anyone willing to list a property that is 20 per cent over comparables may be foolish.     Make sure that you do your homework and work with a broker who earns your trust. 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.

Commercial Market Changes

by Darrin DeRoches April 3 - 9, 2014

Properties are slowly coming up for sale throughout downtown Hamilton and recently a couple of buildings have come up for sale and lease. Most commercial properties do not have signage on them and people wonder why. It’s pretty simple. I doubt that you have 3 million dollars burning a hole in your pocket and you drive by a property where the sign will convince you to buy it. Commercial owners also like to use out–of–town agents since they figure it will keep it quiet when they are trying to sell the property. So no sign and an out–of–town agent may keep things quiet but maybe you forgot about the little thing called the internet or worse yet — word of mouth.     I was having a beer this week — shocker, I know — and the conversation at the table turned to a local bar that is rumoured to be for sale. I know the property and had to tread softly in the conversation since I had already met with the owners and know that they are not selling it yet, but according to this guy in the bar — it’s for sale. Then they tried to figure out how much it would sell for and since I already know the listing price, I humoured them when they came up with a price. I then threw out the real price and they thought it was too much after they figured what is should be worth. I told them about a bar on Augusta priced for 2.9 million ready to go and they also figured that was too much. Of course, none of them own any commercial property but they figured it is way overpriced. These rumours can hurt a business and even a potential sale since everyone is talking about the property before it even goes on sale. Then there are properties who list at an outrageous price to “test the market” and everyone thinks some magical buyer from out of town will swoop in and buy it.     In the commercial world, the majority of deals are done over a long course of time with people who know the market and sometimes do not even list the properties. A friend or business associate will use “word of mouth” to let it be known the property is for sale and overtime they find a buyer or lease. Kijiji and other internet sites attract more interest than the commercial real estate sites. You really have to think outside of the box when marketing a commercial property in today’s market. Twitter and LinkedIn have become a useful recourse in today’s evolving commercial real estate market. The problem is the majority of commercial agents are “mature” agents who do not evolve as quickly as the market and this may be their downfall. My last few commercial deals have come down to word of mouth, signage and most importantly, Kijiji. Real estate is always changing and a good broker has to move with the times. 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.

Higher Capital Targets For CMHC

by Darrin DeRoches March 20 - 26, 2014

Mortgage rates have stayed low for the past three years, and they will stay low into the near future, so things seem bright for buyers. The lower the rate, the higher you will be approved for and the bigger the property you can buy. Sounds good but the Canadian Mortgage and Housing Corporation has decided to raise their fees to insure your home. Most people buying a property are not even aware of this insurance and do not even consider it when buying a home. So how does it work?     Quite simply, every home must be insured by CMHC if you put down less than 20 per cent on a property. This relates to the majority of home buyers. There are a couple of other insurance companies but CMHC are the standard. If they do not approve of the deal, you do not get a mortgage. It is that simple. They can kill a deal for many reasons and if they deem the deal to be “shaky” – no insurance and no home. So what is the big deal about the increase?     As of May 1st 2014, the premium will go up from 2.75 per cent to 3.15 per cent on the average 5 per cent down deal. Their website then goes on to say it will only cost $5 more per month on the average mortgage – so who really cares? All of this is really misleading. The average homebuyer is only putting down 5 per cent when buying, and since the average home will hit $400,000 this year, what is this slight increase going to cost you? Around $1,600 on the deal which really increases the monthly mortgage about $8 per month. Currently you would pay about $11,000 of insurance on this deal and your premium will now be around $13,600 for insurance on an average sale of $400,000 property. Does this not seem to be a lot of money for insurance you will never use and the CMHC never really pays out?     We went through a housing crisis a couple of years ago so you would think that the insurance company must have paid out millions of dollars on this disaster. If there is a huge flood or catastrophe, insurance companies have to pay out millions if not billions. The CMHC explains the increase this way: “The higher premiums reflect CMHC’s higher capital targets” said Steven Mennill, CMHC’s Vice–President, Insurance Operations. This statement should be written in simpler language like this “We want more money, so we are raising our rates”. But don’t worry, we will just roll these costs into your mortgage so it is only like five bucks more a month. The reality of it is that this extra $1,600, which is about $13,000 on the average mortgage, is going to cost you about $20,000 over the course of your mortgage. But just look at it as an extra five bucks per month to the CHMC since they want “higher capital targets”. Your only option is to put down 20 per cent — so come up with another $60,000 on an average deal to save the insurance premium of $20,000 over 25 years. 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.

Ten Steps To Making More

by Darrin DeRoches March 13 - 19, 2014

This winter has been brutal for weather but the real estate market is still hopping. Next week it is officially spring and the weather may not be co–operating but the market is. The phones have been ringing all week and once March break is over the market will be in full spring fling. So what should you be doing?     Get your property ready for the spring market by doing these ten steps. Begin by donating something. Take a look around your home and make a pile of clothes, furniture — whatever — and donate it away. You will feel good about it and your home will begin the positive purge.     Next, trash all of the stuff that is not worth donating and get it out of your life. The third step is to sell something. It may too valuable to just donate so list it online or have a garage sale. The money you will raise from this will give you a “piggy bank” to invest in the supplies you need to do the next steps. Fourth thing to do is paint something. Take the money you made and freshen up a room or the whole house. This fresh step will give you pride in your property and it will show once you put the property up for sale. Once that is done, clean something. It may just be all the windows that are dirty from the harsh winter, the yard from the ice storms or the winter grime from all those grey days. Get serious and scrub the property clean and once you’re done — do it again. A clean property sells faster than a “staged property”. That said, now it is time to do the sixth step and organize — it can be your kitchen cupboards or your basement storage. Make things neat and tidy so that your property looks ready to move into.     Next, renew something that is tired. It can be a simple project but a little update goes a long way. Now try to update something in the home. By adding a new trend or even colour, a simple change can bring todays style into your home and give potential buyers the push to see how the home can be updated. The ninth step is to plant something. Bring in a little colour and freshness to your property. It can be a simple pot or a whole new yard of grass. Take a look around and update your landscape.     Lastly, take a look around your now clean, freshly painted, de–cluttered property and spend the last dollars you made by selling off your unwanted items and buy a new “upgrade”. Reward yourself for the hard work and buy something that may upgrade the property or better yet something that you can take to the new property as yours will be selling for top dollar since you did all ten steps. Come on sunshine! 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.

Seller List For Spring

Sellers List For Spring

by Darrin DeRoches March 6 - 12, 2014

I wrote about what the buyers are doing to get ready for the spring market and now we can focus on what the sellers need to do. First thing you need to do is declutter.  This winter has been brutal and we are stuck in the house so you might as well use the time to start throwing out the accumulation of stuff. Get everything packed up and ready to either be stored or, better yet, thrown out once the weather clears.  The second thing to do is fix up all the little bumps and scrapes that your house has weathered over the winter.  The little fix ups will make it really easy once the market starts to heat up and you will be ready the minute it stops snowing.  Once the snow finally melts, clean up from the ice storm and make your outside as tidy as the inside.  Then call you broker and get ready to list early.     Homes are still selling fast in this cold, miserable market and once the weather clears up, the market is going to be fast and furious.  Think of it as cabin fever and once the buyers get ready to buy, it will be early spring. Talk to your agent about the best way to market your property and how they will be able to control the sale in a fast paced market.  If you make a mistake it may cost you dearly.  You only come on the market once and you really want to hit it the right way.  A great broker knows how to control the sale and get top dollar without getting greedy and pissing off the buyers.  I once sold a cottage in competition for top dollar after sitting on the market for the whole winter with no calls. Timing and marketing to the right market made a huge difference to the bottom line and profit.     You should be contacting your broker soon so that they can help you prepare your property for the spring market.  The weeks following March Break are when everyone has settled down from their holidays and are looking to make a move.  If your house has a pool, you should be booking the earliest opening so the property will stand out amongst the others.  No one has to swim in it but it will sell your home over others with a pool covered up. If your roof has been leaking in the fall, book a roofer now so that you can have a new roof to sell the property.  All these trades people have been waiting all winter to make money and you should book them now or you will be waiting to set up your property for the spring market and may in fact miss the best opportunity be waiting to the last minute.  Take the time now to get things ready and booked so that your property will shine amongst all of the others that are going to hit the market when spring comes. 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.