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Real Estate Planning 2017

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Blog by Mary Roy | January 4th, 2017


Real Estate New Year’s Resolutions!

The Durham region has been one of the markets that has continued, over the past five years, to attract more flow, more new home buyers, and an increasing amount of investment. Providing safe communities, housing available for less than the average price in the GTA, and a reasonable commute to Toronto, Durham is forecasted to continue being a hot market in 2017. Here are a few things you should consider if you're thinking of making a move this year: 

Your credit rating. 
Have Equifax Canada, TransUnion Canada or another credit reporting agency pull your credit report. If necessary, improve a poor credit rating by paying off debts and consistently paying them off on time before applying for your mortgage.

Make a budget. Can you afford a home and all the associated costs? Is this the right decision for you? Canada Mortgage and Housing Corp. offers tools to help you calculate your net worth, current household budget, monthly debt payments, and how much you can realistically afford to spend. Your affordability assessment may indicate you need a larger down payment or a lower price point for your purchase. Also keep in mind that new mortgage qualification rules took effect in October, requiring that all insured mortgages qualify at the Bank of Canada’s benchmark rate, even if your lender offers you a lower rate.

Get your financing – and supporting documents – in order. At the very least, lenders and mortgage brokers will require documentation that proves your personal information, your net worth, income, employment, the amount/source of your down payment, and your ability to pay the closing costs. Closing costs generally range from 1.5 to four per cent of the purchase price and your lender may provide a loan to cover those.

Get pre-approved for a mortgage to determine the amount you can afford based on the lender’s review of your finances. This will also provide written confirmation of the interest rate that will hold for around 90 days.

Find the home. Start considering your desired location, how long you plan to stay in the home, and other factors that are important to you. Is a short commute to work more important than yard space? Do you want to be in a good school district? Deciding what factors are important to you can also help you decide how long you will need the home to suit your needs. It is important to have an agent who can keep an eye out for new homes as soon as they come out on the market. Knowing your desired location and price range with your preferred features enables your agent to use all their resources to the fullest. A tour of open houses is also a fun way to spend a few hours of a weekend. If you’re opting for a brand-new home, visit presentation centres, and explore new communities in person to get a feel for what living there will be like. Your real estate agent may also be able to introduce you to some new communities that you may not have considered on your own.

Review your mortgage agreement. Visit your financial institution and/or a mortgage professional. If you’re in the first year of a five-year term, the payout penalty might be so high that you decide to wait until at least the mid-point, if not the end of that term, to sell your home.

Assess the selling costs. This may include repairs, home appraisals and inspections, legal and realtor’s fees, so that you can budget and save for these costs.

Do some number crunching. Will your home’s proceeds cover your next home purchase? Do you plan to invest part of the proceeds?

Fix and De-clutter. De-clutter your home as much in advance as possible. When staging your home to go up on the market, overstuffed storage areas suggest a lack of space rather than your organizational tendencies. If you’re downsizing into a smaller home, you’ll likely need to edit down your movables anyway. While you’re combing through your stuff, identify items that are worn, outdated or don’t work, then repair or replace them. Often, small details such as replacing knobs, changing a light fixture, or a new coat of paint can make an immense difference. A professional home stager along with your real estate agent can also help you identify what renovations and repairs will help you achieve the highest return. More so, your agent may have contacts such as a handyman or electrician for things that may require a bit more work. If things like a leaky roof or basement isn’t repaired, buyers may expect a reduction in price.

Unsure how to start making your real estate goals for the year? Give us a call or email, we would be happy to help! (905)-426-7515 or maryroy@maryroyteam.com