May 12, 2021

Market Minute

 - May 12, 2021
HIDDEN GEMS

There are some gems to be found in this housing market 

Houses that are on the market for 30+ days can often be great deals and a great houses.

Some houses have pending deals that fall through.  If the house becomes a pending sale and the buyer has a financing condition period of 14 days and the purchase falls through because the buyer can't find financing then the house has been on market 20+ days. 

That doesn't mean it's not a great house!

Don't get fixated on new listings...  search through the older ones as well.
Posted in Buying a Home
May 11, 2021

Market Minute

May 11, 2021

Not all banks and brokers drop your credit rating. 

Are you worried about getting a mortgage pre-approval because the credit check might drop your credit score?  Don't be!  Some banks and brokers do 'soft' credit checks that don't affect your credit.

They can pre-approve you without damaging your credit.  Before you move forward with a mortgage expert, make sure they will do a soft credit check.

Don't be worried about a pre-approval credit drop but confirm first! 

Posted in Market Updates
May 11, 2021

April Market Stats

May 2, 2021

EDMONTON MARKET MINUTE

May 2, 2021

April was an interesting month in the market.  Simply put, it was busy!  Houses in the price range of $350,000 to $450,000  sold 29 days faster than last year and prices were 1.4% higher.  In the $450,000 to $550,000 market homes sold 27 days faster but there was no price movement.

 

Obviously COVID makes the numbers very hard to interpret but the fact is houses are selling much faster yet we aren't seeing real price pressure.

May 1, 2021

EDMONTON MARKET MINUTE

May 1, 2021

Lumber prices are a concern for everyone in the Edmonton Real Estate market. 90% of new homes are framed with lumber. Lumber prices are up over 75% on vital materials and that is pushing construction and renovation costs way up.

 

Alberta Forest Products (AFP), the industry group representing FP companies, say mills have been running at capacity.  COVID 19 caused a pause in production but that was brief.  The AFP hints that this is not a supply problem.  

 

There isn't a lot of speculation on where prices will go next.

Posted in Market Updates
April 19, 2021

Caution - Pre-Approval vs Possession dates

I'm sure many of you have amazing mortgage pre-approval rates between 1.5%  & 2.0%.  If you were approved for those rates in January, you likely have that rate held for 120 days.

 

Did you know that the 120 term ends at possession of your new home. 

 

- Most people think it expires when you buy the home, that's not the case

- That 120 day time frame could run out in May so if you buy now and have possession in 60 days you could risk losing your rate.

- Rates have gone up and you will be paying more.

 

If you aren't actively out, on the ground looking for homes, you should be!  Take advantage of your pre-approval rates.

I don't want you to have an interest rate that has risen since you received your pre-approval.

Please get out and start lookingContact me or one of my team members ASAP.

 


Tim Grover

April 10, 2021

March Market Stats

The Edmonton real estate market is very active. Personally, I don't think this is a 'Hot market' yet. The increasing prices are compared to the heart of COVID shutdowns last year. However, we are seeing accelerated sales and may see real price pressure by May/June.
 Buy or Sell now.
March Market Stats
Jan. 27, 2021

The 6 Most Important Things You Need to Know to Buy a Home in Canada

The 6 Most Important Things You Need to Know to Buy a Home in Canada

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Are you in the market to purchase a home in Canada? This will be the biggest buying decision you will make in your lifetime, and not something to be cavalier about. Make sure to equip yourself with the knowledge, resources and experts who can guide and support you along the way. While buying a home can be a taxing experience, it is also a highly rewarding one! Unsure where to begin? We have compiled a list of the six most important things you need to know to buy a home in Canada.

#1 Have More Than A Down Payment

Do you have a down payment for the home of your dreams? Congratulations. You are one step closer to achieving home ownership.

But if you are still working toward accumulating a minimum down payment in the Canadian real estate market, you should know some of the specifics. Federal regulation now dictates designated percentages in relation to the purchase price.

In other words, the federal government wants you to have some skin in the game.

That said, here is what you need to know about how large a down payment you’ll need (at minimum):

  • $500,000 or less: Five per cent
  • $$500,000 to $999,999: Five per cent for first $500,000 and 10 per cent of any amount exceeding $500,000
  • $1,000,000 or more: 20 per cent

#2 Get Pre-Approved for a Mortgage

Trying to buy a home without a mortgage pre-approval is kind of like trying to hit a target in the dark. You do not know how much you can spend when shopping the market. Furthermore, who knows how long the current record-low interest rate will be in place – although the Bank of Canada (BoC) said it will not be raising rates in the near future.

Our advice on the matter of mortgage pre-approvals is don’t delay! One benefit of getting a mortgage pre-approval is that your lender will lock in the current interest rate for up to 120 days. If rates increase, your lender should honour the current rate. If they fall, so too should your guaranteed rate.

#3 Shop Around the Best Rates

Interest rates have never been lower. The BoC has brought its benchmark rate to 0.25 per cent in response to the coronavirus pandemic, and the central bank lowered the five-year mortgage rate to below five per cent.

Why does this matter? It will determine how much you will pay on your mortgage every month, in principal and in interest.

#4 Check Out First-Time Homebuyer Incentives

The Canadian government offers the First Time Home Buyer Incentive (FTHBI) , which is a loan to encourage them to achieve the home-ownership dream. First-time homebuyers can borrow:

  • Five per cent of the price of a resale home,
  • Five or 10 per cent of the price of a newly constructed home, and
  • The loan is interest-free and repaid at any time within 25 years or when the home is sold.

Do you qualify? Well, you must be a first-time homebuyer, have a household income of less than $120,000, and the mortgage is capped at four times the maximum household income of $120,000.

Let’s be honest: in today’s ultra-competitive and expensive real estate market, many Canadians are struggling to finance their purchase of a home, particularly for those living in the major urban centres. This program could help lessen some of that financial strain, making housing a little more accessible to those with no current equity.

In addition, there’s the federal first-time Home Buyer’s Plan which let’s each first-timer borrow up to $35,000 from their RRSP, interest free, to boost their down payment or to put toward other purchase-related costs. Provincially, some regions also offer a Land Transfer Tax rebate

#5 Work with a Real Estate Agent

Homebuyers do have the option of going solo in their search for a property, whether detached, semi-detached, townhome, condominium or otherwise. But without the benefit of experience and expertise on your side, the process can be complex and you risk missing some potential red flags. Working with an experienced real estate agent can significantly ease the stress associated with buying a home in Canada’s competitive markets, and could potentially even save you money!

So, what are the advantages of working with a licensed real estate agent?

  • You have better access to homes in and out of the local market.
  • Realtors know the neighbourhood and the market conditions.
  • An experienced real estate agent has advanced negotiating skills.
  • Real estate agents understand the incredible amount of paperwork that is associated with buying a home.
  • Realtors offer the guidance and support you need for the biggest buying decision you will ever make in your life.

#6 Do a Home Inspection

Unfortunately, due to bidding wars and strengthening demand, many homebuyers are ditching home inspections out of fear of losing out on the property. This may have various consequences that could hit your pocketbook. From moisture and mold in the basement to foundation issues, you could be on the hook for costly repairs and renovations once you receive the deed to the house.

No matter what the situation may be, we always recommend getting a home inspection before you acquire any property. This could save you money in the long run, and provide you some assurance that you made the right decision.

Home ownership is a dream for most people. It provides a place to plant roots and raise a family, but it is also an investment that could fund your children’s college tuition or your future retirement. The Canadian real estate market is booming, but that does not mean you’re too late to enter the market! Ensure you’re equipped with everything you need to know to buy a home in Canada, by working with an experienced real estate professional.

Have more questions about the home-buying process, or ready to move forward with your purchase? Contact a RE/MAX agent today, or download the RE/MAX Home Buyer’s Guide, for everything you need to know about buying a home.

 

Dec. 23, 2020

Edmonton Is Now the Country’s Most Affordable Urban Real Estate Market!

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It has been several months since the coronavirus pandemic shut down the Canadian economy from coast to coast. Although the nation is in the middle of a second wave of the highly infectious respiratory illness, the country has been opening up, allowing the Great White North to initiate an economic rebound and get things back on track. All the data point to a gradual revival of the tenth-largest economy in the world.

The Canadian real estate market has been one of the drivers of the nation’s economic recovery, thanks to the hard work, diligence, and adaptation of real estate agents since the beginning of the public health crisis. Historically low interest rates have also helped to drive the strong trends in the buying and selling of properties, whether in the hottest urban centres or the prairies.

Despite having one of the most sought-after housing markets in the country, the Edmonton real estate market has been able to strike the right balance for both buyers and sellers. Below, we dive deeper into the current trends within Canada’s most affordable urban real estate market and share our projections for Alberta’s capital city as we shift into 2021.

Edmonton Is Now the Country’s Most Affordable Urban Real Estate Market!

October was another decent month for the Edmonton real estate market. According to the REALTORS® Association of Edmonton, total residential unit sales surged 26.34 per cent last month from the same time a year ago. All residential average prices advanced at an annualised rate of 7.97 per cent in October to $382,060.

Moreover, overall inventory in the Edmonton CMA tumbled 12.10 per cent from October of last year, while the number of new residential listings rose 14.75 per cent year-over-year last month.

“The Edmonton market has seen an increase in year-over-year unit sales, compared to a slight decrease in month-to-month sales,” said REALTORS® Association of Edmonton Chair Jennifer Lucas in a news release. “There have also been more sales of single-family homes, condos and duplexes compared to October of last year, while we’ve seen stable or decreasing month over month sales in all markets, which is typical for this time of year. We’re pleased to see year-over-year increases in pricing across all markets, with single family home pricing up 5.05%, duplexes up 2.34%, and condos up 1.67%.”

This comes one month after the same organisation reported that the Edmonton housing market in 2020 has been a “pleasant surprise” for buyers and sellers. The data – month-over-month and year-over-year – has been favorable to both sides of real estate transactions. This, Lucas said in an interview with the Edmonton Journal in September, has built up enough confidence where homebuyers are prepared to delve into the market.

The reason? Interest rates have never been this low. The Bank of Canada (BoC) slashed rates to 0.25 per cent earlier this year, as well as bringing the benchmark five-year mortgage rate to below five per cent. The central bank has indicated that it has no intention of tightening monetary policy, meaning that the borrowing costs in credit markets will be cheap for another couple of years.

What’s the Deal with Property Taxes?

A key advantage in the Edmonton real estate market is that the property tax hike for homeowners in 2020 was less costly than the city’s municipal counterparts. This year, property taxes rose 2.7 per cent, compared to the 13 per cent hike in neighboring urban centre, Calgary. But how long will Edmonton be able to stay so low?

Officials debated a three per cent property tax increase, choosing to tighten the public purse instead and leave it essentially flat year-over-year.

Despite many Canadian cities bleeding revenues in the COVID-19 economic climate, elected representatives will have a hard time trying to raise taxes on a vulnerable public and risk making life more expensive. Any substantial tax hikes, from property to water, could threaten the Edmonton real estate market’s revival over the next six to 12 months.

Could 2021 Be a Breakout Year for the Edmonton Housing Market?

Edmonton continues to be one of the most livable places in Canada.

Although the Edmonton economy has diversified in recent years, the city and the broader province are still reliant upon the energy sector. That said, with the rest of the country on the road to economic recovery, it is likely that Edmonton will follow suit. The city persevered through the COVID-19 turbulence, and its real estate market has handled the volatility rather well. Currently, all signs are pointing to a breakout year for the Edmonton real estate market in 2021: the central bank is keeping interest rates at historic lows, the federal government is ready to do whatever it takes to protect the housing sector, the height of the coronavirus pandemic is likely to wane in the new year, and shrinking inventories and strengthening demand are projected to prevail within this local market!

Dec. 4, 2020

What to Know Before You Buy

 

There’s no denying that Canadians value the concept of home ownership, in spite of the bubble rumours, speculation and even in light of COVID-19. The housing market has remained resilient, as evidenced by recent record-breaking Canadian housing real estate activity.

 

Home ownership is a way to plant roots, create family security and build future wealth. In fact, it’s how many of the world’s richest people earned their fortunes, and it’s how many “regular Joes” finance their retirement or build generational wealth. But home ownership is not for everyone.

 

Ultimately, buying a home is a very personal decision that depends on a number of factors, such as your financial fitness, your future plans and your overall comfort level. The good news is, professional real estate agents, mortgage brokers and real estate lawyers are there to advise you before you dive in. To help get you thinking about whether home ownership is right for you, are are some important things to consider.

 

5 Questions to Ask Before Buying Canadian Real Estate

Can I afford to buy Canadian real estate?

Buying real estate involves up-front costs, which can include things like your deposit, downpayment, home inspection and appraisal fees, property insurance, Land Transfer Tax, title insurance, legal fees and moving expenses. Click HERE to get into the nitty-gritty of these costs.

 

Then, there are your ongoing costs that include property tax, regular maintenance, condo fees and utilities. If you’re saving some money up-front by buying a fixer-upper, also factor in renovation costs.

 

Here are some strategies to spend less, and save more.

 

Do I have too much debt?

When buying real estate, most people will take on a mortgage. Lenders evaluate your costs versus income to determine your qualification. Your Gross Debt Service ratio is your housing costs (mortgage principal and interest + property taxes + heat + 50% of your condo fees, if applicable) divided by your pre-tax income. The result should be 32 per cent or less.

 

Then, lenders look at your Total Debt Service ratio: all debt (GDS + car payments + alimony + other loans + the remaining 50% of your condo fees) divided by your pre-tax income. This should be less than 40 per cent.

 

Click HERE for to calculate your GDS and TDS.

 

Am I secure in my job?

Think about this honestly. Is business bustling? Is the industry on an upward or downward trend? Are you comfortable with the financial commitment of home ownership?

 

Speak to your supervisor to get some additional insight. Mortgage lenders like to see stable employment, and you’ll need to provide proof of income in the form of an employment letter or current pay stub, your position and length of employment, and if you’re self-employed, Notices of Assessment from the Canada Revenue Agency for the past two years.

 

Click HERE to find out what else mortgage lenders look for.

 

Am I sticking around?

Buying real estate has historically proven to be a good long-term investment. Ask your parents how much they paid for their home 30 years ago, and compare that to the home’s value today. On the other hand, a quick sale can mean financial losses if the home’s appreciation doesn’t surpass closing costs, which are estimated at 1.5 to five per cent of a home’s value.

 

Typically, the magic number to stay in the home before putting it back on the market is five years – hence the five-year plan.

 

Do I even want to own a home?

People invest in the Canadian real estate market for a slew of different reasons. For homeowners, this is a method of forced savings for retirement and future generations, while also fulfilling the basic need of providing shelter. It’s also a great source of pride for many. Picture yourself in five years. Do you plan to relocate at some point? Where will you work? What’s your family structure? Then, consider how home ownership fits into the bigger picture. Click HERE to read more about buying versus renting.

 

RE/MAX HOME BUYERS GUIDE

Posted in Buying a Home