Archive for the ‘Home Buying Advice’ Category

I have to thank a client of mine for the inspiration to write this blog article. The spotlight as we all know is on the economy. Nowhere is this more apparent than the media attention being given to the ‘hot’ housing market.

Here are some common real estate questions that I am being asked with increasing frequency by prospective buyers and sellers. I preface that the responses below are my opinion only. If I had a crystal ball, I would use it to make my fortune and retire early but alas I am still sitting here.

1) What is your gut feel on what will happen this summer after new mortgage restrictions have kicked in?

To clarify, Finance Minister Jim Flaherty announced last week the following changes to housing market rules: 1)all new borrowers will have to meet standards for five-year, fixed-rate mortgages even if they’re seeking a shorter, variable-rate loan 2) The government is lowering the maximum amount Canadians can withdraw when refinancing to 90 per cent of the value of their homes, from the current 95 per cent 3) The government will now require a 20-per-cent down payment for government-backed mortgage insurance on “speculative” investment properties.

My gut is that the mortgage restrictions aren’t going to have a significant impact on the resale market in Oakville. It may have a bigger impact on the Toronto condo market where there are more speculators affected by the refinancing and speculative down payment restrictions. What the press didn’t really publicize is that mortgage lenders were basing approval ratings on 3 year fixed rates prior to the new rules taking effect. Changing the approval requirements to a 5 year fixed rate is not a significant leap given that most of the buyers I know aren’t maxing out their qualification amount anyways. A bigger impact would have been made if Flaherty reduced amortization or to a lesser degree, increased the down-payment rules. Most first time buyers I know are usually putting more than 5% down but many take advantage of the longer 35 year amortization just to keep their monthly costs lower. Regardless, Flaherty didn’t touch amortization or down-payment requirements so this is a moot point. From my perspective, the new mortgage rules do a good job of reducing the market swings that could be caused by speculators while maintaining the opportunity for credit-worthy buyers to purchase property.

2) What is your gut feel on what will happen this summer after HST is implemented?

The harmonized HST which comes into effect July 1, 2010 will mainly affect service costs in the resale market (commissions to real estate brokerages, legal fees, etc). In the new home sales market, HST will be applicable on any home over $400,000. Purchasers of new homes valued between $400,000-$500,000 will be able to claim a proportional rebate on HST paid while homes under $400,000 will be exempt from the tax.

Some realtors are worried that the HST rules are contributing to people’s motivation to sell before the tax comes into effect. I personally don’t know anyone selling now to save on HST costs (it really only affects commissions, legal services, and other related closing costs). I think HST is having a much bigger factor on the new home market which as far as I can see is going absolutely crazy right now. There isn’t a ton of detached new home sales in Oakville right now but when they do start selling off the land North of Dundas Street, I can see how it will be more difficult for developers to keep prices in line with resale prices given the new HST tax applicable to new home sales over $400,000. If anything though, this should have a slight positive effect on keeping demand for resale homes high.

3) What is your gut feel on what will happen this summer after interest rates start to rise?

The Bank of Canada has publicly announced that they will not raise the overnight lending rate until midway through 2010. Mortgage rates tend to follow overnight lending rates and bond rates therefore, when the overnight lending rate starts to rise as expected in the back half of 2010, mortgage rates are also expected to rise.

Interest rates should have the greatest effect on the housing market. Typically the Bank of Canada doesn’t raise rates more than 0.25% each quarter although I suppose the rate will ultimately depend on how strong our economy rebounds. I think there is a lot of hype being written about the benefit of locking in rates right now which is motivating buyers. I would expect demand to soften slightly in the back half of this year which in turn should reduce the rate of housing price increases. The big BUT for me is that lower demand does not necessarily mean lower prices. Unless we see another huge catastrophic economic event like we did in Q4 ‘08, I suspect that housing prices will continue to rise albeit at a slower rate than they are now. Even with last year’s economic crash, housing prices dipped for only a few months before rebounding. During that period, I met a lot of people who were scared and feeling the pinch of the economy but there really weren’t a lot of foreclosures/power of sales, etc. People hung on to their homes to ride out the storm and if they had to move, many decided to lease out their properties so they wouldn’t take a hit on the price.

Bottom line for me is that current demand is not sustainable but prices are. Canadians have too much equity in their homes to walk away from them and while I have no evidence of this, the vast majority of Oakville properties are principle residences so the influence of speculators is much less than it is in say Toronto or Vancouver. I’m working with a number of buyers right now and I have to say that some of the sale prices seem ridiculous given their comparables but these new prices are the comparables of the future. There really would be no reason to think that a new listing would be worth less than a comparable listing recently sold unless demand somehow just drops off. For this to happen, we would need to see a sharp, fast rise in interest rates (unlikely given the economy) or a significant new economic development (while domestic and foreign debt is to me a real long term concern, I don’t think it is an immediate threat to local housing prices).

If you have questions about the local Oakville real estate market, I would love to hear from you. I can be reached at lindsay@remaxaboutowne.com or 905.338.9000.

Regards,

Lindsay

What a difference a year can make. We started off 2009 with headlines predicting housing market crashes, rapidly declining sale prices and general gloom and doom stories. Now, in December we are seeing speculation of housing bubbles, stories of bidding wars and general speculation about how “hot” the market is. Buying a home is a stressful time, particularly as a first time buyer. Who should you believe? How do you know when it’s the right time to buy? Where do you start to look? Below are my thoughts on what you as a first time buyer should think about when buying your first home.

1. When You Get Into The Real Estate Market is Less Important Than Just Getting In It and Staying In It. In other words, the length of time you plan on staying in your home is more important than when you buy it. If you are like most first time buyers, you are likely planning on owning a home for the rest of your life. We can all make predictions but no one really knows what the market is going to do in 2, 4, 6 or even 12 months. Just look at 2009 real estate predictions versus actual results (VERY few people predicted the housing market to take off as it has). It is however fairly safe to assume that if you hold onto your home for several years, you will make money. Instead of timing what the market is going to do next month, focus on what it will do a few years out. If you believe the market is going to go up, then ignore short term price swings and go for it.
2. Plan for Future Life Changes. Typical first time buyers in their 20’s and 30’s generally have a number of life changes to look forward to: marriage, children, potential career changes, etc. While you can’t eliminate these unknowns you can plan for them when buying a home. Don’t ignore things such as local schools, access to major transit lines and the size of that 3^rd bedroom. You just never know when these things will become important to you. Even if you plan on moving in a few years, it is always better to buy a home that can accommodate future life changes (just in case).
3. Don’t be Swayed by the Media. Media headlines are meant to invoke readership. The headlines don’t need to be false to play up the most shocking details ultimately spinning a story out of balance. To prove my point, here is a sample of Real Estate headlines appearing in Canadian papers in the first quarter of 2009:- GTA Housing Sales and Prices Plunge (Globe and Mail)

   - January Home Sales Plunge 50% (Toronto Star)

   - Loss of Confidence Swamps House Market (Toronto Star)

   The Toronto Real Estate Board reported that in January 2009, median sale prices were down 5.3% from a year earlier. The only thing that dropped 50% was the number of homes being sold. The truth is most people don’t care about sales volume but do care about home prices. So why wasn’t the focus of these headlines on the actual price drop? Clearly, reporting a “5.3% drop” isn’t nearly as eye-catching as a “50% plunge”. Ironically, the best time to buy in 2009 was when the doom and gloom headlines were at their peak. Those buyers who had the insight to look beyond the fear-filled stories typically bought their home at a good price and low mortgage rate. While I wouldn’t ignore the media all together, I certainly advise buyers to take it with a grain of salt. Every article has a bias (mine included). In the end, it is your money and your decision. Do not let others dissuade you from doing what you feel is best.

4. Consider Your Future Income Potential. Understanding what you can aford is important but so is factoring in your future income potential. If you are early in your career, it is not uncommon that your salary will appreciate considerably within a few years. Not everyone can count on a salary increase however if you are confident you will make more money in the future, you may want to consider stretching into a home that you can live in longer. Moving costs can wipe out any profits if you decide to sell in the first few years of home ownership. If you are lucky, your home will appreciate quickly but this is not something you should count on. You should anticipate living in a home for at least a few years before breaking even or realizing a profit on its sale.
5. Don’t Let the Past Paralyze Your Future. First time buyers tell me all the time, “I wish I had bought 2 years ago”. The truth is that in real estate, the earlier you bought, generally the more money you have made. What first time buyers need to realize is that a few years from now someone will likely be saying, “I wish I had bought in 2009”. Prices are high right now but what is more important is where you think they are going to be a few years from now. If you believe they will be significantly lower, than wait; if not, jump in.
6. Be Prepared to Respond to Changing Markets. The housing market is finicky (just look at the market fluctuations in 2009 alone). Real Estate Board statistics are great at showing market trends but they are backward looking reports that are not necessarily indicative of the future. Supply and demand change significantly from month to month due to seasonal, situational and economic shifts. The faster that you as a buyer react to the changes in the market, the better off you will be. There are times when buyers have to be more aggressive to get the home they want and other times when they can be more demanding on sellers. The only way to know what the market is doing right now is to get the advice of a realtor. We are the ones who see the market shifting before the MLS statistics come out. Finding a realtor who is in tune with the area you want to buy in is a powerful tool. Find an agent you trust, and get them working for you as early as possible.
7. Understand Your Financial Options. Don’t rely on on-line mortgage calculators and internet information. The best people to talk to about financing your home are the experts themselves. A good mortgage broker or financial lender will tell you exactly how much money you qualify for and more importantly, provide you with different payment options. Speaking with a mortgage broker early on in your buying process (even 6-12 months out) can be key in giving you the knowledge you need to make an informed financial decision and they give many buyers the peace of mind they need to move forward. If you want some names of people to speak with, let me know. I know some fantastic mortgage brokers that I am happy to recommend.
8. Your Home Is Unlike Other Assets. A home is a place to live, relax and create memories, it is not just an asset. I find that most people have some kind of emotional reaction to a home when they find “the one”. My only point here is to tell you not to settle. There are great homes out there at every price point. Don’t let fear, frustration or guilt make you settle for something less than stellar.
9. Have Faith That People Want to Help Not Hurt You. It is natural for people to be guarded by realtors and mortgage brokers. I get it. Like every profession, not everyone abides by the same skill level. I will say though that for the most part realtors exist to help, not hurt you. I have no desire to work with someone who doesn’t want my help but I am more than happy to work with those who do. There is only so much information you can get from looking at MLS and researching the internet so don’t feel guilty about getting an agent involved before you are ready to buy. Many first time buyers are surprised when I tell them that I start working with many of my clients 6-9 months before they actually buy anything. My role is to educate and empower. This is not something that is necessarily accomplished in 2 weeks. Don’t feel guilty as a first time buyer to get a realtor and mortgage broker involved at the start of your home search. When you surround yourself with knowledgeable people, the entire process is much easier.

2010 is shaping up to be another fascinating year for real estate in Oakville. Best of luck to all the first time buyers out there! For more advice, visit www.lindsaywalls.com or email me at lindsay@remaxaboutowne.com.

Regards,

Lindsay

If you have spoken to a Realtor about buying a home, you should be familiar with the Buyer Representation Agreement. Like any contract, the Buyer Representation Agreement outlines commitments that your agent promises to make in exchange for commitments you promise to make. Under this Agreement, agents are committed to provide you with the following duties: LOYALTY, OBEDIENCE, DISCLOSURE, CONFIDENTIALITY, REASONABLE CARE AND DILIGENCE, and ACCOUNTING. In exchange, buyers commit to ensuring the agent is paid for services rendered (Note that in most cases, the payment is usually paid by the seller). Legally, realtors are obligated to discuss buyer agency with potential clients at the earliest opportunity.

When I first learned about Buyer Representation Agreements I wasn’t convinced they were really in the best interest of buyers. You can argue that realtors like Buyer Representation Agreements as they bind buyers to them and ensure they get paid regardless of the service they provide. I agree to a certain extent but have quickly determined that as a professional realtor, establishing a Buyer/Agent relationship is the only way I will do business. Here’s why…

As a realtor I meet a lot of people who are looking for information on the Oakville housing market. I receive several emails and phone calls and am happy to spend time discussing real estate issues with potential clients (really I am) but like everything else there is a limit to the amount of hours in my day. Despite what many people want to believe, real estate is much more than setting up appointments and opening up doors. I say this with the utmost honesty as someone who knows the pressures and stress of a corporate job. There is no way I would have chosen to switch careers if I thought the advice of a realtor could just as easily be learned through an MLS or Google search. No one understands the nuances of the local market, future development plans for an area, the art of negotiation, school issues and make-up of specific neighbourhoods like an intelligent, diligent local realtor.

I spend hours upon hours working for my clients and several more keeping up to date with current real estate and housing information. My first priority is to my clients and in order to provide a level of service that I am proud of, I limit my interactions to clients first and prospective clients second. To be brutally honest, I just don’t have time to dedicate the kind of service buyers deserve (sometimes for months at a time) without any kind of commitment of loyalty from them. For me, the Buyer’s Representation Agreement solidifies my commitment of excellence and priority status to you in exchange for your commitment of loyalty to me.

When explained this way, I find that most people have no issues signing the agreement, leading to a relationship built on trust and service. It is the best way I know how to do business. I question buyers who believe that they will somehow get better service or a better deal without using a committed Buyer’s agent. I simply do not understand how they think they will get first class service and advice without any kind of commitment (on either end). Like most things in life, you get out what you put in. If you believe realtors are transactional type people who simply book appointments and unlock doors then you can easily find one that will be willing to provide you with minimal service for minimal commitment. If you expect more out of your realtor, then take your time, find a realtor you trust, have them commit to you, and be willing to commit to them. If you do so, you will be impressed by the advice and expertise you gain from the experience.

Questions or comments? Feel free to comment below, email me at lindsay@remaxaboutowne.com or call me at 905.338.9000.

Regards,

Lindsay

I am a bit of a learning junkie.  If I could, I would spend hours reviewing current events then spend several more discussing them with family and friends.  My husband jokes that dinner with me is a two hour affair as it takes me that long to tire of discussing the day’s events.

I recently watched an episode of Allen Gregg’s program on TV Ontario that I think is worth sharing with you.  The program is focused on financial planning in general however several points are made about real estate investing, most people’s largest investment.

At the very end of the clip (around the 24 minute mark), financial guru David Bach gives his take on realtors which of course made my ears perk up.  Below is the full clip, enjoy!

Luxury homes sales continue to accelerate as economic recovery takes hold in major markets in Ontario and Atlantic Canada, according to a report released today by RE/MAX.  Below are the details of the full press release.

The RE/MAX Upper End Report found that momentum is building in St. John’s, Saint John, Halifax-Dartmouth, Ottawa, Kingston, Greater Toronto, Hamilton-Burlington, and London as purchasers realize that the best buying period in recent history is about to come to a close.  Sales are already on par or ahead of last year’s levels in 50 per cent of cities surveyed, while the remaining markets are set to reach 2008 figures by year-end.

“Twelve months of healthy home buying activity have clearly been crammed into five short months,” says Michael Polzler, Executive Vice President, RE/MAX Ontario-Atlantic Canada.  “It’s hard to believe that the transition in the market began in May. We’ve seen steady upward momentum since that time, with solid year-over-year gains posted each and every month.”

Pent-up demand and greater affordability have been the catalyst.  Increased selection in all markets—except Greater Toronto—as well as record low interest rates have also helped fuel move-up activity from Ontario to Newfoundland.

Leading in terms of sales appreciation is London, Ontario where the number of homes sold, priced in excess of $500,000, has climbed 11 per cent from January to September 2009, compared to one year ago.  Greater Toronto and Ottawa both reported a one per cent increase in the number of homes sold in the top end during the same period.  Within the GTA, Richmond Hill/Thornhill is particularly heated, with sales up 24 per cent over 2008 levels, followed by Mississauga— up 10 per cent.  St. John’s, Newfoundland is on par with year-ago figures.

Of the six markets reporting a year-over-year decrease in sales, four are off by just a handful of transactions (10 units or less), including Halifax-Dartmouth (off eight units), Kingston & Area (off three units), Toronto – West End (off 10 units), and Oakville (off five units).  Activity in the remaining two markets—Saint John and Hamilton-Burlington—is on the upswing, with the gap between 2008 and 2009 narrowing each month.

“A considerable shift is underway in the upper end,” explains Polzler.  “The price correction that we witnessed earlier in the year is over and prices have since firmed up.  Conditions are more balanced across the board or leaning toward seller’s territory once again.  The one exception is the Greater Toronto Area — now largely a seller’s market — with bidding wars making a comeback amid tight inventory levels.  The strength of the luxury segment is evident.  This is now a real estate market with all sectors working in tandem.”

Highlights:

• Upper end sales started to move upward as positive indicators of economic recovery began to emerge.  The momentum is expected to continue as Canada edges closer to positive periods of GDP growth in Q4 2009 and in 2010.
• Locals are fuelling luxury sales in the majority of markets surveyed.  Activity among out-of-province and international purchasers has waned from one year ago, although their presence in still evident in some markets.
• Sixty-one properties in Canada are currently priced over $10 million, with 18 of those located in Ontario.  The priciest Ontario home is nestled in Toronto’s prestigious Bridle Path area, listed at $23 million.
• Three hundred properties currently listed for sale are priced over $5 million in Canada.
• In Atlantic Canada, there are 22 listings in excess of $2 million—13 in Nova Scotia, five in New Brunswick and two in Prince Edward Island.  The most expensive property in Atlantic Canada is a $7.75 million estate on a bluff fronting the Atlantic Ocean on PEI’s north coast.

RE/MAX is Canada’s leading real estate organization with over 17,000 sales associates situated throughout its more than 677 independently-owned and operated offices across the country.  The RE/MAX franchise network, now in its 36th year, is a global real estate system operating in more than 70 countries.  Over 6,700 independently-owned offices engage nearly 100,000 member sales associates who lead the industry in professional designations, experience and production while providing real estate services in residential, commercial, referral, and asset management.  For more information, visit: www.remax.ca.

October statistics were just released from the Oakville Milton Real Estate Board which confirms everything we are seeing in the press - the real estate market is really hot right now. Sellers are enjoying high demand for their homes with most selling close to or higher than list price.
Many people have asked me if the lack of listings is causing upward pressure on prices however as the stats show below, the number of listings is actually up 7% year to date. The real issue is that growing consumer optimism and historically low interest rates are attracting buyers to the point where demand is dramatically outpacing supply.

October Oakville Real Estate Statistics

It’s important for anyone thinking about buying or selling to look at the short, medium and long term economic forecast. Even with speculation that mortgage rates will start to rise, I’m not convinced that housing prices will come down anytime soon. For this to happen, we would need to see the economy plummet again and/or see a spike (both fast and dramatic rise) in interest rates.
For now, sellers and buyers should expect that homes in desirable neighbourhoods and in good condition will sell quickly and for top dollar. My advice for anyone thinking about buying or selling is to speak with a respected agent that takes the time to educate you on the current market. The right agent will give you the peace of mind you need on the biggest transaction in your life. And this my friends, is priceless.

I often get messages from people asking for my opinion on the local housing market. Recently I received a letter from a local resident which I decided to post in the event that someone else out there had the same question. A special thanks to the resident who sent me the question. Hopefully you don’t mind my reposting it here…

QUESTION:
Why are contractors building so many large and luxurious houses when the real estate market is depressed? I feel there is something odd and illogical about the enthusiastic construction of these houses during a slump. What do you think?

ANSWER:
Thanks for your email. I am guessing you contacted me for my advice as a local realtor. I have to admit I’m not entirely sure the context of your question but I will assume you are looking for information to satisfy your own personal interest on the matter. With that said, here are my thoughts…

The housing market in Oakville has changed dramatically over the past year. My personal opinion is that the reasons for the change are threefold. First, reduction of mortgage rates to historically low levels has enticed many people (particularly first time buyers) to enter into the market, driving the demand for housing up. Second, it is also more affordable for owners of lower end housing (condo’s, semi’s, towns and smaller detached homes) to move into a larger home given the low mortgage rates. These homeowners are seeing their neighbours successfully sell their homes for strong prices and have now gained the confidence to move themselves. Consider this the ripple effect. Third, some home owners who planned to move in winter 2008/spring 2009 held off due to uncertainty with their own jobs and investments. Many of these people, particularly young, employed professionals have come out relatively unscathed from the recession and are now feeling confident about their ability to take on a larger mortgage/more expensive home. As their family grows, their housing needs change, thus the interest in larger/more expensive homes.

For the most part, demand for Oakville housing is now outpacing supply. This is all seen in recent real estate board statistics which show that housing prices are on the rise and days on market (average time it takes to sell a home) is on the decline. September saw a 15.5% increase in average housing prices and a 6.9% increase in median sale prices proving that a fair portion of this increase is attributable to high end housing. This differs from the market in the winter when high end housing was hit the hardest. Realtors are sending more and more messages to each other to try to generate listings for their firm buyers. The scales are now tipped in favour of sellers with many buyers frustrated with the lack of inventory on the market. Homes that represent good value are selling quickly; multiple offers are not uncommon. New home construction helps fill the current supply gap.

The truth is that no one has a crystal ball to determine what will happen in the future. I personally believe that Oakville is and will remain a very desirable place to live for years to come. Oakville is also very fortunate to be part of Canada’s largest and most diverse economy which protects housing prices to a degree. People are willing to pay more to be a part of the Oakville community. With a good reputation for safety, education levels, parks, services, etc, I believe Oakville can support higher than average housing prices and a luxury housing market.

There were people lining up overnight at the last two new housing releases in Bronte Creek as well as the Waterlilies release on Dundas so the demand for new housing is definitely strong in Oakville right now. I also continue to meet prospective buyers who are interested in buying in the area that is yet to be developed North of Dundas. Given what I’ve been seeing in the market, I don’t think the enthusiasm of construction is illogical. That said, I think much of the housing boom right now is based on mortgage affordibility so demand and prices will be determined by the pace with which mortgage rates change. The other major factor to consider are investors. I have no evidence to support or repute this but there is a possibility that part of the demand for new housing in particular is with investors who see real estate as a better alternative to traditional forms of stock market investing. Even so, the most popular housing investments are new condo/semidetached/townhomes so it doesn’t explain the quick sales of more expensive homes in Bronte Creek.

Hopefully this gives you some food for thought. Thanks for the message. If you have any other questions, please don’t hesitate to ask.

Regards,
Lindsay

If you have a question or comment about the local real estate market, send me an email at lindsay@remaxaboutowne.com or call me at 905.338.9000.

My husband and I recently bought a new house. While we had no intention of buying from a developer, after many conversations and much investigation it was clearly the right choice for us. My wonderful husband Chris is used to me talking about houses and the real estate market non-stop so he was not surprised when I asked him one day if we could stop by a builder’s sales office on our way out of town to spend the day with our nephews. Truth be told, I think he was actually warming up to the idea that it was time to move although you would be hard pressed to catch him admitting it. My intentions were really just to understand the new phase being developed by the builder as I do with all the new developments in Oakville. I wasn’t serious about buying for ourselves and yet there we were 6 days later, standing in line overnight waiting to purchase a new home.

When we arrived at the sales office for the first time we were practically laughed at for being so naive as to think that the homes being advertised were still available (how silly of us!). We were promptly told that they were released a month earlier and already sold out for weeks. All I will say is that it was truly an interesting experience to be sitting on the client side of the fence. Even though I live and breathe the local market and knew all the reasons why this was a great investment, my emotions ran high throughout the whole experience. To be honest, if it wasn’t for my knowledge of real estate, I’m not sure I would have been prepared enough to actually purchase new. New home buyers tell me all the time that they wish they had done more research before they bought and I couldn’t agree more. Remember, that while the builder’s sales representatives are available to help, they ultimately represent the interests of the developer NOT you as a buyer. The only way to really know whether or not you are making a wise decision is to do your homework. Below is a list of steps that my husband and I undertook prior to the purchase of our home. As a realtor, I highly encourage anyone thinking of buying from a developer to do the same. Without further adieu, here they are…

Before You Buy From a Developer:

1. Compare the builder’s price to comparable homes in the resale market – how else are you able to determine whether or not the home you are about to purchase is a wise investment? The market has seen several years of steady growth so most new home buyers have enjoyed significant gains when they’ve sold but this upward trend isn’t a guarantee. New homes should ALWAYS be compared to resale homes to determine their value. Don’t just take the builder’s price for granted without doing your research first. Some new home values are much more attractive than others. The best way to compare homes is to look at recent comparables that have sold in similar areas.
2. Confirm the local schools, than expect them to change – Even if you are not planning on having children, it is important to understand your new home’s local school. The majority of new developments attract families with children and this can play a significant factor in resale. Remember that your local school boundaries are likely to change as your neighbourhood continues to experience rapid population growth. Do your homework to understand not only current but also expected future local schools. If you have school age children, the possibility is strong that they will have to switch schools due to changing boundaries so be prepared.
3. Choose your builder wisely – Understand that picking your builder is equally as important as picking your home’s location and layout. You want a builder who has a good track record of customer care both during and post build. I would look at JD Power and Associates New Home Builder Customer Satisfaction Survey in addition to speaking with friends and searching for new builder forums and chat rooms on-line.
4. Talk to people who own a home from the builder you are considering – I personally think this is an essential step. You will never get a truer picture of the quality of a builder than from the people that have already gone through the experience. I strongly encourage you to knock on some doors of older homes built by the same builder and ask the owners what they think of the quality of the home and their experience with the builder. If you aren’t sure which areas are built by the same builder, call a local realtor. I for one am happy to answer people’s questions.
5. Review the zoning and zoning applications of neighbouring areas – The future development plans of the areas surrounding the lot you are interested in is really important. If you don’t want to live next door to a warehouse, major throughway or strip mall, then it is important to review the zoning around your neighbourhood. That vast field next to your lot may not remain that way forever. You can check zoning by visiting the Town of Oakville’s Planning office.
6. Ask lots of questions – Don’t feel pressured to buy just because everyone else tells you it’s a great deal. Instead of just dropping by the sales office, book an appointment with one of the sales representatives for some one on one time and use this time to ask questions about the developer, development, floor plans, etc. Do not leave until you get answers to all your questions.
7. Visit homes still in the building phase - This isn’t possible for every development but if you should be lucky enough to purchase from a developer who has other homes still in the construction phase, try to visit the site after hours. Walk around the properties and pear through windows to check the quality of workmanship and take note of things such as electrical outlets and structural walls as well as the home’s flow and layout – basically all the things you can’t be sure of from a floor plan. My experience has been that you will often find other snoopy home buyers on the sites after hours that can all provide valuable tips about the builder and model you are interested in.
8. Factor In Upgrade Costs BEFORE you buy – Everyone knows that builders often have hefty mark-ups on upgrade costs however these costs vary significantly from builder to builder. A purchase price of $500,000 can easily turn into a final price of $600,000 from one builder and $550,000 from another. It all depends on what the builder includes as standard features and what they charge for each upgrade. If you can’t get your hands on a complete upgrade price list, at least ask your sales rep or design centre for price lists on popular upgrades (ie: staircases, cabinets, granite, etc). This will at least give you an idea of how much you will spend and how big the builder’s mark-up is.
9. Be ready to visit the site often and expect errors – there are literally thousands of components that go into building a home. As a former project manager, I know that not even the best run projects run perfectly. Mistakes should not be large and should not be commonplace but they do occur. Best to be prepared for some mistakes and check in with your builder and home while it’s under construction to make sure things are ticking along as planned. How a builder handles mistakes is very telling so ask other people who have bought through the builder how their issues were resolved.
10. Don’t expect a custom home – There is a huge difference between buying a common floorplan from a major builder and building a custom home. While there is nothing wrong with customizing certain aspects of your home, you must realize that to do so will 1) cost you money 2) result in a larger margin for error and 3) may not turn out the way you expect. My personal take is that it is okay to make some modifications to a home but if you need to change too many structural elements, you are probably better off picking a different floor plan altogether.
11. Understand that the early bird gets the worm – If you decide that the home is right for you, ask the builder’s sales rep when they expect people to start lining up. Our sales rep told us that people started to line up at 5 am for an 11am opening during the last phase they released. We showed up at 12:45am and were 4^th in line. It sounds crazy and it is but it is not uncommon in today’s market for people to start lining up 2 days in advance of a release of homes. Find out what is reasonable for the development you are interested in and be prepared to show up even earlier for choice lots and layouts.
12. Talk to a local realtor before you buy – realtors speak to home buyers for a living. There is no one better to advise you on layouts, lots, colour choices and features that are attractive to buyers. Why not take the time to review your thoughts with a local realtor for a second opinion? You don’t have to follow their advice but it’s better to know before you buy whether or not your home’s features will appeal to resale buyers. I believe most realtors will be happy to discuss your options with you if for no other reason than to build customer relationships and goodwill in the community.

Best of luck to those of you buying a new home. Chris and I are excited to see the progress on our own home and will keep you updated as things progress. If you have any questions or comments about buying new, please let me know. I can be reached at www.lindsaywalls.com, lindsay@remaxaboutowne.com or 905.338.9000.

All the best,

Lindsay

It’s hard to believe but Thanksgiving and Halloween are just around the corner. Where has the year gone? The real estate market certainly out-performed the weather, sweeping aside the dark economic clouds despite a forecast of doom and gloom in the media at the beginning of the year.

Throughout this year, buyers and sellers obviously focused on neighbourhood and chose to ignore negative national and provincial headlines on market conditions. The simple fact is that the only meaningful real estate marketplace is the one you are in, so it is important to look closely at your own community’s real estate activity. The road to good real estate buying and selling decisions is via a market analysis provided by a local Realtor who knows the ins and outs of the neighbourhoods you are most interested in. Just like our weather, there will always be some hot real estate markets and others that will be cold as we have seen across the GTA this year. Pricing trends that have emerged in 2009 are likely to continue for the balance of this year if, as predicated, interest rates remain low. While interest rates do remain low the simple facts are that buyers who want to buy will buy and sellers who want to sell will sell.

According to the sales data for September the average time for homes that sold, to be on the market in Oakville was 26 days and in Milton 18 days. The current resale housing stock in Milton tends to be mainly in the newer sub-divisions and is attracting first-time buyers looking for a newer home with almost immediate occupancy.

Oakville continues to offer a wide range of properties and prices. Most activity (nearly 50%) in recent months has occurred in the $300,000 to $600,000 price range. If you are looking to buy or sell, I would love to hear from you. I can be reached at 905.338.9000 or lindsay@remaxaboutowne.com.

Regards,

Lindsay

Yes it’s true. Today, the Oakville Power Authority (OPA) announced plans to build a gas fired power plant in Oakville. The power plant will specifically be located along Royal Windsor Drive, next to the Ford Motor Company’s Oakville manufacturing plant just southwest of Ford Drive and QEW. OPA awarded the power plant contract to TransCanada Corporation; the only company of the 4 bidder’s who plans to build on Oakville lands. The other 3 companies all proposed to build in the neighbouring Clarkson area of Mississauga.

Tens of thousands of Oakville and Mississauga residents have signed petitions to stop the 900 megawatt gas fired plant from being built in Oakville or Clarkson. In a recent press release by OPA, Colin Andersen, chief executive officer of the Ontario Power Authority had this to say, “This new plant will meet local needs for a reliable supply of electricity, strengthen Ontario’s overall system, while performing far above Ontario’s stringent air emission standards.”

Construction of the plant is expected mid 2010 with an operational date of January 2014. While Premier Dalton McGuinty says the plant is needed to supply the growing power needs of the GTA, local residents have been outraged for months over the prospect of it being in their backyard citing that the area is already environmentally overtaxed.

The contract for the plant may have been awarded but this battle is far from over. One thing is for certain - Oakville residents will not give in to the Provincial Government’s plan for a new plant so easily. I suspect the Ontario government is about to see a fight like they have never seen before….