INSIDER WAYNE COCHRANE’S REAL ESTATE

February 2014

Your Neighbourhood Real Estate Professional

Wayne Cochrane...www.mooving.ca

Real Estate Market Predictions for 2014

Buying a House– You Need a Checklist!

Homestaging Could Be the Key to a Quick Sale and Happy Buyer

Buying a Home– Considering Closing Costs

Keys to Home Ownership

How Canadian Homeowners are Handling Debt

12&14 Tradewind Crt

$599,800

Kingswood North

It’s bad news for first time home buyers: real estate prices this year look like they’re moving in the upwards direction. But it’s not all doom and gloom. If you happen to be selling your home this will likely be a good year for you.

As we usher in the new year I see some changes on the horizon. Here are my predictions for Canadian real estate in 2014.

Prices will go up

Not everywhere. And not as much as in 2013. Price appreciation will not only be city specific, but neighbourhood specific as well, and the kind of property you buy will be key. Houses will continue to be in high demand with ongoing bidding wars, especially in desirable and emerging neighbourhoods. Certain condos will also rise in price, but not by leaps and bounds. The key with condos is to be in right neighbourhood and the right building.

It’s the year of reckoning for new Toronto Condos

A lot of condos have been sold over the years in Toronto, but 2014 we will see the most condos for sale than we have ever seen before. And many worry that we will have too many condos for sale and not enough buyers to buy them. And in turn, this could lead to a

downturn in the Toronto condo market.

Why are there so many condos hitting the Toronto market this year? Well, to answer that question, we need to go back to 2011. In that year, we have seen the most condos that were ever sold in the pre-construction phase. With pre-construction, buyers and investors simply went into a developer’s office, looked at the floor plans and the price list, and bought their condo of choice before any construction even began. Now in 2014, the once pre-construction condos are now built and ready to be occupied, rented or sold by their owners. We have a total of 20,000 brand new condo units that will be ready in Toronto this year in addition to the resale condo markets.

In simple terms, we will have A LOT of condos for sale this year. And the worry becomes: Will there be more condos than condo buyers?

Personally, I think there is a still in a strong enough demand for condos in this city, but the uncertain climate can prove to be an advantage to those who are looking to buy a condo as sellers may feel the need to list at a low price in order to encourage sale.

And developers may be a little nervous too. Because they have to

Real Estate Market Predictions for 2014 Written By David Coffey

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FEBRUARY ISSUE

compete with all the condos that will be for sale on the condo market, they will continue to offer incentives like they did last year. In other words, with some pre-construction condos, the developers will offer buyers some great reasons to buy this year including free parking or a free locker or a year of free maintenance fees to sweeten the deal. It’s a way of bringing down the cost of a condo for a buyer without officially lowering the price of a pre-construction condo unit. By 2016, the ample supply of units will begin to dwindle. So, those incentives won’t likely stick around forever. So if you’re looking for a new condo in Toronto, this may be your year.

Investors will look to greener pastures

When the financial crisis happened in 2008, it seemed that Canada was one of the very few countries that didn’t have their real estate market crash. So, many folks from abroad who grew weary of the stock market and their own country’s real estate market, came here to invest in real estate. Canada makes it relatively easy for foreign purchasers to invest in our country. So, foreign investment became a big deal in Canada. Nowadays, the deals are better in the U.S. cities where prices are starting to rebound after their huge slump. So, there will be far fewer investors and more buyers who actually live in the properties they purchase in 2014. This is a good thing. Though every condo has its fair share of owners who rent out their condo, it’s good to have a healthy number of owners who live on the premises. They can participate on the condo board and be involved with the running of their building. It makes for a stronger board and well-maintained maintenance fees.

Buying a house can be very difficult with many different things you need to remember in order to buy your house without problems. Here are some of the key things you need to make sure you have completed before you can buy a house:

1. Are you pre-approved for a house loan? If you are not pre-approved for buy my house loan then you run the risk of finding a home that you want to only to go to the bank and find out you can't get a loan to buy it, or even worse you can encounter lengthy delays and end up losing the house to someone else who has their loan pre-approved and ready! Pre-approval is fairly straightforward to get, just go to local bank and explain that you are planning to buy a house and give them an idea of how much you are looking to lend.

2. Have you made a budget? If you are buying a house you need to have your finances in good condition and the best way to do this is with a budget. You need to accurately work out how much you earn now and how much you realistically expect to earn in the future, subtract all necessary expenses, and the remainder is how much you can use to save for a deposit or to make repayments on your loan in the future. If you don't

budget you can end up in serious financial trouble!

3. Have you done enough research on the area where you want to buy? Many home buyers fall into the trap of not doing enough research into the neighbourhood they are buying into. You need to not only inspect the property many times but also inspect the neighbourhood. Problems such as loud barking dogs, constant noisy parties and violence in the neighbourhood are things you need to look out for, and you can only find out about these things by asking the neighbours and personally exploring the area.

4. Have you made a plan for how you will negotiate to buy? In order to get the best price for the house you're buying you need to have a plan. If you are buying from an auction you should go to a few other auctions before the real one just to get the hang of it, and if you are buying through an agent you should talk to friends who have bought homes as they will each be able to give some advice on the perfect strategy.

Buying a House- You Need a Checklist! Written By James Calin

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Give me a call...

Wayne Cochrane EXIT Realty Metro

wayne@mooving.ca (902) 830-4761

(902)

WAYNE COCHRANE’S REAL ESTATE INSIDER

Homestaging Could be the Key to a Quick Sale and Happy Buyer

Written By Annemarie Greenhill

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FEBRUARY ISSUE

What is Home Staging and Why Does it Work?

In a perfect world, you’d put your house on the market, breeze through a couple of open houses, and Boom! Get a full price offer within a couple of weeks.

In reality, even an attractive, well-priced house can languish on the market for months on end, if not years.

If you believe, or have been told, there’s nothing you can do besides dropping your price thousands of dollars, then home staging is something you need to know about.

Home staging is the process of decorating, decluttering and rearranging a home so it appeals to the most possible homebuyers. It can be as simple as re-arranging existing furniture, or as involved as renting furniture to attractively stage an empty house.

It may involve repainting, depersonalizing, accessorizing and necessary repairs.

It does NOT mean stripping a house of all its personality, or painting every wall beige.

The intention of home staging is, in fact, to showcase a homes personality and livability, so a homebuyer will have no trouble imagining themselves living there and loving it.

Now you know what home staging is. But why does it work?

It works for the simple reason that most home-buyers lack the imagination to picture your home without your stuff and your personal taste in it.

Most people cannot see beyond

wallpaper, cluttered rooms, or minor repairs you haven’t noticed in years.

They cannot imagine how their furniture will fit into a new space.

A home stagers job is to let home-buyers see the potential that your home can be their home.

To illustrate;

Imagine a street with three houses for sale.

House one is a typical family home, somewhat cluttered with furniture, paint scuffed by many years of wear, kids toys and personal belongings everywhere.

How does it feel? Overwhelming and tired, so you have an uncomfortable look around and leave quickly.

House two is an empty house, with nothing on the walls, no furniture to indicate how the rooms are used, and little to indicate how the house would function.

How does it feel? Boring and empty. There’s nothing to hold your attention, so you’re through in five minutes.

House three has been staged by a professional home stager.

The walls have painted in neutral, attractive colours.

Furniture and accessories have been carefully placed to maximize space and function.

Personal photos have been replaced with attractive art work. The house looks comfortable, tidy and interesting.

The first two homes are homes I personally looked at, in the Fairview

area, 15 years ago when we first moved here.

The last one I only wished I saw. If I had seen a house three, most likely I would have bought it instead of the house I’m in now. (It was house one. It’s been a lot of work.)

As you can see, home staging is an investment in your property.

It is a way to improve the value of your home by increasing its marketability.

Now that the majority of Canadians see their homes on a listing photo before ever setting foot in the door, a good first impression is essential in the effort to sell your home.

Potential homebuyers will thank you, and hopefully pay you! Happy holidays, everybody!

Word Scramble:

smiontpusa

WAYNE COCHRANE’S REAL ESTATE INSIDER

Page 5

What can’t be burned in a fire nor drowned in water?

I am an English word with five letters.If you remove my last four I am still

pronounced the same. What am I?

Go to www.mooving.ca - ‘Wayne’s Team’ and click on ‘Trivia Answers’

Brain TeasersBrain TeasersBrain TeasersBrain Teasers

Buying a Home—Considering Closing Costs Written by The Independent Free Press

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twitter page @RUMooving

When considering the purchase of a home, an important step is to review all the financial costs involved. In addition to the down payment and what you can carry on an ongoing basis, you will need to budget for closing costs.

Closing costs are the charges over and above the purchase price which are required for your lawyer to finalize the transaction so that you can take possession of your new home. Planning ahead helps to prevent feeling overwhelmed!

Closing costs can include some or all of the following.

Legal fees and disbursements include your lawyer’s fees and such charges as title search, deed

registration and tax certifications. Your lawyer will also advise you on final adjustments such as outstanding property taxes for the calendar year.

In Ontario, there is a Land Transfer Tax which is the fee to transfer ownership of property. First time buyers can be exempt for a portion of this tax.

There may be mortgage fees and financing costs through your lender for such services as an application fee, appraisal fee and if you are selling, mortgage discharge fees. Depending on the size of your down payment, you may require Mortgage Insurance.

The Harmonized Sales Tax (HST),

Property Insurance and Title Insurance also need to be taken into account.

You will also likely wish to pay for a Home Inspection if the property is more than 5 years old.

Finally, don’t forget to budget for moving expenses, service connection charges and any move-in renovations or purchases you may be planning to do.

The recommended guideline is to budget from 1.5 to 2.5% of the purchase price of your home for closing costs. Your real estate representative can help you to work out a closer estimate based on your specific transaction.

It’s not possible to know all that the coming year has in store for us. But, if you’re ambition is to make a move in real estate and buy a new home, preparedness is critical. Here are three qualities that can help make you a successful buyer in 2014.

Be organized

You’ve heard it before. Buying a home is the largest financial purchase you will ever make. And, every level of progression along the way is important — from paperwork to viewings, offers, inspections and closing activities.

The best way to be successful throughout the process is to get organized early on. Talk to your bank and a mortgage professional to get your finances in order. Ask family and friends for their recommendations and referrals on professionals to work with, including REALTORS®, lawyers and inspectors. Be sure to also organize your current household and prepare for the big move.

Be informed

There are plenty of factors that impact the real estate market. The area’s current and prospective job market, consumer confidence in the economy and upcoming development projects in a community can all play a part in influencing competition in the market, value of a home and the long-term return on your investment.

The best way to proceed in any market, and especially in 2014, is to be informed on all the variables. In today’s online world there are plenty of resources to help you, like howrealtorshelp.ca and nsrealtors.ca, but nothing can replace the expertise, knowledge and personal service your REALTOR® can offer.

Be focused

There are a lot of considerations throughout the transaction of buying a house. If you’re looking now you will quickly find that there is also plenty of selection on the market.

So, the final most important quality for buyers to have in order to be successful in the coming year is to remain focused. Keep your list of wishes verses needs close at hand so you don’t lose sight. Your REALTOR® will help you remain true to your budget and objectives, but once you begin to dive into the selection of listings you will want to keep this list close on hand.

Viewing homes can become overwhelming, especially when there is plenty of selection on the market.

Stay focused on what’s most important, get informed early on, and remain organized and you can have a successful home buying experience in the New Year.

Keys to Home Ownership By NSAR

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Give me a call...

Wayne Cochrane

406-SOLD

The bad news is that only 43 per cent of Canadian homeowners say they are happy with the way they've managed their debt and day-to-day finances during the last year, according to a survey by Manulife Bank of Canada. One in three homeowners say they are "very unhappy" with the way they've managed debt.

The good news? "Canadians have a culture of repaying debt promptly," says Will Dunning in the latest Annual State of the Residential Mortgage Market in Canada report for the Canadian Association of Accredited Mortgage Professionals (CAAMP).Much has been made in the media about the amount of debt that Canadians have been racking up while rates have been low, but the two studies show that borrowers are aware the low rates won't last forever and most are doing their best to reduce their debt as soon as possible.

Dunning says recent homebuyers "are more likely to take steps to shorten amortization periods than are prior purchasers (to increase their payments, make lump sum payments or increase the frequency of mortgage payments)."About one in six mortgage holders voluntarily increased their regular mortgage payments during the past year, says the CAAMP report. About 17 per cent of mortgage holders made lump sum payments, and eight per cent increased the frequency of payments. That means that 38 per cent of mortgage holders, or 2.1 million out of an estimated 5.58 million mortgage holders in Canada, took one or more measures to accelerate repayment.

The Manulife survey says that more than three-quarters of homeowners say being debt-free is one of their top financial priorities."Debt is a tool that Canadians can use to improve their standard of living and purchase assets over the long term," says Doug Conick, president and CEO of Manulife Bank of Canada. "Still, people need a strategy to manage debt. The key is to determine what your financial priorities are - and

then put a plan in place to focus your most important goals."Consumers have realized that an important first step in managing debt is by tackling high-interest credit card charges. Two-thirds of Manulife survey respondents say they always pay off their credit card balance in full. That's a nine-per-cent increase from a similar survey conducted two years ago. Among the other third who carry a balance, most of them say they plan to pay it off in full in the coming year."Interestingly, this finding is very similar to that from the 2011 survey - suggesting that good intentions may not always translate into action," says Manulife.

Other strategies for paying down debt include "making extra payments on my debts" (suggested by 61 per cent of respondents) and creating a written budget to track and manage spending, mentioned by 43 per cent of those homeowners surveyed. For those who are concerned about higher mortgage interest rates when it comes time to renew, the CAAMP report has some reassuring news."During the next year, renewal of mortgages is likely to result in reduced interest costs; it will be a

positive factor for these borrowers and therefore for the broad economy. Farther out, the outcomes are likely to be closer to neutral," says Dunning in the CAAMP report.

The report found that mortgage rate discounting is widespread and is saving consumers a lot of money. For mortgages that were initiated or renewed in 2013 with five-year, fixed terms, the average mortgage interest rate is 3.06 per cent, says CAAMP. The average posted rate was 5.21 per cent, so the negotiated mortgage rate discount averaged 2.15 percentage points.While most people are concentrating on paying off their mortgages, about 11 per cent of homeowners took equity out of their home in the past year. The average amount taken out was $57,000. The most common use for the money was debt consolidation, followed by investments, renovation and home

How Canadian Homeowners are Handling Debt By Jim Adair

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repair and purchases, including education.

CAAMP says on average, home equity in Canada is equivalent to 66 per cent of the value of the homes. Among homeowners who have a mortgage but not a home equity line of credit (HELOC), the average home equity is 46 per cent. For homeowners with both a mortgage and a HELOC, it's 43 per cent.Eighty-three per cent of homeowners (about 7.9 million out of 9.52 million) have 25 per cent or more equity in their homes, says CAAMP. Both surveys show that Canadians worry about debt. CAAMP says that more than 70 per cent of those surveyed agree with the statement that "low interest rates have meant that a lot of Canadians became homeowners over the past few years who probably should not be homeowners."

Dunning says: "However, while consumers believe other people have been irresponsible, the responses to other questions show that they believe their own behaviour has been responsible…It is likely that beliefs about other people are shaped by messages in the media and from pundits."Manulife says only one in three homeowners have consolidated debt at a single low rate, and one in four get advice from a financial adviser. The company says that 80 per cent of homeowners who work with an adviser pay their credit card balance in full each month, compared to 64 per cent who don't seek advice.

"For anyone who struggles to find time to spend on debt management or who could benefit from objective, professional advice, it's certainly worthwhile to seek out a financial adviser," says Conick. "It never hurts to learn about the strategies and tools that work for others - and getting personalized advice could help you remain focused on your goal of becoming debt-free."

WAYNE COCHRANE’S REAL ESTATE INSIDER

WAYNE COCHRANE’S REAL ESTATE INSIDER

Note: This is not intended to solicit clients currently under contract.

The trademarks MLS®, Multiple Listing Service® and the associated logos are owned by The Canadian Real Estate Association (CREA) and identify the quality of services provided by real estate professionals who are members of CREA.

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Wayne Cochrane Real Estate Professional

902-830-4761 wayne@mooving.ca

More homes listed and sold by Wayne - view these homes at:

w w w. m o ov i n g . c a

unless noted otherwise

List Today and EXIT Tomorrow!

68 Gallery Crescent

Beaverbank

5 Daisy Drive

Timberlea

29 Sienna Court 250 Glen Arbour Way

176 Patton Road

Upper Sackville

12&14 Tradewind Crt.

$538,900

Kingswood North

Middle Sackville Voyageur Lakes

212 Voyageur Way

Timberlea

23 Avignon Lane

$844,700

$549,800

$599,800

$261,800

$599,800

$477,000

$377,000

$ 299,900

$ 349,800

Glen Arbour