Top Real Estate Secrets

Whether you’re a buyer, seller or both, check out these tips for navigating the real estate market successfully. … Continue Reading

Buying “New” can be the best way to go $$$

Currently the re-sale condo market is still going strong, there is also no end to the new building developments popping up and being developed all over the city skyline. One of the number one benefits of purchasing a new condo in the development stage is the selection. … Continue Reading

Key items to upgrade to help sell your home!

There are certain things you need to consider when doing any home renovationsto boost the sale of your home.  You want to make sure your putting your money into the right areas of your home. You wouldn’t want to put thousands of dollars in putting new wallpaper up  in your bedroom,you want to make sure any upgrades you do make you money not loose money. … Continue Reading

Choose an Amortization Period, that makes sense for you

Choosing a longer amortization period can get you into your dream home sooner than choosing a standard or shorter period.  When you apply for a mortgage, lenders calculate the maximumregular payment you can afford. They then use that amount to calculate the maximum amount they will lend to you for your mortgage.

As a shorter amortization period results in higher regular payments, a longer amortization period reduces the amount of your regular principal and interest payment by spreading your payments over a longer period of time. So you could qualify for a higher mortgage amount than you originally anticipated. Or you could qualify for your mortgage sooner than you had planned.  Either way, you end up in your dream home sooner than you thought possible.

Get your dream home sooner with a longer amortization. Regular payments are less with a longer amortization. Again, this option is not for everyone. While a longer amortization period will appeal to many people because the regular mortgage payments can be comparable or even lower than paying rent, it does mean that more interest will be paid over the life of the mortgage.Regardless of which amortization period you select when you originally apply for your mortgage, it does not mean you have to stay with that period throughout the life of your mortgage. You can always choose to shorten the amortization period and save on interest costs by choosing an accelerated payment option, making extra payments when you can, such as a Double Up annual lump sum principal prepayment.  

You should review your options at each renewal to shorten your amortization and pay off your mortgage faster. It also makes good financial sense for clients to re-evaluate their amortization strategy every time their mortgage comes up for renewal.

Then, as you advance in your career and begin to earn a better salary over time, you can simply increase the amount of your regular payments by as much as 10% once each year. All these prepayment features will take years off your amortization period, and save you money on interest.

Is there ever a right time to Buy/Sell?

I’ve been getting some mixed reviews from both colleagues and clients over the past few months, when I have shared my personal and professional opinion on today’s CRAZY market.  

According to real estate industry sources, the national average house price in Canada is expected to continue to rise this year and through 2009.   Both the Canadian Real Estate Association (CREA) and Canada Mortgage and Housing Corporation (CMHC) have predicted that house prices will climb to new records in major markets all across the country. 

Figuring out whether it is your time to jump in to the real estate market at this time is a difficult call.  How you arrive at an answer to that question depends partly on where you’re starting from.  If you’re starting out in your first home, it’s fairly straightforward. You calculate your carrying costs and the potential for return on your investment and then determine if that situation will improve if you wait. With today’s low interest rates, the cost of carrying a home is now very affordable.  The low mortgage rates also provide you with an opportunity to pay down more of the principal in those critical early years of your loan.  Paying even a quarter of a percent less interest in the early years of your mortgage could add up to a savings of many thousands of dollars over the life of your loan.  Your price range will be the major factor in determining where you should be looking.  

In most cases, a simple calculation will show you that you have a lot to lose by waiting.  Not only would your carrying costs be higher if house prices or mortgage rates go up, you’d also lose any equity you could be earning as the value of your home increases beyond your original purchase price.  These factors will usually outweigh any savings you might realize by entering the market later with a larger down payment.  This is especially true when you consider you still have to pay rent on another location while you save for that down payment.

If you are on the other side of the equation and you’re one of those fortunate people who already owns a home and you need to decide if it’s a good time to sell it and buy another. You’ve got both ends of the transaction to consider, so your primary concern isn’t just the price of the home you want to buy. It’s between the sale prices of the two properties that’s important.  If you’re downsizing and want to come away with a cash surplus, it’s to your advantage to do so in a market where homes are commanding top dollar.  Even if you’re upsizing, it would still be to your benefit to act now and take advantage of the property appreciation that’s to come, and do it before the gap between the two properties widens.