Ask the Agent: How Important Is Staging to Sell?

How Important Is Staging to Sell?

Whether or not to stage is top of mind for sellers these days. There really isn’t a consensus on whether staging your home for sale will increase the amount people will pay for it, but anecdotally it does appear to be the case. Today’s buyers have higher expectations, and staging definitely helps.

For example, assume a potential buyer will view your home online; staging your home for photos may make the difference between whether he or she will decide to tour your home—or not. In addition, a well-staged home can impact buyers during that “aha” moment when they decide your home “feels right”—or not.

Professional staging, however, can cost big money. You can declutter and clean your home yourself, but if you think it needs more, ask your real estate agent. He or she has experienced firsthand the impact of staging on selling prices.

Ask the Agent: How do I know if downsizing is right for me?

How do I know if downsizing is right for me?

Downsizing has costs and rewards. You may have to give up things, but you’ll gain something as well. If you’re considering moving to an urban environment from the suburbs, you might miss your neighbourhood, your neighbours, and your big workroom and garden. If you’re purchasing a condo or townhome, you may have to pay HOA fees, and you’ll likely sacrifice some privacy.

On the other hand, you’ll probably save on utilities and maintenance costs. You can start fresh and redecorate just the way you want. And you’ll find you’re now able to take advantage of city life and enjoy the benefits of being close to all the urban amenities. 

Plan ahead. You’ll probably still want to host family celebrations. So think well-organized kitchen and sufficient entertaining space. Most importantly, keep an open mind. This may be the best move you’ve ever made.

Landscape for Summer Outdoor Fun and Profit

It’s hard to put a value on landscaping projects. A study by realestate.com indicates the return on investment for landscaping and/or man-made garden architecture can be as high as 150%, while others suggest a more reasonable 15% to 20%.

The bottom line, however, is that everyone wants a front yard with curb appeal and a secondary living space in the back. And while it may increase the value of your home, it also improves your quality of life. Particularly for those in cooler climates, summer is short, and a landscaped outdoors can be, well, priceless.

That said, landscaping can prove a very costly proposition indeed. The generally recommended figure for a landscaping budget is 10% of your home’s value, although that varies according to your local area. The majority of projects reported in a study of landscaping by houzz.com cost from $1,000 to $5,000 for minor planting or mulching, and $50,000 or more for “complete overhauls.”

Remember, time is also money, and even small projects can take longer than you think. According to the Houzz survey, smaller projects averaged approximately three months of planning and three months of work to complete. Having spent time and money on landscaping, there are ways to reduce future costs:

·         Lawn care alone can cost upwards of $100 a month, so do as much of the maintenance as possible yourself.

·         Construct decks, stairs, and pergolas of maintenance-free materials such as composite decking.

·         Artificial grass can be a big expense up front, but it saves on maintenance (mainly the cost of water) in the long run.

·         Consider using recycled bricks instead of expensive rocks in your landscaping plan.

·         Perennials are a great choice, as they reduce the need to buy new plants every year.

·         Edible gardens can be lovely as well as a good source of delicious vegetables and herbs.

Now, step away from the lawn mower, take a break, and enjoy your newly landscaped property.

Rent-to-Own: An Easy Way to Buy a Home, or a Trap?

If you want to own a home, the rent-to-own option may seem appealing, particularly if you’re credit- or income-challenged and can’t qualify to buy a home any other way. But it’s not always as simple as it seems.

In this situation, the homeowner may be having difficulty selling the home, and may decide to sell it to you after a pre-determined amount of time. In the meantime, you rent and live in the home, and save for the down payment.

The two parties enter into an “Option to Purchase Agreement,” and the tenant pays an additional fee up front — usually about 2% to 2.5% of the home’s purchase price. This fee is later deducted from the down payment.

When the lease ends, ideally the owner follows through on the agreement and sells the home to the tenant. But things may go wrong.

Read the agreement carefully first, before you agree to anything. If possible, talk to a lender to find out how easy or difficult it may be to secure financing at the end of the lease; a good real estate agent can also steer you in the right direction at the beginning.

One big benefit of the arrangement is that the tenant knows how much the house will cost, so rising house prices aren’t a concern.

However, the owner could include a clause in the agreement specifying that the buyer may have to pay more at lease-end if house prices rise significantly.

It’s one good reason to understand what you’re getting into from the start

Home Hungry: Why Not Co-Own a Home with a Co-Stranger?

Not unlike speed dating, the goal of a recent Toronto meet and greet was to discover a soul mate. Only the objective here was to find a soul mate with whom to buy a house. For many living in expensive urban centres, it might be the only way they’ll ever become homeowners.

Co-ownership of property has been around for years. However, with the housing price increases in some areas of the country, it appears to present a viable solution to home-hungry Canadians, particularly millennial wannabe-homeowners used to sharing.

That’s because you and your co-owner will jointly own a property purchased together. And you may or may not be friends or even acquaintances; these days many are looking to go halvsies with complete strangers.

At the Toronto meeting, a number of wishful homeowners “speed-interviewed” each other, hoping to find a compatible stranger. But even if the homeowner vibe is right, don’t go blindly into mutual homeownership without knowing the risks. As real estate lawyer Lauren Blumas told the CBC, it’s important that co-purchasers sign a legally binding agreement before they buy.

This agreement should detail the percentage of the property each individual owns, as well as the responsibility each has for maintenance and repairs. Also necessary is a resolution mechanism in case the co-owners decide to go their separate ways.

Says Blumas: “(The agreement) would … force you to sit down and think about how you want to structure your arrangement and then formalize it.” 

Not to mention to decide if it’s worth the risk.

Rules Differ in a Condo Remodel: Here’s How

You’re ready to renovate. Your creative juices are flowing, and you’re excited to create that perfect space.

But wait. Are you remodeling a condo? If so, this requires some special considerations. The game rules differ from those for a detached home. Here’s the playbook: 

Read the regulations: Condos come with associations. These come with rules. The association has put certain standards in place to maintain the best possible conditions for your building. Before forging ahead with any plans, read through the regulations of your association and consult with your board or property manager for anything that will need the association’s approval.

Consider condo limitations: Your unit may be linked to others, so you may not be able to alter certain aspects of your home: plumbing fixtures might have to stay where they are; you may not be able to remove walls that support the structure, or install pot lights in ceilings. But don’t let these limits stifle your creativity or dash your renovation hopes. Just keep them in mind as you plan.

Plan ahead: If your renovations are extensive and the space small, your contractor and workers may require an extra space in which to work. Ask if there is a workshop or outside space they may be able to use.

Don’t fear the painter: One of the easiest (and cheapest) ways to transform a space is by painting it. However, many condo owners are concerned about personalizing their walls, especially with deep, dark colours. Unless you’re renovating for an immediate sale, go ahead and make the space your own. Enjoy it while it’s yours. When you are ready to sell, you’ll likely need to apply a fresh coat of paint anyway, and you can make it neutral then.

Get out: For your own sanity, stay with a friend or relative during construction, or treat yourself to a hotel.

Ask the Agent: How do I sell my home in a buyers’ market?

How do I sell my home in a buyers’ market?

Selling a home in a buyers’ market can be stressful. And these days, even in a sellers’ market you can’t take anything for granted; the market may change quickly and dramatically. But flexibility and thoroughness can help make your selling experience positive.

Keep your price expectations realistic. Your real estate agent will find market comparables showing what houses in your area sold for and how long they spent on the market. The market determines the price—not you. Don’t worry if this year isn’t like last year. Focus on today.

You can, however, help your home sell faster. Prepare for offers with conditions, and be flexible about closing, or even moving, dates. A home inspection may identify potential problems you may not be aware of and can fix before listing. Listen. List. Show flexibility. And the experience can still be a positive one.

Green Renos Are Increasing by Leaps and Bounds

Not all home renovations are made in order to improve a home’s aesthetics or comfort. A June 2017 article in Real Estate Magazine took a look at a growing trend — additions and improvements for the purpose of improving a home’s efficiency and environmental friendliness — and its value.

Michael Garrity, CEO of finance company Financeit, told REM that in the past four years his company has seen a 200 per cent increase in the number of loans intended for “green” usage; and from 2013 to 2016, the company’s financing for residential solar projects alone increased by 232 per cent.

One homeowners’ survey conducted by the Canadian Home Builders’ Association (CHBA) indicated that energy efficiency was the third most desired factor in a new home purchase, behind cost and location. The reason: a desire on the part of homeowners to reduce utility costs.

As well, the past 30 years have brought continuous improvement in energy-saving technology, including heating and cooling and solar energy advances. Homes now use about half as much energy as they did in the 1980s, another CHBA survey found.

So what does this mean for homeowners and buyers? While upfront costs may be steep, they’re worth it. (Garrity suggests new state-of-the-art windows may cost between $5,000 and $15,000 while solar panel installation may be as high as $25,000, depending on the size of the project.)

Homeowners will benefit from reduced energy costs while they live in the home and see its value increased when they go to sell, because, increasingly, home buyers are willing to pay the price.

Millennials’ Homeownership Dreams Can Come True

For many millennials, the dream of homeownership feels far away, if not impossible. Salaries that haven’t grown with the cost of living, new mortgage rules, volatile housing markets, and a plethora of other reasons have made buying a home more difficult than it’s ever been for young people.

A survey by Apartment List of 24,000 American renters found that 80% of millennial renters want to become homeowners, but 72% are held back by affordability. Some 44% don’t have savings to put toward a down payment.

Many who find themselves in that position are trying to reach their homeownership goals with second and even third jobs in order to save extra money. Some are moving to smaller towns where housing is cheaper, while others are living with Mom and Dad in order to save on rent. But Fundrise, a Washington, D.C.-based start-up, has another, more creative solution.

Fundrise is a real estate crowdfunding start-up that sells shares in “eFunds” that build and/or remodel urban housing. An investor can be part of an eFund for $1,000, and the target audience is millennials.

Notes a recent Forbes article on the project: “(T)he goal is for a subset of the fund investors to become owners of the very places their money is helping build. Fundrise calls these ‘homebuyer investors’ or HBIs.”

So if a millennial could invest in a property today, he or she could be taking advantage of gains toward what might eventually become his or her home.

As well, says Forbes writer Samantha Sharf: “Fundrise’s effort is unique in tackling the dearth of affordable supply, which many economist [sic] agree is the biggest issue in the housing market today.”

The Fundrise project launched this past summer, so it’s too early to assess its success in encouraging new supply or in attracting millennials.

But this initiative may soon become one of many—millennials deserve their shot at homeownership too.

Ask the Agent: Which is better, a new house or an older one?

Which is better, a new house or an older one?

When choosing between purchasing a newly built home and an older one, know that there isn’t a “right” or “wrong” answer. Choosing new or old may be more about understanding what you want. Here are some points to consider.

Older homes tend to be closer to downtown amenities, like restaurants and entertainment. They’re usually in established neighbourhoods with mature trees and large backyards. But older houses can be expensive to maintain, and may have small rooms with little storage space.

Newer homes typically offer larger rooms, trendy finishes and usually require less maintenance. But new builds are often farther away from the excitement of downtown living. Commuting may also take longer and cost more.

Your real estate agent can help, but it comes down to one thing: Old or new, the home that feels right for your family is the one to buy.

Family Living in the Sky: North America’s Newest Reality

As land available for new construction shrinks in urban centres across North America, governments, builders, and families are looking upward. Living high in the sky isn’t how many young families would have envisioned the family home, but for many, it’s a reality.

This new reality is playing out in Toronto, Canada, where family-sized condo units are rare. Some 80% of new housing built in the past decade are buildings of five or more stories. Yet fewer than 10% of high-rise homes in the city have three or more bedrooms. And this is presenting a problem for young families who want to live and work there.

According to a recent story in Citylab.com, Toronto is on its way. Guidelines generated in a 2015 study by the city’s Planning Division were adopted this summer by its City Council and will be used in evaluating current and future projects. The guidelines, points out CityLab contributing writer Mimi Kirk, “are not only applicable to Toronto, but to cities across North America and beyond …”

Among the recommendations: 15% of units should include two bedrooms and 10% should include three, with these larger units located on lower levels, close to each other, and adjoining outdoor spaces.

Meanwhile, in New York City, where raising kids in high-rises is nothing new (but not particularly family-friendly), some existing buildings are currently updating and repurposing their amenities, thanks to the growing number of New Yorkers choosing to raise their families in the city.

Maybe life in the sky isn’t such a hardship after all.

Wait and Save: We Still Believe in Homeownership

Do you dream of owning a home someday? If so, you’re not alone. The desire to put down roots and invest in a home is a common one.

And this dream is still strong across North America. The problem is, many can’t afford it.

To many, the dream seems elusive as a result of the significant cost not just of purchasing a home but also in carrying it. Many who would like to and can pursue the dream never will due to fears associated with the lack of affordability (“Will I be in over my head?” “Will I lose money?”).

Affordability is a concern

According to the RBC 2017 Home Ownership Poll, 80% of Canadians believe homeownership is a good investment.

However, only 25% plan to purchase a home this year. Why the discrepancy? Considering the average Canadian home price has climbed over the $500,000 mark, it’s understandable why many won’t find home-buying affordable just yet. And “yet” is the key word. For many, their plans to own a home someday have not changed. They’re simply delayed. For example, nearly 40% of Canadian millennials plan to buy a home in the next two years.

As some Canadians put their home-buying plans on hold, they cite three main reasons for the delay. More than half of those participating in the RBC poll believe that housing prices may come down. Others are uncertain about the state of the economy and also express concern that carrying costs continue to increase.

How are they dealing with it? As RBC vice president Nicole Wells suggests: “For many Canadians, buying a home is a financial and personal milestone – often the biggest investment one will make.

“In today’s market, the best advice is to start with understanding exactly how much you can afford, and focus on your wants and needs ahead of starting the house hunt. … Knowledge and education are key.”

Ask the Agent: What do home inspectors do?

What do home inspectors do? 

Before you sign on the dotted line, you should have an understanding of the current condition of the property you intend to purchase. A buyer can order a home inspection report to identify potential problems and then negotiate any repairs necessary before the sale is final.

Typically, for a flat fee, a home inspector spends one to three hours reviewing the interior, exterior, and major systems of a home. He or she will prepare a written report, and may include photos or videos.

The inspection will point out safety or potential barriers-to-purchase issues, such as sagging floors or an aging roof. However, the inspector can’t break through walls or pull up floors, and also may be unable to access certain areas. For an additional fee, special inspection equipment can look further.

A home inspection identifies items you may not have noticed about your home—and may well save you from making a big mistake.

Downsizing Happens at All Ages Now: Here’s How to Ace It

Downsizing is often associated with empty nesters and retirees, but as it turns out, more and more homeowners of all ages—including millennials—are looking for smaller residential footprints.

Currently, more than 40 per cent of Canadian millennials rent, and many say they prefer it. But those who are buying are lining up for small condos that will allow them to live in urban centres at affordable prices.

Downsizing dilemmas

Getting rid of belongings that won’t fit in your smaller space is challenging. The upside—of particular interest to millennials—is the opportunity to dump old inherited pieces for trendy modern furniture.

Measure your new home before moving day, and decide what to take before you start packing. If there’s a too-big item that you can’t bear to part with, store it. But not at mom and dad’s, say experts; they may be downsizing soon themselves.

Emotional attachment can make it hard to decide what you should throw out. Ask a straight-talking friend or family member to help with an unbiased second opinion on tough decisions—like whether your bookcase or king-sized bed is way too big for your new digs.

Once you’ve rounded up everything you won’t be taking, have a garage sale. You’ll feel less guilty about parting with so much, and you can make a surprising amount of money to help with moving expenses.

Trying to dispose of all the items you can’t sell can be overwhelming. Hiring a pickup service for junk removal or to take to a charity can be well worth the expense.

Will Balance Return to Real Estate Markets?

According to the Canadian Real Estate Association (CREA), the summer of 2017 delivered the first year-over-year decline in home prices in four years. And this may be a sign of balance returning to housing markets across Canada.

As reported by CREA, the across-the-country decline was only 0.3 per cent, but many believe this downward trend will continue at least into the new year. According to CREA, home sales declined in two-thirds of the Canadian market, including Calgary, Halifax and Ottawa, and the Greater Toronto Area.

As CREA chief economist Gregory Klump says: “Sales may be starting to bottom out amid stabilizing housing market sentiment. Time will tell whether that’s indeed the case…”

The national news magazine Maclean’s believes that prices will also fall, especially in the single, detached-home market. And, to the relief of many, Maclean’s suggests the days of bidding wars are most likely behind us.

Market watchers attributed the drop in home sales that initially affected Vancouver, and was still impacting Toronto this fall, to recent measures imposed by both provinces designed to cool overheated housing markets.

Also this fall, the Bank of Canada increased the interest rate for the second time in two months — which had the immediate effect of raising mortgage rates. Expectations are that rates will continue to rise. As well, the Office of the Superintendent of Financial Institutions is considering again tightening credit regulations. But industry pushback may put this on hold.

What are buyers and sellers across the country to do? With the usual slowdown in the housing market in fall and winter combined with uncertainty on many fronts, both may be inclined to take a wait-and-see attitude.

Or they may adopt the position of cautious optimism espoused by some experts, who are anticipating calmer, more balanced housing markets across the country with more choice for buyers and sufficient profit for sellers.

After all the instability, this may be news to take action on.

Millennials Seek New Housing Opportunities

Canada’s millennials are transforming the housing landscape in their search for new kinds of homes.

And they pack a big punch financially. According to a report by CBC News, more than 50% of 25 to 35-year-old Canadians own a home, compared to 36% of U.S. millennials. The research, from TD Economics, says that Canadian millennials have less student debt, better jobs and higher incomes than their U.S. peers. What do millennials want it comes to housing? The answer is: Pretty much everything. And a U.S. innovation called an “Urby” may suit the bill.

The Urby is a mixed-use residential development that brings a little bit of city, a little bit of community and a little bit of entertainment to a little apartment. Emphasizing “New Urbanist” principles such as walkable neighbourhoods and access to public transportation, Urby developments are designed for urban professionals.

Key to Urby projects such as the Urban Ready Life (URL) complex in Staten Island, N.Y. is providing opportunities for social interaction. URL common areas offer chances for interpersonal connections between residents by including lobby coffee shops, communal kitchens and a cultural director. Sounds ideal for this work-hard, play-hard generation, and Canadian developers are watching the progress of projects such as Urbys, the tiny house movement and co-op housing developments.

So far, however, they’re just watching: Notes Steve Jackson, program manager for the Cooperative Housing Association of Canada: "It's unfortunate that there are no major programs to develop new co-op housing … We know that a lot of millennials do see co-op housing as a wonderful option.”

Ask the Agent: This Month’s Question

Should I buy a home first or sell mine first?

The answer: it depends on where you are. Your approach may change depending on whether it’s a buyer’s or a seller’s market in your area, and in the area where you want to buy.

In Canada, there’s been a shift in some areas towards a buyer’s market. The Canadian Real Estate Association (CREA) expects sales and prices to decline slightly in 2018.

Typically in a seller’s market, you would be inclined to buy first, as there are more buyers than available properties, and it might be harder to find a home you like. But it’s a great time to sell your own property.

In a buyer’s market, you may want to sell first, as there are more available properties than there are buyers. You will want to list first, as your home may be on the market for some time, and you don’t want to carry both. The bottom line? Do what’s best for your family.

Redecorating Your Child’s Room? Start Here

Redecorating a child’s room is enjoyable. Figuring out creative ways to make your kids’ spaces whimsical yet functional is a fun design challenge. And watching their faces light up when it’s all done? Priceless.

Home design website Houzz conducted a survey of users who have “recently completed, are working on or are planning a home project with kids in mind.” The results provide an interesting look at what’s currently trending in the world of children’s rooms. If you’re about to embark on creating a special room for a child, keep the following in mind:

·         Close to 70% of respondents said their kids’ rooms have themes. The most popular looks, in order: nature, animals, sports, and princesses. But note: kids grow up quickly and tastes change just as quickly. Today’s trendy decor may look dated tomorrow.

·         Functionality and maintenance are top priorities. Seventy-one percent of respondents said they wanted a space that was easy to clean and maintain, and 64% said they needed a functional setup. Be sure to incorporate washable and durable materials, and include labeled storage boxes and bins.

·         Blue reigns supreme. Fifty-nine percent said blue is the dominant colour for kids’ rooms, followed by white, gray, green, and pink.

·         The cost of redecorating a kid’s room varies. Of respondents who had completed their project, one-third spent $1,000 or less. Establish a budget before starting; it’s easy to get carried away with cute decor and playful features. And unlike adults, kids don’t notice the difference between the more expensive option and a more affordable one.

·         Nearly 70% of participants cited clutter as a challenge. Make toy management a priority in your kids’ rooms. Oversized bins in fun colours and/or closet storage systems are key to keeping toys and “stuff” out of sight and out of mind.

Finally, involve your kids in the decisions. After all, it is their room.