Mitten Real Estate Team's Real Estate Blog

October 2021 Fraser Valley Housing Market Update

Tue, 02 Nov 2021 20:53:08 GMT

Demand for Fraser Valley real estate remained solid in October with overall sales the third highest
on record.

The Fraser Valley Real Estate Board processed a total of 1,938 property sales on its Multiple Listing Service® (MLS®) in October, an increase of 3.9 per cent compared to September and a decrease of 18.2 per cent compared to the same month last year.

The President of the Board, said, “What we’re seeing is a combination of above‐average sales with
below‐average new listings which is placing strong upward pressure on home prices, for all residential categories,
month‐over‐month.

“It is a very challenging time, particularly for buyers. I empathize with clients who have been trying to buy a home
for more than a year without success after multiple attempts. Now, more than ever is the time when buyers and
sellers alike must rely on their REALTOR® to guide and advise them in considering all available options, including a
change in community or even property type.”

After rebounding slightly in September, new listings decreased in October. The Board received 2,188 new listings, a
decrease of 29.0 per cent compared to last year, and a decrease of 6.6 per cent compared to September 2021. The
month ended with a total active inventory of 3,447, which is a 9.6 per cent decrease compared to September, and
a 49.8 percent decrease compared to October 2020.

Baldev Gill, Chief Executive Officer of the Board, said, “Fraser Valley is a top destination currently in BC for buyers
looking for relatively affordable family‐sized homes. Townhomes and single‐family homes are selling on average
within two to four weeks in our region, with buyers keenly watching the market for new listings.”

Across the Fraser Valley, in October, the average number of days to sell a single‐family detached home was 28 and
a townhome was 18 days. Apartments took, on average, 27 days to sell.

MLS® HPI Benchmark Price Activity

Single Family Detached: At $1,396,700, the Benchmark price for an FVREB single‐family detached home
increased 2.5 per cent compared to September 2021 and increased 33.4 per cent compared to October 2020.
Townhomes: At $720,500 the Benchmark price for an FVREB townhome increased 1.9 per cent compared to
September 2021 and increased 26.6 per cent compared to October 2020.
Apartments: At $514,200 the Benchmark price for an FVREB apartment/condo increased 1.9 per cent
compared to September 2021 and increased 18.3 per cent compared to October 2020.

We are open for business during the Pandemic

Tue, 17 Mar 2020 22:03:17 GMT

Dear friends and clients, we are living in unusual times. In light of Corona virus concerns, we regretfully are cancelling our Easter Celebration on April 11, 2020 in order to comply with the social distancing recommendations of the health authorities and to do our part to protect our clients from potential exposure to the virus

We want you all to know that our team is in good health and we are still open for business. We are still serving our clients and will be happy to help you with your real estate needs while at the same time taking all necessary steps to follow the recommendations of the Provincial and Federal Health authorities to proactively protect our clients, while still meeting their real estate needs. We are very fortunate in that in many parts of our business we are already employing technology to deal with our clients and other realtors remotely. This will allow us to seamlessly facilitate the ‘social distancing’ recommended by the health authorities while still serving the needs of clients. When in person meetings are required we are taking all possible measures to protect ourselves and our clients thereby mitigating any risk of transmission. We are not yet certain what effect the current situation will have on market sentiment (if any) or how long it will persist but we are hopeful that the mortgage rate relief will help to mitigate potential negative impacts but we will be monitoring the situation closely and will be happy to discuss it with you.

Inspirational Quote of the day

Fri, 23 Nov 2018 17:51:47 GMT

Great quote by Winston Churchill:

Under stairs Storage ideas to make maximum use of space

Wed, 21 Nov 2018 18:38:00 GMT

Here are six ideas to make smart use of the space under your stairs. They range from the relatively easy, which any regular reader of this magazine can likely manage, to more complex projects that might require the assistance of a contractor, plumber or electrician. By-laws vary across the country, so you’ll want to call your municipal Building and Planning Department to find out whether a permit is required for the type of project you plan to undertake. If the area under your stairs is open, it’s unlikely you will require a permit to install removable shelving or rolling cabinets. However, if the area has been framed-in and covered with drywall, or if you intend to install a permanent fixture, then a permit may be required.

Why Bother with a Permit?
Building permits aren’t all about enriching the coffers of local government. While they do serve to ensure that homeowners pay their fair share of the tax burden, they also make certain that any structural, electrical or plumbing modifications to your house are done according to accepted standards. If you later sell your house, most real estate agencies will require you to sign a disclosure form, stating whether you have undertaken any unpermitted work. Don’t be surprised if prospective buyers request that the unpermitted work be inspected by a contractor, at your expense. Real estate agents also caution that unpermitted work, no matter how impressive, doesn’t necessarily add market value to the house – but it does raise indecision and apprehension on the part of buyers. And, if the unpermitted work is the cause of fire or water damage, you may run into problems with your insurance company when processing a claim.

Regardless of the project you undertake, it’s always a good idea to take the time to plan what you intend to do. Sketching out the project, ensuring that your measurements are correct, preparing a materials list and purchasing any necessary hardware before you start will help make the job go easier – and fend off frustration down the road.

Rolling Cabinets
An advantage of movable, or rolling, cabinets is that they enable you to use the full depth of the stairwell. The front panel can be built to suit the room. Be sure to use a high quality set of casters, as each cabinet will be heavy when fully loaded. This option works best if your floor is fairly flat and even as any bumps or slope will cause problems when it comes time to roll out the cabinet.

Closed Cabinets
Cabinets are an option for those who don’t like the look of open shelving. They can provide a much more finished look than open shelving, particularly when located on a main floor rather than the basement. Install any combination of doors and drawers that best fits your needs and complements the design of your home. The plywood framework can be installed underneath the stairs, then the doors or drawers can be made to fit. Although it’s not impossible, it is more difficult to install a large bank of drawers than it is to opt for doors.

Built-In Appliances
In many homes, laundry appliances are located in the basement. This can pose a problem if you have difficulty walking up and down stairs; or it can simply be a nuisance in large households where laundry is a daily chore. As for the half bathroom option, you’ll need to have some plumbing and electrical work done. If you have never done either type of work before, now is not the time to give it a go – hire a professional.

Office/Study Room
Increasingly, people are working from home, either on an occasional basis or full-time. Even if no one in your house works from home, it’s nice to have a quiet place to pay bills, check your email or browse the Canadian Woodworking forum. Children and young adults can also benefit from having access to a dedicated study room rather than the kitchen table or too-small bedroom. For either use, you’ll likely want at least one electrical outlet and a wall or ceiling light. An alternative to compact fluorescent lighting for a small space is LED lighting, like the Energy Star-rated AmbientLED. It is more energy-efficient, doesn’t generate much heat, isn’t affected by cycling the power on and off, and lights up instantly. Rather than a conventional door, which requires ample space to swing into or out of a room, consider installing pocket doors – they are ideal for small spaces and are no more difficult to install than a swing door.

Half Bathroom
Skill Level: advanced
Having an extra bathroom, especially for families with children, can be a godsend. You won’t be able to fit a full-size bathroom under the stairs, but it is ideal for a half-bathroom (or powder room), consisting of a sink and toilet. This, of course, means that some plumbing and electrical work will be required. If the bathroom will be located in the basement, consider using moisture and mold-resistant gypsum, such as Humitek (cgcinc.com). You might also want to consider installing a space-saving pedestal sink and toilet. High-efficiency toilets require a space of only 15 ½" x 28 ½". Of course, the issue with toilets is their somewhat extensive plumbing requirements. An alternative to the conventional toilet is an ‘up-flush’ toilet. While more expensive to purchase up-front, they are easier and less costly to install, as they require only a cold water intake and a 1" diameter discharge pipe. The toilet macerates the waste and paper and flushes it through the discharge pipe to the main drainpipe.

Hope you enjoyed these ideas for how to make better use of the under stairs space in your home.

Article courtesy of : https://www.canadianwoodworking.com/diyhome-improvement/under-stairs-storage?fbclid=IwAR2LUIb5KDYralX8x6ddIsZLvT4G3RsabA0JQzPy6h_CFsdkENvwE3T7b_A

16 Tips for preparing your home for winter

Tue, 20 Nov 2018 00:24:00 GMT

As fall draws to a close and winter draws near here are some useful tips for protecintg your home from the elements.

1. CLEAN YOUR GUTTERS AND DOWNSPOUTS

Remove all debris that have accumulated in gutters and downspouts. This will ensure that gutters can drain effectively and the water gathered goes to where you want it. A blocked gutter will result in water overflows and can lead to expensive damage from ice dams.

Check that gutters are in good condition (no sags or missing brackets) and repair where necessary. Take care when climbing ladders. If you are wary of heights, hire a professional to get the job done.

2. CHECK YOUR ROOF

Visually examine your roof for any obvious signs of damage, such as missing or buckled shingles. You can eyeball the roof from a distance and should not need to climb all the way up.

Replace loose shingles and repair damaged portions immediately to avoid more serious problems that can occur when the snow starts to accumulate and freeze and thaw cycles begin.

3. DRAIN GARDEN HOSES

Garden hoses should be removed from outdoor faucets, drained of water and stored away indoors, such as in a garage. When garden hoses are not disconnected, the water in them can freeze and expand resulting in burst hoses and/or cracked pipes.

If your outdoor faucets have shut-off valves located on the inside of your home, turn them off. Consider insulating water pipes that are close to exterior walls. Also, remember to turn of the sprinkler system.

4. PREPARE GAS-OPERATED TOOLS FOR WINTER STORAGE

Home tools and equipment should be checked before storing them away for the winter. If they are gas-powered, either drain the gas (fuel) or add a fuel stabilizer to ensure that old fuel does not degrade and make your equipment difficult to start in spring.

If you use a stabilizer, run the equipment for a few minutes to ensure the stabilizer gets to the carburetor.

5. TUNE UP YOUR FURNACE

You do not want to wait until temperatures drop before ensuring that your furnace is working efficiently. Replace the filter and if the furnace has not been serviced in the last year, hire a professional to conduct a full tune-up.

6. FEED AND MAINTAIN YOUR LAWN

The grass on your lawn start to store food for the winter as temperatures drop, so you should be fertilizing once or twice in fall to ensure your lawn greens up faster in spring.

Rake tree leaves to prevent them from killing off your lawn and/or encouraging disease spread. You can also choose to mulch the leaves using a mower. Overseed the lawn if required, aerate, and mow one last time, leaving about 3” before the first snowfall.

7. PREPARE YOUR DECK

If you live in the cold North, your deck is going to be covered in snow and ice for a few months during winter. Fall is a good time to give your deck a good wash and get rid of debris and mould. Repair any rotted boards, and depending on the condition, fall is great for staining and sealing your deck.

8. STOW-AWAY PATIO FURNITURE

Remove patio furniture and keep them away in a garage or other enclosed space for the winter. These include hammocks, umbrellas, cushions, and others. You can also protect them using weather-proof covers.

9. WINTERIZE YOUR AIR CONDITIONER

Disconnect the air conditioning unit from power to prevent it from powering up during the winter months and getting damaged. If you want to save yourself clean-up time in spring, clean out all debris now and put a protective cover over the AC to prevent damage from snow and ice. A sheet of plywood also works.

For window units, you can remove them completely, or cover to prevent drafts.

10. MAINTAIN YOUR FIREPLACE AND CHIMNEY

Check your fireplace and ensure it is working okay. You may need to hire a professional to inspect and sweep your chimney to get rid of accumulated debris, including soot, leaves, and bird nests. This will prevent dangerous chimney fires and also dangerous gases from seeping into your home.

If you have a firewood fireplace, now is the time to stock up on firewood. Store firewood in a safe place.

11. MAINTAIN SMOKE AND CARBON MONOXIDE DETECTORS

Test all smoke and carbon monoxide detectors to ensure they are in good working order. Replace batteries with new ones. Windows are closed in winter and with gas furnaces and fireplaces burning away, the danger of noxious gases escaping is always present.

12. CHECK WEATHERSTRIPPING

Drafty windows and doors can increase your annual heating and cooling bill by up to 30%. Replace worn weatherstripping, caulk gaps around windows, door frames, exterior pipes, and faucets.

Check and seal any gaps on exterior walls that can be used by critters to invade your home. Spray foam comes in handy for larger gaps.

13. CLEAN YOUR GRILL

Lengthen the lifespan of your BBQ grill by cleaning it out this fall. Follow the following steps:

Let it run on high heat to burn off leftover food
Clean grill grates with a wire brush
Empty the grease tray
Wipe off grease and other debris on the exterior
Store grill in a dry area or protect using a grill cover

4. CHECK ATTIC VENTILATION AND INSULATION

Ensure your attic is well-insulated to save on energy costs. Check the attic door for gaps that leak warm air into the attic and predispose your roof to ice dams and other winter damage.

Check attic vents to ensure they are free of debris and are providing adequate ventilation. Proper ventilation will prolong the life of your roof.

15. WINTERIZE YOUR POOL

If you have a pool, remove debris and partly drain out the water. Purchase a winter treatment kit like this one and a pool cover to keep out debris.

16. PREPARE YOUR SNOW BLOWER

Service your snow blower and ensure it is ready to go when the first snowfall arrives. You may need to replace the spark plug and top the engine oil.

You will also need snow shovels, ice melt, salt, mitts, toque, and other cold weather essentials.

Article Courtesy of:

https://www.savvynewcanadians.com/fall-and-winter-home-maintenance-checklist/?fbclid=IwAR2WBcMQSU3sbEW1g9WvNOLQgJUx5qj_M-9xgEb2Xx4AGvN1LtQRO_PgfOk

October 2017 Fraser Valley Market Real Estate Statistics

Fri, 03 Nov 2017 18:37:24 GMT

Here are the latest market statistics courtesy of the Fraser Valley Real Estate Board.

The ongoing demand for properties in the Fraser Valley saw overall sales reach the second highest point for an October in the Board’s history.

The Fraser Valley Real Estate Board processed 1,799 sales of all property types on its Multiple Listing Service® (MLS®) in October, an increase of 23 per cent compared to the 1,463 sales in October of last year, and an 11.1 per cent increase compared to the 1,619 sales in September 2017.

Attached sales represented 56% of all market activity for the month, with apartment sales totaling 591 and townhomes at 418.

“The divide between our attached and detached markets continues to widen,” Gopal Sahota, Fraser Valley Real Estate Board president said. “Apartment activity was notably strong in October with a sales-to-actives ratio of 105 per cent, meaning that apartments are selling as fast as we can list them.”

Last month the total active inventory for the Fraser Valley was 5,483 listings. Active inventory decreased by 6.3 per cent month-over-month, and decreased 9.1 per cent when compared to October 2016.

The Board received 2,479 new listings in October, a 13 per cent decrease from September 2017, and a 12.8 per cent increase compared to October 2016’s 2,197 new listings.

“Your real estate experience in the Valley is going to be very different depending on what you’re looking for or selling,” continued Sahota. “Regardless, with the help of a professional REALTOR® you can understand exactly what’s happening in your market and find success.”

For the Fraser Valley region the average number of days to sell an apartment in October was 18 days, and 19 days for townhomes. Single family detached homes remained on market for an average of 31 days before selling.

HPI® Benchmark Price Activity

Single Family Detached: At $971,900, the Benchmark price for a single family detached home in the Valley decreased 0.3 per cent compared to September 2017, and increased 11.8 per cent compared to October 2016.
Townhomes: At $502,800 the Benchmark price for a townhome in the Fraser Valley increased 0.8 per cent compared to September 2017, and increased 18.4 per cent compared to October 2016.
Apartments: At $369,400, the Benchmark price for apartments/condos in the Fraser Valley increased 3.1 per cent compared to September 2017, and increased 36.4 per cent compared to October 2016.
Market Statistics courtesy of the Fraser Valley Real Estate Board

BCREA September 2017 Province Wide Real Estate Statistics

Fri, 20 Oct 2017 23:26:41 GMT

Vancouver, BC – October 12, 2017. The British Columbia Real Estate Association (BCREA) reports that a total of 8,340 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in September, an increase of 9.9 percent from the same period last year. Total sales dollar volume was $5.8 billion, up 30.2 percent from September 2016. The average MLS® residential price in the province was $693,774, up 18.5 percent from September 2016.
“BC home sales rose nearly 5 percent from August on a seasonally adjusted basis,” said Cameron Muir, BCREA Chief Economist. “Total active listings on the market continue to trend at ten-year lows in most BC regions, limiting unit sales and pushing home prices higher. While the economic fundamentals support elevated housing demand, rising home prices are eroding affordability, particularly for first-time buyers.”

Year-to-date, BC residential sales dollar volume was down 12.8 percent to $57.6 billion, when compared with the same period in 2016. Residential unit sales declined 13 percent to 81,608 units, while the average MLS® residential price was down 0.2 percent to $705,501.

September 2017 Fraser Valley Market Statistics

Fri, 06 Oct 2017 19:24:55 GMT

Here is the latest market statistics for Fraser Valley Real Estate Courtesy of the Fraser Valley Real Estate board:

Demand for Fraser Valley homes remains unchanged despite change of season

SURREY, BC – Residential property sales in the Fraser Valley remained strong in September, with both attached and
detached homes performing well throughout the region.

The Fraser Valley Real Estate Board processed 1,619 sales of all property types on its Multiple Listing Service® (MLS®) in September, an increase of 24.1 per cent compared to the 1,305 sales in September of last year, and a 13.8 per cent decrease compared to the 1,879 sales in August 2017. This was the fifth highest sales total for a September in the Board’s history. Of the total sales processed 392 were townhouses and 470 were apartments, together representing 53% of market activity in September. “Often we see summer demand continue as far as October, so it’s not unusual to have another strong month before the seasonal cool down," said Board President Gopal Sahota. “What’s unusual this year is that attached inventory sales are still driving the market despite the increased competition we’re seeing there.” Last month the total active inventory for the Fraser Valley was 5,854 listings. Active inventory increased by 2.5 per cent month-over-month, and decreased 8.8 per cent when compared to September 2016.

The Board received 2,848 new listings in September, an 8.2 per cent decrease from August 2017, and a 5.1 per cent
increase compared to September 2016’s 2,709 new listings.
"It’s also interesting to observe the return to a balanced market for detached homes here in the Valley,” continued
Sahota. “While pricing remains stable, competition for houses has simmered and listings are staying on market longer. Ifyou were waiting to make a move or upgrade, now might be a good time to talk to your REALTOR® and see what’s out there.” For the Fraser Valley region the average number of days to sell an apartment in September was 19 days, and 18 days for townhomes. Single family detached homes remained on market for an average of 29 days before selling.

HPI® Benchmark Price Activity

• Single Family Detached: At $974,500, the Benchmark price for a single family detached home in the Valley
decreased 0.2 per cent compared to August 2017, and increased 11.2 per cent compared to September 2016.

• Townhomes: At $498,900 the Benchmark price for a townhome in the Fraser Valley increased 1.4 per cent
compared to August 2017, and increased 17.7 per cent compared to September 2016.

• Apartments: At $358,200, the Benchmark price for apartments/condos in the Fraser Valley increased 2.5 per
cent compared to August 2017, and increased 35.2 per cent compared to September 2016.

June 2017 Fraser Valley Market Report

Thu, 06 Jul 2017 18:22:19 GMT

Fraser Valley apartment sales reach all-time high in June

SURREY, BC – While overall market activity slowed slightly in June, apartment sales reached record-breaking levels at 683 transactions for the month.

The Fraser Valley Real Estate Board processed 2,571 sales of all property types on its Multiple Listing Service® (MLS®) in June, a decrease of 10.2per centcompared to the 2,864 sales in June of last year, and a 5per centdecrease compared to the 2,707 sales in May 2017.

At 683 sales, apartment transactions represented 27per centof all sales activity in the Fraser Valley in June, increasing 13.1per centcompared to apartment sales in June 2016 and 12.2 per cent compared to May 2017. The average number of days to sell an apartment in June was 15 days, compared to 32 at this time last year.

“We knew that there was a growing appetite for our attached properties, but this month was exceptional,” said Gopal Sahota, Board President. “I think one reason demand has continued to be so strong for our region is that we have such diverse, robust inventory to help buyers find the right home even in a more complex market like this one.”

Last month the total active inventory for the Fraser Valley was 5,487 listings. Active inventory decreased by 2.2 per centyear-over-year,and increased 5.5 per centwhen compared to May 2017.
The Board received 3,707 new listings in June, a 0.1per cent increase from June 2016, and a 0.1per cent decrease compared to May 2017’s 3,712 new listings.

Sahota added, “More and more buyers are looking for affordable entry pointsin tothe Fraser Valley. No matter what you’re trying to sell – from townhomes to ranchers – if it’s priced right, someone will be knocking on your door.”

For the Fraser Valley region, the average number of days to sell asingle familydetached home in June 2017 was 21 days, compared to 17 days in June 2016.

HPI® Benchmark Price Activity

• Single Family Detached: At $934,600, the Benchmark price for a single family detached home in the Valley increased 2.1 per cent compared to May 2017, and increased 8.5 per cent compared to June 2016.
• Townhomes: At $467,000 the Benchmark price for a townhome in the Fraser Valley increased 1.8 per cent compared to May 2017, and increased 20.6 per cent compared to June 2016.
• Apartments: At $325,300, the Benchmark price for apartments/condos in the Fraser Valley increased 10.3per cent compared to May 2017, and increased 40.3per cent compared to June 2016.

Report Courtesy of the Fraser Valley real estate board.

Another Record setting month in Fraser Valley Real Estate

Wed, 02 Mar 2016 21:13:55 GMT

Here are the latest statistics for the Fraser valley Real Estate Market courtesy of the Fraser Valley Real estate Board:

In February, the Fraser Valley Real Estate Board processed 2,387 sales on it's Multiple Listing Service® (MLS®), an increase of 79 per cent compared to February 2015 and 78 per cent more then was processed in January. To give a historical perspective, sales in February were 46 per cent over the 10-year average for that month; and, 4 per cent higher than the previous record of 1,948 sales in February 1992. The President of the Board said of this month’s record numbers, “In my twenty-five years of real estate, I have never seen such consistent demand for housing in the Fraser Valley.”

While it’s certainly encouraging to see such confidence in our region, the intense demand has created a more complex market for buyers. For certain property types, prices have increased and selection is scarce. If you find yourself struggling in your search, please feel free to give us a call at 604-882-8384 or send us a message we have over 39 years experience and we would be pleased to help you.

The Board received 3,283 new listings in February, an increase of 26 per cent compared to February of last year, and another record high for February. The total active inventory for February was 5,127, down 35 per cent from last year’s 7,864 active listings.

Wiebe explained, “Inventory is moving fast, so it’s critical that buyers know what they most want in a home and neighborhood, and be open to considering new areas. The Valley features a wide range of diverse housing options, with many areas still very affordable, so talk to your REALTOR® who will help carve a path to suit your needs.”

Across Fraser Valley, the average number of days to sell a single family detached home in February 2016 was 21 days, compared to 41 days in February 2015.

The MLS® HPI benchmark price of a Fraser Valley single family detached home in February was $714,000, an increase of 23 per cent compared to February 2015 when it was $581,400.

In February, the benchmark price of townhouses was $337,300, an increase of 13.5 per cent compared to $297,200 in February 2015. The benchmark price of apartments also increased year-over-year by 11.2 per cent, going from $189,700 in February 2015 to $211,000 in February 2016.

Thank you for reading the Mitten Real Estate Team Blog, if you have any questions about this article or anything else real estate related please give us a call at 604-882-8384 or send us an e-mail at dbmitten@mitten-realty-services.com we would be happy to assist you.

YOUR INVITED!

Fri, 03 Apr 2015 17:08:00 GMT

At Mitten Real Estate Team we would like to invite all of our Blog reader to come to our Easter celebration and customer appreciation event tomorrow April 4, 2015 from 12:30-4pm. We will have a pizza and subway lunch for everyone starting at 12:30 we will also have either and indoor or outdoor bouncy castle depending on the weather and we will have an ester egg hunt at 1pm. additionally we will be having a campfire social all afternoon and we have rented a large 'Party Tent' so that you will have a dry place to enjoy even if it is raining. We Hope to see you there

Here is a copy of our event flyer:

Housing Options For Seniors

Thu, 19 Feb 2015 23:50:00 GMT

Welcome to the Mitten Real Estate Team blog. In today's article we are going to be talking about some of the things seniors should consider when deciding on thier housing options.

During our many years of experience we have helped many seniors choose which housing options is best for them based on thier current and anticipated needs:

First and foremost let me start by saying this is all about you and your family.

Our goal is to do our best to our clients and in some cases their family members move into this next phase of life with as little effort and in a way that will make it as rewarding, enjoyable and safe as possible without infringing on the freedom they are used to.

1. The decision to move as we begin to think about sizing down and moving into the gold years of our lives is often a process – sometimes over a number of months or years. Once the decision is made there are a number of factors that one must consider in the planning.

A. What is value of your existing property?

B Assessment of requirements and associated costs:

i. Housing

ii. Care

iii. Income

iv. Estate Planning

C. Timing of each phase.

2. What are housing options?

A. Current Home

i. Does the layout of your current home lend itself to you being able to remain and age in place safely and in a way that is as rewarding as possible.

ii. If your home does allow you to age in place is home care an option and what sort of remediation would be required to ensure you being able to remain safely – ramps, grab bars, stair lifts etc.

iii. If your current home does not lend itself to aging in place then a move should be considered while you are still healthy and able to enjoy the ability to move on your timing prior to when one is forced to make that move.

B. Apartment, townhouse or house

There are a number of options for one to look when making this move:

i. Some of our clients move to a home that does lend itself to aging in place such as a rancher or we have even had some of our clients buy homes with legal suites and either use the suite to supplement income or for housing for a caregiver and in some cases our clients have moved into the suite and rented out the main house leaving them in a situation where they are in accommodation similar to what they would be if they moved to an independent living complex but also have additional income to assist with the increased cost of care as ones needs in that regard increase.

ii. Some of our clients decide to further reduce the maintenance requirements of a home by moving to an apartment or townhome. There are many great options for adult oriented living in a number of great 45+ or 55+ complexes in the Fraser Valley area.

iii. If one is considering a move to a home, townhome or apartment give consideration to the fact that at some point in time it is likely that an additional move may be necessary unless in home care is an option as it becomes necessary.

C. Independent Living Community – with or without care

Independent living facilities offer apartments, along with meals or meal plans, laundry, housekeeping, concierge services, handyman services and usually the option for care on a pay for use basis. Most are based on a rental for the apartment, however, some also offer the opportunity for ownership of the apartment

i. Rental

a. Advantages:

-With independent housing your housing is integrated with a number of other factors such as: food, staff, entertainment, care and more. The benefit of renting, is that you will have the opportunity of determining whether the overall experience is to your satisfaction prior to your final decision – do you like the food, the staff etc. With this in mind I would highly recommend renting at least for a while before making your final decision.

-The benefit to renting on an ongoing basis is simply that although the housing is what it is, staff can change and along with the changes so can the care and the food. Renting allows you the flexibility to switch to other facilities should you decide you are no longer happy.

-Bear in mind that it has been the experience of many of our clients that have gone through this it takes at least six months to get used to a facility. Also bear in mind that no facility is perfect and often if you are not happy with something about the facility you are in that there are often benefits to working with staff to correct it rather than simply changing.

b. Disadvantages

-The disadvantage to ongoing rent is that typically rents increase overtime and therefore your housing costs can go up as does your need for additional income.

-The other thing to consider with renting on an ongoing basis is that the income necessary to pay the rent may be taxable depending on your tax situation whereas with ownership providing you purchase without a mortgage you will need less income to sustain your living expenses and therefore your tax burden may be lower. When we were exploring this for our parents giving consideration to all of the factors they felt it was best for them to rent on an ongoing basis and we found our financial advisor to be very helpful in working together with our accountants to structure a solution which mitigated the taxes payable on the income necessary to pay for their living expenses.

ii. Ownership

a. Advantages:

-Ownership allows you to fix your housing costs. The cost of food and care may still go up but the costs of the housing portion of your requirements is fixed and again if you own clear title the need for additional income and the tax burdens associated with it are a non issue.

-The other benefit for ownership is that at the end of when you will be staying in this location you or your families owns the property and are able to sell the property at whatever the current market value is at that time. Your financial advisor can help you determine whether there are greater benefits in investing in the housing or other investments that may yield a greater return if this is the only decision in determining whether to buy or rent.

b. Disadvantages

-The disadvantage to ownership is the lack of flexibility. This disadvantage goes both to the choice of the facility you will be moving to originally as well as to the ease of moving should you not be happy with some facet of your living situation. Not all independent living communities offer the option to purchase and therefore if one desires the option to purchase it does limit the independent living communities that one can consider.

D. Care facility – Normally provide a room as well as the food and care on an all inclusive basis. This decision is normally predicated on the care requirements of the

individual.

3. Sizing Down: This process usually involves sizing down to smaller accommodations.

A. Can you do it yourself?

B. Do you require help?

i. Family

ii Church or support community

iii. Professional organizers

4. Choosing Where To Relocate

Determining where to relocate often involves giving consideration to:

A. Proximity to family or friends

B. Proximity to support community

C. Proximity to doctor or other professionals

5. What Are Your Goals

A. The goal is usually to move into a housing situation which allows one to age safely and in many cases people also want to free up equity from their home to provide for some of the increased care needs with the return that their invested equity can provide or as in the case of people moving into properties with legal suites to utilize the suite instead of investing their equity to increase their income to provide for their growing care needs.

B. Often there is a desire to move towards a more maintenance free life with options for future care if not immediate care and that desire to simplify and be more flexible to deal with unpredictable events in one’s life or health often prompts people to move into assisted living and to free their equity up to invest for their care needs.

6. Cooperation Is Very Important:

This transition is generally best accomplished by a cooperative effort involving family and professionals such as lawyer, investment counselor/bank, doctors, accountant, realtor, social worker, care facilities and providers and support workers to determine the housing, care and income requirements, formulate a plan giving consideration to the different options and needs, and implement it in a timely manner.

Bank of Canada Lowers Interest Rates - what does it mean?

Wed, 21 Jan 2015 19:29:00 GMT

Welcome to the Mitten Real Estate Blog, If this is your first time reading our blog we hope you will enjoy the content provided, we have many archived article that you may find informative. The real estate market in the fraser valley has been quite busy lately especially in the detached sector. Today we would like to briefly talk about the announcent on interest by the bank of Canada toady.

Today the bank of Canada suprised the markets by lowering interest rates by 0.25%, which leaves the overnight interest rate at 0.75%. Although this was not an expected move, a number of financial comementators did believe that this could and would happen.

As a general rule this is good news for potential home buyers and those with variable rate mortgages as it means the cost of borrowing money should be reduced.

http://mitten-realty-services.com/blog.html/interest-rates-a-quick-finance-lesson-for-the-savvy-real-estate-invest-3370179

If you would like to see the press release by the Bank of Canada that can be found here:

http://www.bankofcanada.ca/2015/01/fad-press-release-2015-01-21/

If you have any real estate realted questions or questions about anything you see in our blog please feel free to contact us as we are always happy to help you. You can contact us through this website or call us directly at 604-882-8384 we would be happy to assist you.

Sincerely,

Doug, Bonnie and David Mitten.

(Mitten Real Estate Team).

What is a Depreciation Report?

Thu, 11 Dec 2014 18:33:07 GMT

Introduction:

Welcome to the Mitten Real Estate Team’s Blog. If you are a first time reader or a regular reader we would like to thank you for taking the time to read our Blog, we hope that you will find the information provided here both helpful and informative. If you ever have any questions about one of our articles or anything real estate related please feel free to contact us we would be happy to speak with you.

For this week’s Blog article we wanted to bring you some information on what a depreciation report is. Many people have heard the term, but do not really understand what a depreciation report is, we would like to give you some information on it.

Relevant Legislation:

In December 2011, the British Columbia Provincial government passed legislation which requires Strata Corporations in the province to produce a detailed report called a ‘Depreciation Report’. The legislation gave Strata corporations until December 31. 2013 to comply. Exemptions include Strata corporations with less than 5 lots. Additionally any strata corporation can exempt themselves by a ¾ majority vote by their members.

Documents Strata must provide for the Report:

When having a depreciation report a strata corporation must provide the following documents to the person preparing the report:

• Operating budget

• Current balance sheet, including the contingency reserve fund balance and any investments & assets

• General ledger

• Copies of invoices relevant to operations and repairs

• Current insurance certificate or insurance appraisal

• Any reciprocal easements/Service agreements/Air Parcel Agreements

• Any leases and licenses (enterphone systems, parking garage use )

• Any agreements granting third party use and access of the strata property

• Prints, plans and drawings – architectural, structural, mechanical, electrical, fire protection and other systems.

• Any prior investigation reports: maintenance, repair, investigation etc.

• Annual fire inspection report

• Maintenance manuals

• Maintenance logs

• Registered strata plan & any amendments

• Registered bylaws & any amendments

• Any bylaws where the strata corporation has taken responsibility for the maintenance and repair of part of a strata lot

• Any information & bylaws relating to sections

• Any registered allocations of Limited Common Property

• Any alteration agreements where an owner has taken responsibility for the cost of the maintenance or renewal of the alteration

• Lawsuits or arbitration decisions that impact property use, maintenance repair or obligation.

Who Can Prepare a Depreciation Report:

The government also has legislated who is allowed to prepare a depreciation report for a Strata Corporation, the act states the following:

Regulation 6.2(6) broadly defines who is qualified to develop your depreciation report. (6) For the purposes of section 94 (1) of the Act, “qualified person” means any person who has the knowledge and expertise to understand the individual components, scope and complexity of the strata corporation’s common property, common assets and those parts of a strata lot or limited common property, or both, that the strata corporation is responsible to maintain or repair under the Act, the strata corporation’s bylaws or an agreement with an owner and to prepare a depreciation report that complies with subsections (1) to (4).

Several of the following professions may have the skills and qualifications necessary to prepare a

depreciation report:

• A person who is a registered professional engineer with the Association of Professional

Engineers and Geoscientists of B.C.

• A person who holds a certificate of practice within the meaning of the Architects Act of B.C.

• A person who is a member of the Real Estate Institute of Canada and holds the designation of a certified reserve planner

• A person who is a member of the Appraisal Institute of Canada

• A person who is a member of the Canadian Institute of Quantity Surveyors and holds the designation of professional quantity surveyor.

• Other persons who meet the qualifications and skills required.

Any one of the above designations unto itself is not a complete representation of a person’s

qualifications or skills. A depreciation report requires technical, financial planning, and management

skills. This combination of expertise may be difficult to find in one individual. Depending on how

complicated and extensive a strata corporation is, this may mean a depreciation report is prepared by a team of professionals rather than an individual.

Technically, speaking the regulation also does not prohibit a Strata Corporation from preparing their own report, however given the scope and the large number of responsibilities any Strata Corporation should be cautious about producing their own report, an errors may expose the Strata to liability. Furthermore proper disclosure of the Strata having prepared the report would also be required, in such a case.

What Topics Must Be Included In The Report?

• An inventory of the strata corporation’s common property common assets, and any limited common property or part of a strata lot that the strata corporation has a duty to maintain, repair and renew.

• An evaluation of the inventory by performing a physical review of the site and the components.

• Provide an evaluation that addresses the following requirements:

o Estimate the service life of the assets over the next 30 years

o The anticipated maintenance, repair and replacement costs that usually occur less than once per year

o Evaluation of the components ( the current condition )

o Financial evaluation of the factors and assumptions used in estimating the costs over the 30 year period

o A description of how the contingency reserve fund is currently being funded, along with a current balance, minus any expenditures that have been approved but not yet taken from the fund, and

o At least three cash flow models for the contingency reserve fund relating to the maintenance, repair and replacement over 30 years.

How Often Must a Depreciation Report Be Done?

The regulation specifies that a new report must be obtained three years after the last one. These

subsequent reports may be less expensive than the original baseline report as some of the information and modeling will only require updating. However, the new report must still include on-site visual

inspections and cover at least 30 years from that date. Be aware that, in addition to your assets having aged since the last report, interest rates, inflation rates, and the cost of items and labour will likely have

changed. Some experts advise that depreciation reports should cover the entire expected life of the building rather than the minimum 30 years required. Such a report may be no more expensive and would give the strata corporation better information to use in planning, saving and equitably allocating costs between present and future owners.

Other information:

As you can see by the information given above the purpose of the depreciation report is to take stock of the assets of the strata corporation and to them project the estimated maintenance cost for the strata to maintain its structures in a good state. This information will be used by future buyers to assess how well the building is maintained etc… it may also be used by insurance companies and other entities.

However as was mentioned earlier it is possible for a Strata Corporation to exempt itself from the report by way of a ¾ vote by its members. The main Reason for this is the cost of repairing the report, where some strata’s reason they would be better served spending money on maintenance than writing a report.

If you would like to learn more about depreciation reports, please visit the following link for even more detailed information:

http://www.choa.bc.ca/_members/_pdf/400/400007%20Depreciation%20reports%20Jan%201%202014.pdf

Conclusion:

We Hope that this article on Depreciation Reports was helpful and informative to you. If you have any questions about this article or anything else related real estate please feel free to contact us we would be happy to assist you. We can be contacted through this website or by phone at 604-882-8384.

Sincerely,

Doug, Bonnie and David Mitten

(MITTEN REAL ESTATE TEAM)

Your Invited!!!

Fri, 05 Dec 2014 00:04:00 GMT

Dear readers of Mitten Real Estate Team blog, we very much appreciate you taking the time to read our blog.

Weather you are a current client, prospective client or just a reader who enjoys the content provided here we would like to invite you to our customer appreciation day, which is tomorrow December the 6, 2014 starting at 5:30pm - 7:30pm. Located at 20585 Fraser Highway, Langley City (British Columbia, Canada).

We always enjoy seeing our clients and if you are a reader or a prospective client we would really like to have the opportunity to meet you in person as well and we would be happy to answer any real estate questions you might have. Additionally we know as a reader it is always nice to be able to meet the person who writes this blog.

So if you have any real estate questions or would like to meet us in person please stop by we would love to catch up with you or have the opportunity to meet you for the first time.

Information about the event can be found here:

http://mitten-realty-services.com/events.html

If you have any trouble finding our office please call us at 604-290-5480.

Oh and we will be serving lots of Hot Chocolate and christmas goodies and there is a parade taking place in front of our office so please bring the whole family for an evening of family fun.

Here are a few of the Christmas goodies we look forward to sharing with you...

We look forward to seeing you at our customer appreciation day tomorrow.

Sincerely,

Doug, Bonnie and David Mitten

(MITTEN REAL ESTATE TEAM)

Continued Low interest rates good news for home buyers and owners

Wed, 03 Dec 2014 00:09:00 GMT

Welcome to the Mitten Real Estate Team Blog, whether this is your first time reading our blog or if you are a regular reader we would like to thank you for taking the tie to read our blog. We hope you will find the information provided both informative and helpful and if you have any questions about what we have written please don't hesitate to contact us, we will be happy to talk with you.

Earlier today the bank of Canada announced that it has decided to hold interest rates steady at 1% where they have been since September 2010. In its report the bank of canada notes that although inflation is a bit higher than expected, the current policy is still appropriate and the Canadian economy is showing signs of a broadening recovery even with lower oil prices.

For a real estate prospective a low prime interest rate means that it costs less to finance the purchase of a home which is good news for home buyers and those home owners looking to renew thier mortgages.

If you would like to know more about interest rates and how they affect the housing market please visit our earlier blog post which can be found here:

http://mitten-realty-services.com/blog.html/interest-rates-a-quick-finance-lesson-for-the-savvy-real-estate-invest-3370179

If you would like to view the PDF report made by the Bank of Canada for this latest announcement please visit this link:

http://www.bankofcanada.ca/wp-content/uploads/2014/10/fad-press-release-2014-12-03.pdf

At Mitten Real Estate Team we would like to thank you for taking the time to read this Blog article and if you have any questions about this article or any other real estate realted questions please feel free to contact us we wouls be happy to assist you. We can be contacted through this website or you can phone us directly at 604-882-8384.

Sincerely,

Doug, Bonnie and David Mitten.

(MITTEN REAL ESTATE TEAM)

What Is Your Home Worth?

Tue, 25 Nov 2014 21:06:00 GMT

Introduction:

Welcome to our mitten real estate team blog, whether you are a first time reader or a regular reader we would like to thank you for taking the time to visit our blog today. If you have ever wondered you’re your home is worth you will enjoy this article. This week are going to be talking about how our home evaluations work and how they can work for you. We are writing this article because recently some of our clients were surprised to learn that we are happy to offer free no obligation home evaluations so we just wanted to be sure that all of our clients and prospective clients know this is a service we are happy to offer to you.

In addition to providing you with a free home evaluation when you are thinking of selling we are also happy to offer you a free home evaluation even if you are not thinking of selling right now but want to know what the market value of your home is.

Times you may want a home evaluation:

There are many situations where you may want a home evaluation and in many cases you may not even be thinking of selling your home, some examples are:

1.) If you were considering renovating your home but didn’t know if the renovation made financial sense or what type of renovation gives the best return in your situation.

2.) If you were thinking about buying a fixer-upper home to flip but wanted to know if you would be likely to see a good return on your investment.

3.) if you need a professional opinion of value because you are thinking of refinancing,

4.) You just want to know what your home is worth, etc…

5.) If you are thinking of selling your home.

In all of these situations we are happy to assist you even if you won’t be selling or buying right now…

The reason we are willing to provide this service is we know that to provide you with the best service we need to go the extra mile and help you with all aspects of your real estate decisions even when those don’t include selling or buying immediately. We also know that by providing this service you will want to have us represent you when the time to buy or sell does come, and in addition we really do care about our clients and want to be sure you make informed real estate decisions.

How our Home Evaluations Work:

So you may be asking how does your home evaluation’s work? And, what makes them different from every other agent’s evaluations?

We take the responsibility of estimating the market value of your home very seriously this is why WE DO NOT just visit you home and immediately give you a dollar value based on gut feelings…

Instead we have a proven and detailed process(s) for valuing your home, investment or commercial property.

For residential properties what we like to do is start out by viewing your home, on this first trip we will view your home and you can tell us anything special about your home that we should know. We don’t usually give any opinions of value of this first visit…

Now that we are familiar with your home and have seen where it is located in person we will go and do some research, we will find similar homes that have recently sold in your area as well as similar homes that are for sale in your area… But our research does not stop there….

Next we take those comparable sales and input a number of characteristic about those homes as well as characteristics about your home into a mathematical spreadsheet, which we have refined through years of experience), in addition to this quantitative component to our spreadsheet we also have a qualitative component to our spreadsheet. In the qualitative portion of the spreadsheet we can look at and adjust for an unlimited number of factors relating to how your home compares to other similar homes that have sold. For example how much your kitchen is worth compared to each of the kitchens in the comparable sales. These adjustments are made based on our professional experience and professional opinions. In total Most compehesve home evaluations are between 100 - 200 pages long!

Using this detailed method that combines quantitative and qualitative analysis we are then able to determine an estimate market value for your home which we feel is backed up by a thorough analysis and professional experience.

Once our analysis is complete we will then call you and arrange to meet with you to discuss what your home’s estimated value is, and if you are thinking of selling what your home will be priced at…

While no home evaluation can ever tell you with 100% certainty exactly what a future buyer will be willing to pay for you home, in our experience we have found our home market evaluations to be quite accurate in most situations.

The reason we go to these lengths to determine the value is that we know decisions relating to real estate involve a lot of money so we want to be sure you are well informed so that you can make good decisions.

As a side note we also have a very detailed method for determining the value of commercial properties as well, however we won’t get into the details of that process in this article.

Our Compehensive Home Evalution

Conclusion:

To conclude we hope you have enjoyed the brief description of how our home evaluations work and why we feel they have industry leading accuracy. If you would like to have us preform a free no obligation market evaluation for your home regardless of if you are thinking of selling please let us know we would be happy to provide this service for you.

We can be contact through this website, or you can call us directly at 604-882-8384 we wuld be happy to assist you.

Sincerely,

Doug, Bonnie and David Mitten

(Mitten Real Estate Team)

Buying a Home When Your Self-Employed

Fri, 14 Nov 2014 22:29:00 GMT

Introduction:

Thank you for visiting our blog, this week for our weekly blog article we would like to talk about the area of financing your real estate purchase. Financing is a very important consideration when you are thinking of purchasing real estate. The reason for this is first, unless you have a lot of cash you won’t be able to make a purchase without financing and second, if a buyer ca not get financing at a reasonable interest rate and amortization the cost of financing may be too great. Therefore it is very important for most buyers to be able to obtain financing at an affordable cost. Additionally, for self-employed people buying a home or investment property can be a bit more challenging as lenders have added additional requirements that self-employed people must meet in order to qualify for financing.

If you are thinking of buying a home and need financing and especially if you are self-employed, understanding the requirements lenders will want you to meet is very important. Equally important is receiving expert advice on the financing of your home. While we are experts in the area of purchasing, selling and marketing real estate we are not mortgage brokers. That is why if our clients are not yet working with a mortgage broker we put them in touch with an experienced mortgage broker who can guide them through the process of financing.

Thus we would like bring you what some information about what is required for self-employed people to qualify for financing for Ken McLellan and Marcy Koopmans, who are experienced mortgage brokers with Canadian Mortgage Experts.

Here is What Mortgage Brokers Ken McLellan and Marcy Koopmans Had To Say:

A survey from the Canadian Federation of Independent Businesses indicates that for the first time in 4 months, “small businesses report higher levels of optimism.” The report from CKNW notes that while scores from 65-75 point to a growing economy, BC’s score rose from 56.4 in August to 59 in October, and that this reflects a similar trend across the country. It’s been clear for some time now that small businesses and self employment are more popular career choices than ever before, and while being your own boss comes with unique challenges and costs, there is no denying the appeal. New Westminster itself is home to many small businesses, and in fact, it’s one of the things that I most enjoy about the city. I could go on about the mix of independent and chain business and their locations in New West, but what I would really like to address is what to expect if you are working for yourself (also known as “business for self” or BFS) and you need to get a mortgage.

Where do you start?

If currently have a mortgage that you got while you were working at a regularly paying job, then you will likely be given a renewal offer by your lender when your mortgage maturity date comes up (i.e. the end of the term you initially agreed to, usually 5 years). This will be based on what they are currently offering for rates, though little else will change. Accepting a renewal offer usually means the lender does not re-qualify you; they don’t ask again for your pay stub or job letter or check your credit, as they assume if you’ve been making all your payments that you’re in the same financial situation as when your relationship began. However, if you are now BFS and want to switch to a new lender or you are getting an entirely new mortgage, then there are some pieces of information that it’s important to know.

The paperwork

Most lenders, if they are to give you their best available rate, want to see 2 years of employment. This goes for regular jobs as well, though there are exceptions for if you’ve just started at a new company but have been in the industry for many years, or you have just left school and begun working in a related field to your studies. The same goes for self-employed individuals. The difference is in how they calculate your yearly income. With a regular employee, the most recent year’s income can be used. For self-employed borrowers, however, a two-year average, taken from T4s or notices of assessment, is used (this is also how lenders will calculate and verify part-time work). In addition, lenders will usually want to see proof of business for self in the form of the business’s articles of incorporation or accountant-prepared T1 Generals. There are other programs available that don’t require income verification like this, however due to the increased risk to the lender, the borrower will need to pay a higher interest rate. Basically, what is most important for BFS borrowers is to have been working for themselves for at least two years, to have all tax documentation in order, and to have a realistic idea of how much money they made over those two years.

Every borrower is different

There are so many variables that can change what a particular person needs in a mortgage, so it’s fairly impossible to give universal advice. Furthermore, each lender is going to have its own standardsand requirements. In the BFS category, the requirements used to be less stringent, but as more and more people have been quitting their corporate jobs, and as the economy has struggled in other ways, lenders have tightened up their expectations for this kind of borrower. This is where a mortgage broker can really make a difference with increased knowledge of how to navigate borrowing when you’re self-employed

Ken and Marcy’s Blog can be found here:

http://newwestmortgages.ca/working-for-yourself/

Here is a link to their website:

http://newwestmortgages.ca/about/

Conclusion:

As you can see from the comments above self-employed buyers do need to meet a few extra requirements compared to those with conventional employment. However with the right guidance getting satisfactory financing for you next real estate purchase can be accomplished.

If you have any questions about this article or any other real estate related questions please feel free to contact us we would be happy to assist you. We can be contacted through this website or you can phone us directly at 604-882-8384.

Sincerely,

Doug, Bonnie and David Mitten

(Mitten Real Estate Team)

October 2014: Increased demand for Fraser Valley Homes and Townhomes

Tue, 04 Nov 2014 23:05:00 GMT

Introduction:

At Mitten Real Estate Team we would like to thank you for reading our blog. This Week we are pleased to bring you our latest Blog article courtesy of the Fraser Valley Real Estste Board that we are a member of. This report gives some details of the market activity in the Fraser Valley during October of 2014, it is our hope that this article will be informative to both our current and potential clients.

Fraser Valley Real Estate Board's Comments on Report:

During October 2014 the Fraser Valley Real Estate Board processed 1,448 sales on its Multiple Listing Service (MLS®), an increase of 16 per cent compared to the 1,249 sales during the same month last year and 2 per cent more than in September.Fraser Valley Real Estate Board’s president, says, “Sales overall continue to outperform last year and as we’ve seen for anumber of months now are the best they’ve been in five years.

“Demand remains steady in our region for single family detached homes and townhomes. Last month, the market share of sales of single family homes increased by almost five per cent compared to last year; while the share of condo sales decreased by the same amount and we’re seeing that preference reflected in prices.”

The MLS® Home Price Index (MLS® HPI) benchmark price of a detached home in October was $573,500 an increase of 4 per cent compared to October 2013, when it was $551,400. The MLS® HPI benchmark price of townhouses increased 1 per cent from $295,500 in October 2013 to $298,500 last month. The benchmark price of apartments decreased year‐over‐year by 3.5 per cent, going from $199,500 in
October of last year to $192,600 in October 2014. In the last five years, the MLS® HPI benchmark price of a detached home in the Fraser Valley has increased by 16.6 per cent. For townhouses, the price is flat having increased by 0.5 per cent and for apartments; the price has decreased by 6 per cent. The Board's President adds, “With the influx of new developments and a steady supply of resale units, we’ve never had a better selection of condos than we do right now at prices the lowest they’ve been in years. For those that say housing isn’t affordable in Metro Vancouver, you need to check out the opportunities currently for condo buyers in the Valley.”

In October, new listings in the Fraser Valley increased by 3 per cent, going from 2,336 last year to 2,395 last month taking the number of active listings to 8,807, a decrease of 3 per cent compared to the 9,047 active listings in October of 2013. “Inventory is edging down, which is typical for this time of year,” says the board president. “The result is we’re seeing good quality homes that are priced right moving quickly.”

Conclusion:

If you would like to read the full PDF report pleas click on the link below:

http://www.fvreb.bc.ca/statistics/Package%20201410.pdf

As always if you have any questions about this article or any other real estate realted questions please feel free to contact us we would be happy to help you. we can be contacted through this website or you can phone us directly at 604-882-8384.

Sincerely,

Doug, Bonnie and David Mitten

(Mitten Real Estate Team)

Typical Expenses For Buying and Selling a Home

Wed, 29 Oct 2014 18:50:00 GMT

Introduction:

At Mitten Real Estate Team we are pleased to bring you this week's Blog article which focuses on the typical expenses that you can expect when you are buying or selling your home. We are bringing this article in the hopes that it will be a useful resource to both our current and potential clients. The information we are providing is part of our “Buyer Assistance Program” and has been designed, after years of successfully assisting people to find and acquire the perfect property for them and to assist our clients in achieving thier real estate goals. We will also provide information on the expenses that sellers can expect which derived from our "Seller's Assistance Program", which seeks to educate sellers on all the cost of selling.

Buyer Expenses:

One of the things which is important to buyers is that they know what the typical expenses involved in a purchase will be. Accordingly we have put together the following outline of typical expenses which one would see in a typical purchase in the area which we service. It should be noted that each transaction is unique and may carry with it unique expenses and in order to ensure that you are fully apprised of all expense on your transaction you should work with a reputable real estate agent that you trust.

1.) Home inspection: $450.00 - $900.00

A Home inspection usually occurs after a buyer puts an accepted offer on a home, they will have the home inspected by a qualified home inspect to determine if there are any problems with the home before the buyer removes the subjects on thier offer. This is very important in protecting buyers from hidden problems with a home.

2.) Appraisal: $150.00 - $400.00

An appraisal of the homes value is often times required by a bank before they will provide financing to the buyer, some banks do provide the appraisal for free while others may require potential buyers to pay for the appraisal.

3.) Site Survey: $400.00 - $600.00

A Site Survey essentailly shows the position of the buildings on the property to ensure that any buildings are infact within the property boundaries and are not over any property lines. A Site Survey may be required as a condition of financing, alternativley title insurance can often times be obtained. In Some cases there may already be a fairly recent site surey for a home however it is not always avalible in which ase a buyer may have to pay to have one produced.

4.) Property Transfer Tax: 1% on the first $200,000 and 2% there-after.

The Property Transfer Tax is a government imposed tax which buyers must pay when they purchase real estate. There are certain exemptions that you may qualify for, so please contact us if you are thinking of buying or selling and we can disscus if you qualify for any exemptions.

5.) Legal Fees: $750.00 - $1500.00

6.) Property Tax Adjustment: Cost is dependant on the property taxes for the property.

The Property tax adjustment results from a monitary adjustment based on the amount of time the buyer and seller own the property during the purchase year.

For Example if the buyer took possesion of the property on October 31, they would have to repay the seller for the remaining two months worth of property taxes which the seller would have already paid to the municipality. Conversly. if the sale took place in march the seller would have to repay the buyer for property taxes due later in the year (that cover the whole year) that have not yet been paid by the seller.

7.) Septic Inspection: $600.00- $1,000.00

A Septic inspection is only required if the home uses a septic system to treat sewage. If the home does use a septic system it is important to have the septic system inspected by a qualified septic inspector to insure it is in good working order (a new septic system can cost in excess of $20,000 - $30,000) or if repairs are required.

8.) Water Test: $300.00 - $500.00

A Water Test is only usually required if the home is using a well. A water Test is usually taken by taking a sample of the water from a property to a lab where they determine if it meets the standards set for drinking water.

9.) Home Insurance: Cost is dependant on the replacement value of the home

10.) GST: Not usually payable on used residetial real estate

GST is payable on all real estate, EXCEPT USED RESIDENTIAL REAL ESTATE. However thier are a few exceptions to this exemption. This means that purchasers of bare land and new construction homes are usually required to pay GST while most purchasers of used residential real estate (for personal use) are not usually required to pay GST.

Seller Expenses:

In Addition to thier being costs associated with buying real estate there are also cost associated with selling real estate. the following list should provide a good idea of what costs you can expect to incur when selling real estate.

1.) Real Estate Fees: Typicall 7% on first 100,000 and 2.5% there-after.

The real estate fees are split between the buyer's agent and the seller's agent. The Real Estate Fees cover the cost of determining the value of the home, Marketing and advertising, MLS fees, strata documents,advise on sale preprations, negotiations, real estate agents time, equipment and signs, etc... Real Estate fees are usually only payable if your home is suscessfully sold.

2.) Legal Fees: $500.00 - $600.00

3.) Prepayment Penalty for Mortgage: Depends on mortgage terms.

A Pre-Payment Penalty on a mortgage cost depends on the terms of the mortgage. Often times a bank may make a seller pay a penalty for paying off the mortgage early. In some case the bank may wave this penalty but in other cases they may require a seler to pay it.

4.) Property Tax Adjustment: Depends on time of prucahse and cost of property taxes

As was discussed in the buyers expenses section, this is a monitary adjustment based on the amount of time the buyer and seller own the property during the purchase year.

For Example if the buyer took possesion of the property on October 31, they would have to repay the seller for the remaining two months worth of property taxes which the seller would have already paid to the municipality. Conversly if the sale took place in march the seller would have to repay the buyer for property taxes due later in the year (that cover the whole year) that have not yet been paid by the seller.

Conclusion:

As always if you have any questions about this article or any other real estate realted questions please feel free to contact us we would be happy to assist you we can be contacted through this website or you can call us directly at 604-882-8384.

Additionally to be sure you are fully and correctly informed of all of the cost realted to your purchase and sale and to recieve the best quality service please employ us to assist you, we would be honored to assist you with your next home purchase or sale.

Sincerely,

Doug, Bonnie and David Mitten

(Mitten Real Estate Team)

Tips To Keep Your Home Safe While You Are Away On Vacation.

Fri, 24 Oct 2014 21:17:00 GMT

Introduction:

This week for our latest blog article we would like to give you some advice on how to keep you home safe while you are away or on vaction. Since theft and vandlism is something that every home owner worries about while they are away we hope this article will be a useful tool in helping to keep you home safe while you are away.

Idea #1: Suspend newspaper delivery and arrange for someone to pick up your mail, this will prevent mail or newspapers from stacking up, which gives aways that you are not home.

Idea #2: Ensure all doors and windows are locked - for sliding glass doors, use locks specially designed to prevent the door from being lifted out of its track.

Home Window Lock

Idea #3: Use timers to turn lights, and possibly the TV or radio, on/off during the day and night.

Home Light Timer

Idea #4: Have someone cut/water the lawn if you plan to be away for more than a week.

Idea #5: Turn the volume down on the telephone so anyone outside can't hear it ringing for extended periods.

Idea #6: Leave a generic message on your answering machine - never say that you are away on vaction.

Idea #7: Secure all tools and ladders so they can't be used to break into your home.

Idea #8: Trim shrubbery around doors and windows so there's nothing to conceal the actions of would-be intruders.

Idea #9: Leave blinds or curtains in normal position - don't close them completely.

Idea #10: Consider installing security bars on basement windows, especially those shielded from view or in the back of the house.

Idea #11: Close and lock the garage door. You might even want to unplug your electric garage door opener and put a lock in the track of the garage door to prevent it from being forced open.

Garage Door Lock

Idea #12: Remove anything of extreme value and put it in a safe place while you're gone.

Idea #13: Make sure your home insurance doesn't expire while you're out of town and that it provides adequate coverage for your belongings.

Idea #14: Tell someone where you're going, how to reach you in case of an emergency and when you'll be back.

Idea #15: Ask a reliable neighbour to 'keep an eye' on your home and report anything suspicious to police.

Idea #16: Consider asking someone you trust to "house sit", especially if you plan to be away for an extended period of time. If you notice signs of forced entry when you return home, do not go inside! Call the police from your cell phone or a neighbour's house. Do not enter the house until you know there is no one hidding inside as many criminals may have weapons and be very damgerous or even mentally un-stable so it is best to avoid any chances of a direct confict.

Conclusion:

To Conclude we hope these ideas will help you keep you home safe while you are away on vacation. If you have any real estate questions or are thinking of buying or selling your home we would be please to assist you. You can contact us through this site or call us at 604-882-8384.

Sincerely,

Doug, Bonnie and David Mitten

(Mitten Real Estate Team)

Strong summer for Fraser Valley real estate carries through to September

Thu, 02 Oct 2014 22:19:00 GMT

This week at Mitten Real Estate Team we would like to bring you the latest report on the Fraser Valley Housing market, produced by the Fraser Valley Real Estate Board.

SURREY, BC – The Fraser Valley Real Estate Board processed 1,419 sales on its Multiple Listing Service (MLS®) in
September, an increase of 25 per cent compared to the 1,131 sales during the same month last year, and an
increase of 9 per cent compared to sales in August.

The Board’s president, says, “Similar to this past summer, this is the busiest September we’ve had
since 2009 with sales of all property types combined out‐performing the 10‐year average by 13 per cent.
“Residentially, the single family detached home remains the preferred property type. From North Delta to Mission,
sales increased in every Fraser Valley community compared to last year with the price range of $400,000 to
$699,999 garnering almost sixty per cent of our total detached market.”

New listing activity was also brisk in September with the Board’s MLS® receiving 2,758 new listings, an increase of
16 per cent compared to last year, taking the total number of active listings by month‐end to 9,156, a decrease of
7 per cent compared to September 2013.

Werger adds, “An important factor underlying the housing market is consumer confidence and in our region that
confidence has been bolstered by the stability of home prices. Since March, the benchmark price of our three main
residential property types combined has remained flat, increasing by only 0.6 per cent.

“Long‐term, the value of single family detached homes has increased at a faster pace than it has for attached
properties, particularly in areas such as Surrey, White Rock, Langley and Abbotsford where we’ve seen many new
townhome and condo developments. The supply of new inventory has affected the price of resale product.”
The MLS® Home Price Index (MLS® HPI) benchmark price of a detached home in September was $569,800; an
increase of 3.1 per cent compared to September 2013, when it was $552,900. In the last six months, the
benchmark price of a detached home has increased by 1.1 per cent.

In September, the MLS® HPI benchmark price of Fraser Valley townhouses was $299,600; an increase of 1.1 per
cent compared to $296,200 in September of last year, and in the last six months has increased by 0.8 per cent. The
benchmark price of apartments decreased year‐over‐year by 4.7 per cent, going from $203,100 in September 2013
to $193,600 last month, and has decreased by 0.9 per cent in the last six months.

As Always if you have any questions about this article or any other real estate realted questions please feel free to contact us we would be happy to assist you. We can be contacted through this site or you can call us directly at 604-882-8384. Please check back next week to see our latest analysis of another local real estate market in the Fraser Valley.

Sincerely,

Doug Bonnie and David Mitten.

(Mitten Real Estate Team.)

Housing Options For Your Golden Years

Fri, 26 Sep 2014 22:59:00 GMT

Introduction:

As time marches on our lives change and so to do our housing needs. Usually when we are younger we strive for a larger home/ property with more space and possibilities. Eventually as you get older that wonderful large home that you enjoyed for many years may become too large to suit your needs and the maintance and upkeep of you home may begin to seem like to large a task.

Additionally, after retirement you may choose to travel and not want to have to worry about who will take care of your home when you are away. Another consideration is that although we all hope you be in good health even in our latter years the reality is even if we stay in decent health eventually things such as stairs and uneven surfaces can become a problem for older home owners. That’s why for our Blog article this week we would like to talk about housing options for seniors.

Over the years we have helped many seniors through the process of planning out their retirement housing needs so we are writing this short article as a service to our clients and potential clients who are considering what sort of housing they need in their golden years.

Deciding on the housing option that will suit you best in your golden years is often a process. This process may take several months or even years. In the end what is important is that you are able to choose the option that best suits your health, life style and financial needs.

What is your current Home worth?

There are a number of factors that go into the process of choosing your retirement housing options. The first such consideration is financial planning. To start you should determine is what your current home worth. This is an important first step because for many people a good portion of their retirement wealth is tied to the value of their home and as a result the value of their home determines the housing options available to them. If you are would like to determine the value of your current home we would be happy to assist you even if you are just planning for the future and are not ready to sell yet.

Determining Your Lifestyle requirements:

The next part of the process planning your retirement housing needs is to look at your lifestyle requirements and their associated costs. For example:

1.) What type of care will you need and what is the cost of that care?

2.) What will your retirement income be or need to be?

3.) Estate Planning: do you want to leave money/assets to your heirs?

4.) Where do you want to live? Is there an area that is close to family you would prefer to live in?

After answering all of these questions you will be in a position to examine your housing options. So what are your options?

Option 1: Adult oriented complex/ community

A typical 1 level townhome in an adult oriented community

An Adult Oriented Apartment Building

If your health is fairly good and you may want to consider an adult oriented apartment or townhouse complex.

There are a number of nice gated adult oriented communities in in Langley that offer senior friendly townhomes. Additionally there are also some nice adult oriented apartment buildings that are certainly an option for seniors.

An important thing to consider when you are looking at this option is whether or not you require care assistance (such as a nurse or care aid) on a daily or weekly basis. There are certainly government programs that can provide you with a very decent amount of care/assistance as well as some private companies that also offer care aids. Generally the cost of government provided in-home care is based on your income, meaning of you have a large income you will pay more than if you have a smaller income.

If you have mobility of other health challenges there are other options besides an adult oriented townhome or apartment. The next option is an independent living community:

Option 2: Independent Living Community

An example of an independent living community

Independent living communities are available both with and without care assistance. Independent living facilities offer apartments, along with meals or meal plans, laundry, housekeeping, concierge services, handyman services and usually the option for care on a pay for use basis. Most are based on a rental for the apartment; however, some also offer the opportunity for ownership of the apartment.

If you think this option could be for you the next question is, should you rent or own an apartment in an independent living facility? Here are some things you should to consider:

Renting:

Some advantages of renting…

-With independent housing your housing is integrated with a number of other factors such as: food, staff, entertainment, care and more. The benefit to renting therefore, is that you will have the opportunity of determining whether the overall experience is to your satisfaction prior to your final decision. With this in mind I would highly recommend renting at least for a while before making your final decision.

Some disadvantages of renting…

-The disadvantage to ongoing rent is that typically rents increase overtime and therefore your housing costs can go up as does your need for additional income.

-The other thing to consider with renting on an ongoing basis is that the income necessary to pay the rent may be taxable depending on your tax situation whereas with ownership providing you purchase without a mortgage you will need less income to sustain your living expenses and therefore your tax burden may be lower. When we were exploring this for our parents giving consideration to all of the factors they felt it was best for them to rent on an ongoing basis and we have found fianncial planners to be very helpful in working together with our accountants to structure a solution which mitigated the taxes payable on the income necessary to pay for their living expenses.

Ownership:

Some advantages of ownership are…

-Ownership allows you to fix your housing costs. The cost of food and care may still go up but the costs of the housing portion of your requirements is fixed and again if you own clear title the need for additional income and the tax burdens associated with it are a non-issue.

-The other benefit for ownership is that at the end of when you will be staying in this location you or your families owns the property and are able to sell the property at whatever the current market value is at that time. An accountant or financial planner can help you determine whether there are greater benefits in investing in the housing or other investments that may yield a greater return if this is the only decision in determining whether to buy or rent.

Some disadvantages of ownership are…

The disadvantage to ownership is the lack of flexibility. This disadvantage goes both to the choice of the facility you will be moving to originally as well as to the ease of moving should you not be happy with some facet of your living situation. Not all independent living communities offer the option to purchase and therefore if one desires the option to purchase it does limit the independent living communities that one can consider.

Whether you decide to rent or own in an independent living facility there are a number of such facilities in the Fraser valley to choose from.

If you feel you may require more care or assistance than either of these options can provide there is another option which is a full care facility.

Option 3: Full Care Facility

An expample of a full care facility

Full care facilities normally provide a room as well as the food and care on an all-inclusive basis. This decision is normally predicated on the care requirements of the individual. There are certainly a few options in the Fraser Valley to choose from in this category.

Downsizing Belongings:

Once you have determined the housing option that will best suit your needs, the next step is usually to downsize in to a smaller home that can serve your current needs. There are a number of things to consider when you are downsizing such as…

Can you downsize yourself?

Can you get help from:

1.) Family

2.) Church or support group

3.) Professional organizer

It is also important to realize that when you are downsizing you will not just be moving your furniture and possessions, you will have to decide which you can/ want to keep and what you must give away or throw out since your new home will likely not have space for all of your current belongings. If this is an area you think you will need to hire a professional we can put you in touch with professional organizers that specialize in helping others downsize.

Choosing Where to Relocate

Determining where to relocate often involves giving consideration to:

A. Near family or friends

B. Near support community

C. Near doctor or other professionals

What Are Your Goals?

The goal is usually to free up equity from your home to provide a simpler life, with your equity

providing both a place to live and income. Additionally, most people desire to move towards a more maintenance free life with options for future care if not immediate care.

Cooperation and professional advise is very important:

This transition often involves working together with family and professionals such as a lawyer, investment counselor/bank, doctors, accountant, realtor and care facilities and support workers to determine the income requirements, formulate a plan, and implement it. The important thing is that you determine what your needs and goals are and then ask each type of professional how you can best accomplish your desired results.

Conclusion:

We have helped many seniors to accomplish their retirement housing needs over the years and if you require any assistance in this process please let us know we would be happy to assist you with the real estate part of determining you retirement housing needs. We would also be happy to put you in touch with other professionals who can help with areas such as downsizing and organizing or estate planning etc… Whatever you retirement needs are we will to help you accomplish your goals. Even of you not ready to move yet we are happy to help you plan for the future. we can be reched through this website or you can phone us directly at 604-882-8384 we would be happy to assist you.

Sincerely,

Doug, Bonnie and David Mitten.

(Mitten Real Estate Team)

Factors that Drive the Housing Market in the Lower Mainland

Thu, 11 Sep 2014 20:02:00 GMT

Introduction:

As you may already know the housing market in the lower mainland and especially Vancouver is one of the more expensive in the world. From time to time you may have asked yourself why that is? That’s why this week at Mitten Real Estate Team we are going to look at some of the fundamental factors that contribute to the housing prices and popularity of the housing market in the lower mainland.

Constrained Geography:

The First Reason that prices have risen in the lower mainland over time is that there is a limited amount of space for building. Geographically the region is contained with mountains to the north and east, the U.S boarder to the south, the Fraser river runs through the middle taking up space and the Pacific ocean is located to the west. Additionally, as a way to preserve farmland a large portion of the land in the Lower Mainland was designated as part of the Agricultural Land Reserve (ALR) many years ago. This of course further restricts the space available for development. Thus as our population grows and more people want to live here the value of the land will increase over time. Now this is not to say that an oversupply of certain types of housing in certain areas can’t happen short term, however long term the limited land area will support upward movement in prices long term especially as population increases.

International Trade

With the lower mainland being located on the pacific coast of Canada, having a river running through it and having the U.S Boarder to its south it is only natural for this area to be a hub of international trade. This trend has been accelerated in the past few decades as China and other countries in Asia gain importance in the world of international trade. Thus, since we essentially live in a gateway city for international trade, the value of land here is going to increase as a result of the economic activity generated by trade.

Safe Geopolitical Environment:

Another very important reason why demand for housing in the lower mainland is strong is that our area is in a politically stable and is far away from any instability. This is quite important because people naturally seek out safe areas of the world with relatively predictable laws. And it is this stability that at least in part allows people to feel comfortable in spending large sums of money on housing and investing in housing, since they know they are investing in a safe area.

Good Weather

In B.C a lot of us like to complain that it rains a lot, however compared too many areas of the world and Canada, the climate in the lower mainland is very temperate, predictable and nice. Yes it does rain a fair bit in the winter, however floods are relatively rare and large snow accumulation is also rare, making the mild winters easy to deal with. Additionally, the summers are usually quite nice and sunny but temperatures rarely clime very high and drought is fairly rare. Once more the spring and fall are quite mild with few severe storms. The reason for this is that the prevailing westerly winds passing over Pacific Ocean, then across the lower mainland are warmed by the water in the winter and cooled by it in the summer, resulting in a very nicely regulated climate that usually prevents extreme temperatures and extreme storms. Also since the ocean current that run by the lower mainland are coming from the north they do not allow this part of the ocean to heat up enough to develop hurricanes (except on very rare occasion). The trade-off for all of this is of course a bit of rain in the winter. This favorable climate helps drive the demand for housing in the region because not only is it nice weather for people to live in, but the weather does not generally interfere with the economy since extreme weather is historically rare compared to other regions, which encourages investment and economic activity in the region.

Beautiful Scenery:

If you live in B.C seeing the ocean or a beautiful mountain vista, is probably a regular thing for you. However, this is not so everywhere, and people are driven to these fantastic views. This of course means people want to visit here, leading to economic activity from tourism. Also lots of people want to live in a beautiful place which again fuels demand for housing in the region. Oh and don’t forget the draw of all those ski mountains nearby, meaning you can live anywhere in the region and still ski regularly in the winter without a large drive.

Multi-Culturalism:

In addition to all of these other factors the lower mainland is very multi-cultural and welcoming to new immigrants to Canada. As a result it is one of a few places in Canada that people newly arriving to the country are drawn to and of course that means they want to live here, which again drives demand for the housing market.

Foreign Investment:

For all of the reasons listed above, B.C’s lower mainland is a great place to live and has a lot of factors driving the housing market. This of course naturally catches the attention of foreign investors who want to invest in a relatively safe area that has many positive attributes. Many people complain about foreign investment ‘driving-up prices’, while it is true that foreign investment is a contributing factor to higher housing prices in the region, investors only invest here because of all of the other supporting factors and instead of being bitter about prices we could also be thankful as real estate owners/investors that there is a large pool of international investors willing to pay a fair amount for housing in the area which provides us with extra security against any large or fast price decreases and allows prices to be sustainable at higher levels than would otherwise be possible.

Conclusion:

While you may have sometimes heard talk of a ‘housing bubble’ in our area or prices are too high based on historical rent to price ratio’s, the consensus seems to be that the housing market in the lower mainland has so many positive factors driving demand that there is really no reason to fear any sort of housing crash in B.C. Now this is not to say that we never see any corrections in housing prices but demand for housing in the region will always be driven by these positive fundamental factors which will support housing prices long term. These positive factors are also the reason that the prices in the region are higher than other areas of Canada and yet are sustainable at those higher levels.

As always if you have any questions about this blog article or any other real estate related questions please feel free to contact us. We can be reached through this website or you can phone us directly at 604-882-8384 we would be happy to assist you.

Sincerely,

Doug, Bonnie and David Mitten

Mitten Real Estate Team.

Interest Rates: A Quick Finance Lesson For The Savvy Real Estate Investor

Fri, 29 Aug 2014 00:54:00 GMT

Introduction:

At Mitten Real Estate Team we are pleased to bring you our latest Blog Article about interest rates and their effect on the real estate market. It is our hope that as a current or potential real estate owner/investor this article will help you be able to understand how interest rates affect the real estate market.

Interest Rates:

Interest rates are essentially the ‘time value’ of money. The interest rate is how much a borrower pays a lender for the use of their money. Additionally, interest rates are also meant to compensate the lender for the risk of loaning the money to the debtor since there is not a 100% guarantee it will be repaid.

Central Bank Interest Rate: (Also Known as the overnight interest rate or key interest rate)

The central bank interest rate in the interest rate at which the central bank of a country lends to domestic banks. These loans are very short in duration and are used because the amount of money a bank has fluctuates daily based on its lending activities and its customers’ withdrawal and deposit activity, the bank may experience a shortage or surplus of cash at the end of the business day. Those banks that experience a surplus often lend money overnight to banks that experience a shortage so the banking system remains stable and liquid. (Source: Investopedia)

The Central bank interest rate (overnight interest rate) is a very important interest rate because it affects the rates at which banks lend money to customers as well as other banks, which has a large influence on the economy and employment. The Bank of Canada makes announcements on interest rates eight times a year, the exact dates are decided on each year and the dates are published.

Prime Rate

The ‘prime interest rate’ is the interest rate at which commercial banks lend to their most credit worthy clients. Although the prime rate is closely related to the central bank rate set by the central bank it is not the same as the central bank rate, and is somewhat higher than the central bank rate, depending on the bank.

Inflation and interest rates:

Inflation is referring to a loss of purchasing power over time resulting from the rising price of goods and services. For example if a package of gum was $1.00 today and the inflation rate was 2%. In one year the pack of gum would cost $1.02. Inflation is measured using the consumer price index (CPI), which is essentially a bundle of goods and the market price of each is monitored to determine inflation. Most central banks aim for an inflation rate of 1-3% which is viewed as being healthy for the economy. As a general rule as the economy strengthens inflation tends to rise, if inflation gets out of control then purchasing power can be eroded too quickly, so the central bank will raise interest rate to slow inflation, which also slows the economy. Alternatively if the economy is weakening and inflation is stagnating the central bank will lower interest rates in help strengthen the economy.

There are several economic theories that explain these concepts in detail but they are beyond the scope of this article.

Interest Rates and Affordability:

When interest rates are low people are more likely to borrow money so that they can make investments in productivity (such as equipment, hire new employees and invest in their businesses etc…), because borrowing the money is relatively inexpensive. This borrowing and investment in productivity in turn stimulates the economy to grow and often eventually causes an increase in inflation as a result.

When inflation rises the central bank raises interest rates. When this happens the interest rate for borrowers increases and it becomes more expensive (less affordable) to borrow money to invest in productivity, thus less people borrow money and most business/people will cut back on spending thus slowing the economy and inflation.

Interest Rates and Investments:

As a general rule when interest rates are low, debt investments such as bonds tend to have a lower yield making them less attractive to investors, during low interest rate environments’ equity investments such as stocks in companies tend to be more attractive to investors because the companies are able to make use of the inexpensive debt to grow and offer a higher yield to investors. This coupled with the low yields of debt investments tends to make stocks more attractive to investors when interest rates are low.

Interest Rates the Real Estate Market:

When interest rates are low financing of real estate becomes more affordable then when rates are higher, thus allowing more people to ‘afford’ real estate and this in turn can put an upward pressure on prices of real estate. However, interest rates are usually lower when the economy is weak which can mean less people are in a position due to unemployment etc…

To see the effect interest rates can have on affordability let’s look at one example:

If a person took out a $300,000 mortgage on home at a 3% interest rate with a 25 year amortization their monthly payments would be $1,419.74

If the same person took out a $300,000 Mortgage on a home at a 4% interest rate with a 25 Year amortization their monthly payments would be $1,578.06

As you can see from this example if interest rates are 1% higher the same $300,000 mortgage would cost the borrower an extra $158.32 a month in interest.

However as was mentioned earlier even though housing becomes more expensive to finance when interest rates are higher, usually the economy is stronger as well which means people can afford to spend more since they may be making more money. Nonetheless higher interest rates can put somewhat of a downward pressure on home prices.

An additional market phenomenon is that often after a potential raise in interest rates is announced there is a short period where the real estate market actually increases in activity. The main reason for this is that potential purchasers who have already been pre-approved at low interest rates will ‘rush’ to buy before their pre-approval at the lower rate expires.

Conclusion:

To conclude at Mitten Real Estate team we hope that this article has helped you better understand interest rates and how they affect the real estate market. As always if you have any questions about this article or any other real estate related questions please contact we are always happy to help you and we always have time to help you plan for the future. We can be reached through this website, by e-mail at dbmitten@mitten-realty-services.com or at 604-882-8384.

Sincerely,

Doug, Bonnie and David Mitten (Mitten Real Estate Team)

A Quick Finance Lesson for the Savy Real Estate Investor

Wed, 06 Aug 2014 20:24:00 GMT

If you have ever thought about investing in a rental property but are unsure if it made financial sense this article is for you!

Buying a rental property is very different from buying your personal home, in that a rental property in a financial investment and it must generate a reasonable return on your investment in order to be worthwhile. So how do you know if buying a rental property is worthwhile? Keep reading to find out…

As a real estate investor you must analysis properties from a finance perspective… A very important finance calculation is the C.A.P rate.

Capitalization Rate

The Capitalization Rate (Cap rate) is a mathematical expression how much monetary return you will receive on your investment. In other words the percentage return an investor would receive on an all cash purchase.

The Formula is:

Essentially to determine the capitalization rate you take the net annual operating income(NOI) and divide it by the purchase price of the property. However before we can determine the cap rate of a property you must determine the annual net operating income.

Annual Net Operating Income

The calculation for determining the annual net operating income:

So to calculate NOI you would take the gross operating income (annual projected rent) and subtract all the operating expenses. Operating expenses would include thing such as:

-Insurance

-Property Taxes

-repairs and maintance

-Property Management (if applicable)

However, it is important to note a few expenses are not part of the NOI, these include income tax on profit and mortgage interest.

CAP Rate Example

To demonstrate how to use cap rate here is a fictional example…

$510,000 Basement Home in Walnut Grove, 2400sqft with double garage, This home has a projected monthly income of $2,500/mo.

2,500 x 12 = $30,000 (Annual Gross Rental Revenue)

Operating Expenses are:

$2,500 /yr insurance +

$3,600/ yr Repairs, +

$3,600 / yr Property Taxes

Total Operating Expenses = $9,700

Using the above formula we can calculate NOI to be $20,300

From this we can use the formula determine the cap rate…

20,300/510,000 = 3.98% So the capitalization rate of this particular (fictional) home would be 3.98%

From this we can also determine the payback period as follows…

510,000 / 20,300 = 25.1 Years or 301.5 months.

The Payback period refers to how long it will take to recover your investment through collecting net income genrated by the property..

Now, of course our example assumes that an investor plans to hold the rental property indefinably, but in reality many investors do sell properties at some point in which case they may also realize a profit when they sell their property especially if they have held it for many years. Any gains in property value made at the time of selling would usually be subject to capital gains taxation, just as most other investments would be...

Uses of Cap Rate:

Cap rate can be used to determine the fair value of a rental property compared to other properties in a similar area.

Cap Rate can be used to decide between investments types eg.( Real Estate v.s bonds)

Cap Rate can also indicate risk, for example properties in one area of a city may have a higher cap rate because there is less demand for rentals in the area so they carry a higher risk of vacany. Some other examples of risk that can affect cap rate are, age of a property, credit worthiness of current tenants (if applicable), length of lease in Place (if applicable), etc…

Cap rate can also be s sign of how much demand there is in the market for a certain type of property, meaning if a trend of cap rate decreasing for a certain type of property is observed, the market for this type of property is heating up and prices are being bid up thus reducing the cap rate.

What About Vacancy?

Vacancy is an important consideration for potential investors. And on the long term vacancy does effect cap rate. However the expected vacancy rate can vary significantly based on the area type of property etc…

Example: If in the area a 2 week per year vacancy was expected you would deduct half a months rent from the Gross Rental Revenue.

For the example we discussed above this would reduce the Gross Rental Revenue to $28,750 (from $30,000) and the NOI to $19,050 (from $20,300) resulting in a C.A.P rate of 3.74% and a 26,8 Year (or 321.3 months) Payback period.

Thus projected vacancy is an important factor to consider when calculating cap rate, but the projected vacancy rate will vary based on area and the type of property.

What about Mortgage/Financing Costs?

Mortgage payments are generally not included in the calculation of C.A.P rate. The reason for this is that financing costs from leveraging can very significantly based on credit history as well as down-payment etc.. which would result in a skewed CAP rate if they were included.

However interest expenses on mortgages of investment properties are usually tax deductible so using a mortgage (leveraging) when investing in real estate can have tax benefits, talking with an accountant would be advisable if you are considering using leveraging (a mortgage) when purchasing a rental property as a way to reduce tax on the revenue.

Although it is not included in CAP rate calculations, financing is a very important aspect in determining if a rental property will make sense financially. Speaking with a good mortgage broker about you ability to finance the purchase and the interest rate avaible is advisable. If you are thinking of buying a rental property using a mortgage and you are not currently working with a Broker please contact us and we can direct you to good mortgage broker who can disscuss what financing options are avalible to you.

Conclusion:

As a current or potential real estate investor, Capitalization rate and other financial considerations are key to making sure that you receive a good return on your investments, which is why we have written this article as a service to our current and future clients, that will help them better understand the finance apect of investing in real estate rental properties.

This article should be considered as a good introduction to some of the useful finance concepts that can be used when deciding to invest in rental properties.

This article is however, not intended to be a comprehensive guide to the finance side of real estate investing.

If you are thinking of investing in rental properties in B.C’s lower-mainland as part of your investment portfolio please contact us we would be happy to discuss some of the finance concepts you should consider when investing as well as assist you with finding a property that would suite your investment goals. We can be reached through this website or by phone at 604-882-8384.

Sincerely,

Doug, Bonnie and David Mitten (Mitten Real Estate Team)

14 Tips to Prepare Your Home for Sale

Thu, 24 Jul 2014 20:12:00 GMT

Selling your home is a big financial decision. So when it comes time to sell it is important to get the best value possible for your home. Over the years working in real estate have have learned what many buyer look for in thier next home and so here are some tips for how to prepare your home for sale. Interestingly, one thing that sometimes gets overlooked when selling a home is the presentation and staging. These are important details because often times how clean and presentable a home is plays crucial role in determining a buyers impression of your home.

While putting a new fancy bathroom in your home or a new upscale kitchen will certainly impress buyers, surprisingly the details such as paint touch-ups can be very important as well. And often small details like this give a much larger return on investment then do larger more expensive home renovations and improvements.

Tip # 1 Keep your Lawn and garden trimmed and tidy

The first such detail is; make sure the yard is neat and clean and the grass is mowed. Nothing gives a worse impression to a buyer than pulling up to a home with an over grown lawn. Alternatively, a neat well cared for front yard sends a good first impression as a buyer drives up to your home.

Tip # 2 Keep your exterior Trim look fresh with a new coat of paint

Secondly, make sure siding is clean on your home and the trim is nicely painted. Although this can be accomplished in only a weekend with nothing more than a pressure washer and a can of paint the impact on buyers of a nice clean home with fresh paint on the trim can’t be underestimated. Alternatively, your home might be beautiful inside but if the siding has green algae on it and the paint is peeling off the trim many buyers may discount your home before they even get through the front door. Additionally, be sure that your front door and hardware are in good working order.

Tip # 3 Nothing makes a home look newer than a fresh coat of paint.

The third tip is, if your home has noticeable chips or marks on the interior paint it is well worth your time to do touch-ups, since spending an afternoon doing touch-ups can make the difference between whether a buyer thinks your home has nice paint or is in need of new paint and equally important chipped paint on ones walls can make a buyer feel that the home has been neglected and not well cared for.

Tip # 4: Uncluttered presentation is a critical component of maximizing the perception of spaciousness when presenting a home.

The fourth tip may be a bit obvious but if possible make sure your home is vacuumed, de-cluttered and cleaned before showings, even if you have a beautiful home if buyers walk into a your home and see dishes piled up in the kitchen and clothes on the ground etc… they will believe your home has not been well cared for and they will not value it as highly. Clear countertops to maximize the impression of cabinet and countertop space, organized closets, keep bathroom toilet tops and countertops clear of clutter, uncluttered hallways and rooms all serve to maximize the presentation in a way that ensures the home is presented to its best advantage.

TIP # 5 Keep the kitchen clean and de-cluttered.

The fifth tip is that the kitchen is one of the areas of the home buyers consider to be most important. Consequently It is important to show your kitchen to its best advantage. Be sure countertops are virtually clear to maximize the impression of lots of countertop space in the mind of the Buyer. Toasters, blenders, coffee perks and can openers should be stored in a convenient out of site location – not on the countertop when you are selling your home. While recognizing this as somewhat of an inconvenience it will truly show this important room to its best advantage. to de-clutter your fridge door. While many people enjoy putting pictures and calendars on their fridge doors, it is a turn-off for most buyers. When it’s time to sell it’s best to store the fridge door photo’s in a drawer.

Tip #6 Keep your baseboard and trim clean

The Sixth Tip is to dust your baseboards, if you have dirt and dust on the baseboards your home may be perceived as ‘dingy’ by buyers. Bring-out the duster when it’s time to sell, it will be well worth your time.

Tip # 7 Arrange furniture in such a way that it promotes smooth traffic flow

The Seventh tip is that over time many people collect more and more furniture and personal belongings. Unfortunately, too much furniture (or to large of furniture) makes your home look smaller and more cluttered in the eyes of many buyers. Thus, it is best to arrange your furniture in such a way that it promotes smooth traffic flow and be sure to keep paths, halls and walkways clear. It is not unusual to have a number of people viewing the home when it is being shown.

Tip # 8 Keep your home odor free

The eighth tip is, if you are a person that likes to burn scented candles leave them unlit for showings. The reason for this is that buyers with asthma and other respiratory conditions may not be able to look at you home at all, as it may cause them difficulty breathing. Additionally, many buyers may also think you are trying to cover an odor and will be suspicious of your home.

Tip # 9 Use neutral colors

The Ninth tip, is that if you are planning to repaint your home before selling, pick neutral colors that most people will like. Although it can be tempting to put your favorite color on the walls, doing so can cause buyers to have a ‘love it’ or ‘hate it response’ and reduce the number of buyers that will consider your home, where neutral colors will be attractive to a far larger group of buyers.

Tip #10 Maximize your Home's lighting

The Tenth tip, is if you choose to put CFL or LED light bulbs in your home, try to choose lights that produce light that is a similar color to what older incandescent lights produce as this is what most buyers consider normal. Having a super white or bluish light can give people an odd feeling about your home and can also make the colors in your home appear different, so best to avoid unusually colored bulbs if you are thinking of selling. It is also often wise to use brighter bulbs in your lights when you are selling than what you may normally use – after all you want your home to be bright and cheerful not dark and dingy. Additionally, be sure that all light switches have covers on them and are in good working order so that buyers are confident your home has no electrical problems.

Tip # 11 Be sure your bathroom is clean

The eleventh tip is be sure bathrooms are sparkling clean. Once again clear countertops and organized drawers are the order of the day. Be sure that you fix any leaky faucets, loose cabinet hardware, drawer handles, chipped countertops or sinks and replace outdated or inefficient light fixtures. Be sure grout in shower and around the tub is sparkling clean and repair any cracked grout. Remove clothes hampers, be sure toilet seats are down and toilets are flushed and once again be sure that your bathroom is odor free for showings.

Tip #12 Clean and refurbish your carpets

The twelfth tip is to clean your carpets and re-stretch those areas which require it. Carpeting has a major impact on the look of a home. Be sure your home is vacuumed prior to showings. If there are areas that are badly worn, outdated or stained, consider having it replaced. Scrub and wax tile floors and repair or replace cracked tiles.

Tip #13 Keep your roof in good condition

The thirteenth tip is that, buyers pay close attention to the condition of your roof. Re-patch or re-shingle where necessary, and fix leaky, corroded or plugged downspouts and gutters. Inside, a watermarked ceiling is a sign to buyers that the roof has leaked—even if damage has been repaired.

Tip # 14 Clean and de-clutter your Garage and Driveway

Be sure your driveway and garage are clean and presented to maximize their size. Organize garagesand park extra vehicles away from the property.

Conclusion:

In conclusion, although taking care of the details in your home does not cost a lot it can certainly change the way buyers view your home and help your home sell for a higher price.

As always if you have any questions about selling your home please feel free to contact us, we can be reached through this website or we would be happy to speak with you, just call 604-882-8384.

Sincerely,

-Mitten Real Estate Team