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Family hanging pictures in new home

How to Downsize to a Smaller Home

Moving to a smaller home can be an intimidating transition for many, as there are often so many questions that come up. Are you ready to give up on the extra space you once had? How will moving from a larger house to a smaller one affect your lifestyle and day-to-day living? All these questions – plus the process of actually downsizing – can be rather overwhelming. Fortunately, the key to navigating this shift is all about understanding what’s involved in buying and making a comfortable home in spaces with fewer square meters than what you may have been used with before. With research and preparation, it’s possible not only achieve but maintain balance between having enough liveable space while still feeling organized. In this blog post, we’ll cover how homeowners looking to downsize their houses can do so without sacrificing comfort or convenience.

Reasons For Downsizing Homes

When it comes to owning a home, smaller isn’t always better. But if you take the time to consider what choosing less might offer, downsizing could prove extremely beneficial—especially with today’s tiny house movement becoming ever more popular! For many of my clients in real estate over the last thirty-seven years alone, opting for something smaller has been about saving money and living without excess space they just don’t need or use; but there are other advantages too. Millennials hoping to make travel plans or retire early may find that downscaling makes sense while those who see retirement on their horizon will appreciate much easier upkeep and management responsibilities compared to larger houses.

Start By Organizing to go Into a Smaller Home

Moving can be a stressful process, but you don’t have to make it even more daunting! Start downsizing your home early – at least several months ahead of the move. Not only will this help keep stress levels low, but taking on each room one-by-one will help with staging once your house is listed for sale. On top of that? Your property could sell faster too! This can be key when considering how to downsize to a smaller home.

Understand The Size of Where You’re Moving Into

Before making the move, it’s important that you understand how much space your new home offers. Doing a quick calculation of square footage will give you all the details about each room and help ensure nothing gets left behind! Knowing which furniture pieces are of use versus those that can be donated or discarded is key in downsizing homes. You may find yourself saying goodbye to some beloved items but remember. If something doesn’t fit its bye-bye for now – maybe things can work out when relocating again down the line?

Organize What You’ll Be Keeping

Get your home ready for the big move with some smart and savvy sprucing! From arranging drawers to shredding papers, proper preparation can help make downsizing a breeze. Make sure you label moving boxes appropriately – this way everything will be easy to find when it’s time. Don’t forget those treasured documents either. Invest in a safe place where all vital records are conveniently located come packing day.

Final Thoughts For Downsizing

It’s no secret that downsizing can be a tough decision, especially when we’re attached to our home. After all the great memories and experiences you’ve had in your home it’s not easy saying goodbye! When you finally get there though, the worry of managing everything decreases. But what do start weighing up if it really is right for us? These tips might just help make that process easier. For more information, contact us today. 

small plant with coins to show savings growing over time.

Affordable Home Upgrades Under $100

Affordable Home Upgrades Under $100. Are you a homeowner looking for an affordable way to upgrade your home? Perhaps, you are in the market for a new house and want to make sure it meets needs while not breaking the bank. Either way, investing in home upgrades can increase your quality of life, boost property value, and even save energy costs over time. The best part is that there are several projects out there which cost less than $100 – making them perfect for households on any budget! We’ll explore home upgrades that will transform your space without taking too much out of pocket cash. Courtesy of Prime Mortgage Works. 

Paint Outdated Cabinets

Spice up your space with a budget-friendly update! Investing in some paint and supplies can be an easy way to bring value to any home. With only $100 and one weekend, you’ll take something old and give it fresh life . This will up its equity for sale or brightening the look if you plan on staying put. Grab that brush or roller, pick out your hues of white or light grey, get ready to work those muscles. Then voila, newly painted cabinets at no extra cost!

Replace Kitchen Hardware

Updating your kitchen hardware can be a cost-effective way to give it an instant transformation. According to Matthew Griffin from At Home Real Estate Consulting, changing out those 2002 gold drawer pulls for something more current like matte black or silver can make all the difference! Want in on this budget upgrade? Check Amazon – you might just find everything you need with 25 stylish handles for around $25! One of many amazing affordable home upgrades under $100.

Add Solar Lights

Are you wanting to give your outdoor areas a little extra pizzazz? Take it from Jason Gelios, top-producing realtor with Community Choice Realty in Southeast Michigan: solar path lights are the way to go! Believe it or not, these high quality lights have become super affordable recently. You can buy 12 stainless steel LED light fixtures for under $50 on Amazon. Why not jazz up your backyard walkways and porches today?!

Change Out a Main Light Fixture or Two

Changing up your light fixtures is an easy way to spruce up the look of your home! According to Mike Stewart, entrepreneur and realtor with his own Professional Real Estate Corporation, buyers love new features that match their style. They’re drawn into it visually – so why not switch those old-fashioned lights out for something a bit more modern? Whether you shop online or hit up local stores in search of discounted deals LIGHTING UP YOUR HOME can be super simple & affordable too!

room in house needing renovation

Purchasing Fixer Uppers

Experienced buyers who value their investments know that purchasing fixer uppers can be excellent sources for substantial savings. These properties make it possible to obtain high quality homes at discounted prices, thus affording homeowners an opportunity to increase equity with budgeted improvements and repairs. Taking on a challenge is sometimes necessary in order to build or renovate one’s dream home. There are also those looking for monetary gain through fixing up houses before reselling quickly at market rates. Whatever the motivation behind investing in a property needing some attention may be, savvy purchasers understand how beneficial such purchases can truly be!

Purchasing Fixer Uppers – Basic Finances

Purchasing Fixer uppers can be a great financial investment, but buyers should proceed with extreme caution. It’s essential to understand the potential worth of your purchase after all work is done. An experienced real estate agent will provide invaluable guidance here in determining what that value may look like for you. Armed with this knowledge and a thorough review of both costs related to repairs and renovations as well as asking price. You’ll know whether or not such a deal presents itself before taking on the project at hand.

Consider the Scope

Restoring a fixer-upper home can be an arduous task, taking several weeks to complete. It’s essential that you accurately assess what needs to be done before commencing. No one likes getting in over their head financially or physically, so make sure the property is structurally sound first. If unsure of your own skillset for this kind of assessment contact professionals who understand such projects. Dedicated businesses offering these services exist specifically for those wanting reliable advice on refurbishing rundown properties.

Special Fixer-Upper Considerations

Before making a final decision on the prospective property, it’s important to evaluate its location and potential for appreciation. Even if significant repairs are needed in an area of steadily increasing real estate values, homeownership may yet be a lucrative endeavor – just bear in mind that unexpected problems can sometimes arise during renovations no matter how small or large-scale they would happen to be.

In Summary – Parting Fixer Upper Information

Purchasing a fixer-upper can be an exciting yet daunting decision. Before taking the plunge, it’s essential to weigh all of your options and understand what you’re getting into. Don’t forget to get advice from professionals! On top of that, if done correctly there are few things as satisfying as finding the perfect property. Not only do you have equity in something which might otherwise never exist for yourself but also pride at having put together such a project. So why wait? With guidance start searching today – your own dream residence awaits!

rate graph on iphone and laptop

2023 Mortgage Rate Predictions

In 2022, the prime rate saw an astounding 163% increase in mere ten months. As a result, this set a record that is unlike any other. This sharp incline left financial lenders and borrowers alike wondering: how long will rates stay at their peak? Looking to history for answers reveals one thing – it’s not too long before we see rates lower again.

With borrowing costs key to the Canadian economy, swift action had to be taken to address a ballooning inflation. Consumers and businesses react swiftly with cautionary behaviour when rates spike rapidly. As a result, we face an unprecedented situation in which expected levels of interest may remain elevated for much longer. Possibly longer than their traditional 4 month lifespan. Doing so could trigger economic uncertainty. This is why quick turnaround intervention is required more urgently now than ever before.

2023 Mortgage Rate Predictions

The current economic landscape does not yield a clear-cut path for future interest rate changes. Although historically it is improbable to see the prime rate stay at its high longer than nine to fourteen months, there are numerous factors which may influence this trend including oil prices, wage gains and COVID risk among others. Meanwhile market speculation has placed an expectation of one more Bank of Canada hike before rates peak with the potential for a first cut in December. Now remains the time where we must exercise our best judgement as inflationary pressures take hold amidst variable external forces on all sides.

Although the BoC Governor‘s words may suggest different, it is highly unlikely that mortgage rates and other borrowing costs will stay high into 2024. Economic trends have been showing more promising signs than expected by the Bank of Canada lately. This alone will provide a ray of hope for borrowers waiting to enjoy lower lending costs in future months. Call us to discuss.

spiral staircase from top to bottom

Winning the LOWEST Rate

 

Keys to the Lowest Rate

Ready to buy a house and winning the lowest rate. Your mortgage rate is heavily influenced by the characteristics lenders look for in borrowers. To get your best possible deal and make sure you meet all of their criteria. Have an impressive credit score, demonstrate stable income and employment history, provide low debt-to-income ratios (DTI). Then, offer 20% as down payment or more if available, this shows financial stability! It’s no surprise that those who present themselves well will get accepted at lower rates. Don’t worry if not everything matches up perfectly – they take other factors into consideration too!

Lower Down Payment?

Don’t let a heavy down payment weigh you down! CMHC Insured mortgages with less than 20% require an insurance premium, but they also offer the lowest mortgage rates. With conventional loans over 20%, higher interest prevails. That being said, some lenders are willing to charge sweet discounts if your wallet’s full enough. A minimum of 5% is needed in Canada, so take advantage and start budgeting for that dream home today!

Does the Lowest Rate = The Best Deal?

When it comes to mortgages, don’t be dazzled by rock-bottom rates! Sure, low interest look great at first glance. However, there’s a range of other factors that can make or break your mortgage deal. Take prepayment provisions for example, these vary between lenders and could potentially cost you in the long run if not suitable to your needs. Additionally, portability clauses should also be taken into consideration before committing. Some brokers might leave out important information when touting their lowest rate offer so ask questions beforehand! We welcome all of your mortgage questions and will provide the best answers for your situation. When deciding on a mortgage plan use all available info as part of an informed decision making process. After all, this is one purchase you’re likely going handle only once in life time. That is why winning the lowest rate for your own case is important.

Couple hugging with keys in hand

First Time Home Buyers’ Guide

So, you’ve finally decided to fulfill a lifelong dream and buy your own home… how exciting! You are ready to fulfill your dream of having a place to call your own as First Time Home Buyers.

Buying a home is one of the biggest emotional and financial decisions you’ll ever make. Prepare by learning about the process of homebuying and the responsibilities of homeownership. The differences between renting and buying a home are vast, and there’s a long list of pros and cons for both options. And, remember — there is no one best decision for everyone. Before moving forward, though, here are some questions to consider.

Do you have the necessary financial management skills?
How financially stable are you?
Are you ready to take on the responsibility of all the costs involved in homeownership, including mortgage payments, repairs, and maintenance?
Are you able to devote the time required for home maintenance?

 

Home Renting vs. First Time Home Buyers

There are pros and cons for both renting and buying a home. Everyone must make his or her own best decision. Buying a home is not for everyone. Take a moment to think through the advantages and disadvantages of both owning and renting, and make a list. Use our home renting vs. buying calculator to help you.

Read over your completed worksheet and then think carefully. Are the advantages of owning your home really bigger than the advantages of renting? Are the disadvantages of owning your own home really smaller than the disadvantages of renting?

If homeownership is for you, you must be both financially and emotionally ready. Buying a home isn’t only about money. You should listen to your heart… and take an honest look at your lifestyle.

Are You Financially Ready To Own A Home?
How can you know if you are financially ready to become a homeowner?

Start figuring out your financial readiness by evaluating your present household budget. How much are you spending each month? Knowing exactly how much, will give you a better idea about whether you can afford to become a homeowner.

Do you know how much debt you are carrying? You need this information to figure out whether you are financially ready for homeownership. If you decide to buy a home, mortgage lenders will ask for this information.

 

How Much Can You Afford?

Before you begin shopping for a home, it’s important to know how much you can afford to spend on homeownership. You will want to plan ahead for the various expenses related to homeownership. In addition to purchasing the home, other significant expenses will include heating, property taxes, home maintenance and renovation as required.

Two simple rules can help you figure out how much you can realistically pay for a home. You must understand these rules to understand if you will be able to get a mortgage.

Home Affordability Rule #1
Your monthly housing costs shouldn’t be more than 32% of your gross monthly income. Housing costs include your monthly mortgage payments (principal and interest), property taxes and heating expenses. This is known as PITH for short — Principal, Interest, Taxes, and Heating.

If you are thinking of buying a condominium or leasehold tenure:

For a condominium, PITH also includes half of the monthly condominium fees.

For leasehold tenure, PITH also includes the entire annual site lease.

Lenders add up your housing costs and figure out what percentage they are of your gross monthly income. This figure is called your Gross Debt Service (GDS) ratio. To be considered for a mortgage, your GDS must be 32% or less of your gross household monthly income.

Affordability Rule #2
Additionally, your entire monthly debt load should not be more than 40% of your gross monthly income. Your entire monthly debt load includes your housing costs (PITH) plus all your other debt payments (car loans or leases, credit card payments, lines of credit payments, etc.). You have calculated these on the Monthly Debt Payments form. This figure is called your Total Debt Service (TDS) ratio.

 

Your Maximum House Price

The maximum home price that you can realistically afford depends on a number of factors. The most important factors are your household gross monthly income, your down payment and the mortgage interest rate. For many people, the hardest part of buying a home — especially their first one — is saving the necessary down payment.

Note: For CMHC-insured mortgage loans, the maximum purchase price or as-improved property value must be below $1,000,000, when the loan-to-value ratio is greater than 80%.

 

Calculate Your Maximum House Price

Use the Mortgage Affordability Calculator in the Mortgage Tools section to figure out the maximum home price you can afford, the maximum mortgage amount you can borrow, and your monthly mortgage payments (including principal and interest).

 

Mortgage Loan Insurance

Mortgage loan insurance helps protect lenders against mortgage default, and enables consumers to purchase homes with a minimum down payment of 5% — with interest rates comparable to those with a 20% down payment.

The CMHC Mortgage Loan Insurance premium is calculated as a percentage of the loan and is based on the size of your down payment. The higher the percentage of the total house price/value that you borrow, the higher percentage you will pay in insurance premiums. The cost for Mortgage Loan Insurance premiums is usually offset by the savings you get from lower interest rates.

Note: The amortization cannot exceed 25 years for mortgage loan-to-value ratios higher than 80%.

Do Your Calculations Look Encouraging?
What is your current financial situation?

You may need to step back and re-evaluate your house goals and dreams. Consider the following which may improve your housing outlook for the long run:

Pay off some loans first.
Save for a larger down payment.
Take another look at your current household budget to see where you can spend less. The money you save can go towards a larger down payment.
Lower your home price — remember that your first home is not necessarily your dream home.
Before approving a mortgage, lenders will want to see how well you have paid your debts and bills in the past. To do this, they consider your credit history (credit report) from a credit bureau. This tells them about your financial past and how you have used credit.

Before looking for a mortgage lender, get a copy of your own credit history. There are two main credit-reporting agencies: Equifax Canada and TransUnion Canada. You can contact either one of them to get a copy of your credit report. There is often a fee for this service.

Once you receive your credit report, examine it to make sure the information is complete and accurate.

 

If You Have No Credit History

If you have no credit history, it is important to start building one by, for example, applying for a standard credit card with good interest rates and terms, making small purchases, and paying them as soon as the bill comes in.

Poor credit? lenders might not be able to give you a mortgage loan. You will need to re-establish a good credit history by making debt payments regularly and on time. Most unfavourable credit information (including bankruptcy) drops off your credit file after seven years.

 

Mortgage Pre-Approval

It’s a very good idea to get a pre-approved mortgage before you start shopping. Many REALTORs® will ask if you’ve been approved. A lender will look at your finances and figure the amount of mortgage you can afford. Then the lender will give you a written confirmation, or certificate, for a fixed interest rate. This confirmation will be good for a specific period of time. A pre-approved mortgage is not a guarantee of being approved for the mortgage loan.

Even if you haven’t found the home you want to buy, having a pre-approved mortgage amount will help keep a good price range in mind.

Bring these with you the first time you meet with your mortgage broker:

Your personal information, including identification such as your driver’s license.
Details on your job, including confirmation of salary in the form of a letter from your employer.
All your sources of income.
Information and details on all bank accounts, loans and other debts.
Proof of financial assets.
Source and amount of down payment and deposit.
Proof of source of funds to cover the closing costs (these are usually between 1.5% of the purchase price).

 

Make Your Mortgage Work for You

We will offer you several choices to help find you the mortgage that best matches your needs. Here are some of the most common:

 

Mortgage Amortization Period

Amortization refers to the length of time you choose to pay off your mortgage. Mortgages typically come in 25 amortization periods, but can be as short as 15 years. Usually, the longer the amortization, the smaller the monthly payments. However, the longer the amortization, the higher the interest costs. Total interest costs can be reduced by making additional (lump sum) payments when possible.

 

Payment Schedule

You have the option of repaying your mortgage every month, twice a month, every two weeks or every week. You can also choose to accelerate your payments. This usually means one extra monthly payment per year.

 

Mortgage Interest Rate Type

 

You will have to choose between “fixed”, “variable” and “protected (or capped) variable”. A fixed rate will not change for the term of the mortgage. This type carries a slightly higher rate but provides the peace of mind associated with knowing that interest costs will remain the same.

With a variable rate, the interest rate you pay will fluctuate with the rate of the market. Usually, this will not modify the overall amount of your mortgage payment, but rather change the portion of your monthly payment that goes towards interest costs or paying your mortgage (principal repayment). If interest rates go down, you end up repaying your mortgage faster. If they go up, more of the payment will go towards the interest and less towards repaying the mortgage. This option means you may have to be prepared to accept some risk and uncertainty.

A protected (or capped) variable rate is a mortgage with a variable interest rate that has a maximum rate determined in advance. Even if the market rate goes above the determined maximum rate, you will only have to pay up to that maximum.

Use the Mortgage Payment Calculator to find how much and how often your payment will be. Compare options and find one that’s right for you.

 

Mortgage Term

The term of a mortgage is the length of time for which options are chosen and agreed upon, such as the interest rate. It can be as little as six months or as long as five years or more. When the term is up, you have the ability to renegotiate your mortgage at the interest rate of that time and choose the same or different options.

An open mortgage allows you to pay off your mortgage in part or in full at any time without any penalties. You may also choose, at any time, to renegotiate the mortgage. This option provides more flexibility but comes with a higher interest rate. An open mortgage can be a good choice if you plan to sell your home in the near future or to make large additional payments.

A closed mortgage usually carries a lower interest rate but doesn’t offer the flexibility of an open mortgage. However, most lenders allow homeowners to make additional payments of a determined maximum amount without penalty. Typically, most people will select a closed mortgage.

 

Property Down Payment

 

A down payment is the part of the home price that does not come from the mortgage loan. The down payment comes from your own money. You can buy your home with a minimum down payment of 5%, if you have mortgage loan insurance from CMHC. You need a down payment of at least 20% for a conventional mortgage.

 

Property Deposit

The deposit is paid when you make an Offer to Purchase to show that you are a serious buyer. The deposit will form part of your down payment with the remainder owing at time of closing. If for some reason you back out of the deal without having covered yourself with purchase conditions, such as financing, home inspection, etc., your deposit may not be refundable and you may be sued for damages. The size of the deposit varies. Your realtor or lawyer / notary can help you decide on the amount.

 

Home Inspection Fee

We recommend that you make a home inspection a condition of your Offer to Purchase. A home inspection is done by a qualified home inspector to provide you with information on the condition of the home. It generally costs between $350-$500, depending on the age, size and complexity of the house and the condition that it is in. For example, it may be more costly to inspect a large, older, home, or one in relatively poor condition, or that has many pre-existing problems or concerns.

 

Title Insurance

Your lender, lawyer, or notary may suggest that you get title insurance. This will cover loss caused by defects of title to the property.

 

Land Registration Fees

Land registration fees are sometimes called Land Transfer Tax, Deed Registration Fee, Tariff or Property Purchases Tax. In some provinces and territories, you may have to pay this provincial or municipal charge when you close the sale. The cost is a percentage of the property’s purchase price. Check on the internet or with your lawyer (or notary) or other team member to find out about the current rates. These fees can cost a few thousand dollars.