Blogs

Whether you're testing for asbestos or hiring a contractor to deal with the removal, this FAQ covers everything you'll need to know when it comes to dealing with the hidden killer.

According to Canada Mortgage and Housing Corporation (CMHC), the trend measure of housing starts in Canada was 189,837 units in August compared to 189,596 in July.  The trend is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

Brokers are pleased to hear that more transparency will finally be required of their major bank competitors.

“Transparency is very important to the consumers as they can make an informed decision of whom they would like to conduct business with,” Angela Wong-Liao of Invis the Money Lady said on MortgageBrokerNews.ca. “Our broker channel has been bombarded with so many disclosure forms since January 2009 and I believe that the lenders -- whether it is a bank, credit union, trust company, investment firms -- should have similar disclosures when they are dealing directly with consumers as it is their fiduciary duties to do so.”

Home buyers have raised prices for single-family detached houses to record highs in Greater Vancouver and Fraser Valley.

With the home price index hitting $984,300 last month for detached properties sold in Greater Vancouver, this is up 6.6 per cent from August 2013. In the Fraser Valley, which includes the Vancouver suburb of Surrey, the detached price index climbed 3.4 per cent to $569,800 over the past year.

Knowing a home's original age is only a starting point to anticipating potential concerns. Not all older homes are going to have issues, but the probability of identifying deficiencies or hazards are much greater. A prudent first step to reducing your buying and ownership risks is retaining the services of a licensed, experienced, and knowledgeable Home Inspector.

Although building science, practices, and material technologies have been improved overtime, older building materials and techniques still remain in service with older homes. Older systems either reach the end of their serviceable-life, require improvement, or removal and replacement from future service based on known issues or risks. For example, design flaws and non-performance issue ('leaky condos' in BC), and health and safety risks (increased probability of electrical fires due to aluminum branch wiring and soil contamination from underground oil tanks). Older homes, especially those that have not been sold for decades, or not renovated/ improved at some point in the past, are commonly going to have defects/ deficiencies that a home buyer needs to know about prior to purchase.

According to a study released today in the Economic Analysis Research Paper Series, Canadian household net worth per capital reached 77 percent of the United States’ level in 2012.

The report compares the household net worth per capita in Canada and the U.S over this time period by using data from the Canadian national balance sheet accounts, and the Flow of Funds published by the United States Federal Reserve.

1. How does buying a home compare to renting?
   
   The best way to think of buying vs. renting is this: You’re either paying your own mortgage, or someone else’s. If you’re renting, you’re literally throwing away thousands of dollars each year on something that is temporarily yours to call home. On the other hand, if you’re making monthly payments on a mortgage, yes, somewhere around half of each payment is going to interest, but the other half is paying down the principal on YOUR home. For example, if you buy a home for $259,900, based on a 5 percent down payment with a 2.79 percent interest rate, a five year term and 25-year amortization period, your monthly mortgage payments would be $1,174. Of this $1,174, around $629 would go towards paying off your mortgage, while the other $545 would be your net interest cost. Therefore, if you are currently renting an apartment for $1,200, not only can you afford this home, but 53 percent of each one of your monthly payment would go towards paying down your mortgage rather than 100 percent of your rent costs paying off someone else’s.
   
   While renting comes with the bonus of being generally free of most maintenance responsibilities and a long term commitment, it also comes with loss of opportunity to build equity and protection against rent increases. You may also be restricted when it comes to decorating, owning pets, playing instruments, or having visitors. Overall, when you rent you’re more or less at the mercy of the landlord.
   
   On the contrary, owning a home has many benefits. First and foremost, when you make a mortgage payment you are building equity, and that's an investment. On the flip side, owning a home also introduces you to new financial responsibilities such as insurance, real estate taxes, and upkeep. That being said, the pros that come with owning your home far surpass the cons.
   
   
2. How do I know if I’m ready to buy a home?
   
   The best way to determine if you’re ready to buy a home is by asking yourself these important questions.

• Do you have steady employment that provides good, reliable income, or are steadily self employed with business income?
• Do you have a good record of paying your bills?
• Are you good at managing your money?
• Do you have few outstanding long term debts (i.e. student loans, credit cards, car payments, etc.)?
• Do you have access to a down payment (gifted, borrowed or your own)?
• Can you afford a monthly mortgage payment and additional living costs?
• Are you tired of paying someone else’s mortgage?
  
  If you can answer “yes” to the majority of these, then chances are you’re good to go.
  
  It’s crucial to have an idea of how much the move is going to cost you. To gain insight on how much you’ll need, use an online mortgage calculator to figure out the amount you’ll be able to comfortably afford based on income, debts and credit. Since the transaction will likely be your largest asset, it helps to speak with a qualified professional. Not only will this person help you get approved for a mortgage, but this way you’ll also know what price range you should be exploring in your house hunt. To find out what your budget is, contact Auxilium Mortgage.

3. How do I begin the home buying process?
   
   Once you have determined that you’re ready to buy a home and have figured out how much you can afford on monthly mortgage payments, the next questions to ask yourself are about the home itself. Ideally, it should be the right size, with a functional layout, and in a suitable location. But how do you determine all these factors when your head is already spinning with excitement and nerves?
   
   A great way to define what you’re looking for in a home is to weed out your wants from your needs. By making two lists, one to include things you cannot live without, your non-negotiable requirements, and the other featuring things you would like your home to include, but could live without, you’ll have a much easier time when visiting potential homes. Separating your wants from your needs will also allow you to know where you can compromise and keep you on budget. To begin your search for potential homes wander through different neighbourhoods, search online listings, and skim your local newspaper’s real estate section.
   
   It’s also important to look to the future when buying a home, regardless of if it’s your first, second or fifth time buying. Since your new home may not be your last, try to anticipate how long you’ll live in it and buy based on plans for that period of time. Do you plan on having kids? Will you be starting a home-based business or housing a relative? Do you want a dog? These are all things to consider.

The Auxilium Team offers a complimentary consultation to start your home buying process; contact us today at 250-590-6520 (toll-free 1-855-590-6520). You can also visit us at 307 Goldstream Avenue during regular business hours. We can arrange an appointment at our Fort Street office, or evenings or weekends, to work with you.