April 23, 2019

Should We Renovate Before Selling?

When you are considering doing some renovations with the idea that the new look will increase the value of your home, there are some choices that are better than others. Some of the best return on investment reno's might even surprise you.

During a recent study by JLC Group’s Remodeling Magazine, they established some costs versus value trends in 2019. What has the biggest bang for the buck? Replacing your garage door.

That’s right if your garage door looks terrible, go ahead and replace it. You will recoup an estimated 97.5% of the cost. The next best value for the cost is changing the façade of your home. If you have grungy old vinyl siding and replace it with something updated and fabulous, you will recoup an estimated 94.9% of the cost.

 

It is really the outside of the house that gets the economic go ahead. A deck addition, siding and new entry door all come in around 75% of cost recovery. The only indoor A+ return is a new kitchen. This is not surprising as so much of our time is spent inside and around this home hub. At an 80.5% cost recovery, go ahead and fix your kitchen, just remember to not go overboard.

You heard me, overboard. Upscale renovations just don’t get the required payback. The worst pay-off is an upscale master suite, bathroom or kitchen renovation. Midrange reno's had a much better return on investment. I know you personally might want a second kitchen inside the kitchen, 2 ovens, a baker centre and 3 sinks, but at the end of the day, don’t expect to get your money back out when you go to sell.

Your home is your castle and not all renovations are going to increase the value of your house but they may be worth it to you. That’s okay as this is where you live, where you create amazing memories and where you provide a haven for family and friends. 

If, on the other hand, you are doing the renovations in preparation to sell your home, reach out to me first and we can discuss whether the change is going to be worth the time, effort and cost. Sometimes it is and sometimes it just isn’t.

April 3, 2019

The Rules Have Changed for Housing in the ALR

April 3, 2019

Thinking about buying a property located in the Agricultural Land Reserve (ALR)?

As of February 22, 2019 the BC government has introduced a few changes to the Agricultural Land Commission (ALC) Act which affect the size and number of dwellings allowed on a parcel of land in the ALR.

ALR

 

KEY CHANGES:

  • ONLY ONE RESIDENCE PER ALR PARCEL IS PERMITTED

  • THE PRINCIPAL RESIDENCE CANNOT EXCEED 500 m2 (5,400 sqft)

 

Previously the ALC Act allowed additional dwellings for farm help or immediate family members. This meant that manufactured homes could be brought onto the property or accommodation above an existing farm building could be constructed. This is no longer true. These types of dwellings would now be considered a "non-adhering residential use" and must now be approved through an application process.

 

Because there are many homes in the ALR which already have more than one dwelling, the Act contains some grandfathering provisions. Carefully refer to the Act and Bulletin No. 05 to see which provisions apply to your specific case. 

 

Links

ALC INFORMATION BULLETIN No. 05

ALC - Agricultural Land Commission

Feb. 28, 2019

Top 10 Things To Look For When Buying a House

Buying a house can be a stressful, emotional experience. This list of the top ten things to look for when buying a home will come in handy when emotions are running high. Go through the list and verify the condition of each of these items. It's not necessarily a deal breaker if one or more of these items need repair, but it does give the buyer some solid negotiating power to ensure the items are fixed or accounted for in the final purchase price.

 

1. Foundation

My dad often said, "I'm glad you have a solid understanding". Of course, he was talking about the rather large size of my feet but the exact same thing is essential for your home. Whether the home you are considering has a full basement, a crawlspace, post on pad, or slab on grade, look for signs of deterioration. 

Concrete is a mixture of cement, sand, gravel and water. As the concrete drys and cures, it shrinks slightly. This shrinking can cause hairline cracks which do not jeopardize the structural integrity of the foundation. Large cracks or bulging in the concrete could indicate a more serious structural problem; for those, a professional must be consulted.

concrete

Other than cracks, look for efflorescence and other signs of moisture intrusion. Efflorescence is the white flakey salt residue left on concrete where moisture has intruded. A damp, or musty smell in a basement or crawl space may be another indication of unwanted water entering the space. 

Is it really serious to have a bit of moisture in the basement or crawl space? Maybe. Moisture can cause things like mould and dry rot to appear. Dry rot, despite its name. requires elevated moisture levels to occur. If your joists and beams are subjected to dry rot their structural integrity will eventually be compromised. The continual intrusion of water can also cause erosion of the concrete itself which obviously undermines the support structure of the house. So where a little moisture might not be a big deal, a lot of moisture usually is.

 

2. Insulation

Older homes in the Comox Valley, let's say pre-1950 may never have been insulated. This is something that will dramatically affect the cost to heat your home in the winter. Consider as well the energy efficiency of windows and doors, are they single pane? Is there weather stripping?

These items may not be deal breakers, but will definitely give you leverage when writing the deal.

 

3. Asbestos

Sometimes it would be preferable to buy a house that hasn't been insulated at all versus one that has been filled with asbestos insulation. The manufacture of products containing asbestos was banned in Canada in 1979, however, products made prior to that time may have been installed in homes up to 1990.

Asbestos can be found in a multitude of building products which appear in older homes, removal of these items should be handled by a professional and may be a costly endeavour. Here is a list of potential offenders:

  • tiles
  • siding
  • roofing
  • drywall
  • spackling
  • insulation
  • fireproofing materials

 

4. Mould

We know that the Comox Valley is part of a temperate rain forest, so mould is difficult to keep at bay. Look carefully in the bathrooms, kitchen and basement for signs of mould. Fresh paint in some cases may be masking an area which was mouldy, look closely for paint colour mismatches to suss these out.

Is it a deal breaker? Maybe. If you are sensitive to mould as are people with allergies and asthma then yes... definitely steer clear. Also, the elderly, children and people with compromised immune systems should not purchase a home that shows any signs of mould. However, if you are healthy and willing to undertake the renovation, repairing the mould affect area may be a great way to add value to the home.

 

5. Wiring

Outdated wiring can be an issue when looking at older homes in the valley. Some instances of knob-and-tube wiring still exist and will need to be replaced with modern wiring. During the 1960s and 70s, due to an increase in the price of copper, aluminium wiring became popular in home building. No longer to code, aluminium wiring can heat up due to oxidation, it can cause lights to flicker and may produce odours in the areas of receptacles. Do not attempt to replace aluminium wiring yourself, a certified electrician must be used.

 

6. Pests

When inspecting a home you are thinking about buying, make sure to keep an eye out for signs of pests. Termites, ants, wasps, mice, rats, and even squirrels can create problems in your home. Look for rodent traps in the basement, ant traps, faecal droppings, etc. Remember to check the attic for signs of mice and squirrels and birds. Deal breaker? Probably not, but you will want to write the purchase contract to reflect the investment it will take to remove the pests.

 

7. Plumbing

From the 1970s to the 1990s Poly-B pipe was often used as a cheap alternative to copper tubing. At the time it seemed fine, but as time went on issues of deterioration have arisen with this type of pipe. The life expectancy of Poly-B is now known to be 10-15 years so if this is in the home you are looking to purchase, you should plan a major plumbing overhaul. 

Closely look at whatever pipework is accessible for signs of corrosion or deterioration. Old iron sewer pipes last a long time but may eventually need to be replaced.

 

8. Septic Systems and Wells

Many rural homes in the Comox Valley do not have access to city water and sewer services. In these cases, water may be brought to the home via a creek, a drilled well, or a shallow/dug well. Of these options a drilled well is preferred as it requires the least maintenance and usually provides a reliable water source year round.

Shallow wells and creeks as water sources may be ephemeral and not provide a sufficient source of water year round. In these cases, you may need to keep cisterns of water on the property to make up the deficit in dry weather.

 

And then where does the water you use go? In the city, sewer systems take it away but in rural areas, people have to deal with their own wastewater. Septic systems do just that, the water which goes down the drain and through the toilet enters a tank in the ground. Sometimes that is the entirety of the system and the tank needs to be pumped out regularly.

A septic tank with dispersal field is usually a better system as the liquid passes through the tank and is filtered through the soil. The solids which enter the tank sink to the bottom and are consumed by bacteria. Typically the bacteria cannot keep up with the amount of solids in the tank so the tank does occasionally need to get pumped out. The frequency of pump out is determined by the number of people using the system and the size of the tank. A household of four people using a 5000 litre tank would have to pump it out approximately every 3.4 years (source: inspectapedia.com). If you don't pump it out, the solids overflow the tank and get into the liquid dispersal field and will cause system failure and groundwater contamination. If you smell a funky smell around a dispersal field, this may already be happening.

 

9. Structural Issues

Sloping floors, sagging ceilings and bowed walls are often signs of significant structural issues in a house. Take a marble with you when looking at houses, set it down and you will quickly learn how level the floor is. Houses can settle after being constructed. Whether the sloping is a major problem or not should be determined by a structural engineer.

Look for cracks in the plaster around windows and door frames. These can be signs of a house shifting and potential structural problems. A little settling is normal but if in doubt have a professional take a closer look.

 

10. The Roof

To cap off the list of the top 10 things to look out for when buying a house we have the roof. One indicator that might indicate roof damage are watermarks on the ceiling. To take a good look at the roof you may have to get up on a ladder. Determine what type of roofing material was used on the roof and estimate at what point in its life cycle that material is at.

Here are some common roofing materials with their average lifespans (source):

  • Composite Asphalt Shingles 15-40 years depending on the quality
  • Wooden Shakes 35-40 years
  • Standing-seam Metal Roof 30-50 years plus
  • Clay or cement roof tiles about 100 years if maintained
  • Slate 100 plus years

If the roofing material looks like it has seen better days you may want to get a quote from a roofing company and use that number when negotiating the final sale price of the house.

 

The good news is that most of these problems can be fixed, the bad news is that they may all cost you more than you were wanting to spend. Take the time to do a solid inspection with a reputable inspector it will be well worth the effort.

Feb. 22, 2019

Moving with Children

Moving is stressful and moving with children is even more stressful. There are more questions than answers when considering a move to a new town, making it difficult to answer questions that your kids may ask. The information below should help you answer these questions with confidence. 

 

What school will I go to? Will I make friends? I don’t want to leave my friends? What is there to do?

 

Let’s start with the basics. 

 

What school will I go to?

There are 21 public schools, 2 alternative programs and 3 private schools. Most of the public schools are smaller elementary schools which eventually merge into 5 high schools. Children regularly walk to and from school with their friends and parents. If your home is not within walking distance, then the school bus will pick up and drop off your little people.

 

The Comox Valley School Locator Tool will show you which school you would be attending depending on your street address. 

 

Of the 3 private schools Comox Valley Waldorf SchoolPhil and Jennie Gaglardi Academy, and Beachcombers Academy, only PJGaglardi Academy goes to grade 12. The other 2 go up to grade 7 and 8 respectively. Each has its own unique curriculum. If private is your preferred route, you will definitely want to check them all out.

 

After graduation, North Island College welcomes students who are looking for a degree, diploma, university transfer, apprentice programs, fine arts, nursing and so much more.  There is everything from aircraft structures technician to web and mobile design developer programs. One of my personal favourites is the metal jewellery design certificate. There are 1000’s of bursaries and scholarships, including one sponsored by my office, Remax Ocean Pacific Realty. Lots of companies participate in local annual bursary programs.

 

What is there to do? 

There are competitive and recreational dance, theatre, choir groups galore. Sports of every kind and competitiveness. Plus, the Comox Valley is home to Mt. Washington Ski Resort and a world-class mountain biking area in Cumberland. 

 

These are a sampling of the activities available for adult, youth and children, the Comox Valley offers something for absolutely everyone.

 

Dance:

Vireo School of Performing Arts

Pantuso Dance

Triple Heat Dance

 

Voice:

Comox Valley Children's Choir

 

Theatre:

Theatre Works

Rainbow Youth Theatre

Courtenay Little Theatre

 

Sports:

If being part of a sports team is your thing, the Comox Valley is the perfect location.

Baseball: Comox Valley Baseball Association

BMX: Coal Hills BMX

Climbing: Cumberland Recreation Climbing Wall

Field Lacrosse: North Island Field Lacrosse

Football: Comox Valley Youth Football

Gymnastics: Chimo Gymnastics Club

Hockey: Comox Valley Minor Hockey

Lacrosse: Comox Valley Minor Lacrosse

Mountain Biking: United Riders of Cumberland

Roller Derby: Brick House Betties

Rugby: Comox Valley Kickers Rugby Club

Sailing: Comox Bay Sailing Club

Skating: Comox Valley Skating Club

Skiing: Strathcona Nordic Ski Club

           Mt. Washington Ski Club

Soccer: Comox Valley United Soccer

Swimming: Comox Valley Aquatic Club

 

What I found when moving to the Comox Valley is the cost of activities are more reasonably priced than in the big city. With so many fun activities, it will take little time for your children to find new friends to create amazing bonds that will last a lifetime. The Comox Valley is a social area where indoor and outdoor activities are endless.

 

The Comox Valley is often considered an amenity destination. It has everything a person wants and needs. You can find a family doctor, dentist, veterinarian and specialists. The hospital and college are both new. Comox airport has many daily flights and Calgary becomes a great hub for travelling internationally when flying from Comox. Having the airport next to the CFB Comox Airforce Base, flights take off and land in Comox when other parts of Vancouver Island are fogged in. 

 

If you want to live in a community that brings your family closer together, consider the Comox Valley.

Posted in community
Feb. 5, 2019

Does Moving Make You Nervous?

Does moving make you nervous?

Does looking a home make you nauseous?

I get it – moving costs a lot. Will your friends still visit? What about the kids? Will it be worth the hassle?

 

The question you need to ask yourself is why did you start looking to move in the first place? Was it for more space or are you looking to downsize?

Do you need more from your home than the current one allows? Are you thinking of renovating and wondering if it would be better to move instead?

All of these are great questions that only you can answer. 

Here is my question to you,  

If you put off buying a home today will you be at peace with your decision or will it nag you and weigh heavily on your shoulders.

If you can let it go, then maybe the timing isn't right.

However, if you can't drop it then you know it is time.

cat in bacckpack

 

Jan. 23, 2019

Energy Efficiency and Purchasing an Older Home

With the desire to be as energy efficient as possible to save money and create a smaller footprint on the earth, our budget and our values can sometimes be at odds while house shopping. Luckily there is a solution for when you find your dream home but it is not as energy efficient as you had hoped. With a combination of lender financing options called Purchase Plus Improvements and BC Energy and Efficiency Grants you may be in for a win-win situation. 

Purchase Plus Improvements is a program where you can add a certain dollar value of money to your mortgage. Suppose you purchased a $450,000 property and you wanted to do some upgrades. You could add up to 10% of the value to the property price for renovations. Now you will have a purchase price of $495,000 and would need at least 5% down payment on $495,000 versus $450,000 BUT you would have that extra money to do renovations and improvements on your home.

 

To get even more bang for your buck, utilize some of those funds to create a more energy efficient house, including new windows, upgraded insulation, changing to an efficient heat and hot water source you may receive rebates from utility companies, government and even the high ratio insurance providers. https://efficiencybc.ca/incentives/ is a great place to start to see what rebates and incentives you could be eligible for.

 

I have personally utilized these incentives to make a 1913 home more comfortable and affordable to live in. If the house you love isn’t perfect, there are a lot of options to make it work for you. Call me if you would like further insight into the available programs.

Jan. 11, 2019

2 Property Transfer Tax Exemptions

There are two basic Property Transfer Tax exemptions that you may be eligible for, and knowing what the price ceilings are may help you decide between house A and house B.

 

The First Time Home Buyer’s Program was created to help first time home buyers get in to a home. The BC Government realizes the cost of getting into a home is substantial.

 

To qualify you 

  • must be a Canadian citizen or permanent resident
  • never have owned a home ANYWHERE in the world
  • have lived in BC for 12 consecutive months before buying the property OR filed at least 2 income tax returns in the past 6 years as a BC Resident
  • have never receive the First Time Home Buyers’ grant before
  • must be buying the residence to live in (principal residence)
  • must be under 1.24 acres in size
  • Under $500,000 (there is a partial exemption up to $525,000)

 

If one person has owned a home before, and the other buyer has not, you should talk to your mortgage broker as you may be able to go 50/50 on title or even 99/1 on title and save a significant amount of money.

 

Newly Built Home Exemption

 

A home is considered newly built if

  • constructed on a vacant parcel of land
  • apartment is in a newly built condominium building
  • manufactured home placed on a vacant parcel of land
  • house moved from one parcel of land to another and hasn't been occupied

 

If you paid PPT on a piece of bare land and have now built a house on the land you may be eligible for a PPT refund.

 

To qualify you must be

  • an individual (not a corporation)
  • Canadian citizen or permanent resident
  • the property must be in BC
  • the property must be used as your principal residence (not a rental property or second home)
  • have a value of $750,000.00 or less
  • be 1.24 acres or smaller

 

This can be a tricky exemption. Even my lawyer got it wrong the first time and second time. Luckily I knew exactly what my costs should be and was able to show the lawyer where to find the information.

 

The nice thing about the GST on a New Home is that it is ADDED to the purchase price so you do not need to come up with the cash. Add this fact and the property tax exemption, buying a 'Newly Built Home' can save you from spending a lot of upfront cash at closing.

 

If you have any further questions, do not hesitate to reach out to me at 250-937-9856. It’s complicated. I have spent 16 years working in mortgage finance and real estate transactions. I can help you.

 

Jan. 9, 2019

Closing Costs Add Up Quickly

If you are buying a house, there are a lot of additional costs to consider besides your down payment. You have scrimped and saved to get your down payment, but what else is going to come up?

 

Here are some costs that you will also need to save for, and in many cases, provide proof to your mortgage holder that you have these funds saved.

 

The biggest cost is the Property Transfer Tax. This is very different than property taxes. The Property Transfer Tax (PTT) is paid when you buy a home and is a percentage amount based on the fair market value of the property (unless you qualify for an exemption). If you purchased the house through a Realtor, the house will generally be considered fair market value, but if you bought the house from your Grandma, and she gave you a smoking deal, you may be required to prove that you paid fair market value and are likely to be audited.

 

The amount is substantial. As of January 2019, the tax is 1%on the first 200,000.00, 2% on the portion between 200K and 2 Million, 3% on the portion from 2 Million to 3 Million and 5% for any value greater than 3 Million.

 

As an example, if you purchase a $500,000 house, you will be required to pay $8000. Below is the BC Government tax estimate calculator.

 

https://forms.gov.bc.ca/taxes/estimate-your-property-transfer-taxes/

 

IF you have NEVER owned a home anywhere in the world, and purchase a house under 525,000.00 then read the blog on PPT exemptions as you may be eligible for an exemption.

As well, IF you are buying a newly built home that is subject to GST and under 750,000.00 you may be eligible for an exemption (which seems fair as you are paying GST as well).

 

Legal Fees will likely be around $1500

Title Insurance is required if you are getting a mortgage $200

And an Appraisal if you are getting a mortgage $300

 

Moving costs - this can range from beer and pizza ($125) up to thousands of dollars when you moving any distance. When getting a quote from a mover ask for an all in price, including fuel surcharge, tax etc. From personal experience, I was quoted $1400 for a move and the final bill came in at just over $2100.

 

Odds and Sods - You will likely have new connection fees for things like natural gas, electricity, internet, and cable. Other things that you might not have considered are garbage cans, garden hoses, blinds or drapes. I once moved into a house which had no window coverings at all, it felt like the neighbourhood fishbowl. Blinds and drapes can easily cost $100/window so with even ten windows you are out another thousand dollars.

 

If you require any further clarification on closing costs, please reach out to me and I will be happy to go over what your specific closing costs should look like.

 

Jan. 7, 2019

Preparing Your Home For Sale

Selling your home is a big step. More than a big step, it is a huge step!

There are many things that need to be done in preparing your home for sale but for now, I am going to tackle three points that are going to be helpful.

 

  1. Once you identify your “Why” for selling the home - you want a larger house, a smaller house, or you are moving to a different location. Whatever the reason, you then need to go to your mortgage broker or bank to ensure that you are going to be able to do what you want to do. In my past, I have seen people find their dream home, sell their house and then find out that the penalty on their existing mortgage was over $20,000.00. The mortgage rules have changed in Canada over 20 times in the past 10 years so you want to make sure that you can qualify for a mortgage if you are going to need one. It would be terrible to sell your home only to find out that now you are unable to qualify for a new home.
  2. Seek out a Realtor who is going to help you sell your home and has excellent marketing skills. Someone who is going to work with you before, during and after the sale of your home. Find someone who communicates well with you and who you trust. A Real Estate Agent should provide advice on how to optimize the value of your home, staging advice, professional photos, comprehensive market evaluation and detailed marketing plan that all works within your timeline. Find a Realtor who will invest in you and your home.
  3. Clean, fix and declutter. I know this is a hard one. You work, have a family, other priorities and then someone wants to view your home. The easiest way to keep on top of the cleanliness is to de-clutter. I provide a pre-sale packing package that comes with boxes, foam wrapping for protecting breakables and tape. You are going to need to pack anyway; why not get a head start? Have you wondered about staging? I bring in a staging consultant who will work with the furniture you have and together we decide what can and cannot be done to optimize the value of your home. Do you have repairs that need to be done? We will consider each repair and evaluate if the repair is worth doing (or has to be done) or whether it is better to leave the repair for the new owners.

There are many more things to consider when preparing your home for sale, but this is a great start. If you would like to meet to discuss selling your home, please do not hesitate to reach out to me at any time.

Jan. 5, 2019

Fiduciary (Trust) Responsibilities of a Realtor

When we first meet and start to get into personal information I will stop and have you read and sign a “Disclosure of Representation Trading Services.”

 

This form explains who the Real Estate Agent is working for (hopefully YOU) and that the information you disclose is to them is confidential. That confidentiality agreement NEVER ends even if you stop working with that realtor.

 

It explains the Realtor will not act in a conflict of interest and they will obey all lawful instructions you provide.

 

This provides you with the confidence and understanding of the professionalism and value that is provided during and after buying or selling your home. This is generally one of the largest transactions that happen in a person's life and it is important to be properly represented.

 

If you work with a Realtor who is working with the buyer AND the seller, one party MUST go unrepresented or find another Realtor to work with. This is to protect the buyers and sellers, ensuring that they are being advocated for properly and professionally. Just as a lawyer does not work for the plaintiff and the defendant, a Realtor should not work for both a buyer and a seller.

 

This form does not obligate you to work with the Realtor you signed the form with, and you may end up signing several of the forms when looking for a Real Estate Agent that suits your style. The form protects you and that is a good thing.

 

If you have any questions about the Disclosure in Trading Services Form please do not hesitate to reach out to me at any time.