As many of you know, stress rules will apply to all purchases including those with 20% down or more effective January 1 2018. Many clients will see an effective drop of 20% in their buying power which translates straight to a reduced purchase price. However, what happens with existing pre approvals?
Here are the rules that apply with a few of my lenders but not all:
Any preapproval committed prior to January 1st 2018 will remain valid for up to 120 days from the date of the original preapproval. Any extensions of an expired preapproval after December 31 2017 must be qualified using the qualifying rate based on the new rules.
Should a preapproval that was committed in 2017 turn into a real deal, the old rules apply even if the closing date of the new purchase is greater than the expiry date of the preapproval, but not greater than 120 days from the date of the commitment for the real deal.
Example; A pre approval committed prior to January 1 expires March 15, 2018. Borrowers purchase a property closing May 1 2018. If the real deal is committed on/before March 15th, we still qualify using the old qualifying rate rule. The rate is no longer protected as the closing is beyond the expiry date of the pre approval, however the old rules still apply for qualification, as long as the deal closes within 120 days.
This is a big opportunity so please contact me asap to get your pre approval in prior to January 1 2018. Any existing pre approvals that I have will be resubmitted next week to take advantage of this.
Today, the Office of the Superintendent of Financial Institutions (OSFI) introduced new rules on mortgage lending to take effect next year.
OSFI is setting a new minimum qualifying rate, or “stress test,” for uninsured mortgages (mortgage consumers with down payments 20% or greater than their home price).
The rules now require the minimum qualifying rate for uninsured mortgages to be the greater of the five-year benchmark rate published by the Bank of Canada (presently 4.89%) or 200 basis points above the mortgage holder’s contractual mortgage rate. “The main effect will be felt by first-time buyers,” says James Laird, co-founder of Ratehub.ca. “No matter how much money they put down as a down payment, they will have to pass the stress test.” The effect of the changes will be huge, resulting in a 20% decrease in affordability, meaning a first-time homebuyer will be able to buy 20% less house, explains Laird.
MoneySense asked Ratehub.ca to run the numbers on two likely scenarios and find out what it would mean for a family’s bottom line. Here’s what they found:
Livia McCabe and Brendan Hughes are realtors with Re/Max Real Estate (Central) who’ve helped many people move from outer communities to downtown and vice versa. In their experience, the people moving into the city centre from the outskirts tend to be empty nesters looking to downsize and simplify in their retirement. “With the kids grown up and gone, most of them find their current property too large and in need of a large renovation,” says McCabe. “They would rather sell and find something turnkey that they could enjoy immediately.”
On January 5, 2016 the Calgary Real Estate Board updated their Calgary MLS community boundaries and names to align with the existing City of Calgary communities. The changes came about in an effort to increase database integrity and eliminate naming communities that do not formally exist or are not formally recognized by the City. This allowed for both CREB and the City to better share, compare and analyze housing data. Generally speaking the ‘Estate’ communities have disappeared and are incorporated into the surrounding communities.
As a result Varsity Acres, Varsity Village and Varsity Estates are now known as the single community named Varsity.
While this might make it easier for data sharing with City, it really skews real estate data. Previous to this change, sales data would have been obtainable by each distinct area of Varsity. Now it is all part of one big ‘Varsity’ area.
Even though the Calgary Real Estate Board lumps all of the sales data into one area, the McCabe Hughes team has the ability to extrapolate the sales data & market information that is most relevant to your specific area within Varsity. Our ability to provide you with the most accurate & relevant data helps determine the true market value and empower you when it comes time to selling your property. Determining the right list price will help sell your property quicker and for more money than you might have thought possible. Ask us for a detailed CMA (Comparative Market Analysis) of your property in your unique part of Varsity.
Selling any home can be difficult in a buyer’s market, but when you are selling a one-bedroom condo there are even more challenges because there are so many comparable units on the market at the same time — sometimes even in your building.
Livia has been featured in Avenue Magazine’s article on how to help people who are looking to sell a one-bedroom condo in this competitive market:
Realtor Livia McCabe of Re/Max Real Estate (Central) believes the biggest challenge when selling a one-bedroom is always the perceived lack of space. “Take out half the things in your closets and drawers,” she suggests. “If it looks like your stuff doesn’t fit, the buyer will think their stuff won’t fit.”
Click here to read the full article
Over the past number of years I can’t tell you how many couples I have met, in their mid-late 50’s whose kids have either left home or are almost ready to leave home, who are out searching for smaller housing options. They have raised their family in their large homes but now wish to ideally find a bungalow that has been renovated to the kind of standards that reflect their position in life and standards which they expect now. They have the means, and understand that if they found the right product, it would most likely be a lateral financial move, depending on where their family home is located.
The challenge is, so many of the lovely couples I have met, currently have homes in NW Calgary with fantastic mountain views and are not willing to part with that view in their next home. I understand that completely and understand why that is a game breaker for sure.
Most of these couples are also not ready for condo or villa living as they still want a small yard and some sense of privacy or private space. If there were more (even any!) high end bungalow villa product choices in the NW that offerred large enough units with views and enough of a feeling of privacy or personal space, buyers would jump all over them. This is a very underserviced part of the market in my opinion.
So their quest comes back to finding higher end renovated single family detached bungalows (preferrably walk outs), in the NW quadrant of Calgary (as those are the buyers I generally am working with, who wish to stay in the NW), with West or Southwest backyards, that have some type of lovely view.
Thankfully, they do exist….albeit not many of them. But this year we have successfully found 3 homes for 3 downsizing buyers where they were thrilled with their new property enough to buy it and then they listed their family home with me and I was able to quickly and successfully sell it. In all 3 cases they were indeed lateral purchases, but it meant they moved into luxury, turnkey residences without doing any renos or giving up any of their important criteria.
Selling your home in an uncertain economy may seem like a frightening experience. Just a few years ago, it seemed like multiple purchasers were lined up with offers. Today, properties can sit unsold for 6-24 months without any action. How can you successfully sell in a challenging real estate market and get the best price possible? It’s all about differentiating your property from the others and the following home staging tips are a great start in doing just that:
- Create an atmosphere in the house that will appeal to a wide range of potential home buyers. Your particular likes and dislikes are not important so discard them now. De-personalize!
- A big part of home staging involves replacing clutter with cleanliness. Purge, purge, purge! Err on the side of minimalism in every room. After that, clean, clean, clean – hire cleaners if necessary but trust me, the more effort you put into this step, the more you will reap the rewards.
- The exterior should also be clean. You may need to pressure wash the siding and decks or other exterior areas. Everything that looks cluttered or messy should be removed. Don’t worry too much about the garage if you need to store boxes/items there.
- Remove all of the clutter from the bathroom countertops, from the tubs, from the shower stalls and especially the commode tops. Coordinate your shower curtains, towels and rugs. Create a spa-like feel.
The following are more tips for getting your house ready to sell:
There are fewer buyers in the market at the moment and you need to entice one of them (at least). Therefore your home must compare favorably to the others listed in your area. It needs to be memorable!
There is a wide range of things you can do to enhance both the value of your home as well as the curb appeal. Ask yourself “how well does your home show to prospective buyers?”
1. The Exterior.
The first thing that people will notice is the exterior of your house. It sets the tone for their visit. If a buyer is turned off by the outside of the house, they may not care much for the inside either.
- Mow & water the lawn and/or shovel the snow regularly. It should be well kept at all times. Remember, some people may drive by just to look at the house before coming to an official open house.
- Pick up any trash. Unfortunately, trash sometimes makes its way into our yards. You don’t want buyers to see this, so make sure to pick it up right away.
- Plant some flowers or add an attractive wreath in winter. Flowers freshen the place up or in winter spruce up your front door with an attractive wreath or outdoor planters/decor.
- Clean your exterior if possible – just a good scrub can make it look brand new.
2. The Interior.
Now that you’ve got them inside the house, you still need to make a good impression. The inside of your home should feel cozy and invite.
- Wash the windows and open the blinds/curtains. It will make the house seem brighter and more spacious. Natural light is so important to most people.
- Every inch of your house should be clean. If this is not your strong point, hire a professional to come in and do the dirty work. Then you just have to do a few touch-ups here and there. I cannot emphasize this point enough.
- Eliminate any unnecessary furniture and stash some of your knick-knacks. Potential buyers want to be able to imagine the home as their own. Your furniture is hindering their imagination. Depersonalize & clear out your clutter.
- Take out half of the clothes in each closet, rehang what you have on matching hangers. Do the same for any overstuffed drawers, cabinets. If buyers see that you don’t have enough room for your stuff, they assume there certainly won’t be enough room for theirs.
- If there are small repairs that are easy to do, then do them. Retouch chipped paint, replace the weather stripping that has hanging off of the back door for years etc… just little things. Look critically at your house and think like a buyer.
- Increase the wattage of your lights and ensure there are no burnt out light bulbs. Bright is better and instant light is preferred – avoid the bulbs that take 5 minutes to get their maximum wattage. Buyers will be in and out of the room long before that.
- If you have pets, try and remove any evidence of them – clean litter boxes thoroughly, remove pet droppings from the yard, remove or hide pet toys or structures. Many buyers are put off or have allergies to certain types of animals. The best thing to do during your listing period is have someone you trust take your pets so that showings can be done easily without having to remove your pets each time a request comes in.
- Avoid the use of strong plug in fresheners as many people find these strongs scents off putting or wonder what scent the seller is trying to hide. The smell of vinegar or a good pure cleaning product is always welcome.
The preparation for listing and selling your house might seem onerous but you have one chance to make a good first impression and this preparation will pay off!
Please contact Livia (403-542-1112) or Brendan (403-560-1673) of McCabe-Hughes Real Estate Inc and let’s discuss your particular situation. Email firstname.lastname@example.org or Brendan@mccabehughes.com