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Land Transfer Tax

Land Transfer Tax is one of the largest costs in buying a home, other than the deposit and the mortgage. It is payable at the time of closing.

Your individual land transfer tax calculation should be calculated and verified by your legal advisor/lawyer.

Please note the Ontario Provincial Government does amend the LTT from time to time. Visit Ontario’s Land Transfer Tax Website for the latest rates and information.

>>> Land Transfer Tax Calculator

Note to users: Although we try to ensure the accuracy of our information, it is not guaranteed, and we advise you to confirm all information with your solicitor/lawyer.

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What do all those abbreviations mean?

What does it all mean … all of the short forms in listings, ads or feature sheets?    

The following are just a few of the common abbreviations you might see.

A/C Air
Apt. Apartment
Appls. Appliance
Bach. Bachelor
Balc. Balcony
B/I Built-in
Bkr. Breakfast
Bsmt. Basement
Bed., Bdrm.
where laid
Bldg. Building
Bung. Bungalow
C/A or
air, central air conditioning
C vac,
C/vac., Central vac.
Condo. Condominium
Det. Detached
Db. Double
Elf. Electric
light fixtures
Ex. Exercise
Exp. Exposure
Ext. Exterior
Foy. Foyer
Fncd. Fenced
Fpl., Fp.
Fl. Floor
Fur. Furnace
Gam. Games
burner & equipment (furnace)
Gar. Garage
Flr., Hrdwd Flr.
Incl. Included
Lau. Laundry
Lib. Library
Lof. Loft
LR. Living
Lux. Luxury
Nur. Nursery
Obf. Open
brick fireplace
Off. Office
O/L’s Over
Pan. Pantry
Pla. Play
Ph. Penthouse
Pc. Piece
Rec. Recreation
Rm. Room
Sit. Sitting
S/L Storage/locker
Sol. Solarium
Spac. Spacious
Stry. Storey
S&S Storms
& screens
Tan. Tandem
Twnhse. Townhouse
Utl. Utility
W/O Walk
W/W Wall to
W/D Washer/dryer
Wkshp. Workshop
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Agency Overview – Working With a Brokerage

Realtors work within the Law of Agency

As of January 1st, 1995, the Ontario Real Estate Association required agents to disclose to everyone involved, who it is they represent.

The Way It Was

In the past, many buyers thought that agents helping them were working in their best interests. The law, however, states that their duty lies with their client. Until now, that was always the Vendor. A buyer could always expect competent service, but in most cases, both agents were “working for the Vendor”

Now.. The buyer has a choice as to how he/she is represented.

  • The Agent is the Real Estate Company (the Broker) and all it’s salespeople
  • The Client is the party who contracts for an Agent to act on behalf of that party and assist with their real estate transaction
  • A customer is a person who receives services from another person’s agent, but they are not the Client of that person

Clear as mud?

Client.. Buyer Broker Situation.

This has become probably the most common situation now because a purchaser can hire an agent to work on their behalf to negotiate the best price and terms for them.

The buyer then becomes “their Client” and the agent must disclose any information that may affect their decisions.

The Sales Rep owes a fiduciary duty to that buyer.. confidentiality, disclosure, accountability etc. and will be able to give direct advice as to market activity, strategy etc.

The agent would work with the buyer to the fullest, making sure their interests are protected. This would include providing regular information on new listings, sales, and other pertinent information.

The best part is … There are no additional costs to hire an agent to represent you. (unless otherwise arranged). The buyer’s agent can be paid by the listing broker, as agreed upon in the listing agreement and MLS arrangements.

If the buyer chooses to be a client, then he/she must sign a Purchaser Agency Agreement with the agent, whereby the buyer agrees to work with that agent exclusively for a designated period of time.

If a buyer doesn’t choose this, then the agent is working for the Vendor, as before.

This can be a fairly lengthy topic, and this is just meant to be a very brief overview. Here are a few facts that may help you understand the relationships a little better:

REALTORS are governed by the legal concept of “ Agency.”

An agent is legally obligated to look after the best interests of the person he or she is working for. The agent must be loyal to that person.

A real estate company may be your agent – if you have clearly established an agency relationship with that REALTOR. But often, you may assume such an obligation exists when it does not.
REALTORS believe it is important that the people they work with understand when an agency relationship exists and when it does not – and understand what it means.

In real estate, there are different possible forms of agency relationship:

1 . Seller’s Agent

When a real estate company is a “seller’s agent,” it must do what is best for the seller of a property.

A written contract, called a listing agreement, establishes seller agency. It also explains services the company will provide, establishes a fee arrangement for the REALTOR’s services and specifies what obligations a seller may have.

A seller’s agent must tell the seller anything known about a buyer. For instance, if a seller’s agent knows a buyer is willing to offer more for a property, that information must be shared with the seller.

Confidences a seller shares with a seller’s agent must be kept confidential from potential buyers and others.

Although confidential information about the seller cannot be discussed, a buyer working with a seller’s agent can expect fair and honest service from the seller’s agent and disclosure of pertinent information about the property.

2. Buyer’s Agent

A real estate company acting as a “buyer’s agent” must do what is best for the buyer.

A written contract, called a buyer agency agreement, establishes buyer agency. It also explains services the company will provide, establishes a fee arrangement for the REALTOR’s services and specifies what obligations a buyer may have.

Typically, buyers will be obliged to work exclusively with that company for a period of time.

Confidences a buyer shares with the buyer’s agent must be kept confidential.

Although confidential information about the buyer cannot be disclosed, a seller working with a buyer’s agent can expect to be treated fairly and honestly.

3. Dual Agent

Occasionally a real estate company will be the agent of both the buyer and the seller. The buyer and seller must consent to this arrangement in their listing and buyer agency agreements. Under this “dual agency” arrangement, the company must do what is best for both the buyer and the seller.
Since the company’s loyalty is divided between the buyer and the seller who have conflicting interests, it is absolutely essential that a dual agency relationship is established in a written agency agreement. This agreement specifically describes the rights and duties of everyone involved and any limitations to those rights and duties.

Who’s working for you?

It is important that you understand who the REALTOR is working for. For example, both the seller and the buyer may have their own agent which means they each have a REALTOR who is working for them.

Or, some buyers choose to contact the seller’s agent directly. Under this arrangement, the REALTOR is working for the seller, and must do what is best for the seller, but may provide many valuable services to the buyer.

A REALTOR working with a buyer may even be a “sub-agent” of the seller. Under sub-agency, both the listing agent and the co-operating agent must do what is best for the seller even though the sub-agent may provide many valuable services to the buyer.

If the seller and the buyer have the same agent, this is dual agency and the REALTOR is working for both the seller and the buyer.

Code of Ethics

REALTORS believe it is important that the people they work with understand their agency relationship. That’s why agency disclosure is included in a self-­imposed Code of Ethics, which is administered by the Real Estate Council of Ontario.

The Code requires REALTORS to disclose in writing the nature of the services they are providing and encourages REALTORS to obtain written acknowledgement of that disclosure. The Code also requires REALTORS to enter into a written agency agreement with any sellers or buyers they are representing.

For more detailed information, please contact us.

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Bank of Canada raised interest rates 1/4%

Bank of CanadaFor the first time in seven years, the Bank of Canada announced that it was hiking its key overnight rate by a quarter percentage point (25 basis points) bringing it to 0.75 percent as the economy has staged a broadly based economic expansion this year.

Read summary provided by a local mortgage broker, Mark Goode of Dominion Lending Centre.

 Michael J Preston, please email me questions or your comments.
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When is a good time to buy multi-unit residential properties?

Investing in OrilliaWhen is a good time to buy multi-unit residential properties? Anytime the fundamentals are good.

Several factors must be considered. A carefully completed due diligence check list is a must before proceeding.

First, a growing city will be ideal for possible future capital gains and income growth potential. The city or town you choose to invest in should have overwhelming evidence of growth and overall low vacancy rates (see CMHC free rental survey reports available online). In a perfect world, you will discover the location before competition drives prices up.

Second, a structurally sound building in good repair will provide a dependable cash flow and a growing positive return. Thirdly your financing can make it all happen or not. Vendor take-backs are not uncommon and can be a great way to make a purchase for those entering this investment arena. Now manage diligently! If you would rather not manage your self, hire a professional property management team.

What cities or towns may be worth a closer look?

If you move early you can grow and prosper as the community’s plan becomes a reality. You could be in place as prices begin to rapidly rise and the general investing public and investment clubs begin to react to the strong fundamentals and low prices compared to the cities already on the radar screen.

What cities would you choose? What about…

  • St John, New Brunswick (oil refinery, tidal power),
  • Sudbury Ontario (mining – huge reinvestment in the older mining properties and infrastructure),
  • Hamilton Ontario (dynamic city redefining it self with investment in the water front),
  • Kitchener – Waterloo, Ontario (highly educated workforce),
  • Windsor, Ontario, (a city that is also seeing the importance of diversity and is working hard to invest in its future; residential vacancy rates are low, many good properties to choose from at excellent prices, you can grow here, location, location especially important with this riskier city).

Lastly, you may find the best properties, possibly diamonds in the rough, in your own neighbour hood town or city.

In our area, Orillia, Ontario has been chosen (by the Real Estate Investment Network), along with Barrie, as their pick for the top ten Best Places to invest for potential capital gains growth.

So, keep your eyes open and your house in order so you can move on a deal when it presents itself. Any town and city can have multiple opportunities, especially during these more turbulent times.

Let’s talk about current real estate opportunities available today. Contact Michael J Preston 705-325-3600 or by email.

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Building a Future Retirement through Real Estate

By Michael J Preston, Lakeview Realty Inc., Broker of Record

I am a most adamant believer in Real Estate investment as a long term investment for safe, near sure returns. What other investment is there that will let you retire, possibly with millions of dollars, and it DOES NOT MATTER WHETHER THE PRICE GOES UP OR DOWN?  If you’re seriously considering investing in Real Estate for your retirement future, please give me a call so I can show you my active step by step plan to accomplish this goal.Is it time in your personal financial life to switch from Real Estate holdings to mortgages? Please call today and let’s discuss your options. The banks have built empires with mortgages, you can have a share of this wonderful investment too.

Michael J Preston   phone 705 325-3600
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How Canadians can boost home value through renovation

By Gail Johnson

With the popularity of home-decorating shows like Trading Places soaring, suddenly everyone’s an interior designer. But from a real expert’s point of view, where are homeowners’ renovation dollars best spent?

“Kitchens and bathrooms are the best places to start,” says Toronto’s Howie Track, owner of Traxel Construction, which specializes in high-end residential and commercial renovation and construction. “Kitchens and bathrooms are the first places people look, and if a new buyer sees that the kitchens and bathrooms have been done, then there’s less for them to do.”

Figures from the Appraisal Institute of Canada support Track’s claim. According to the Ottawa-based property-valuation association, bathroom and kitchen renovations continue to be the most popular on the list of perennial home improvements, with a recovery rate of between 75 and 100 percent.

The organization defines “recovery rate” as the likely increase in a home’s resale value that could be attributed to a renovation. If a $10,000 renovation increases a home value by $6,000, for example, the recovery rate is 60 percent.

Landscaping vies for top spot too, according to Track. “If you can wow potential buyers with some curb appeal and the kitchen or bathrooms have also been done, then selling will be that much easier,” he says.

When it comes to renovating older homes, Track suggests updating wiring and plumbing. “Most knowledgeable home buyers will see this as a definite bonus. That said, many first-time homebuyers may not appreciate the work that has been done.”

Approximately 1.9 million households in 10 major Canadian centres did renovations in 2010, totalling almost $23 billion. The average cost of renos was nearly $13,000.

According to the AIC’s most recent data, energy-efficient upgrades are another popular focus for renovations, with an average recovery rate of 61 percent.

Other renovations that have higher recovery rates include the use of non-neutral interior paint colours (67 percent), the addition of a cooking island in the kitchen (65 percent), and the installation of a Jacuzzi-type bath separate from the shower stall (64 percent).

The biggest mistake people make when it comes to renovating is expecting Champagne-style results on a beer budget.

“Clients will say to me, ‘Get a few prices and we will go with the cheapest,'” Track explains. “In construction, you get what you pay for, and if you only consider price, then you are asking for trouble. It’s important not to overpay, but quality trades come at a cost. I always tell my sub-trades that I want good work at a fair price.”

Above all, planning is crucial. It takes at least two to three months to plan for a simple kitchen renovation, Track notes, urging people to read magazines and clip pictures of everything from layouts to paint colours.

“People who don’t plan always run into problems,” Track says. “People need to hire a good architect and a good designer to help them make informed decisions on materials and design. So many times I have clients who don’t want to spend money on a good architect or designer, and inevitably this leads to problems. The better you plan, the less the chance of making mistakes and the better the chance of coming in on time and on budget.

“Try to make as many decisions as possible before you start,” he adds. “By planning, you’ll have a better idea of how long the job will take and how much it will cost. Also, make informed decisions about materials and do some research.”

Budgeting is another basic, as is asking contractors for references and asking for examples of past projects.

“If you set a realistic budget for a job, you have a better chance of not exceeding it,” Track says. “It’s common for contractors to low-bid a job so that they get it. Once the job is underway, the client has no alternative but to pay all additional costs that arise in order to get the job done. There’s a square-footage or unit price for almost everything in construction, so the only real difference between contractors should be the fee they charge.”

Renovations that add features to a home that others in the neighbourhood already have, such as a second bathroom, have higher recovery rates than features not shared by adjacent properties, according to the AIC.

Poorly done renovations may have no positive impact or could actually reduce the value of a home.
Recovery rates and resale value aside, the AIC can’t put a cost on professionally done renovations when it comes to home owners’ sense of satisfaction and enjoyment. That’s priceless!