7 key questions for your new Realtor

Written by  Tahani Aburaneh

There are at least seven key questions every investor needs to ask their

prospective real estate agent before making the decision to hire.

Today’s markets are filled with potential landmines and dead-end deals," she tells CREW. "For you, the investor, this means hiring the right agent is more important than ever.  Unfortunately, not all real estate professionals are created equal."

Following this list of seven questions will help small and large property investors seperate the real estate wheat from the chaff.

1. How do you determine if a property is a good investment?  

This is your million dollar question… so when you ask it, sit back and listen carefully to the agent’s answer.  Your agent should have a proven process to evaluate potential investments.

Do they discuss cash flow, cap rate and return on investment?  Do they know how to properly calculate these figures? Your agent should also have a rubric to filter out bad investments.

My clients all get access to an investment calculator that crunches numbers for them.  If the investment makes money, we dig deeper.  If not, we move on.  Make sure your agent understands the investment language and the process.

2. Are you an investor yourself?
As an investor, you need an agent that speaks your language.  You need an agent that not only talks the talk, but walks the walk.  You need an agent that “gets it.” 

What better way to ensure your agent “gets it” than if they invest themselves?  As a fellow investor, your agent knows first-hand which strategies will work for your particular type of investment, and which won’t.

They view deals through a different lens as they’ve been in your shoes themselves.  You wouldn’t want advice on the stock market from a broker who had no money invested themselves … real estate is no different.

3. How much of your business is based on working with real estate investors?  
As the old saying goes, Jack of all trades, master of none; and never does this axiom prove truer than in real estate.  Most agents in this business focus almost exclusively on residential real estate, working on investment requirements only when one happens to fall into their lap.  You should avoid this kind of representation like the plague. 

You need an agent that specializes specifically in investment properties.  When you’re looking at investments, it’s not about the size of the kitchen or the paint in the bedroom; it’s about the bottom line, plain and simple.  There’s no room for emotion in investing.  You want an agent who understands this.  After all, you wouldn’t ask a divorce attorney to handle a patent case, you’d want a specialist.  It’s the same in real estate.

4. What kind of  real estate investment  do you specialize in? 
Many agents now-a-days will sell absolutely anything and everything to make a buck.  This is a huge disservice to you, the investor.  Selling ABC retail centres is a different world altogether than selling multi-family investments, or residential housing.  In fact, it’s a different universe.  Not only do the hot-button negotiation topics vary considerably between property types, but so do the players and the trends. 

A great agent will understand the power of specializing.  For example, while vacancy rates for residential investments may be low in one market, the same market may exhibit high vacancy rates for retail centres.  In order to stay up-to-date on these trends, an agent has to specialize.  Make sure your broker is a specialist in your particular property type.

5. How well do you know my market?
Real estate is a highly localized industry.  National or even regional market fundamentals may not reflect the realities of your particular market.  You want a broker who knows your local market inside and out. 

6. Are you familiar with strategies such as seller financing or LTO?  
Your real estate agent should be more than an intermediary between you and a multiple listing service.  A good real estate agent will find you opportunities you never even thought to look for.  They’ll help you look at opportunities in a different light, they are creative and bring power to you and your business.  They’ll be an expert and adviser.  If your agent can’t discuss strategies like vendor take-backs (VTB), lease-to-own options (LTO) or seller financing, you’re missing out on valuable opportunities that might have otherwise made you a lot of cash.  If your agent can’t discuss these strategies, you should find an agent that can.

7. Do you have a power team of professionals that you can refer to me?
A real estate deal requires more than just an investor and their agent; it requires the experience and expertise of a diverse group of professionals including lawyers, accountants, mortgage brokers and appraisers.  I call this my “power team.” 

Your agent should be able to refer you to their power team, who, just like the Realtor, specialize in these investment transactions – this way you know you’re covered from the start of your deal to the finish.

REPAIRING SQUEAKY FLOORS

Special tools needed to fix carpeted floor

Q: How can I repair squeaking carpeted floors that have no access from below — the ceilings underneath are covered with drywall. The noise is coming from the plywood subfloor under the carpet, which needs to be fastened more securely. It is also difficult to find the joists under the carpet. Any ideas on fixing without removing the carpet?

A: A special screw can be used in this situation. These screws are driven through the carpet, using a power drill and a small tool that stops the screw after it has reached the proper depth.

Another small tool is then used to break off the head of the screw so that it is hidden. The screws must be driven into floor joists, so locating the joists is essential.

There are a couple of ways to find the hidden joists. If you plan to do a lot of floors, you might want to invest in an electronic stud-joist finder. A low-tech method that often works is to thump on the floor with a hammer until you get a solid sound. This indicates the presence of a joist.

Note the spot and drill down with a small drill bit — a one-sixteenth-inch bit works and will not damage the carpet.

If the drill goes into solid wood after passing through the carpet and subfloor, you have verified the presence of a joist. After that, you need only measure 16 inches from the first joist location to find another joist, and so on. If you don’t know the direction of the joists, you will need to drill a few more tiny holes to verify that. It can take a lot of screws to fix a very squeaky floor.

Some contractors stretch strings across the floor at each joist location to make the screw installation faster. Spacing the screws depends on how badly the floor squeaks; a screw every nine to 12 inches along the joist might be needed.

McClatchy-Tribune News Service

Private for Sale

According to a U.S. National Association of Realtors survey, in hindsight 70 per cent of people who sell their home themselves say they would never do it again and most sellers net far less than they would have had a Realtor been selling their home.

The complexities of not using a Realtor can be a huge selling point. Todorovic says, “Ask them if they have the time. This is a large factor and should not be underestimated. Can they take time off from work and obligations to show the property? Can they market their property effectively and efficiently when it relates to cost and maximum exposure? Do they understand the complex terms in contracts? Can they handle legal pitfalls that can arise when a messy contract is written, which could result in a legal nightmare and involve huge expenses to rectify? Do they know how to pick the market price? Are they aware of the process that is required in a real estate transaction? Are they comfortable with negotiating contracts on a face-to-face basis with potential buyers? If the answer to all of these questions is yes, then best of luck to them. Otherwise, call the best Realtor in town and get them to do what they do best.”

Gary Bazuik Gary Bazuik, a sales rep with Royal LePage Coast Capital Realty in Victoria, says he avoids discussing being burned by a past experience and focuses on the fact that not all Realtors are the same. “I explain that nine out of 10 FSBOs eventually list their homes for frustration or safety reasons. A For Sale sign is an invitation for anyone passing to enter your home. If you list your home, only qualified buyers will view your property. Our MLS system had 1.9 billion page views last year alone, with each visit lasting an average of over 10 minutes. Your strong web presence will create the exposure you need to maximize value for your home.”

Costs associated with buying a house

UPPER END Market Trends Burlington 2012

Hamilton – Burlington
Luxury home sales in Hamilton-Burlington experienced the strongest first quarter on record, with 67 homes priced over $750,000 changing hands compared with 54 the year previous—a 24 per cent increase. Consumer confidence has bolstered enthusiasm, in tandem with continued diversification —the latter of which has resulted in a greater num- ber of well-paying jobs. The technology and health care sectors have attracted an expanding pool of affluent buyers who are fuelling demand in several hot pockets. Ancaster, in particular, has benefitted, as close proximity to the hospital and university are a top priority. Location is also of primary importance to affluent young families who are seeking homes within a short distance to CAIS-designated private school Hillfield Strathallan College—and they are willing to pay a premium. The market remains bal- anced, with a good selection of properties (284) priced over $750,000. Choice becomes more limited between $1 million and $1.2 million, with just over 30 homes available at this price point, which is generating the greatest number of multiple offers. Today’s luxury consumers are highly value-driven, stretching their dollar as far as possible, with resale properties having a slight edge at the lower end of the upscale market. Walkability has become a serious selling point in the upper-end, fuelling sales in ame- nity-rich Dundas. Turn-key product is preferred, but many buyers are willing to renovate to make it their own. Well-landscaped homes with outdoor living areas that act as an extension of the home for entertaining are sought-after, along with open floor plans. The ultimate perk is a main-floor wine cellar, a property wired with technology’s best bells and whistles and green construction. The latter is play- ing a greater role in recent years, especially at the $3 million to $4 million range and above. To some, the trend is more important than the promise of cost recovery down the road. Equity gains have been a significant factor bolstering upper-end sales, with Burlington a prominent example. In fact, some estatesubdivision homes in Burlington have now reached the prestigious $1 million mark. Some buyers— and more so at the higher price points—have been gravitating to custom construction. Teardown activity continues unabated in Old Ancaster and South Burlington and has even reached West Bur- lington, as a result of spillover from nearby Oakville. Purchasers are snapping-up small, older homes on good-sized lots. These properties are drawing fre- quent multiple offers, if priced correctly, especially those on 100 ft. lots. The $500,000 to $800,000 price point is the current sweet spot. Custom-built homes replacing older structures often sport values of $1.5 million and up. The cost of new construction is on the rise, however, with trades exceptionally busy. Out-of-town purchasers now account for approxi- mately one-third of properties sold in Burlington. International buyers are rare, but some are pur- chasing high-end homes for their children to live in while attending McMaster. The high-end condo- minium market is underserviced in Hamilton- Burlington, with builders yet to adequately address the demand. The supply of luxury units is very tight, and quality product that does come on-stream is sold quickly. The highest priced condo to change hands in the first quarter of the year was a pent- house unit located in Hamilton’s west end, sold for $690,000. In the single-detached category, the pric- iest home sold moved for $3.8 million in Aldershot on the Bay. It boasted over 7,000 sq. ft. of living

space and was situated on a 1.5 acre lot. Increasingly, value-conscious purchasers are looking to areas bordering Burlington and Oakville such as Water- down, where the same money will buy more home or better finishings. Hamilton, Ancaster, Dundas, Grimsby and Stoney Creek will be the area’s up- and-coming communities moving forward, as their appeal increases in step with the addition of new amenities. Waterfront properties, in particular, hold much potential. Demand is expected to be strong in Hamilton-Burlington through year-end, while price growth will move in line with the rest of the market. 

Check out these awesome white kitchens...Pics taken from Houzz.

It turns out that "white kitchen" is one of the most sought-after design terms on the internet. Much as I love a white kitchen, there is one word that sums up why one would never function for me: Cabernet. It would leave a pattern of rings all over that gorgeous Carerra marble in my dream white kitchen. However, for those of you who drink and eat only white food and imbibe only clear drinks, this ideabook is for you.

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This is about as all-white as a kitchen can be. With the exception of the floor, these people have totally gone for it.

by Chelsea Atelier Architect, PC  

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White is definitely the way to go if you want an uber-contemporary look. It also makes the space feel larger.

by Elad Gonen & Zeev Beech

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Here the white expanse is broken up only by stainless steel appliances, fruit, drawer pulls and skylights. Because the skylights are the only sources of natural light, this scheme helps brighten the room immensely.

by William V. Noval

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Here the white kitchen lives up to its glamorous potential, thanks to the well-placed chandelier.

by KITCHENS BY DESIGN  

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This mostly-white kitchen has a few vintage touches, like the schoolhouse pendant lights, drawer pulls and Tolix stools, which keeps it from being cold and sterile.

by Rebekah Zaveloff, KitchenLab & Design in a Bag.com  

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Here the same designer used some more fanciful touches, like that fabulous spherical pendant, the S-scroll door pull, the patterned floor and the details on the glass cabinet doors to add personality to a white slate.

by Rebekah Zaveloff, KitchenLab & Design in a Bag.com

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This island's warm brown wood provides the big accent color and texture. It's a wonderful contrast in an otherwise all-white kitchen.

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Here's another great example of a contemporary kitchen with a warm wood accent.

by Elad Gonen & Zeev Beech

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Another way to add some contrast is via the backsplash. This black backsplash underneath the range hood provides depth in this light kitchen.

by Shannon Poe

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White is a great place to start when designing a kitchen. The other colors and textures that stand out against the white background in this kitchen are wonderful—the warm wood dining table, the eclectic chairs, the barstools, the window trim, the beams.

by Abbott Moon  

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I have a sneaking suspicion these counters were picked with Cabernet lovers in mind! This is how we can do a white kitchen!

Step 3 -How Much will it Really Cost?

Once you have figured out the home price range you can afford and the type of mortgage you qualify for, you will need to calculate all of the associated costs of the transaction to make sure you are financially ready.

Upfront Costs

You will need to plan ahead to cover the many up-front costs of buying a home. Timing is important to help make sure things go smoothly.

• Mortgage Loan Insurance Premium. If yours is a high-ratio mortgage (less than 20% down payment), your lender may need mortgage loan insurance. Your lender may add the mortgage insurance premium to your mortgage or ask you to pay it in full upon closing. (Refer to Step 2 for details)
• Appraisal Fee. Your mortgage lender may require that the property be appraised at your expense. An appraisal is an estimate of the value of the home. The cost is usuallybetween $250 and $350 and must be paid when you contract for those services. (Refer to Step 5 for details.)
• Deposit. This is part of your down payment and must be paid when you make an Offer to Purchase. The cost varies depending on the area, but it may be up to 5% of the purchase price. If you wish to make a down payment of 5% and you give a deposit of 5%, then your down payment is considered to be made.
• Down Payment. With mortgage loan insurance from CMHC you can own your home with a minimum down payment of 5%. At least 20% of the purchase price is usually required for a conventional mortgage.
• Estoppel Certificate Fee (does not apply in Quebec). This applies if you are buying a condominium or strata unit and could cost up to $100.
• Home Inspection Fee. CMHC recommends that you make a home inspection a condition of your Offer to Purchase. A home inspection is a report on the condition of the home and generally costs around $500, depending on the complexities of the inspection. For example, it may be more costly to inspect a large home or one where issues such as moisture problems, pyrite, radon gas or urea-formaldehyde are suspected. (Refer to Step 5 for details.)
• Land Registration Fees (sometimes called a Land Transfer Tax, Deed Registration Fee, Tariff or Property Purchases Tax). You may have to pay this provincial or municipal charge upon closing in some provinces and territories. The cost is a percentage of the property’s purchase price and may vary. Check with your lawyer/notary to see what the current rates are.
• Prepaid Property Taxes and/or Utility Bills. To reimburse the vendor for prepaid costs such as property taxes, filling the oil tank and so on.
• Property Insurance. The mortgage lender requires this because the home is security for the mortgage. This insurance covers the cost of replacing your home and its contents. Property insurance must be in place on closing day. (Refer to Step 5 for details.)
• Survey or Certificate of Location Cost. The mortgage lender may ask for an up-to-date survey or certificate of location prior to finalizing the mortgage loan. If the seller does not have one or does not agree to get one, you will have to pay for it yourself. It can cost in the $1,000 to $2,000 range.
• Water Tests. If the home has a well, you will want to have the quality of the water tested to ensure that the water supply is adequate and the water is potable. You can negotiate these costs with the vendor and list them in your Offer to Purchase.
• Septic tank. If the house has a septic tank, it should be checked to make sure it is in good working order. You can negotiate the cost with the vendor and list it in your Offer to Purchase.
• Legal Fees and Disbursements. Must be paid upon closing and cost a minimum of$500 (plus GST/HST).Your lawyer/notary will also bill you direct costs to check on the legal status of your property. (Refer to Step 5 for details.)
• Title Insurance. Your lender or lawyer/notary may suggest title insurance to cover loss caused by defects of title to the property.

If you feel you cannot cover all of the up-front costs, you can ask your lender for a loan. Remember that payment for this loan amount, based on a 12-month repayment period, will have to be included in your Total Debt Service ratio calculation. 

Other Costs

Besides up-front costs, there are other expenses to consider:

1. Appliances. Check to see what comes with the house, if anything.
2. Gardening equipment.
3. Snow-clearing equipment.
4. Window treatments. Check to see what comes with the house.
5. Decorating materials. Paint, wallpaper, flooring and tools for redecorating.
6. Hand tools. You will need some basic hand tools for your new home.
7. Dehumidifier. May be required to control moisture levels, especially in older homes.
8. Moving Expenses.
9. Renovations or Repairs.
10. Service connection fees. Charged for utilities — telephone, gas, electricity, cable TV, satellite TV, Internet and so on. You may be asked to pay a deposit for some utilities.
11. Condominium Fees. You may have to make the initial payment for these monthly fees