Forecast for K-W region housing market.

A slight decrease in sales in Kitchener from October to November demonstrates a move towards a more balanced market, and not a catastrophe. Many buyers are waiting until 2009, while others are taking advantage of the current beneficial market conditions. While currently it may take a few days longer to sell a home in the area, the value of home ownership investment remains high, with the average sale price of a single family-detached residential property increasing by 7.6% last year. In fact, the average price in Canada is projected to appreciate by at least 9% this year, up over $25,000 from 2006 levels in the nation. What does that mean for you?

It means that if you buy a home today, it is likely to increase in value over time. It also means that sellers that list their homes at fair market value are continuing to sell and make money. Housing supply is currently exceeding demand, allowing for more selection for buyers to choose from. It is good time for buyers. The market should pick up more buyers starting in the New Year, increasing the competition and levelling out the excess in supply.

Condominium and town home unit sales are on the rise, and likely to continue to increase due to downsizing baby boomers. Single family dwellings remain the most popular choice for purchasers.

Major economic drivers in the K-W region keep the housing market moving. The K-W is home to two major universities, Canada's technology triangle and a strong financial sector which make for high employment rates. While manufacturing and automotive sectors are slowing, these other economic drivers ensure the area still has one of the lowest unemployment rates in the province, keeping the housing market fairly healthy.

The mortgage crisis in the US has not been as severe here in Canada. According to CMHC, mortgage arrears in Canada remain incredibly low with only slightly more than one-quarter of a per cent of Canadian households (0.26%) falling three or more months behind in their mortgage payments. Mortgage rates have settled and are expected to remain relatively flat over the next few months.

Rental properties are a fairly good investment, with vacancy rates in the region as low as 2.5% in October. The average rental rate for a two bedroom apartment was around $841 per month.

These factors indicate that the K-W region is moving towards a healthy market, and is not in trouble. If you are a buyer, NOW is the time to buy. If you are a seller, it is important now more than ever that you obtain a fair market value for your home to ensure it sells quickly.

Sustainability in the housing market.

More sustainable living options are available, but the real estate market has been slow in responding to these options. Perhaps people are unaware of the options that are avilable to them. The market is based on the demands of the people, and the people aren't demanding it. Realtors aren't advising their clients to upgrade to more sustainable solutions because many improvements don't increase the value of properties in the market by as large amounts as other more cosmetic upgrades. Not all builders or contractors are salvaging and recycling their materials or using more sustainable solutions in their building practices because they don't know they exist or believe it is too costly. The government housing structures and policies have not legislated enough to ensure that more sustainable housing is mandatory. It is a complicated system that is influenced by many factors, but you as buyers and sellers of real estate property can help sway the tide.

Not only are sustainable living measures looking towards the long-term health of the population, and the planet, but most also make long-term financial sense. A more efficient home, that uses sustainable options wastes far less energy, and therefore money. Many simple and easy solutions result in instant savings. Caulking windows, adding insulation, turning off lights, unplugging unused appliances or switching to a programable thermostat are cheap alternatives that can save you a bundle. There are low-flow toliets, and shower-heads for the bathrooms; even fixing simple leaks or drips is important. There are tons of energy-efficient appliances that reduce energy waste. You can insulate your hot water heater and pipes. There are soo many options for you to reduce your consumption in your home for little to no cost (and actual savings on your energy and hydro bills)! If you want to know more, please ask me!

An initial moderate investment in more efficient heating systems, windows, roofing, etc. can result in significant difference in energy usage resulting in great savings! A more significant investment into sustainable energy solutions such as solar panels, wind turbines or geothermal powering can reduce your energy bills to zero, and possibly even result in rebates if you sell your excess back to the system. Wind turbines can start at as low as $2,500.

Did you know that can switch over to sustainable power in your home today? It is slightly more expensive than traditional energy supplies, but means that you are not using polluting and non-sustainable solutions such as natural gas, or coal; or using potentially dangerous raditation producing nuclear supplies. Bullfrog power supplies Kitchener, Waterloo and Cambridge with alternative sustainable power supplies. Check out www.bullfrogpower.com to learn more.

The governments of Canada and Ontario offer rebates and programs to help assist you in retrofiting your home to be more energy efficient and sustainable. There are nearly $10,000 worth of grants available to many households to do this. Take advantage of them. Check out Natural Resources Canada at http://oee.nrcan.gc.ca/corporate/incentives.cfm to learn more about these programs or ask me!

If the market (YOU- when buying or selling a home) begins demanding these changes- they WILL happen! We all have a part in this, and can work together to make change happen!

What duties does a Realtor owe you?

People are often concerned about what Realtors are actually supposed to do for them.

In Ontario, Realtors are licensed and regulated by the Real Estate Council of Ontario (RECO) and governed under the Real Estate and Business Brokers Act (REBBA), which carries certain liabilities and expectations of service. These structures are in place to protect both you (the buyer or seller) and the Realtor.

Let's say you walk into an open house, and you ask the Realtor at the property some questions? What can they tell, what can't they tell you, and how should they act? Do they have to tell you the truth? In this situation, regardless of whether you are in a contract or not, the Realtor owes you honesty, fairness and due care in answering questions. As skilled and licensed professionals, Realtors are expected to provide sound real estate advice that a person can rely on. They are not allowed to willfully or negligently misrepresent information, or assert themselves as experts in an area that they are not familiar with. They may not be able to provide you with all the information they have on a transaction unless you are in an agency relationship, as a protection to their clients, but they are NOT permitted to provide you with faulty information.You should not tell the Realtor in this situation anything you do not want them to directly reveal to the other party. The Realtor's primary obligation lies with their contracted clients.

If you decide to sign an agency contract with a Realtor, they owe you added duties, including accountability, confidentiality, competence, good faith/full disclosure, loyalty and obedience. Accounting means the agent must keep accurate records of all funds they receive and that all transactions must comply with provincial regulations. Canada's FINTRAC (Financial Transactions and Reports Analysis Centre of Canada) requires all Realtors to check your identification for all financial transactions. They are also required to report any suspicious activity (which includes any large cash transactions) to federal authorities by law. Confidentiality requires that the Realtor should not disclose any information relating to your transactions to anyone else without your consent. This means they can't tell the other party that you are motivated to move, your financial situation, or any other detail about you without your consent. This does not apply to any known material facts of your property (including defects), which a Realtor is obligated to disclose under the general honesty regulation owed to all people.

Competence means that your Realtor must have sufficient knowledge and skill to carry out the transaction. Realtors are obligated to discover certain facts about the property that a reasonable Realtor should be able to ascertain, and have been given training to do this. They are instructed to refer their clients to a third party if they are unable to adequately answer a question. A licence in real estate does not mean the Realtor is licenced to do home inspections, appraisals, or answer legal questions. All homes should be inspected by a licenced inspector for your protection, and a Realtor should not advise you otherwise.

Good faith/full disclosure means that the Realtor must disclose all information they have that relates to the transaction. This means they must tell you everything they know about the property, including any profits they may gain for the transaction from referrals or other reasons. Dual agency, when a Realtor represents both the Buyer and the Seller, is a slightly different situation, as the Realtor must protect the interests of both parties. In this situation, the Realtor should explain the situation to you and get your permission in writing. The Realtor may not tell the Buyer or Seller the price the other party is willing to accept, the motivation of either party, the price the Buyer should offer, or the price the Seller should accept.

Loyalty means that the Realtor should place the interests of their clients above all else except the law. They must act in the best interest of their clients at all times. Obedience means that in a client relationship, the Realtor must follow their client's lawful instructions whether they agree with them or not.

What is the best way to ensure you are receiving the care and treatment you deserve from a Realtor? Inform yourself of what to expect, and interview a couple of Realtors before you hire one. Ask them what services they are willing to provide you with for their services and get it in writing. Keep copies of all your communication or documents. You always have the option to fire the Realtor if they do not meet the contract. Be aware that most agency contracts have holdover periods which may obligate you to pay commission to them for certain services. If you don't know, ask. There is no such thing as a stupid question, and your Realtor should make an effort to answer you- that is what you pay them for.

If you feel that a Realtor has not performed their prescribed duties under their licensing, you should contact RECO or the provincial governing body in your area. The Real Estate Council of Ontario (RECO) handles all complaints in Ontario (ccd@reco.on.ca).

A good Realtor is worth their commission, unfortunately a small handful give the rest a bad name. It is in your best interest to protect yourself by knowing what to expect in the process!

How to choose a Realtor and how they can help you purchase a home.

The Realtor should first discuss with you the values and services he/she will bring to the table.

What SHOULD they be doing for you as a Buyer agent?
• Organize and schedule your home search process
• Discuss with you the benefits and drawbacks of each home in relation to your specific needs
• Provide you with ongoing updates on available homes
• Help you compare homes and make a decision
• Advise you on the terms and issues of the offer and fill out the purchase order contract
• Present your offer and negotiate on your behalf
• Coordinate and supervise the preparation of all closing documents and guide you through the closing process
• Help you resolve any closing issues
• Answer all your questions in a timely manner.

Decide on the values that are important to you, and discuss them with your Realtor. Are they willing to provide you with all the services you need? Get it in writing!

You will then need to decide whether you want to sign a contract with your Realtor. There are several types of contracts, depending on the services you will require.
The Buyer Agency Agreement is the most common. This agreement:
• Establishes the type of relationship that is involved
• Sets out the duties and responsibilities of both parties
• Details commission arrangements and buyer responsibilities if commission is not to be paid by the seller

Why should you sign an agreement?

By signing the Buyer Agency Agreement, you ensure that your Realtor is working for you in a client relationship, meaning that the Realtor must represent you exclusively in the contract. It lets the Realtor tell you all the information they know about the property, and makes sure they are obligated to work in your best interest.

The traditional agency relationship requires that all agents have a fiduciary relationship with the seller. That means that it's their job to protect the interests of the seller. By entering into a Buyer Agency Agreement, you ensure that the Realtor will always be protecting your interests.

The agreement also protects your Realtor. It means that you acknowledge that he/she is representing you for the duration of the contract period, and that you are agreeing to work exclusively with that Realtor for the duration. This means you have the responsibility to notify the Realtor of any property that you are interested in during this time period and your Realtor will make all the arrangements to view the home. This includes homes that come directly from the builder, or open houses that you want to inspect in the neighbourhood.

Deciding whether or not to sign a Buyer Agency Agreement is up to you. You can sign the Agreement for one property, or one area, or for everything you are searching for. You should discuss the terms of service that the Realtor will offer you in return for your signing and get all the details in writing. This could include certain marketing aspects and all the rights and duties that each party will perform. This is a promise for a promise: you promise your Realtor exclusivity, and they promise you service. This means that if your Realtor does not perform the set services, you CAN fire them. But be aware that Buyer Agency contracts typically have what is called a "hold over" period (usually 30-60 days). If you purchase a property that was introduced to you by your Realtor within this period, they are entitled to commision under most contracts.

Things you can do to protect yourself:
- ask for a short term or specific contract (for 30 days, or 24 hours, or for a specific property, area or price range);
- ask about anything on the contract you don't understand- if the Realtor cannot explain it to you in clear terms- do not sign it.
- Get copies of anything you sign, and keep it in a file for yourself
- Know what duties to expect of your Realtor, and make sure they answer all your questions. Remember there is no such thing as a "dumb" question- so ask if you don't understand! It is part of your Realtor's job to answer your questions.

Can you afford to buy a home?

Would you like to buy a home, but don't know whether you can afford it or not?

Here's what you can do:

- Check your credit score. You can do this online at www.equifax.ca for about $25.
You are probably looking for a score of at least 600 to be able to qualify for a mortgage. There are many ways you can begin to improve this score. Make sure to make at least your minimum payments on your credit cards each month, and pay all of your bills on time. If you have a large amount of debt, talk to a debt counselor or banker to find out what can be done to up your score. Try Debt Freedom Canada at (519) 342-2524 (located in behind Century 21's current location at 1770 King Street, Kitchener).

- If your credit score looks good, and you are steadily employed (typically for at least 2 years): you should consider talking to a mortgage broker about your ability to qualify for a mortgage. Mortgage brokers will look at your employment status and history. This involves looking at your gross monthly income and the length of your employment (usually 2 years of steady work). They also look at your credit history (any debts you have, debt balances versus your credit limits, how you handled debt in the past, missed payments, late payments, etc.), your assets (stocks, bonds, personal property), and the value of the property you want to purchase. Mortgage brokers are sometimes able to help you build a down payment through special programs. Try Discount Mortgage Canada (who shares an office with Century 21) at 1-866-833-8601 or 519-570-9684 to find out whether you are able to qualify for a mortgage.

- Can't make a down payment? The Region of Waterloo (which includes Waterloo, Kitchener, and Cambridge) runs an Affordable Home Ownership Program. This program allows first time home buyers to obtain a down payment loan of up to $10,000 (payable when you sell your home). This applies for homes under $226,000, for those with household incomes of less than $68,000. Check out the full details at www.region.waterloo.on.ca/aho.

- Mortgage payments can be similar in amount to your current rental payments. The only difference is that instead of losing the money you pay into your residence to a third party, mortgage payments go towards increasing YOUR equity. If you can qualify for and afford a mortgage, home ownership makes a lot of financial sense.

Things to consider:

- Closing costs typically range between 2-5% of your mortgage loan and include things such as land transfer, title policies or insurance, recording fees, inspections, attorney's fees and lenders fees. This works out to approximately $3,500 to close for a $250,000 home purchase.

- Closing (the day you gain possession of your new home) typically takes place between 30-120 days after signing the agreement.

- A deposit is usually required at the acceptance of the agreement of purchase (at the time your offer is accepted by the Seller). Deposits usually start at around $1,000.

- Lenders require that monthly payment ranges for your mortgage be between 25-8% of your gross monthly income. This would include the principal on your loan (P), the interest on your loan (I), property taxes (T), and homeowner's insurance (I). You monthly PITI payments (as these are called) plus all of your debt payments should range between 33-38% of your gross monthly income.

If you have any questions, please feel free to contact me at rebecca.sargent@century21.ca!

How is the K-W Market Doing?

Do not let the American market and media scare you! Canada's housing market is on much firmer footing than the American housing market.

The sub-prime mortgage crisis that we have seen in the past few years is an ongoing financial crisis that stems from mortgage companies offering mortgages with little or no downpayment to households with low incomes, assets and with troubled credit histories. Sub-prime mortgages account for 14% of the American housing market, but accounts for less than 5% in Canada, making the problem much more severe in the US. Canada has a strong labour market to underpin our housing market, with an unemployment rate holding at a 33 year low of 4.9%. Average wages are outpacing inflation, meaning that homeowners are still realizing real increases in monthly wages.

Kitchener has one of the strongest average sales-to-listings ratios this year. Considering the current instability of the government, confidence and job security is undermined. However, there is good news. The average sale price of a single family-detached residential property in the K-W area increased 7.6% in the past year. Many other markets are experiencing decreases in sale prices, making the value of home ownership investment in K-W relatively high. The slight dip in sales prior to November might be a reflection of the season, pre-election jitters, stock market instability or an indicator of a return to a more balanced market. The market has slowly but surely moving away from the aggressive Sellers market of the past few years and into a more balanced market.

Buyers entering the market today are in a good position, having much better choice and negotiating ability! If you are looking to be in your new home for spring, now is the time to buy! Take advantage of the current market position before it begins changing in the New Year!

How to Buy a Great House!

You want to buy a great house, but what do you look for? After figuring out what you can afford, you should begin to think about what you really need and want in a new home.

Do you want to be in the heart of the city, the suburbs or in the country? What type of neighborhood are you looking for? What features do you absolutely need in a home? What features would you like to have? How many bedrooms do you need? Is a big property important to you? Think of the spaces you will need or want to live your life. Do you need spaces for entertaining? A home office? A workshop? A garage?

Decide on a top five criteria that are important to you. Remember. It might not be possible to find a home with every feature you are looking for, but this will help you focus your search so that you can find the best home for your needs.

There are many factors to consider when selecting a new neighborhood. If possible, you should first scout the area in person- You live in more than just your house!

- Talk to people who live there- go for a walk through the neighborhood, check out the local shops and services.

- Drive through the area at different times of the day, during the week, and on weekends. This will help to eliminate any suprises.

- Look carefully at how well other homes in the area are being maintained; are they painted, are the yards cared for, etc.

- Consider things like access to major highways, city centres, transit, shopping, etc.

- Listen for noise created by roads, commerce, railways, public areas, schools, etc.

- How far will you be from work? Drive or take the commute and check it out!

Once your list of needs and wants is made, it is time to begin searching for properties.

How to prepare yourself for a move.

So you have decided to move. How do can you begin to prepare yourself to move? Here are some helpful tips!

-Begin collecting boxes. Many grocery stores are a good source of boxes. You can start by packing up items that you seldom use or non-seasonal items. You can use towels or sheets to wrap more delicate items. Get creative! Label the boxes by their eventual location: ie. kitchen, living room, closets, etc. This will make it easier down the line. Be sure to distribute the weight in your boxes. Do not pack an entire box full of books as it will be very difficult to move!

- Make sure you change your address with Canada Post. You can do this online at www.CanadaPost.ca/ChangeMyAddress. Make sure you change the billing address for your credit cards, car insurance or any other bills. Send a postcard or email to your family and friends with your new address and phone number.

- Arrange for the start of any utilities or services at your new home, including gas, water, cable, internet, etc. This way they can be up and running right away and you won't have to wait around. Also arrange for them to be disconnected at your current home.

- Pack a box of everyday items that you will keep on hand with you during the move. You may want to include things such as toliet paper, tolietries, change of clothes, medications, basic tools (screwdriver, hammer, etc), drinks, tape, markers, broom or vacuum etc. A fold up chair in your trunk might also be handy!

- Start early to save your sanity. Begin packing away things you don't use as often immediately, and slowly declutter your home until the move.

- Don't move anything you won't use again- now's the time to cut back! Consider having a garage sale before you move to get rid of any excess things.

- carry jewelry, important documents or valuables yourself

You've found the home of our dreams- now what?

Once you have found the perfect property, it is time to make an offer! This is where your Realtor can really help you!

You want to be realistic in your offer; something that you can reasonably afford, and that the other party will reasonably sign. So how do you come up with the price? Your Realtor should provide you with a list of comparable properties to help you decide on proper pricing. Comparables should include a couple of active listings, recently sold listings, and expired listings. Listings should have similar qualities (ie., # of bedrooms, property size, type of home); the more similar, the better the comparison. Sold listings help to give you an idea of homes that were probably fairly reasonably priced. Expired listings tend to indicate a price that was too high for the market or some sort of other deficiency. This will make it easier for you to decide whether the sale price matches the local realtity and whether you should offer more, less than or equal to the asking price.

It is advisable to include a home inspection clause in your offer. Sometimes it will be necessary to include certain clauses to protect your interests. For example, if the property has a well, a fuel tank or a fireplace, there are certain certifications that can be obtained or requested to ensure they meet standards and are in proper working order. If you have any concerns about the property, bring them up with your Realtor and make sure they include the proper clause(s) to protect you. All fixtures and chattels that are staying with the property should be clearly expressed on the offer, so that there is no confusion at closing.

Your Realtor will probably use a standard Agreement of Purchase and Sale form provided by the Ontario Real Estate Association (OREA). Ask your Realtor to explain anything you don't understand. Usually a deposit will be attached with the offer as a sign of good faith. The deposit can also be given upon acceptance of the offer (once all parties have signed and agreed to the offer).

Your Realtor will then present the listing agent with the written offer, which can be either be accepted, rejected or counter-offered by the Seller. Once the Seller accepts the offer it becomes a legal contract, and you have purchased the home. Usually this is conditional upon inspection or other conditions, and so doesn't become "firm" until a later date.

If the Seller rejects your offer, you can either come back with a better offer or move on to a different home. Offers are rejected for many reasons. If you DO make another offer keep in mind the following: the price, the closing date, the number and type of conditions, and which fixtures or chattels are included. Sometimes simple things, other than just the price are keeping the seller from accepting. If the Seller counter-offers to you; you then have the choice to accept, reject or counter-offer.

How can I prepare my home for sale?

The best way to ensure your home sells in the quickest amount of time for the highest price is to have the home clean, well-maintained and decluttered. The best time to prepare your home is BEFORE you list it. That way buyers will see it at its best and offer accordingly.

You want to make the space to look as spacious, bright, warm and inviting as possible. Wash the walls, ceilings and trim or consider painting the rooms in light, neutral colours. Repair any cracks, loose knobs, towel racks, switch plates, outlet covers, doors, windows, squeaky floorboards, leaky faucets or loose stair banisters. Clean and repair caulking around tubs and sinks. All light switches should work! Replace any lightbulbs, including any exterior lights.

Remove any unnecessary furniture or clutter from each room. Each room should reflect its purpose. A dining room should look like a dining room. A garage should look like a garage (and not a storage locker!). The buyers need to be able to get through the home easily. All closets should be organized and decluttered. Remove any items you plan to take with you, such as chandeliers. This will help to eliminate any potential confusion down the road.

Curb appeal is important. Cut the lawn, remove snow or ice from walkways. Remove any yard debris, gardening equipment or toys. Trim the shrubs, touch up the paint on doors, siding and trim. Clean the windows and replace any broken panes or torn screens. Clean up the garage and shed.

Certain renovations can help you maximize the value of your home. A small amount of repair and renovation up front can help you get a better offer. The renovations that offer the greatest return are in the bathroom, the kitchen, and the roof. Replacing a furnace or heating system, or interior and exterior painting are also good options. Your Realtor should be able to help you decide which renovations will help to ensure you get the highest return.

Remember, you want the buyer to come into the home and picture themselves living there. They won't be able to do this if your personal touches are clouding their mind and their vision.

Your house doesn't have to be perfect, but a small amount of care can make a great deal of difference!

Dangers of listing your property too high

You've put your home up for sale, but no one is biting. What's wrong?

Your home may be overpriced. You may think that starting off with a high price is the right way to go, but you couldn't be further from the truth. If you come out with an overpriced home you may scare away potential buyers and send the message to other Realtors that you are not serious about selling your home. Remember: the market determines the price.

You might love aspects of your property- but that does not mean it affects the market value of your property. Potential buyers do not care how much you money you need to purchase your next home, how much you paid on the property or spent on improvements, or your personal attachments to the home. A feature you may love may have little to no reflection on the ultimate value of the home.

Your Realtor should be able to help you determine a competitive price based on location, size, style, condition, ammenities, and market conditions. A realistic price means that your property will sell faster. An overpriced property will lose its "marketability".

The unsold home will ultimately be price adjusted downwards, as market staleness creeps in. You might even have to reduce the listing price below true maket value just to regain market momentum. Buyers may wrongfully assume something is wrong with the property.

A properly priced property should sell within a reasonable time period. Have your Realtor demonstrate a reasonable listing price based on market conditions through a Comparative Market Analysis (CMA).