October 2, 2009
REBGV September Stats

Buyer demand remains strong while home listings increase

Greater Vancouver home sales remained strong last month, with the second highest number of residential sales ever recorded for the month of September.

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in Greater Vancouver totalled 3,559 in September 2009, an increase of 3.4 per cent from the 3,441 sales recorded in August 2009, and an increase of 124.5 per cent compared to September 2008 when 1,585 sales were recorded.

"As homes sales in Greater Vancouver continued at an elevated pace in September it's encouraging to see that more homes were listed on the MLS® in the month than any other so far this year," Scott Russell, REBGV president said.

New listings for detached, attached and apartment properties in Greater Vancouver totalled 5,764 in September 2009. This represents a 6.2 per cent decline compared to September 2008 when 6,142 new units were listed, but a 26.8 per cent increase compared to August 2009 when 4,544 properties were listed on the Multiple Listing Service® (MLS®) in Greater Vancouver.

At 12,596, the total number of property listings on the MLS® increased 5.5 per cent in September compared to last month and declined 36 per cent from the 19,852 homes listed for sale during the buyer's market that was experienced at this time last year.

"During this period of renewed demand in our marketplace, home values have gradually recovered from the declines that occurred in 2008," said Russell.

Since the beginning of the year, the MLSLink® Housing Price Index (HPI) benchmark price for all residential properties in Greater Vancouver has increased 13 per cent to $547,092 from $484,211, while home prices compared to Septembers 2008 levels are up 1.6 per cent.

Sales of detached properties increased 160.6 per cent to 1,423 from the 546 detached sales recorded during the same period in 2008. The benchmark price, as calculated by the MLSLink Housing Price Index®, for detached properties increased 2.1 per cent from September 2008 to $741,632.

Sales of apartment properties in September 2009 increased 94.9 per cent to 1,489, compared to 764 sales in September 2008. The benchmark price of an apartment property increased 1.5 per cent from September 2008 to $374,686.

Attached property sales in September 2009 are up 135.3 per cent to 647, compared with the 275 sales in September 2008. The benchmark price of an attached unit increased 0.4 per cent between Septembers 2008 and 2009 to $466,276.

The Real Estate industry is a key economic driver in British Columbia. In 2008, 24,626 homes changed hands in the Board's area generating $1.03 billion in spin-offs. The Real Estate Board of Greater Vancouver is an association representing more than 9,400 REALTORS®. The Real Estate Board provides a variety of membership services, including the Multiple Listing Service®. For more information on real estate, statistics, and buying or selling a home, contact a local REALTOR® or visit www.rebgv.org. 

 

copyright© real estate board of greater vancouver. all rights reserved.

Real estate recession over in Canada as prices recover, report says        By Brenda Bouw (CP)

 House hunters still waiting for prices to drop further before buying may have sat on the sidelines too long, according to a new report.

A Re/Max study released Thursday shows home values in some major markets across Canada have recovered to levels where they were before the recent market drop.

Economists agree and say the power has shifted to a seller's market in recent months, after the buyer's were in control for more than a year.

"(The) bounce back that began in early spring has made this recession one of the shortest on record for real estate," said the Re/Max "Bricks and Mortar Report."

The survey says values are ahead of record highs set in 2008 in seven of the 11 markets surveyed for the brokerage network.

The national average price was $312,585, up 0.5 per cent from a year ago.

Re/Max said low interest rates, pent-up demand, and improved affordability as a result of record low interest rates are behind the recovery.

"Purchasers are clearly taking advantage of affordable prices and rock bottom interest rates," said Re/Max executive vice-president Michael Polzler.

"Those who missed the boat in years past have found that sitting on the sidelines can be a costly move."

Polzler said home prices are rising and inventories are tight.

The survey shows home values were up the most in Newfoundland and Labrador, by 18.1 per cent from January to August to an average of $203,584, followed by a 6.4 per cent rise in Regina to $244,088 and a 3.5 per cent rise in Halifax-Dartmouth and Winnipeg, to $239,633 and $207,006 respectively.

Values in Ottawa were up 3.3 per cent to $301,684, and up 0.3 per cent in Toronto to $385,978.

Sales are also soaring, up 14 per cent in Vancouver so far this year, followed by a 7.4 per cent rise in Victoria, 6.2 per cent rise in Edmonton and five per cent jump in Regina.

Sales were up a more modest 2.4 per cent in Ottawa in the period, followed by a 1.8 per cent lift in Toronto.

"There is no question that the housing recession was fast and furious, but so too has been the recovery," BMO Capital Markets economist Douglas Porter said.

Porter said existing home sales had plunged by about 40 per cent year-over-year last November through January, and prices fell by about 10 per cent on average across the country.

Since then, thanks in part to government incentive programs, particularly for new home buyers, the market has bounced back.

Earlier this year, Ottawa increased the amount first-time home buyers can withdraw from their RRSPs from $20,000 to $25,000, and implemented a tax credit for first-timers of up to $750 to help cover closing costs. It also introduced new tax credits of up to $1,350 for home buyers who do renovations.

To encourage the banks to lend money for home buyers when credit markets were tight, Ottawa also started an emergency mortgage purchase program where it swapped billions in mortgages for cash. Reports say that program will be extended.

Despite rising unemployment in Canada, now at 8.7 per cent as of August, Porter said home buyers are taking advantage of all the incentives and looking "beyond the valley of the recession" when making the purchase.

Toronto real-estate agent Darren Josephs said the market has "gone crazy" in recent months.

"It's the most frenzy I've seen in my 12 years in this business," Josephs said.

Most noteworthy for Josephs is the increase in demand for condominiums recently, many of which are attracting multiple offers.

Low interest rates are also enticing consumers to buy homes, Josephs said, despite the nation's rising unemployment rate.

He said today's market has done a complete turnaround compared to earlier this year, when sales had slumped following a global financial crisis that originated in the U.S. housing and mortgage industries.

"It's pent up demand. A lot of people were waiting to get off the fence, but were too afraid, until now," Josephs said.

Vancouver real estate agent Paul Eviston said prices in some of the areas where he works are exceeding the highs of 18 months ago.

Eviston said it's also because of lack of supply. He said sellers aren't putting their homes on the market because they are anticipating prices to rise further. That leaves less inventory for buyers, and drives up demand, and in turn price.

"Would you sell a stock if you thought it was going up?" Eviston said. "It's the same thing in the real estate market."

Eviston said part of the real estate madness right now is due to "cheap money" and the knowledge people have that interest rates will be creeping up again next year.

Bank of Canada governor Mark Carney has issued a conditional commitment to keep the policy rate at the record low of 0.25 per cent until next summer, which means mortgage rates will likely remain at record lows for awhile longer.

The Re/Max report predicts sales growth to continue this year and into next year, however Scotiabank economist Adrienne Warren believes that outlook may be overly optimistic.

Warren believes much of the pent-up demand has played out by now, and expects a more "balanced market" towards the end of this year.

"Right now it's a seller's market just because we've had a pickup in sales, but we haven't had a pickup in listings," Warren said.

"A strong market brings in more listings. I would expect to see a pickup in listings and levelling off in demand, bringing us back to a balanced market over the next few months, but it will take awhile to get there."

Copyright@ Tha Canadian Press. All Rights Reserved

 

 

Flipping houses is a hot topic these days. Here are 10 tips to help you find the perfect flip from HGTV’s The Big Flip renovator’s John Stassen and Randy Mackay. 

1. Find properties that are diamonds in the rough – homes that are rundown in comparison to those around them – as these often have a low list price. 

2. Are the surrounding properties well maintained? This can add value and clinch a sale when your house goes back on the market. 

3. Scrutinize previous renovations. Poor quality workmanship can mean you have paid a premium for finishes that you will have to repair or replace yourself. 

4. Can you add bathrooms, storage or enlarge a small kitchen to meet the needs of today’s average family? If you can’t, walk away, as these features often make or break a sale. 

5. Ensure you do a thorough home inspection before purchasing properties – this could save thousands of dollars in the long run. 

6. Identify your potential buyers (i.e. young professionals or families) and design the house with their needs in mind. 

7. Find a real estate agent who understands the market. There are thousands of real estate agents; get one who is experienced and understands the business of flipping houses! 

8. Do your research and find areas that are up and coming. Neighbourhoods that are in the early stages of being gentrified often contain homes that offer large returns on their investment. 

9. Be realistic with your budget and always leave room for hidden costs. Early budget optimism can mean cost cutting later on, which means sacrificing quality – and profits – in the final sale. 

10. Keep your eye out for properties with good layouts that can be easily updated with new paint and trim. You may get lucky and find a home that’s a good price and only needs finishing touches, adding tens of thousands of dollars with minimal investment. 

(Article by John Stassen and Randy Mackay / www.hgtv.ca) 

 

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                              One for the Money, Two for the Show!

 A Manual to Prepare your Home for Selling

 

“You never get a second chance at a first impression.”  We’ve all heard this expression before.  And now, while you are preparing your home to sell, it should not be far from your mind. 

 

While logical factors such as price and location narrow the pool properties a potential buyer will look at, the ultimate decision to buy a particular property is fuelled by a mixture of logic and emotion.  And emotion often wins out.  The same might be said for the process of selling a home.  For this reason, Real Estate Agents, when they talk to you about buying real estate, will refer to your purchase as a “home.”  When discussing the sale of your current home, however, an agent will refer to it as the “property.”  This is a conscious choice.  The agent knows that buying a property is often an emotional decision, while, when selling a property, emotion should be separated from the process. 

 

Buyers are searching for a “home”—a place in which they will feel comfortable, secure, and happy, a place in which they can imagine settling down and raising their family.  As a seller, your goal is to cultivate these feelings through the property you’re selling.  Look at your home as a marketable commodity.  A buyer’s emotional response is triggered early, so you want to ensure you have done everything you can to encourage a positive response to your home from the outset.  Within minutes—even seconds—of pulling up to

the driveway, buyers have formed an impression that they will carry with them through the rest of the showing, and beyond.  Keep in mind, this impression will not only influence whether or not they make an offer, but also what they consider to be the value of the property.    

 

If you’ve ever visited model homes, you’re familiar with effective presentation styles.  Have you ever walked into one of these homes and immediately begun taking stock, planning how to get your home to look that good?  Well, now is the time to take some of these steps.  Of course, there are ways to achieve the same effect in your own home without incurring model home costs.   

 

When homes create this immediate type of emotional appeal, they tend to sell quickly—and for more money.  Use the following step-by-step guide to get your house into selling shape before you put the property on the market, and you’ll be well on your way to a successful sale!

 

 

1.     Depersonalize.

 

This should be one of your first steps when you begin preparing your house to sell.  Over the years, a home inevitably becomes tattooed with the owners’ lives, covered with touches that have made it that special place for you.  At this point, however, you want buyers to recognize it as a property they could make into their unique place.  When a homebuyer walks into a room and sees these personalizing touches—such as photos on the walls or trophy collections—their ability to picture their own lives in this room is jarred, impairing a positive emotional response.  So, your first step will be to remove all the family photos, the trophies, collectible items, and souvenirs.  Pack them all together, so you’ll have everything you need at your disposal when it comes time to personalize your new home. For the time being, rent a storage space and keep these items there.  Do not simply transfer these items to another place in your house.  Do not hoard them away in a closet, basement, attic, or garage, as the next step in preparing your home is to minimize clutter—and these areas of your house will all be targeted.

 

2.     Remove all clutter.

 

The next step on the list is to purge your home of the excess items that have accumulated over the years.  This is the hardest part for many people, as they have an emotional investment in many of these things.  When you have lived in a house for several years, a build-up of personal effects occurs that is often so gradual that you don’t notice the space is becoming cluttered.  If you need to, bring in an objective friend to help point out areas that could stand to be cleared.  Try to stand back yourself and see your house as a buyer might.  Survey shelves, countertops, drawers, closets, the basement—all places where clutter often accumulates—to determine what needs to go.  Use a system to help you decide:  get rid of all items, for example, you haven’t used in the past five years, and pack up everything that you haven’t used in the past year.  Although getting rid of some things might be hard, try to do it without conscience or remorse.  You’ll be forced to go through this process anyway when you move, and with each box you eliminate, your storage space—and the room in general—begins to look larger.  We’ve broken down the process into specific areas of your apartment to help you concentrate your efforts:

 

Kitchen:

The kitchen is an ideal place to begin, as it’s easy to spot and eliminate the type of clutter that tends to accumulate here.  Homebuyers will open your drawers and cabinets as they’ll want to check if there will be enough room for their own belongings.  If the drawers appear cluttered and crowded, this will give them the impression there is not enough space.  

 

·           First of all, remove everything from the counters, even the toaster (the toaster can be stored in a cabinet, and brought out when needed).

·           Clean out all the cabinets and drawers.  Put aside all of the dishes, pots and pans that you rarely use, then box them and put them in the storage unit you have rented (again, not in the basement or a closet).

·           If you, like many people, have a “junk drawer,” clear this out.

·           Get rid of the food items in the pantry that you don’t use.  Begin to use

                           up existing food—let what you have on your shelves dictate your menus

                           from now on.

·           Remove all extra cleaning supplies from the shelves beneath the sink.  Make sure this area is as empty as possible.  You should thoroughly clean this spot as well, and check for any water stains that might indicate leaking pipes.  Buyers will look in most cabinets, and will notice any telltale signs of damage.

 

Closets:

·           Go through all clothes and shoes.  If you don’t wear something anymore, get rid of it.  We all have those clothes, too, that we wear only once in awhile, but can’t bear to give away.  Box these items and keep them in the storage unit for a few months. 

·                 Go through all other personal items in the closet.  Be ruthless.  Weed out everything you don’t absolutely need.

·           Remove any unsightly boxes from the back of the closet.  Put them in storage if need be.  Get everything off the floor.  Closets should look as though they have enough room to hold additional items.

 

Furniture:

·           You may want to tour a few model homes in order to gauge the type of

furniture chosen by design teams to create a spacious, yet comfortable atmosphere.  Note how that furniture is arranged to cultivate a certain feeling.

·        After having armed yourself with some ideas, stand back and look at

         each of your rooms.  What will you need to remove?  Remember, most

         homes contain too much furniture for showings.  These are items that  

         you’ve grown comfortable with and that have become incorporated into

         your everyday routine.  However, each room should offer a sense of

         spaciousness, so some furniture will likely need to be placed in storage.

 

Storage Areas:

·           Storage closets and lockers:  these are the “junkyard” areas of

any given home.  It is possible to arrange simple clutter into a certain order, but junk is sent packing to these often-hidden rooms.  First, determine which of these boxes and items you actually need.  Can some of it be sent to the dump once and for all?

·           Hold a Garage Sale.  You’ve heard the saying, “One person’s trash is

another’s treasure.”  Let these items go to a better home.

·           Transfer some items to the rental storage unit.  You’ll want to clear the

storage areas in your home as much as possible, in order for them to appear spacious to potential home-buyers.  Buyers want the reassurance that their own excess belongings will find places for storage in their new home.

 

3.     Inside the Apartment

 

Once you’ve cleared the apartment of excess items, you’ll have room to work on other areas.

  

Walls and Ceiling:

Examine all the ceilings and walls for water stains or dirt.  We don’t often look closely at the walls that surround us, so be careful—there could be residual stains from leaks that have long been fixed, or an accumulation of dirt in an area you hadn’t noticed.

 

Painting the walls may be the best investment you can make when preparing your home to sell.  You can do it yourself, and relatively inexpensively.  Remember, the colours you choose should appeal to the widest range of buyers, not just to your own personal taste.  A shade of off-white is the best bet for most rooms, as it makes the space appear larger and bright.

 

Carpet and Flooring:

Does your carpet appear old, or worn in areas?  Is it an outdated colour or pattern?  If the answer to either of these questions is yes, you should consider replacing it.  You can find replacement carpeting that is relatively inexpensive.  And always opt for neutral colours.

 

Any visibly broken floor tiles should be replaced.  But make sure you don’t spend too much on these replacements.  The goal isn’t to re-vamp the entire home, but, rather, to avoid causing any negative impressions due to noticeable damage or wear around the house.

 

Doors and Windows:

Check the entire house for any cracked or chipped window panes. Test all windows, as well, to ensure they open and close easily.  Try spraying WD40 on any with which you’re having trouble.  This should loosen them up.   

 

The same can be done with sticking or creaking doors.  A shot of WD40 on the hinges should make the creak disappear.  Check to make sure each door knob turns smoothly and polish them to gleaming.

 

Odour Check:

Begin by airing out the home.  Chances are, you’d be the last person to notice any strange or unpleasant smell that may be immediately apparent to visitors.

 

If you smoke indoors, you’ll want to minimize the smell before you show your home.  Take your cigarettes outside for a period of time before you begin showing.  Ozone sprays also help eliminate those lingering odours without leaving a masking, perfumed smell.

 

Be careful if you have a pet.  You may have become used to the particular smell of your cat or dog.  Make sure litter boxes are kept clean.  Keep your dog outdoors as much as possible.  You may want to intermittently sprinkle your carpets with carpet freshener as well. 

 

Plumbing and Fixtures:

All sink fixtures should look shiny and fresh. Replacing them can be done fairly easily and inexpensively, if needed.  Check to make sure all hot and cold faucets are easy to turn and that none of the faucets leaks.  If you do find a leaking faucet, change the washer.  Again, this is an easy and inexpensive procedure. 

 

Finally, check the water pressure of each faucet, and look for any stains on the porcelain of the sinks or tubs.

 

 

Once you’ve covered all these bases, your house will be in prime shape for its time on the market.  Congratulations, you’re ready to begin showing!

 

 

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What Is A Short Sale? 

From: http://en.wikipedia.org/wiki/Short_sale_(real_estate)

 

In real estate, a short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold. In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank's Loss mitigation department. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale. Most Short Sales leave a deficiency balance for which the Mortgagor / Borrower is still liable. In 99% of all cases it is not a settlement-in-full. A deficiency balance will remain while the mortgage broker, real estate agent / broker, loan officers, title and closing agents retain their profit. No regulatory agency governs this hybrid transaction.

Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower's financial situation.

A short sale typically is executed to prevent a home foreclosure. Often a bank will allow a short sale if they believe that it will result in a smaller financial loss than foreclosing. For the home owner, advantages include avoidance of a foreclosure on their credit history and partial control of the monetary deficiency. A short sale is typically faster and less expensive than a foreclosure. In short, a short sale is nothing more than negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount. It does not extinguish the remaining balance unless settlement is clearly indicated on the acceptance of offer.

Short sales are common in standard business transactions in recognition that creditors are not doing debtors a favor but, rather, engaging in a business transaction when extending credit. When it makes no business sense or is economically not feasible to retain an asset, businesses default on their loans (called bonds). It is not uncommon for business bonds to trade on the after-market for a small fraction of their face value in realization of the likelihood of these future defaults.

[Lenders have a department (typically called "loss mitigation") that processes potential short sale transactions. Typically, lenders do not accept short sale offers or requests for short sales until a Notice of Default has been issued or recorded with the locality where the property is located. However, given the unprecedented and overwhelming number of losses that mortgage lenders have suffered from the current foreclosure crisis, they are now more willing to accept short sales than ever before. This is great news for borrowers who are "under-water" or in other words those who owe more on their mortgage than their property is worth and are having trouble selling to avoid foreclosure because of this. They are type of distressed borrower who needs a short sale the most.

Lenders have a varying tolerance for short sales and mitigated losses. The majority of lenders have a pre-determined criteria for such transactions. Other distressed lenders may allow any reasonable offer subject to a loss mitigator's approval. Multiple levels of approvals and conditions are very common with short sales. Junior liens - such as second mortgages, HELOC lenders, and HOA (special assessment liens) - may need to approve the short sale. Frequent objectors to short sales include tax lien holders (income, estate or corporate franchise tax - as opposed to real property taxes, which have priority even when unrecorded) and mechanic's lien holders. It is possible for junior lien holders to prevent the short sale. If the lender required mortgage insurance on the loan, the insurer will likely also be party to negotiations as they may be asked to pay out a claim to offset the lender's loss in the short sale. The wide array of parties, parameters and processes involved in a short sale makes it a relatively complex and highly specialized type of real estate transaction which is why unfortunately short sale deals have a high failure rate and often do not close on time to save homeowners from foreclosure when they are not handled by a knowledgeable and experienced professional. The best sources of knowledge and expertise in short sales are real estate lawyers who specialize in short sales, short sale negotiators and loss mitigation specialists.

 Credit reporting

A short sale does adversely affect a person's credit report, though the negative impact is typically less than a foreclosure. Short sales are a type of settlement. Like all entries except for bankruptcy, short sales remain on a credit report for seven years. Depending upon other credit information it is typically possible to obtain another mortgage 1-3 years after a short sale.^[While it is frequent if not common for a lender to forgive the balance of the loan in question, it is unlikely that a lien holder that is not a mortgagee will forgive any of their balance. Further, it is common for a lender to omit updating mortgage balances to reflect a zero balance after a short sale. However, willfully misrepresenting information on a credit report can constitute libel in some jurisdictions, and lenders may be sued in civil court for engaging in this behavior.

 

 

OTTAWA, Aug 6 (Reuters) - Canadian builders unexpectedly took out more permits in June than in May as a rebound in the housing market continued and more plans for commercial buildings were drawn up, Statistics Canada said on Thursday.

The value of permits climbed 1 percent in the month, outperforming market expectations of a 3.5 percent decline and adding to a massive 17.5 percent gain in May, according to Statscan's revised figures.

In the first six months of this year permits were still down 26 percent from the same period of 2008.

The construction industry and housing in particular appear to be jumping back to life after a slump, helped by low mortgage rates. Permits for residential projects grew for the fourth straight month, up 0.5 percent, with all of the gains in single-family units while multifamily units fell.

Permits in the nonresidential sector rose 1.5 percent thanks to a sharp increase in commercial buildings such as hotels and laboratories in the province of Ontario, Statscan said. The value of permits for institutional and industrial projects fell from May.

Statscan report:

here

($1=$1.07 Canadian) (Reporting by Louise Egan; Editing by Kenneth Barry)

 

Is the Air in Your Home Healthy?

How to Improve Air Quality and Fight Asthma in Your Home

 

Controlling mold is one way of improving air quality in your home, thus preventing asthma.

Asthma is one of the most common chronic conditions affecting Canadians today. An estimated 2.2

It

Normal activities in your kitchen produce water vapour and odours, but installing an efficient range hood, vented to the exterior, can help minimize the effects on your air quality. As well, when you shower or bathe, use the bathroom fan and allow it to run for 15

To help control dust, vacuum thoroughly and often. A vacuum cleaner with a HEPA (high-efficiency particulate air) filter or a central vacuum that exhausts to the outside can prevent the dust collected from being re-distributed back to the room. Area rugs are preferable where dust allergies or asthma are a concern since they can be removed for proper cleaning. Avoid wallpaper, textured finishes, fabric furnishings and draperies that can trap dust. If you are replacing floor coverings, ceramic flooring and hardwood are easily cleanable and reduce chemical odours. You can also reduce dust mites by vacuuming your mattresses, pre-soaking and washing bedding in warm water and using washable mattress and pillow covers.

You can reduce the level of chemical contaminants in your home by asking smokers to smoke outside. Avoid using pesticides, harsh chemical cleaners or scented household cleaners. Air fresheners and deodorizers only mask odours and add pollutants to the air. Lastly, use only new, low-odour paint.

Lastly, choose an electric stove rather than a gas stove and be sure to change your furnace filters regularly. It

To help you learn more about improving indoor air, Canada Mortgage and Housing Corporation has a publication called The Clean Air Guide as well as a free About Your House fact sheet called Fighting Asthma in Your Home. To order your copy, visit www.cmhc.ca or call 1-800-668-2642.

Effective January 29, 2009,any Canadian who spends

money on home renovations will be eligible to receive up to

$1,350 in tax relief thanks to the new Home Renovation Tax Credit proposed in Harper

Governments Economic Action Plan. Every time Canadians investin home renovations, they are

helping to create construction and building-supplies jobs in

their own communities, said the Prime Minister. By providing an incentive for

Canadians to invest in their homes, we are also encouraging them to invest in

local jobs.

To highlight the kind of projects that will be eligible under this plan, the Prime Minister

visited an Ottawa-area home renovation site and met with a local contractor

who will be better able to protect and create jobs thanks to the additional home

renovation projects that will be encouraged through this tax credit.

The Home Renovation Tax Credit will provide a one-year, temporary 15% income tax

credit on eligible home renovation expenditures for work performed, or goods

acquired between January 27, 2009 and February 1, 2010.

The credit may be claimed on eligible expenditures exceeding $1,000 but no more

than $10,000. The Home Renovation Tax Credit is one of several initiatives to help homeowners

and homebuyers that is contained within the Harper Governments Economic Action Plan.

Before homeowners, homebuyers, and local construction and building supply workers

can benefit from these new initiatives, Parliament must pass the 2009-2010 Federal Budget.

(Source: Office of the Prime

Minister - pm.gc.ca)

For the past ten years, Scott McGillivray, a 30 year old real estate

entrepreneur, has made a living by transforming houses into income

properties. Today, he manages 18 properties with over 100 tenants and here

he shares his top tips for creating legal income suites that will help you offset

your rising mortgage payments.

1. Make sure it’s worth it

The cost of renovations has to be able to pay itself back within two years

rent. Scout out local markets or get a professional opinion.

2. Tag team, if you can

To use a cliché, two heads are better than one, and home-owning is no

exception. Getting to your desired final product is a journey, and having a

teammate to share frustrations, anxieties and costs with is invaluable.

3. The best way to learn is to go through the experience

You can read as many books as you want, but you have to experience it.

Every home is unique, and every home will reveal its own problems and

potential solutions.

4. Whatever you budget, add 25 per cent

When renovating your space, despite what a professionally quoted budget

says, add 25 per cent, just in case. If you don’t go over, nothing lost. But if

you do, at least you were expecting it.

5. Houses are like onions

The more layers you peel back, especially while demolishing, the more

problems you’re going to find. Count on hidden gems like mould, live wires

and any other hidden costs, just in case.

6. Consider all the options

If you have a 3 story plus basement house, why just rent out only the

basement? Doubling the space not only allows you to live mortgage-free by

increasing the rent, it also increases the value of the home.

7. Make sure the space is livable

If the kitchen has zero counter space and the bedroom can only fit a bed,

not only is it going to be hard to find someone to rent out your unit, but

think of the types of people who might be wanting to rent out your unit.

8. Don’t skimp on the drywall, especially on the ceiling

Not only do you want a fire barrier between you and your new

housemates, you might be thankful for a little bit of sound-proofing in the

long run.

9. Start on the outside

A separate entrance is key when renting out a basement, especially if you

don’t want to mingle too much with your new tenants. And you might want

to make sure there are no potential lawsuits hanging around – such as

slippery stairs or rotting wood.

(Article by Amber Dowling/ www.hgtv.ca )