The Calgary housing market continues to show signs of a sustained recovery according to figures released January 3, 2010 by the Calgary Real Estate Board.

 
     ”The number of single family homes sold in December 2009 in the city of Calgary was up 78% from the same time a year ago, while condo sales saw an increase of 66% from the same time a year ago.”

 
     “What a difference a year makes. Undoubtedly the recovery in Calgary’s housing market came sooner than expected this past year,” says Bonnie Wegerich, president of CREB®. “Pent up demand by first time buyers, record low mortgage rates and improved affordability have helped bolster the Calgary market in 2009.”

 
     In fact, we are close to seeing a sellers’ market. With continued limited resale home supply and a robust buying public…the pendulum is swinging in favor of sellers which will, more than likely, push prices up.

 
     There are also fears that interest rates are going to rise and this has buyers anxious to lock into more favorable rates now.

 
     With the additional fear that the government may make 10% down payments mandatory and maximum 30 year amortization periods, we may see many buyers pushing their plans forward.

 
     If you are thinking of purchasing a home, moving up or down sizing, now would be a most favorable time to do so and I would love to help you.

 

Buying a home can be a stressful process but here is a bit of knowledge I’d like to share with you about condo’s so as to keep you better informed when you are making that important decision of buying property.

 

by Shannon Essington

Source: www.cren.ca

 

Last week we took an in depth look at some common mortgage terms that will come up time and again. This week we will continue on that path but head in the direction of condominiums, a popular choice for both first time buyers and those who appreciate a maintenance free lifestyle.

When considering purchasing a condominium there is some extra things to be aware of before signing on as an owner. The challenge is that many aspects of condo ownership are not easy to understand, and come complete with a language of their own. This terminology, added with all of the other industry jargon, can often cause confusion and frustration for buyers, in fact even the name “condo” is often misunderstood.

The word “condominium” refers to a form of legal ownership, not a style of construction. While most buyers tend to think of a condominium as a high rise apartment complex, this type of ownership can be extended to low rise buildings, townhouse complexes and believe it or not, some single family homes as well.

The ownership of a condo consists of two parts: firstly, the individual unit, which is owned exclusively by the purchaser, and secondly, a shared ownership in all common areas of the building or complex, such as the lobby, hallways, elevators, fitness facilities, parking and landscaping outdoors.

To cover the ongoing costs involved in managing and maintaining the common areas, a monthly condo fee is charged to all owners. Most condo fees are determined by the square footage of the unit, although some are just a flat rate. As this monthly fee is set by the condo board it is neither optional nor negotiable. Additionally, like most expenses it will most likely increase over time.

Condo fees are used to finance many aspects of ownership within the condominium. Some of these expenses include day-to-day care of the common areas, property management fees, some utilities and an ongoing contribution to the reserve fund.

The reserve fund is set up by the condominium management to cover the cost of major repairs and necessary replacements over time. Costs such as roofing or window replacement would fall under the intended use of the reserve fund. In the event that the reserve fund falls short of covering a necessary expense, each owner could be given a special assessment charge. These special assessments may be payable as a one-time lump fee and depending on the financial need of the condominium, these assessments can be extremely costly. Beware of developments that have significantly lower monthly condo fees than other similar properties, as this can be a sign of poor management and under-funding, which might cost you much more later.

Another challenge when looking to purchase a condo is that mortgage lenders have varying policies surrounding what they will and will not finance. It is not uncommon for a lender to prefer one type of building style over another.

If you are considering purchasing a condo in the near future, it is even more important to have a clear understanding of what you are truly pre-qualified to purchase, beyond just the maximum approval amount. Square footage and property specifics are just two of the points that could come up after you’ve found that perfect condo, which you may wish you had known up front.

To ensure that your condo purchase is a great buying decision, both in the short and long term, it is best to work with a team of professionals who are experienced with the finer details of condos. A great realtor and mortgage broker are certainly key members of that team. Call today to get the information you need to get this process started, especially if you want to take advantage of the deals that inevitably come available during this holiday season.

Canada’s Next Generation of Recreational Property Owners

by Jim Adair  (source: www.realtytimes.com)

 

 

Canadians love their cottages and chalets. According to a recent report by Scotiabank, the rate of second homeownership rose from seven per cent of Canadian households in 1999 to nine per cent in 2005. Up until the end of the housing boom last year the recreational property market was very active across the country. While sales and prices dropped with the end of the boom, recent reports suggest that interest in recreational markets is already picking up. Lower prices combined with low interest rates have made properties more affordable, and in areas such as the Kawarthas in Ontario, sales are once again brisk.

 

The Scotiabank report raises an interesting question about the future of the recreational property market. It notes that the median age of Canadians who own second homes is 50, and that only one-quarter of vacation homes are owned by families with children – the rest are owned by empty nesters, singles and childless couples.

 

“Demand for second homes/vacation homes could slow over the coming decade as the large baby boom generation moves past its peak cottage buying years, and wealth gains fail to replicate the outsized increases of the past decade,” says report author Adrienne Warren.

 

Re/Max says the demographic shift from baby boomers to Gen X purchasers has already begun. It says demand for recreational property from those born between 1965 and 1980 has increased from 40 per cent in 2008 to 74 per cent this year.

 

“After being priced out of most markets for the better part of the last decade, Gen X purchasers now have the financial wherewithal to buy recreational property at virtually every price point,” says Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada. “Gen X is ideally positioned to pick up the slack in recreational property markets caused by softer demand from baby boomers and retirees. They represent the next wave of recreational property owners in Canada and they know it.”

 

A Re/Max report says that although the supply of recreational properties is adequate in most areas, “heated activity in the lower-end has resulted in tight inventory levels for entry level products in 18 markets” in Ontario, North Saskatchewan and Salt Spring Island in B.C.

 

A Royal LePage survey found that 64 per cent of Canadians view cottage ownership as a sound investment. “To save money, a majority told us that if they owned a cottage, they would be happy to call it their new vacation destination,” says Phil Soper, president of Royal LePage Real Estate Services. “It appears that many view owning a recreational property as the ultimate, no-hassle ’staycation’ and one that presents an opportunity to invest while they enjoy.”

 

The survey also found that 55 per cent of respondents say they would be willing to make financial or lifestyle compromises in order to get their vacation home. This includes purchasing a property with family or friends, renting out their cottage to help pay for expenses, buying a ‘fixer-upper’ and even moving to a smaller principal home in the city.

 

The Scotiabank report says that the majority of first and second homeowners in Canada are in the 45 to 64 age group. They represent 45 per cent of all homeowners, but 70 per cent of the increase in the number of recent homeowners.

 

Warren acknowledges that “anecdotal reports suggest that ‘baby bust’ households … are already stepping up as the next wave of vacation home buyers. However, this cohort is far smaller than its baby boom predecessor.”

 

She says while this could produce an easing in the steady upward pressure on cottage prices, “the available supply of listings is likely to remain fairly tight.” That’s because family properties are often passed down through generations of cottage owners, and land for development is hard to come by.

 

Re/Max says that while “low-ball” offers are increasing, they are not meeting with much success because sellers are in no hurry to make a deal. The sales-to-list ratio is still relatively high in most markets, says the company.

 

Some other recreational property trends:

 

Some American cottage owners in Canada are taking advantage of the stronger dollar to cash out of the market, says Re/Max. Older Canadians continue to look for secondary homes in the U.S. in Florida, Nevada, Arizona and California. But Scotiabank says that about 75 per cent of second homes owned by Canadians are located in Canada.

 

Re/Max says American purchasers have “largely fallen off the radar” except in a few locations.

 

When searching for a property, 68 per cent of Canadians want a lakefront location, says Royal LePage. The company says the three most important features of a recreational property are peace and quiet; access to electricity, sewers and plumbing; and four-season use.

 

“Notwithstanding the potential for a cyclical slowdown in home sales and price appreciation over the next few years, the longer-term trend toward real estate investing will likely remain an important component of household wealth accumulation and portfolio diversification,” says Warren.