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Toronto real estate is in a seller’s market. Prices are high and competition fierce for the homes on the market. It is no wonder that many people are choosing to stay put and renovate instead of wading into such a hot market. Then there are those who are renovating to maximize the returns they can get when they do list their property. Whatever your reason for wanting to renovate, the first step is figuring out how you will finance your reno. Financing a renovation is one of the very few acceptable reasons for incurring debt. Renovations are considered a good debt because they add to the value of your home.

Budget

Once you have determined the kind of budget you will need for your renovation, you will have to think about where to secure that funding. If your project is small, then you might already have the funds set aside or can postpone your reno a few months to save it up. However, if your project is large then there are several options available to you for financing.

HELOC

The home equity line of credit is one of the smartest ways to finance a home renovation. The HELOC lets you borrow money against the equity built-up in your home – up to 80% of your home’s value (loan plus mortgage combined). HELOCs require you to repay only the interest every month, making them extremely flexible. The only caveat with a HELOC is that you must be disciplined enough to draw down on it only for the project at hand and not be tempted into using it to float any shortfalls in your monthly budget. As there are no requirements to pay back the balance each month, the other danger is that you never really ever end up paying the loan back. However, if you are disciplined and know that you can repay what you borrow and won’t use it for vacations or other miscellaneous expenses, then a HELOC is a great way to finance a reno. And, because of its flexibility, you can borrow and repay against it as often as you like.

Remortgage

The next option for financing a renovation is to remortgage your home. As long as you have a realistic budget and know how much you will need for contingency remortgaging your home will give you the best interest rates and it will force you to repay the loan every month – making it an ideal way to ensure that you don’t simply float the loan indefinitely. The only drawback with remortgaging your home is that it is not as flexible as a HELOC. If the project costs more than anticipated or you have other projects you want to do afterwards, you will again have to look for a way to finance them.

Personal loan or unsecured line of credit

The other options for financing your home renovation is through a personal loan or a line of credit. While they are both solid options if you aren’t able to access a HELOC or remortgage your home, they will cost you more in the longer run and are not very flexible either. Furthermore, if you don’t make the minimum payments on the line of credit every month, the interest charges can balloon your debt significantly in a short amount of time.

Home renovations are great not just for adding value to your home, but also for creating a space tailored to your needs, your aesthetic and your comfort level.

Buying more house than you can handle and becoming instantly house poor is very easy in the heated Toronto real estate market. As the property boom continues due to record low interest rates, a lack of supply and the continuing pandemic that is causing people to seek out space, emotion is another very important component that is fueling the rise. People are fearful of “missing out” and of never being able to enter the housing market if they don’t do so now. However, before taking the plunge it is so important to properly evaluate how much you can realistically afford to pay every month.

Monthly carrying costs

Most financial institutions recommend that your mortgage not be more than 26% of your monthly income and your total carrying costs should be maximum 30% of your budget – that would include property taxes, insurances and an emergency fund. Many people push that figure to 40%, but that is truly the limit when it comes to how much of your monthly income should be spent on housing costs.

How to calculate what you can afford monthly

Before you can determine how much you can feasible afford to pay per month, you first have to calculate just how much you earn. While most financial institutions and mortgage lenders will calculate your borrowing capability based on your gross income (before taxes), a more accurate way of calculating is to base your borrowing capacity on your net income (after taxes). Then, calculate all of your fixed costs – savings, car loans, school loans, utilities, insurances, etc… Add on your variable expenses such as food, clothing, entertainment, vacations, haircuts – and then see what you are left with at the end of the month, this figure is the real amount that you can afford on a mortgage. If you don’t have much left over, then you will have to rejig your spending to include a mortgage, property taxes and/or condo fees, house insurance and a maintenance fund.

Deposit

The amount of your deposit will also play a role in how much of a mortgage you can afford. The greater your deposit the more house you will be able to buy. If you are able to put down 20% of the asking price, then you will also save on mortgage insurance, something that can add quite a bit depending on the amount that is being insured.

Better safe than sorry

Lenders will always be quite eager to lend you money – but it is prudent not to let their enthusiasm sway you. Be prepared with your own calculations so that you know exactly how much you can afford and just how much you are willing to stretch. Although what you can afford right now might now buy you the kind of property you had in mind, it doesn’t have to be the only property you purchase. When you have enough equity in your home, you can sell it and move up – this is especially true if you are buying your first property. A starter home is something you can easily afford, that will get your foot in the real estate door.

In the end, there is no point to buying a home that will leave you broke at the end of each month. Living a good life means being able to go out for meals or shows, take vacations and not have to pinch your pennies to buy clothes or shoes. You will be much happier in the long run if you only bite off as much as you can comfortably chew.

Toronto realtors and home buyers have become savvy at sales knowing that in order to get top dollar for their listing staging the property is very important. Once the excitement of an accepted offer has abated slightly and the more nitty-gritty elements of a home sale need to be tackled, such as a home inspection, people tend to not be as diligent in their preparations.

Reason for a home inspection

The home inspection is a crucial step in any realty purchase and will determine whether the buyer is justified in paying big bucks for your place or whether you will have to make some price concessions or whether you will need to do some maintenance before the home is ready for sale. Most of the time sellers agree to credit a portion of the cost from the sale of the house instead of doing the repairs raised by the inspector.

What are inspectors looking for?

The main areas that inspectors want to ensure are solid in any property are the major ones:

– Structure/foundation
– Wiring/electrical
– Plumbing
– Drainage/water damage
– Roofs
– Mold
– Pests
– Toxins (asbestos, Radon, lead)

Preparing for the inspection

In order to facilitate the inspection of your property below are a few tips to follow:

– Make sure all light bulbs are working
– Clear out any closets with access to the attic
– Label your electrical panel
– Clear paths to anything the inspector will want to check such as gas tanks, hot water heaters, etc…
– Keep basement walls clear
– Turn all the utilities on
– Don’t conceal any issue with your home!

Pre-listing inspections

Some motivated sellers are even willing to pay for a home inspection pre-listing to know what shape their house is in and what they could potentially face after a sale and can choose to address the issue beforehand. An advance home inspection does make a realtor’s job much easier and make pricing a home more accurate. However, this does mean paying for the inspection yourself and you will face a second inspection once an offer has been accepted.

Whatever route you decide to take as a seller, just be sure to prepare for the inspection so that the inspector has an easier time of navigating your home.

Summer in Toronto is just around the corner and with the lockdowns still in place people will once again have to find ways of enjoying the warm weather at home. Last year the lockdown resulted in a huge boom in the sale and installation of pools. In fact, many installers are already booked solid for 2021 based on the sales they had in 2020. If you are thinking of installing a pool in your yard for the summer, here are some costs to keep in mind to help you properly budget for the expense.

Type of pool

The type of pool you choose will definitely influence the price you will pay for your Toronto installation. There are three main kinds of pool available: liner pools, fiberglass pools and concrete (gunnite) pools.

Liner (vinyl) pools are the most affordable to install (between $10K to $25K) however they will require more frequent maintenance as liners need to be changed every 5-10 years and can be damaged by pets. The yearly maintenance can also be higher for a liner pool, but they are naturally algae resistant and fairly easy to clean.

Fiberglass pool costs can be initially quite attractive – but the base price doesn’t truly reflect the cost of a full install. Usually the base prices start at around $20K but with a full, professional installation can be as high as $60K. Fiberglass pools are very low maintenance, though, and will save you money in the long run.

The most expensive option is concrete. Although they are great looking, fully customizable pools, they will cost between $50K-$100K depending on the finishes and features you choose. These pools do require a lot more maintenance but will last the longest out of all three pool options. However, the cost of maintaining a concrete pool is also the highest.

Hidden costs

The installation of the pool is only one of the costs that you will have to take into consideration. Some of the other costs to keep in mind are:

– The concrete collar
– How much extra dirt removal will be if you need it
– Electrical and/or gas hookup
– Landscaping
– Fencing
– Removal of large objects such as tree stumps or boulders
– Moving of power lines if they are in the way

When all of the costs involved with a pool installation are taken into account, the final price tag can easily range from $50K on the low-end to nearly $200K.

Shop around

Naturally, you can bargain with installers and it is always best to shop around. Read reviews of installers and ask friends and family for referrals. Another tip to keep in mind is that the best prices for pool sales is usually in the early fall when business begins to slow down.

Pools are a great addition to your home. However, they do not really add value to your property, and depending on the age of your pool, can even be a hindrance to prospective buyers. In the end, any pool you install will be for the pleasure of you and your family.

Toronto real estate’s busiest time of year is gearing up. Traditionally spring has always been the hottest time for home sales and this year is no exception. If you are among the intrepid bunch who are contemplating a move in this red-hot market, then there are a few things to keep in mind when you first move into your new home.

When you take possession of your new Toronto home, you might want to start moving your furniture in right away – however, before you do that, there are certain steps you should take beforehand.

Renovate

Yes, now is the time to renovate! Painting, polishing the floors and changing fixtures can definitely be done after you have moved in, but it becomes a bit more logistically challenging. If you have the funds and the manpower, then it is best to take care of any renovations before you move in so that once you do, you can simply start enjoying your new home.

Utilities

Be sure to set up your utilities before moving in. In fact, it is best to call your utilities provider as soon as you have your closing date so that you can set up a time for the hook up for the date of possession. Otherwise, it is very possible that you will have to wait several days to almost a week or more to have your utilities connected – something that will impact your move-in plans considerably.

Child/pet proof your home

If you have little children or pets then a good rule of thumb is to take a little time to child/pet proof your new home before you move in. Setting up security gates at staircases and installing finger guards on sockets will ensure you can move-in and set up without worrying that your loved one is going to get into any serious trouble as you do so.

Change locks

If you like to play it extra safe, then you might want to have the locks on all your doors changed immediately after you take possession of your new place and before you move in. While in theory the previous owner must turn over all extra copies of the keys to you, there is no guarantee that an extra key might remain floating around somewhere. Changing the locks will guarantee that no one else will have a way to get in except for you and your family.

Decide where things go

Yes, as silly as this sounds, it is better to have an idea of where you want your furniture to go before the movers arrive. Since movers are generally paid by the hour, if they have to stand around waiting while you figure out where the couches are going, you will have a much bigger bill to pay in the end. Additionally knowing where you want things to go will help you set-up and settle in quicker.

Lastly, don’t forget to have your mail forwarded to your new address for at least the first three months – otherwise you risk having important correspondence arrive at your old place until you have made the changes with all of your contacts.

The Toronto spring real estate frenzy is just gearing up. Buyers are getting ready to bid and homeowners are preparing their homes to ensure maximum gain when they sell. However, is buying the right option for you?

While it is clear that buying into the Toronto real estate market has been a very profitable venture over the last two decades, owning property is not necessarily for everyone. It is important to evaluate your individual requirements before jumping in.

Costs

Regardless of whether you buy a home or a condo there are clear obligations that come with owning a property. Depending on your current lifestyle, financial situation and future plans, owning might not be the right choice. With a home or condo you will be responsible for a monthly mortgage, property taxes and maintenance. If you live in a condo, you will also have condo fees. Additionally you will have all of the ancillary costs associated with life today – from utilities to cable/wifi. On the flip side, if you rent, you are only responsible for your rent and perhaps your heating/electricity. You don’t have to worry about maintenance costs or taxes because those are covered by your landlord. Those who choose to rent can use the savings from what they would otherwise put into taxes and home maintenance into savings.

Maintenance: home

When it comes to maintenance homeownership means being responsible for all the maintenance/repairs a property requires. Although homeowners can certainly take care of any maintenance or repairs at their own pace and as their budget permits, anything that has been neglected for too long, will incur even greater costs down the road.

Maintenance: condo

Condos are much easier than a home when it comes to maintenance. Owners must contribute to a maintenance fund (conde fees) and sit on a board that helps oversee how those funds are spent, but otherwise condo owners don’t have to worry about maintenance/repairs. The only repairs you are truly responsible for is if anything breaks down in your unit – water leak that causes damage to your flooring, an electrical issue, etc…

Maintenance: rental

Renting comes with the least amount of responsibility when it comes to maintenance and repairs. The landlord is fully responsible for ensuring that the grounds are tended and the structure is sound. The one drawback about renting is having to wait for the landlord to arrange for something to get repaired.

Lifestyle</p>

One of the biggests differences between owning a house/condo or renting an apartment is when it comes to lifestyle. Homeownership means having to be around to take care of the daily/weekly/monthly maintenance of your property. While you can certainly leave for vacation, you will have to make arrangements for the grounds to be maintained, so it is not completely hassle free. However, houses provide plenty of privacy from neighbours. In a condo, while you won’t have to worry about maintenance if you want to leave, you will have a lot less privacy. The upside of less privacy in a condo, is better building amenities. Many condo complexes have fitness centres, pools, party rooms and even games areas. An apartment is the most hassle-free alternative. You can come and go without worry as you are not responsible for any of the building’s maintenance.

In the end deciding whether you are better of in a house, a condo or a rental comes down to a combination of your financial situation, your goals and your lifestyle.

It is nearly a year since the pandemic forced Toronto residents to retreat to their homes. Over the past 12 months people have realized just how functional or not their home is based on having to use it as more than just their primary residence. Now that people are living and working from home, the merits of the newer floors plans have and design trends have come into sharp relief.

Open layouts

One of the most popular contemporary design trends of the past two decades has been the open-concept layout. Families who have been forced to work and study from home over the past year have discovered the drawback to not having private spaces. Those forced to share work space with a partner or their children have realized that having a room with a door is very important in our new reality. Although it will take a few years for more closed layouts to reappear, they are already in the beginning stages of new home construction development. Additionally, unless you have an immediate need for privacy due to your current work/living situation, there is no rush to install walls or doors in your home.

Home offices

Yes, now that so many of us are working from home, the need for a dedicated space to concentrate is crucial. Whether you already had a designated home office or were winging-it on the couch, the move towards a clean, integrated workspace is growing. Even if there isn’t a specific room for a home office, people are finding innovative ways to include a dedicated spot where they can leave their computers, files and anything else needed to be productive from home.

The importance of light

The other element of interior design that has become important now that so many of us are spending most of our days at home, is the amount of light and the quality of that light we get. Although having plenty of natural light is always ideal – full sunlight on your computer screen can be hard on the eyes. It also creates harsh lines on a person’s face that aren’t flattering for video conferencing. Ideal light includes diffused natural light, warm lighting and plenty of it – having sufficient light is crucial for your eyes. However, when creating a lighting design for your home and workspace, don’t forget to include lighting to help your creative juices flow. More ambient, atmospheric lighting can help you get into a more creative space if you need to flesh out or come up with ideas.

Sustainable furniture

The trend towards more sustainable furniture will pick up speed in 2021. People who are now spending most of their time at home have realized that furniture that lasts is worth investing in. Although there is a market for fast furniture, having something solid that will see you through for longer than a couple of years is having a bigger appeal lately.

While everyone will eventually design their home to suit their needs, it is clear that some trends are universal and will continue to gain in popularity the longer the pandemic persists.

Winter in Toronto is decidedly cold. The seasonal drop in temperatures across the country can cause debilitating spikes in heating costs. To keep your home heating costs steady through the year, there are a number of little things you can do during the winter months.

Seal windows/doors

One of the best ways to minimize a hike in heating costs when Toronto temperatures drop is to make sure your windows are properly sealed and your doors have weather stripping. If you are unable to add/replace the weather stripping on your doors, then get draft blockers to make sure that any cold air entry points are blocked off.

Using drapes/blinds properlya

You can also pull the drapes/blinds on windows that don’t get direct sunlight. By keeping the drapes/blinds drawn you will prevent any possible cold air from seeping into the room. Conversely, if you have windows that get a lot of direct sunlight – be sure to keep those blinds/drapes open. The sunlight will create passive heat that can help raise the temperature in your home even on the coldest days.

Thermostat regulation

If you don’t mind waking up chilly, you can turn your thermostat down at night. Wait for as long as possible after you get up to turn them up again. If you don’t like the cold air first thing in the morning, then program your thermostat to turn on a half hour before you get up. If you are susceptible to the cold and don’t relish the thought of turning the heat down at all, then you could keep your thermostat steady at a lower temperature throughout the day.

Residual heat

Baking is a good way of warming up your home without turning up the thermostat. While it is unsafe to use your oven as a method of heating your home, by baking more often you can organically benefit from the heat produced. Once your baking is done, leave your oven door open to better help disperse the heat into your kitchen.

Dress warm!

Dressing in layers is a great way to stay warm. Instead of turning up the heat in your home, wear a sweater over a T-shirt. Wear wool or cotton socks to help your feet breathe. Use slippers to keep your feet warm. If you are prone to being chilly, you could also wear a warm hat to keep your body temperature even.

Be strategic

Another way to stay warm without raising the heat in your Toronto home is to keep blankets readily available in every room. Blankets are especially good for when you are doing low energy activities such as watching TV or working on a computer.

Stay active

Exercising regularly will automatically raise your body temperature and help you to withstand the cold.

Water and heat

If you feel really chilled, a good way to raise your body temperature quickly is to soak in a warm bath or to take a warm shower. You could also use a heating pad placed strategically on your feet to warm yourself up.

Keeping energy costs down in your Toronto home is always a challenge during the winter. However, by using a few of the tips mentioned above, you can mitigate the more drastic energy cost swings you would otherwise experience.

Welcome back!

2021 in the Toronto real estate market is certainly taking its lead from the last quarter of 2020. Despite the pandemic buyers were eager and their enthusiasm drove the real estate market to post record gains in some sectors. Although the city condo market remained flat, the housing market heated up.

The latter half of the year posted especially strong numbers. Toronto housing prices increased by 13.8% in November, year-over-year. And, the usually very quiet holiday month of December saw housing sales increase by an extraordinary 64.5%. According to an article in the Toronto Sun, experts are expecting the strong seller’s market to continue.

The surge in activity in the Toronto property market is really a tale of two realities – houses vs condos. While the housing marketing is red-hot, the condo market is facing some tough head-winds. The reality of the pandemic and the difficulty people have found of living in a city in small condos with little room to move around vs owning a house in either the suburbs or the country has been the catalyst for this uneven market.

With the pandemic still not under control, people will likely continue looking to make significant lifestyle changes. Should this trend continue then the Toronto real estate market is heading towards another banner year – especially given the continuing shortage of inventory for single family homes – a factor that will certainly push prices up further.

Regardless of market conditions, you should only jump into the current market if you are very well prepared financially

Toronto’s condo market, which for years was robust and posted yearly gains, has softened and regular investors are having to make difficult choices. According to the Financial Post, where investing in a condo seemed like a solid, secure investment even just a year ago, because of the pandemic and the exodus from the city’s core, rents have plunged and condo prices have dropped.

If you purchased an off-plan condo two years ago at the peak of the market as an investment, then you could very well be underwater today unless you are able to carry the loan costs. With the dip in what owners can ask for in rent, many condo buyers are seeing themselves in the scary position of either having to sell at a loss or cover the shortfall in rent that would have otherwise covered the mortgage payment. Since rents have fallen significantly since the start of the year, what an owner can now ask for in rent will, in many cases, no longer cover the mortgage, insurance, condo fees and taxes – leaving owners out-of-pocket for the difference.

The hardest hit sector are condos that are yet to be finished. People who have bought off-plan and are waiting for their condos to be completed are now seeing that they will likely be unable to afford their units once completed. In fact, according to the Financial Post article, many of these buyers are even willing to sell at a loss just to get out of their contracts.

There is no doubt that the market will recover. However, until that happens the condo market is likely to remain flat and could potentially see an even larger drop than the 3% decline that we have seen this year.

While the market might be facing some challenges right now, once the pandemic is over and life begins getting back to normal, there is every reason to believe that people will once again want to live in the city and that condo sales will again be a solid investment.