Home Sales Edge Up In November

Home sales recorded through the MLS® System of the Kingston and Area Real Estate Association numbered 210 units in November. This was up two per cent from a year earlier.

Sales of all types of properties numbered 236 units in November, up four per cent on a year-over-year basis.

“Housing demand in the region remains a steady as she goes story, with the November sales figure edging up a bit from last year to stand roughly in line with the five and 10-year averages for the month,” said Tim Barber, President of the Kingston and Area Real Estate Association. “With just one month left to go this year it looks like sales for 2013 will come in about five per cent below 2012, and that’s really a story about a very strong first half of 2012, and a weak start this year. Meanwhile, prices have continued to grind higher, with the average home price likely to finish the year up about three and a half per cent.”

The average price for homes sold through the Association’s MLS® System in November 2013 was $289,977, up six per cent from November 2012.

There were 410 new residential listings on the Association’s MLS® System in November 2013, up three per cent on a year-over-year basis.

Overall supply levels have risen in recent months. Active residential listings on the Association’s MLS® System numbered 1,504 units at the end of November, up 18 per cent from the same month in 2012.

There were 7.2 months of inventory at the end of November 2013, up from 6.2 months at the end of November 2012 but still below the long-run average for this time of the year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.

The value of all home sales was $60.9 million in November 2013, up nine per cent from a year earlier. The total value of all property sales rose eight per cent from a year earlier to $65.7 million in November.


The information contained in this report has been prepared by
The Canadian Real Estate Association, in co-operation with the Kingston and Area Real Estate Association.
The information has been drawn from sources deemed to be reliable, but the accuracy and completeness of the information is not guaranteed.
In providing this information, neither The Canadian Real Estate Association nor
the Kingston and Area Real Estate Association assumes any responsibility or liability.
Copyright © 2014 The Canadian Real Estate Association. All rights reserved. Reproduction in whole or in part is prohibited without written permission.

 

Do you feel your home is overvalued?

According to a new study from Deutsche Bank,  Canadian homes are overvalued by 60%.  According to a CBC article, some Canadian economist feel this is accurate.  When we look at areas like Toronto or Vancouver we can understand what they are saying because the cost of homes are simply out of reach for most Canadians.

Fortunately, most of us don’t live in these major cities. Beautiful places like Kingston, Ontario saw an average selling price in November 2013 of $289,977.  This is up six per cent from November 2012.

Some are saying there are no bubbles in the Toronto market but we do see corrections in the market.  The graph below certainly makes you nervous!

Buyers should be cautious in purchasing homes where the potential for a correction is likely.  If you do need to buy now, you should be in for the long haul.  If you have to sell when they market drops, the potential to lose equity you have built up in your home is likely.

RESIDENTIAL RESALES ACTIVITY FOR CANADA
(Sales to New Listings vs. MLS Price $)

 Source: Adapted from CMHC, Housing Now – Canada Edition, December 2013.

Homes Sales Edge Back in October

Home sales recorded through the MLS® System of the Kingston and Area Real Estate Association numbered 215 units in October. This was down 14 per cent from a year earlier.

Sales of all types of properties numbered 242 units in October, down 15 per cent on a year-over-year basis.

“Sales activity fell back in September following a strong month of August, and it edged down a little further in October,” said Tim Barber, President of the Kingston and Area Real Estate Association. “The combination of a quieter month of October for sales this year and a strong month of October by historical standards last year served to stretch year-over-year comparison.”

The average price for homes sold through the Association’s MLS® System in October 2013 was $282,666, up five per cent from October 2012.

There were 530 new residential listings on the Association’s MLS® System in October 2013, up one per cent on a year-over-year basis.

Overall supply levels have risen in recent months. Active residential listings on the Association’s MLS® System numbered 1,667 units at the end of October, up 20 per cent from the same month in 2012.

There were 7.8 months of inventory at the end of October 2013, up from 5.6 months at the end of October 2012 but still below the long-run average for this time of the year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.

The value of all home sales was $60.8 million in October 2013, up down 10 per cent from a year earlier. The total value of all property sales rose 17 per cent from a year earlier to $65.2 million in October.

 


The information contained in this report has been prepared by
The Canadian Real Estate Association, in co-operation with the Kingston and Area Real Estate Association.
The information has been drawn from sources deemed to be reliable, but the accuracy and completeness of the information is not guaranteed.
In providing this information, neither The Canadian Real Estate Association nor
the Kingston and Area Real Estate Association assumes any responsibility or liability.
Copyright © 2013 The Canadian Real Estate Association. All rights reserved. Reproduction in whole or in part is prohibited without written permission.

Having a TFSA works. Get one working for you.

The Tax-Free Savings Account (TFSA) was introduced in 2009 and offers Canadians a unique and flexible planning opportunity to save for their financial goals. Your contributions to a TFSA are not tax deductible for income tax purposes, however your savings grow tax-free inside your account. In addition, there is no tax payable when you make a withdrawal from your TFSA.

The savings you accumulate in your TFSA can be used at anytime and for any purpose – it’s completely up to you. Whether you are saving for a new car or a home purchase, your child’s education or your own retirement, a TFSA can help you reach your goal sooner.

Contributions

Canadians age 181 and over can contribute $5,5002 annually to a TFSA. Since 2009, the annual contribution limit was $5,000. Effective in 2013, the annual contribution limit has been increased to $5,500. Contribution limits are indexed to inflation in $500 increments. Any unused contribution room, dating back to 2009 or the year you turn 18, carries forward so it can be used in a future year. So if you have never contributed to a TFSA, your contribution limit for 2013 will be $25,500.

Your annual TFSA contribution limit is reported on your annual Notice of Assessment from Canada Revenue

Agency (CRA). In general, a TFSA is permitted to hold similar types of investments as an RRSP.

Withdrawals

Withdrawals from a TFSA are tax-free. An amount withdrawn in the current year will be added to your contribution room at the beginning of the following year. For example, assume a $5,500 contribution is made in January 2013, followed by a withdrawal of $5,900 ($5,500 contribution + $400 gain) in October 2013. On January 1, 2014, an additional $5,900 will be added to your TFSA contribution room.

Other Planning Opportunities

Given the tax-free nature of the investment income and flexibility regarding withdrawals and re-contributions, there are many opportunities that you and your Investment Advisor can explore to incorporate a TFSA into your overall wealth management plan.

 TFSAs offer a significant income splitting opportunity. You can provide funds to your spouse, common law partner or adult children to allow them to contribute to their own TFSA (subject to their personal TFSA contribution limit). None of the income earned within their TFSA is attributed back to you.
 Consider holding investments in a TFSA that would otherwise be taxed at high rates outside a registered account, such as interest income
 Since neither the income earned nor withdrawals from a TFSA will affect your eligibility for federal income-tested benefits and credits (e.g. Old Age Security, GST credit, age credit), consider depositing your surplus RRIF or pension income into your TFSA.

Please contact your BMO Nesbitt Burns Investment Advisor for more information on how to get a TFSA working for you.


With permission

Pierre L. Gaumond,
CFP, CIM, FMA, FCSI

Investment Advisor
& Financial PlannerContact Info:
67 Bock St., Kingston ON
(613)-547-5214
(613)-547-5288website

Home sales slip further in February

Home sales recorded through the MLS® System of the Kingston and Area Real Estate Association numbered 181 units in February. This was a decline of 26 per cent from a very strong February 2012.

Sales of all types of properties numbered 209 units, down 23 per cent on a year-over-year basis.

“It’s important to remember that last February was the strongest month for activity in the region in three years on a seasonally adjusted basis, which means even after accounting for the fact that 2012 was a leap year, so that explains at least some of the big year-over-year decline in sales this February,” said Tim Barber, President of the Kingston and Area Real Estate Association. “Having said that, February’s year-over-year decline also reflects the fact that demand has quieted down in recent months. At the same time, new listings have generally been trending up, and that’s resulted in a rising trend in the overall number of homes on the market.”

The average price for homes sold through the Association’s MLS® System in February 2013 was $274,562, up five per cent from February 2012.

There were 546 new residential listings on the Association’s MLS® System in February 2013, down two per cent on a year-over-year basis.

Active residential listings on the Association’s MLS® System numbered 1,347 units at the end of February, up 10 per cent from the same month in 2012.

There were 7.4 months of inventory at the end of February 2013. This was up from five months at the end of February 2012, and also stood above the long-run average for this time of the year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.

The value of all home sales was $49.7 million in February 2012, down 23 per cent from a year earlier. The total value of all property sales declined 20 per cent on a year-over-year basis to $55.3 million.


The information contained in this report has been prepared by
The Canadian Real Estate Association, in co-operation with the Kingston and Area Real Estate Association.
The information has been drawn from sources deemed to be reliable, but the accuracy and completeness of the information is not guaranteed.
In providing this information, neither The Canadian Real Estate Association nor
the Kingston and Area Real Estate Association assumes any responsibility or liability.
Copyright © 2013 The Canadian Real Estate Association. All rights reserved. Reproduction in whole or in part is prohibited without written permission.

 

Home sales remain at more moderate levels in January

Home sales recorded through the MLS® System of the Kingston and Area Real Estate Association numbered 147 units in January. This was decrease of 17 per cent from a very strong January 2012, but stood even with the five year average for the month.

Sales of all types of properties numbered 161 units, down 16 per cent on a year-over-year basis.

“Home sales activity has actually remained pretty stable since the market initially geared down in the wake of changes to insured mortgage lending rules back in July last year,” said Tim Barber, President of the Kingston and Area Real Estate Association. “The apparent deepening of year-over-year declines in recent months is really a reflection of rising demand at this time last year, with last January marking some of the strongest activity we’ve seen in the entire post-recession period.”

The average price for homes sold through the Association’s MLS® System in January 2013 was $275,287, edging up one per cent from January 2012.

There were 574 new residential listings on the Association’s MLS® System in January 2013. This was up six per cent year-over-year.

Active residential listings on the Association’s MLS® System numbered 1,176 units at the end of January, up 11 per cent from the same time in 2012.

Months of inventory numbered eight at the end of January 2013, up from six months at the end of January 2012 but still below the long-run average for this time of the year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.

The value of all home sales was $40.5 million in January 2012, down 16 per cent from a year earlier. The total value of all property sales declined 12 per cent on a year-over-year basis to $44 million.

 


The information contained in this report has been prepared by
The Canadian Real Estate Association, in co-operation with the Kingston and Area Real Estate Association.
The information has been drawn from sources deemed to be reliable, but the accuracy and completeness of the information is not guaranteed.
In providing this information, neither The Canadian Real Estate Association nor
the Kingston and Area Real Estate Association assumes any responsibility or liability.
Copyright © 2013 The Canadian Real Estate Association. All rights reserved. Reproduction in whole or in part is prohibited without written permission.

 

Joint Ownership of Property: Pros & Cons

Married spouses commonly hold property jointly with right of survivorship. In certain circumstances, there are several benefits to this ownership structure. For example:

  • Each spouse has the ability to manage the property without written consent of the other.
  • Upon the first death, the surviving spouse automatically owns 100% of the property.
  • Probate tax is payable on the value of the property only once (i.e. at the time of the second death).


However, joint ownership for couples may not be appropriate if one of the spouses wishes to benefit children of a previous relationship, or other family members, friends, charities or other beneficiaries. In addition, conflicts can arise during the administration of the estate of an individual who had transferred property into joint names (with a right of survivorship) with another person who is not a spouse or where the spouses do not have common children.

Disgruntled beneficiaries, heirs at law or creditors, may try to claim that the property held jointly should form part of the deceased’s estate to be distributed in accordance with the terms of his or her Will , or be subject to estate liabilities.

Where a parent transfers property into joint names with only some of the children, there is potential for conflict among the children and other beneficiaries as to whether an immediate gift was intended at the time of transfer, or whether the surviving joint owners hold the property as a Resulting Trust for the parent’s estate.  In addition to potential conflict, a host of other problems may be associated with the transfer to joint tenancy. For example, if the property transferred has an accrued gain, there could be immediate tax liability triggered, upon transfer.

If the family home is transferred to joint tenancy, there may be loss of some of the Principal Residence Exemption, in the future. In general, property should be transferred into joint names with children only when an immediate gift is intended. If you are contemplating joint tenancy with right of survivorship, you should be aware
of the following:

  • All owners have immediate, full access to the property.
  • The property passes to the surviving owners on the death of one joint owner by right of survivorship, bypassing the deceased’s estate and possibly conflicting with distribution plans in his or her Will. For example, the Will may provide for an equal division of the estate among surviving children. If property is held jointly with only one of the children, was it intended that that child receive this asset in addition to an equal share of the estate? 
  • If there is an out of order death, family members may be disinherited. For example, what if one of the children dies before the parent? Usually grandchildren receive a gift over of their deceased parent’s share under their grandparent’s Will. However, with joint tenancy, grandchildren who are the surviving children of a predeceased child of the testator will not receive their deceased parent’s share. On the grandparent’s death, the property will pass only to the surviving children who are joint owners.This could occur where there is a common accident that claims the parent and grandparent.
  • The property may become subject to the claims of creditors of all joint owners. In the event of divorce of one of the joint owners, a creditor could include an estranged spouse of one of the joint owners.
  • A transfer of property into joint names, unless to a spouse, creates a deemed disposition or sale at fair market value for income tax purposes on the portion passed to the other joint owners.The death of a joint owner also generates a deemed disposition on that person’s share. 
  • All joint owners must declare their portion of the income and capital gains from the jointly held property, if any, annually.
  • A portion of the Principal Residence Exemption will be lost if the jointly owned property is a principal residence for only one, or some, of the joint owners and other joint owners have their own residence on which they intend to claim the exemption.

If property is held jointly and you want to avoid the previously discussed negative consequences, professional advice is recommended. If you are a joint owner or are considering becoming one, talk to your tax and legal advisors about the benefits and risks. Your BMO Nesbitt Burns Investment Advisor can help introduce you to a professional advisor upon request.


Posted with permission

Pierre L. Gaumond,
CFP, CIM, FMA, FCSI

Investment Advisor
& Financial PlannerContact Info:
67 Bock St., Kingston ON
(613)-547-5214
(613)-547-5288

website

The Trouble With Mold

The last thing you want to hear when buying a house is that there’s a mold problem. These sneaky little spores aren’t easy to detect. Mold is a fungus and although some molds are visible and even odorous, mold can also grow between walls, under floors and ceilings. Or in less accessible spots, such as basements and attics. Mold flourishes in water-soaked materials (paneling, wallboard, carpet, paint and ceiling tiles), and will survive in almost any damp location.

There are thousands of disputes over mold between sellers and buyers through the years. Both parties should protect themselves up-front. A wise seller should put a mold disclaimer into the sales contract and encourage in the sales contract that the buyer hire and rely upon the buyer’s own independent mold inspection and testing of the home by a certified mold inspector.

Conversely, a buyer should ask the seller about mold and hire an inspector who can seek it out. While it’s not the inspector’s job to look for mold, most home inspectors will mention obvious signs of water damage and the possible presence of mold. Because the inspector will poke around in spaces you might not, he or she may see things you wouldn’t. Don’t be shy. Ask whether the inspector saw signs of mold or potential mold dangers.

In some states, real estate agents have a duty to disclose problems they know exist. Appraisers should also notify you of any obvious sign of a mold problem if the value of the property can be affected.

According to the Environmental Protection Agency, molds produce allergens, irritants, and in some cases, potentially toxic substances. Inhaling or touching mold and mold spores may cause allergic reactions in sensitive individuals, including hay fever-type symptoms, such as sneezing, runny nose, red eyes, and skin rash.

Molds can also cause asthma attacks in people with asthma who are allergic to mold. In addition, mold exposure can irritate the eyes, skin, nose, throat, and lungs of both mold-allergic and non-allergic people. Easily aerosolized once they are disturbed, hundreds of thousands of spores can fill the air within a short period of time. Containment procedures are necessary to prevent contaminating the entire house or building. Preventing water damage is key in stopping mold. Many indoor mold problems begin with an aging, weathered, leaky roof that allow waters to enter the home.

If your home or property has a water, mold, other environmental problem or if there’s a reasonable suspicion of a problem, you should remedy the water problem, mold infestation, or environmental threat prior to even offering the property for sale.

Learn to detect mold in homes. Get the seller to disclose mold issues and negotiate around any mold problems in the course of the sale.


THE PRUDENTIAL REAL ESTATE ENEWSLETTER – VOLUME 57

Home Sales Edge Lower in December

Home sales recorded through the MLS® System of the Kingston and Area Real Estate Association numbered 205 units in November, a decrease of three per cent from the same month last year. Sales of all types of properties numbered 228 units, down five per cent on a year-over-year basis.

On a seasonally adjusted basis, home sales edged back five per cent month-over-month in November 2012, reversing some but not all of the gains made since August.

“Home sales activity in the Kingston area has held up pretty well in the wake of stricter mortgage rules that came into force in mid-July,” said Tim Barber, President of the Kingston and Area Real Estate Association. “To put it in perspective, demand in the past four months has been running, on average, just four per cent below levels observed in the first half of the year, and those were actually quite strong.”

A total of 3,197 homes have traded hands so far this year. This remains six per cent ahead of the first 11 months of last year, and stands above levels in the same period in 2010 as well.

The average price for homes sold through the Association’s MLS® System in November 2012 was $273,902, up 10 per cent from November 2011.

There were 400 new residential listings on the Association’s MLS® System in November 2012, rising 15 per cent from year-ago levels.

Active residential listings on the Association’s MLS® System numbered 1,276 units at the end of November, up nine per cent from the same time last year.

Months of inventory numbered 6.2 at the end of November 2012, up from 5.5 months at the end of November 2011, but below the long-run average for this time of the year. The number of months of inventory is the number of months it would take to sell current inventories at the current rate of sales activity.

The value of all home sales was $56.1 million in November 2012, up six per cent from a year earlier. The total value of all property sales increased four per cent on a year-over-year basis to $60.9 million.


The information contained in this report has been prepared by
The Canadian Real Estate Association, in co-operation with the Kingston and Area Real Estate Association.
The information has been drawn from sources deemed to be reliable, but the accuracy and completeness of the information is not guaranteed.
In providing this information, neither The Canadian Real Estate Association nor
the Kingston and Area Real Estate Association assumes any responsibility or liability.
Copyright © 2013 The Canadian Real Estate Association. All rights reserved. Reproduction in whole or in part is prohibited without written permission.

 

Credit Scores – Improving and Protecting Them

 


 

With tighter regulations, credit is playing an even bigger role than ever before. There is A LOT of mis-information out there. I have attended 2 seminars with representatives from Equifax to explain it to me. Below is a very rough guideline how it is calculated. NOTE: even the rep from Equifax said they don’t even understand how exactly it is calculated as it is so convoluted and there are so many variables….(seriously that is what they said LOL)

Payment History

35%

Factors in the recency of, and number of, payments over 30 days late, collections, judgments, and bankruptcies. A single 30-day late payment can drop your score 15-20 points.
Current Debts

30%

Considers how much you currently owe (in absolute terms and compared with your credit limits), how many creditors you owe money to, and how much you could owe if you maxed all your available credit.
Age of Accounts

15%

The longer your accounts have been opened the better. You generally need at least three accounts over one year old.
Type of Credit

10%

Bank loans, credit cards, and revolving credit accounts all impact you differently.
Credit Enquiries

10%

Numerous credit applications in the past 12 months is a no no. This is a big benefit of mortgage brokers, who pull your credit only once for multiple lenders.

 

Besides the obvious (bankruptcies, judgments, etc.) the top Beacon killers are:

  • Payments over 30-days late
  • Maxing out credit cards (i.e. using over 70% of a high credit limit)
  • Seeking too much credit in a short period of time (e.g. applying for 4 credit cards in one month)

 

If you have a lot of maxed out cards, bring them at least below 70% of their limit (Below 50% is better. Below 30% is best). Your credit score can jump considerably in as little as a month.

GREAT TIP – it may not be realistic for the client to come up with a few thousand dollars to reduce their balances. As such, have them call the credit agency to increase their limit. Ex – if a client has a $10,000 line of credit with $9,000 against it, have them get the limit increased to $15,000. This is a VERY easy way to keep under the 70% rule without having to spend $$$ to do so. This isn’t a good idea for those clients that use the room they have been given however as they will just put themselves deeper in debt.

What does this mean for you?

With more restrictions and smaller pool of qualified buyers going forward, it will be increasingly critical to counsel those around you about the importance of protecting their own credit. I work with credit everyday and find myself educating and informing everyday as well. I would have absolutely no problem (in fact I would welcome it) sitting down with someone you know and discussing and informing them about credit and how they can prepare and protect themselves for when they are ready to buy. Far too often I meet with someone ready to buy, only for them to be surprised / disappointed about their credit situation. It is no easy or quick fix. Often times it takes months or years to fix. In the past we have said “call me when you have fixed it” and moved on to the next client, but with a shrinking pool of qualified buyers, etc. it may be best to be proactive. I would welcome playing a role in that.


Permission was obtained by Chris to post this article.  If you are interested in more information about your credit score and how best manage your finances, please contact Chris

 

 

 

Chris Matthey, AMP
Mortgage Agent
License# M08000692
Office: (613) 384-4000 x 243
Toll Free: (866) 384-4855 x 243
Cell: (613) 561-5850
Fax: (613) 384-4047

 
 

VERICO -The Mortgage Professionals
775 Blackburn Mews West
Kingston, Ont.
K7P 2N5
Mortgage Brokerage License #10280

 

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