When you purchase a home, there are many additional costs over and above the price of that property.  See the selection below and be sure you've taken them into consideration to avoid any nasty surprises at completion time! This informative graphic and follow up list was supplied by one of the best mortgage brokers I know and one I often recommend for my clients, Lynn McLellan at Dreyer Group Mortgage Brokers.

I read an article recently in Business Negotiations by Katie Shonk about four major challenges that come up again and again in negotiations between buyers and sellers.  I think she's absolutely right about all four; I see it in my real estate practice all the time.  As Katie says, "By bing more mindful of these traps, we can learn to avoid them and get better deals."  I've paraphrased her full article below.  You can read more of her work at Harvard Law School's Program On Negotiation Daily Blog at https://www.pon.harvard.edu

Pitfall #1:  Overvaluing Your Possessions

Why is it some homes are plucked off the real estate listings within mere days while others sit for months or even years?  Location, condition and curb appeal have something to do with it, but there's another factor -- one that sellers can avoid --  which is the tendency to overvalue one's property.  Some sellers ignore the best advice of their real estate agent's carefully determined valuations and ask for much more than they should.

There's a name for this pitfall -- it's called the Endowment Effect.  Basically we all overvalue just about anything we own, no matter how trivial, simply because we own it.  If we were looking at buying a similiar article from someone else, we would have no interest in paying as much as we are asking.  Think about the ads you see on Craig's List for old furniture with high price tags that you think should likely be given away or taken to the dump.  See what I mean?

Sometimes the best thing to do, if you don't believe your real estate agent and/or a buyer, is have an appraisal done by an objective third party.  

Pitfall #2:  Focusing Too Much on Price

What's your most important goal when making a sale?  If you're like most of us, getting the best price possible is foremost in your mind.  It's normal for sellers and buyers to place a high premium on meeting their target price in a negotiation. 

Sometimes that focus becomes so competitive and focussed that the end goal of actually making the sale or purchase gets lost in only looking at the price.  Perhaps there are other sources of synergy that could enhance the agreement (and the bottom line) such as possession dates, inclusions of fixtures, etc.  When you find buyers or sellers are obsessing strictly about price, try brainstorming ideas for adding more value to the deal on both sides.

Pitfall #3:  Compromising Your Ethics

Whatever it is that you are selling, you know far more about that item than potential buyers do.  Because of what Katie refers to as this information asymetry you need to be careful not to take advantage of the buyer because of this when negotiating.  Anything that should be disclosed must be disclosed.  Do not compromise your ethics.  It's extremely tempting to "not mention" the leaky roof in the middle of a hot dry summer, and tell yourself that it's "buyer beware".  If you are found to have been dishonest, you can pay a whole lot more down the road in legal suits and damage to your reputation than you gained in price.

Pitfall #4:  Making Unappealing Offers

Many buyers pride themselves on making "lowball" offers just to show their negotiation skills.  Unfortunately, that often insults the sellers, they become intransigent and negotiations go downhill fast from there. 

It's difficult in some cases to provide a reasonable offer that doesn't look like a "lowball" if the seller's price is too high.  (See Pitfall #1!)  But in those cases, provide carefully thought out comparable sales examples and then present your offer in the best light.  Try framing your offer as a gain over the status quo by showing that your offer is at least better than  the one received down the street for a comparable property.  Or mention the provisions you've included that don't address price directly but enhance the agreement in other ways that can effect the bottom line (See Pitall #2!)

Awareness of common sales negotiation pitfalls is the first step in overcoming them.  It takes practice and effort but we can all get better results by removing the negative effects of the pitfalls mentioned above.

Clients getting ready to sell their homes often ask me to do a "walk through" to let them know what needs to be done prior to selling.  The first thing we talk about is always

de-cluttering.  

The second thing we talk about are there are a few little fix-ups that are easy to do and make a real difference in making the house look clean and inviting. 

Fix Up #1:  Replacing Stained or Cracked Caulking around sinks and tubs.  

Removing it is easy with a metal or plastic tool. Hardware stores sell specially designed plastic ones that are inexpensive and super effective.

The tricky part is getting the caulk back in place evenly.  I've found that putting down painter's tape on either side of where I apply the caulking makes it easy, quick and very professional looking. Just be sure to remove the tape before the caulking dries!

Fix Up #2:  Change Light Bulbs and Update Light Fixtures

You want your home to be bright and well-lit.  Take your ceiling fixtures down, wash out the little bits of dust and bugs that have accumulated and replace burnt out bulbs with new ones. 

If your fixtures are old and out of style, consider a quick trip to Home Depot or Rona to get an inexpensive replacement from Home Depot or Rona.  It's amazing what a difference it can make in bringing your home up to date. 

Fix Up #3:  Painting.  When you Paint Your Walls, Consider Painting over that                           Dingy, Dirty Brick or Stone Fireplace

Not every brick or stone fireplace is created equal.  Some are lovely and could even be brought back with cleaning.  Some just are not.  If you have an fireplace in a family room that just doesn't work, think about painting over it. 

These are just a few ideas to get started on now.  I'll add more soon.  In the meantime, each of these is easy to achieve, won't break your budget and will really help to show your home at its best when it comes time to go on the market.

Many people I know are talking about clearing out their junk - either as a New Year's Resolution or getting ready to move.  And many find that all the trash they want to clear is too much to deal with themselves.  I contacted Alyx LeBeau, Commercial Account Manager at 1-800-Got-Junk? and she agreed to provide $50 off coupons for me to give my clients to help with the task.  The card is to be presented at pick up and can't be used for just a one item pick up or minimum order. 

However if you have a LOT of stuff this card will be of help.  I've already sent cards to clients on my mailing list but there are just a few left.   If you live in the South Surrey White Rock area and would like me to send you a card, just get in touch via email or phone and I'll be happy to send one to you.  Hurry, supplies are limited!

Looking back at the outstanding year of real estate activity in 2017, the Canadian Real Estate Association is forecasting a slower year in 2018.

This cut back has been driven by the new mortgage rule which is set to take effect January 1.  In October, 2017, the Office of the Superintendent of Financial Institutions announced a new mortgage "stress test" which will require  uninsured mortgages (those who have 20% or more down payment or are refinancing their mortgage) at major banks to qualify at either the posted benchmark rate (currently 4.9%) or 2% above the lenders' contracted interest rate, whichever is higher.

There is also speculation that the Bank of Canada may increase interest rates 1 to 2 times before the end of 2018.  Interest rate averages are predicted to reach a more "normal" level in an attempt to moderate housing prices and affordability.

The benchmark rate is predicted to reach 5.15% and the average lending interest rate is expected to reach up to 3.44%.  With the combination of increasing interest rates and new qualifying guidelines, we're likely to see a decline in housing prices, as these changes could reduce borrowing power up to 20%.  The Canadian Real Estate Association expects to see a drop in national sales by 5.3%.

Not all financial institutions will be required to abide by the new mortgage "stress test".  Non-federally regulated lenders, such as credit unions, are not required to comply with the new legislation.  For this reason, other lenders may very well hold off on increasing rates in order to remain competitive in the market.

I'll be watching closely over the first quarter of 2018 for ramifications of this new rule.

Over the years one thing I hear over and over in conversation with people when they talk about their previous real estate experiences  is: "I wish I'd known more about what I was getting in to" or "My agent didn't tell me what I needed to know".

Honestly I don't think that real estate agents really mean to mislead their clients.  It's just that many have been in the business for so long and done so many deals they forget not everyone knows what to expect or fully understands what they're being told. They may not explain everything completely because they think you've taken it all in and understand.

I tell all my clients "There's no such thing as a stupid question."  And there isn't.  

Ask More Questions.

And if you don't know what questions to ask, say to your agent "What questions should I be asking?"  Any good agent will be happy to run through the process with you.

If you want to know more about Buying and Selling just go to those sections of this website. There's a good outline of what's involved in both.  And if you have any questions, please just ask.

I was in Romancing the Home the other day; it's a lovely home decor store in the heart of Ocean Park Village.  Jill, the owner, and I were just chatting when a woman came in to look around.  In passing, she then asked if she could trade her older Sid Dickens decorative tile "Memory Block" for a new one.  It had been a gift for her collection but she'd never really liked it so was wondering about an exchange.

I was a little taken aback to hear her request.  But Jill was gracious -- saying no she didn't do exchanges like that because her clients only buy new product from her.  But she pulled out a sheet of older Sid Dicken tiles to see if the visitor's tile had been "retired".  This is where the conversation started to get interesting.

Sid Dickens is a Vancouver sculptor whose hand-made blocks have become popular world wide.  His work is only available at one store in each city and the tile selection at any one time tops out at about 100.  

When he designs new tiles, he takes some of the older ones out of circulation.  To date, just over 400 pieces have been made.  Each tile has a name, a number and a story that goes with it. (See example below)  The older ones increase in value as they become scarce. In this particular instance, the visitor's tile had likely increased in value by between $150 and $500.

If Jill had been dishonest, she could have said, "Sure, I'll trade you." and then resold the tile online and made a tidy profit.  Instead, she made the visitor's day by sending her off to either re-sell the tile for a profit herself or keep it knowing it was growing in value.

Jill sells Sid Dickens Memory Blocks for $83.  They're available online for $98 at www.siddickens.com  If you want to buy one in Whistler you can pay $150.  Buying at Romancing the Home means you get the blocks for less from a reputable dealer.

Shopping local makes sense on so many levels, don't you think?  If you're interested in the new Spring Collection, drop by Romancing the Home (1637 128 Street, South Surrey) soon.

When we're moving there are a million details to cover.  An important one that can sometimes be overlooked is letting everyone know where we're moving.  Here's a handy checklist to ensure no one gets missed!

Many people find the thought of clearing out and packing up a major impediment to moving.  While the idea of living someplace smaller and easier to manage is attractive, the work of dealing with no-longer-needed belongings and clutter stop them right in their tracks. For some the emotional attachment and memories are the deciding factor; for others, it's just the physical work and time involved that counts. It brings to mind that old saying "We may think we own our stuff; actually, it owns us."

A friend recently asked for help in dealing with his mother's two storage lockers.  They'd been loaded years before and she wasn't sure she knew what they contained anymore.  They both realized those lockers needed to be gone through and emptied but she wasn't physically able and he didn't have the time to take it on. 

I did some research and came across Susan Borax and Heather Knittel of Good Riddance.  They run a professional organizing company specifically aimed at helping overwhelmed people work through their piles of stuff and come out the other side organized and satisfied their belongings had found the right home.They also run a sister company specifically for seniors and their particular needs called Practically Daughters. Susan was warm and friendly to talk to; they will come to your home to do a complimentary visit to find out what you need, make suggestions and provide a quote for their service. If this sounds like a solution for you, take a look online at www.goodriddance.ca  

I'm talking with Susan about coming out to South Surrey to do a seminar on downsizing this spring.  Call me at 604-916-4664 or email if you're interested in attending.

The cold, icy weather conditions we've just come through (with more forecast soon) might have some seniors (or their families) starting to wonder if perhaps looking at a Retirement Residence might be worthwhile.  You can enjoy Independant Living or Assisted Living in the right Residence and leave the snow shovelling, grocery shopping/ loading and home maintenance to someone else!

The best thing to do is book tours at different residences to see what they offer before it's an emergency situation. Give yourself time to consider the different options and plan ahead.

When you tour each residence, make notes about what you see so you can compare later.  Here are a few questions outside of the usual ones (such as pricing and suite size) that I recommend my clients ask:

     1)  Is there an ATM where I can get cash in the building or close by?

     2)  Are there private mailboxes? Can I receive FedEx etc. deliveries?

     3)  What arrangements do you make for smokers?

     4)  Is wine or beer available at meals or in the lounge?  Is the residence licensed?

     5)  Is seating assigned for every meal?

     6)  Are pets allowed to live here and/or visit?

     7)  What's the procedure for aging in place? What medical conditions are accepted?

     8)  What changes,if any,may I make to my suite - paint, wallpaper, flooring, etc?

     9)  Do suites have WiFi, cable and phone jacks?

   10)  Is there a recent Resident Satisfaction Survey available?

If you think selling your home and moving to a retirement residence is the next step, feel free to get in touch.  I'm happy to help.

Clients who are considering selling in the not-too-distant future have asked if there is anything beyond cleaning, clearing out and possibly staging that they need to do before listing their home.

Now that the market here in the Lower Mainland has changed from a hot sellers' market to a more balanced market, almost all offers to purchase will be subject to a building inspection.  It's interesting how many buyers, once they've seen the building inspection and note deficiencies, will try to renogiate price or in some instances even walk away if there is anything that worries them.

The key is to do the proper maintenance prior to selling on any items that could give them pause for concern.  Often those items are smaller and easy to look after.

Five common items exposed in home inspections are:

     1)   No GFCI protection:  Electrical outlets near basins and sinks need a GFCI receptacle or breaker. An electrician can easily do that for you at low cost.

     2)   Downspouts too close to the foundation:  Extend them about 4 feet from the house.  Placing a concrete splash pad often does the trick.

     3)   Poor Roof Drainage:  Leaves and debris blocking the gutters can cause water to back up under the shingles.  Have your gutters cleaned out regularly at least once and preferably twice if your home is close to tall trees.

     4)   Water leaks:  Have your roof, flashings and window caulking looked at to make sure there's no way water ingress can cause problems.  Check older toilets and replace wax rings if necessary.

     5)   Do It Yourself Improvements:  Use qualified licensed tradespeople -  especially for plumbing and electrical work.  Take out permits if they're necessary.  Label the breakers on your electrical panel.

Any property that has had proper maintenance done before selling fares much better during showings and price negotiations.  You can consider having a pre-sale inspection done by your own Building Inspector to be even better prepared.

I make my living helping people in my community buy and sell their homes.  It's a wonderful way to make a living and I'm grateful for the chance to help so many terrific people make the changes their lives require.

It's extremely important to me that the community in which those people find their homes is a healthy one with safe, clean streets, good schools and all the services they need to function well in their day to day lives.

One of the best ways to promote healthy living is to support the small businesses in that community - many of which are owned by local residents.  It's the small businesses who provide employment, donate to local schools and other worthy causes as well as act as the life blood central to community life.

That's why I've sponsored the Ocean Park Business Directory.  See it at http://www.theoceanparker.com/business-directory.html.   It provides a way for the folks who live in Ocean Park and nearby to access great local services and shops and then support them instead of driving across town (or the border) to the big box stores.

I just received this interesting page from Lynn McLellan, Verico Mortgages.  It explains some of the terms and talks about how we're all affected.   It also shows the difference between what you may have qualified for before October 17th when the new regulations came into force and what you're likely to qualify for now.  Take a look:

.

I've been reading about the Federal Government's new mortgage guidelines introduced this month.  The Feds have introduced these new guidelines because they want to protect the long term stability of the housing market in Canada.

Here in the Lower Mainland home prices are higher than almost anywhere else, except perhaps Toronto.  So by introducing the "stress test" requirement for buyers with less than a 20% down payment, the government has basically given those buyers approximately 20% less purchasing power to work with.  For first time buyers, this may well be just one more hurdle to home ownership.

Previously buyers just had to qualify for a mortgage at the lender contract rate which has ranged in the 2.39 - 2.79% range for a 5 year fixed term.  Now, the home buyer must qualify at the Bank of Canada rate (which is currently 4.64%) for a maximum 25 year amortization, with a maximum property purchase price of $999,999.99.  Potential buyers will have to have a minimum credit score of 600 and a maximum gross debt service of 39% of the home buyer's income .  

So far, those home buyers who are able to put down at least 20% down aren't facing the same challenges.

What about refinancing mortgages?  At this point, home buyers will still be able to refinance up to 80% of the value of their property. 

Now, more than ever, you need to ensure you have all the information at hand to make a wise mortgage decision. Enlist the aid of an experienced, well-qualified mortgage broker to give you all the tips and help you need.