Tuesday, April 28, 2009

My thoughts on the new mandatory energy audits

Energy Audits before you sell your home, I’m not sure on this one.

Pro: Lets the buyer know the efficiency of the property they are buying?
Con: Can be used against the seller in negotiating a final/fair price.

Pro: Shows the buyers where improvements can be made to save money on their energy usages.
Con: Forces the seller to spend $

Pro: National Association of Green Agents and Brokers apparently has a kit for a preliminary examination which points out areas in which small changes can help reduce energy costs and improve a property’s score.
Con: Question: could anybody “cook the books” for a better score?

Pro: Only licensed auditors will perform these audits.
Con: Exactly what does the licensing entail? Licensing plumbers, electricians and carpenters take several years; will an auditor be as educated? After all, they are providing a professional opinion indirectly on these trades.

I read that new windows don’t necessarily save money (energy) compared to old. I believe most building inspectors will tell you my 100 year old windows should be replaced. I get a little anal sometimes and this winter we tested out my “grandparent theory”… Close the drapes! Our living/dining room is 30 feet by 16 feet with 2 large windows facing south and 2 large windows facing west. Our experiment involved opening the drapes one evening, and closing them the next. We found a 4-5° difference in temperature. Our grandparents were right, 5° warmer with the drapes closed! So if you want to be warmer…close the drapes. If you want them open, understand the extra cost associated. It’s your money!

My drapes would be closed for an energy audit. Would I pass or fail? How would we know if any standard testing could be strictly adhered to? Impossible! I am all for reducing costs through education and choices but I don’t believe we should be forced.

Comments Please?

Monday, April 20, 2009

Can't we all just get along?..

I just returned from visiting my mom in Winnipeg. The Winnipeg news featured 3 top stories throughout the weekend. The flood and how the communities are pulling together helping one another, Susan Boyle the singing sensation from Britain’s Got Talent show - over 35 million views on You Tube within the week - showing us anything is possible, and the unions comments about the Chrysler bail out.

I hate win lose situations; I much prefer win-win. The union has publicly announced they will not negotiate anymore with the government. The fate of the company hangs while this game continues to play out. Windsor with 14% unemployment does not want to afford another plant closing. I hope it is the workers in that plant that are voting for their fate. You see, they are not just voting for their fate, but the fate of many businesses and communities these workers and this company supports. The decision to keep working and take less money during this downturn should be the decision of the people working at the plant…those affected the most.

I know someone who owns a company with a fairly large workforce. The union contract is up in the fall; apparently he has asked to negotiate now so that he can bid on jobs and keep his people working. No work, no pay! Because he does not know what his labor rates will be, he cannot bid on work. Who loses? The worker, you, and me! I am not against unions, but I am against win-lose. Cami kept 2 shifts going on reduced work weeks and unemployment picks up some of the tab. That means we all share in this; that to me is a win-win, working together, supporting our communities together.

Together we stand, divided we fall! As REALTORS® we compete against one another and then turn around and work with one another with one common goal sell a property; make a buyer happy and a seller happy. By working towards a win-win anything becomes possible.

Tuesday, April 14, 2009

Get Rich, Stay Rich

March sales in our area rebound with a fury…yeah! Sales were within 7% of last year. I realize we had a pent up of buyers from the miserable winter we had but I am cautiously optimistic. Is our market dead? Nope, I don’t think so, I think we will remain stable and balanced.

I just read a book called “Get Rich, Stay Rich, Pass it on” by Catherine S. McBreen and George H. Walper Jr. Interesting read, a little repetitive for me however overwhelmingly this book goes on about owning investment real estate. The findings are based on 10 years or research interviewing thousands of families. It confirms what I call the “Department Store” effect. At any one point stocks are up and real estate is down or real estate is up and stocks are down. By investing in different areas helps insulate us from challenging times.

I am a REALTOR® so investment real estate works for me ;). Rental income produces a constant monthly return well into our future. In fact, it is something you can pass onto your heirs. Land, “if you can afford it”, can be easier to manage, bigger pay off usually longer hold pattern for a return.

First things first: credit card debt should be paid off monthly, your first investment should be your home and from there carefully consider what could work for you, do you hire a management company or do you take more of a hand’s on approach? Worth discussing further.

Everyone's circumstance is different. There are some very good (as Warren Buffet calls them) cigar butts out there that do not cost a lot of $ (investment) to enter the market. Interest rates are incredibly low, maybe it’s time to take advantage!

I always have time for a coffee or a juice!

Wednesday, April 8, 2009

New "tenant tax"?

If the City council approves, owners of small apartment buildings, with six or fewer units, will be required to obtain a license at a cost of $150 per unit every five years to allow for city inspections to ensure housing standards are met.

The new rules would allow bylaw officers to blitz neighbourhoods they believe to be rife with problems, but they would still have to give a month's notice to tenants and landlords before inspecting inside homes.

Monday, April 6, 2009

London real estate market update

Real Estate Market UpdateA small drop in sales is good news for London. The London area real estate market saw a decline in sales by 7.2% (detached homes).

The London St. Thomas Association of Realtors (LSTAR) reports 551 detached homes and 118 condos sold in March. The total sales of 669 units is down 10.2% compared to 745 in the same month last year.

This is a great improvement compared to the 35% drop in January, and 30% in February. And when you look at what's happening in other markets, a 7.2% decline isn't so bad.

Prices have remained stable; the average house price for the first quarter of 2009 was $206,944, which is down by only 2.7% from last year.

Active listings in March was up 20% compared to same month last year, while home sales in St. Thomas jumped 14.6%--although house prices in St. Thomas have decreased more than any other London area (down 7.2%)

The London area market is living up to its reputation as a long-term stable market.

Thursday, April 2, 2009

The Good, The Bad, and The Ugly of HST

The Good

Tax experts predict the average Ontario family will be further ahead despite harmonized sales tax. Lower-income families will get hit a bit more, but the tax rebate will cushion that.

Harmonizing GST and PST is good for businesses because it lets them recover money now lost to retail sales taxes and use it for investment in new equipment and machinery. Currently, businesses receive a rebate on the GST, but not PST.

A study of Quebec, Newfoundland, Nova Scotia and New Brunswick - which harmonized their GST and sales taxes - found business investment jumped and prices (of goods & services already taxed) decreased.

In the long run, more jobs will be created (better jobs that require equipment and machinery behind them which may pay better) and increased job security.

The Bad & Ugly

We will be paying more at the checkout.

Homebuyers, especially first-time homebuyers, will find it tougher to afford a home. For a resale house priced at $360,000, a HST could add over $2,000 in new taxes to closing costs. Take a look at the table below:

In total, a HST will add $313 million annually in new taxes to resale home transactions. This will hurt the resale home market, prolonging the housing industry’s recovery from the current economic downturn.

Harmonized Sales Tax for Ontarians

More taxes to come (Yipee Yahoo!)

Starting July 1, 2010 expect a harmonized sales tax. The McGuinty government announced it will harmonize the GST and PST, causing consumers to pay extra tax on a range of goods & services.

This will increase the costs associated with real estate transactions (legal fees, moving costs, commissions, home inspection fees), which we currently pay only 5% GST on.

And better yet, we will also be paying more for goods & services we use daily: gas, utilities, haircuts. This is in response to the economic downturn; in hopes of raking in an additional $3.5 billiion in annual revenue.

The good news?

- There will be three tax rebate cheques totalling $1,000 for families with household incomes of less than $160,000 and $300 for individuals who make less than $80,000 a year.

- Some basic goods will be exempt from the blended sales tax, such as children's clothing, books, diapers and new houses costing less than $400,000.