The Montreal Real Estate Blog

If your property is fresh in the market, an open house can be very important. You never know whom in your neighbourhood is looking to buy a home like yours.
There has been some instances where the actual buyer came from a Open House visit. Although this isn’t always the case.

In fact, most visitors who come to open houses rarely buy the house. A lot of them don’t even know the price of your home when they stop by to visit; they probably just followed an “Open House” sign, got curious and came in. It will be the agent’s job to quickly screen the visitors and to identify them as “Potential buyers” or “Lookers”. (Your listing agent should know how to do that)

You might be wondering:
what is the purpose of holding an open house? Read more »»

Every municipality must collect duties on the transfer of any immovable situated within its territory. These land transfer duties are better known as the “Welcome Tax”. This tax is payable by the buyer and is calculated as follows:

• 0.5% of the first $50,000;
• 1% of the next $50,000 to $250,000;
• 1.5% of any portion exceeding $250,000.

For example:
If a property is sold for $180,000. The transfer duties payable to the municipality will be:

0.5% of the first $50,000 = $250

1% of the next $130,000 = $1,300

(1.5% of the portion exceeding $250,000 = n/a)

Total= $1,550

Another example for a property sold for $300,000

0.5% x $ 50,000 = $250
1% x $200,000 = $2,000
1.5% x $50,000 = $750

Total= $ 3,000

For more information on the land transfer duties payable on a given transaction, please contact the municipality concerned.

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If you are looking for Montreal Rentals. Here are a few links that will help you find your new pad.

• Craigslist’s Montreal for Rent
• Kijiji Montreal
• Canuck.ca Montreal
• Louer.com
• More Montreal

Although not about Real Estate, these blogs are quite entertaining. Specially for the downtown and Plateau crowd.

• Midnight Poutine | Montreal Blog
• MetroBlogging Montreal
• Montreal City WebLog

Do you know of other interesting and informative websites related to the Montreal Market? Let us know!

So, you’ve finally decided that homeownership is right for you. Now you need to determine if you are financially ready to buy a house. Check out these formulas to calculate the size of your loan and evaluate your current financial situation.

Knowing your net worth is important because you will need this information when you discuss a mortgage with your lender.
Your net worth is the amount left over once you’ve subtracted your total liabilities from your total assets. It will also give you a snapshot of your current financial situation and show you how much you can afford to put as a down payment. Read more »»

The buying of undivided co-ownerships is getting more popular in Montreal, specially in the Plateau area. And it’s quite understandable why. There are advantages over the divided co-ownership (condo), specially when talking about Condo fees.
When buying the undivided, this is an important piece of information to have, both for real estate agents, as well as buyers:

“A real estate broker or agent entrusted with the sale of a co-owner’s share in an undivided co-ownership property must know that the other co-owners have the right to exclude a potential buyer.

In this regard, it is important first to take a look at the indivision agreement that governs the relationship between co-owners. These agreements often require that a co-owner offer his share to the other co-owners before offering it to a third party, or provide for the other co-owners to be able to match the third party’s offer for this share, following the terms of the agreement. A seller who decides to ignore these terms exposes himself to legal action and potential liability for damages.

(…) Whether resulting from the indivision agreement or the Civil Code of Québec, it is important that the seller and any potential buyer be informed of the rights of the other co-owners and their impact on the transaction under consideration. In order to minimize the risks, it is recommended that a waiver of this right be obtained from the other co-owners as soon as the brokerage contract is taken up. This waiver should be drawn up by a lawyer. If it is not known whether such a waiver exists, it is suggested to make any promise to purchase conditional to the seller providing copy thereof to the buyer.”

Source : ACAIQ. Read the original article

Cadastral designation
Information concerning an immovable (location, area, value, etc.), contained in the cadastre for a given region.

Cadastre
Public register containing the technical data on each immovable in a given region (lot).
A lot number used to publish the applicable rights is assigned to each property indexed in the cadastre.

Certificate of location
Document containing a report and a plan, in which the land surveyor expresses his opinion on the location and condition of an immovable compared to the titles and the cadastre as well as laws and regulations governing the immovable.

Read the complete entry >>

While you probably have a lot of good reasons for wanting to buy a home, you also have to consider your reasons for not wanting to.

Remember that buying a home is one of the biggest emotional and financial decisions you’ll ever make, so prepare yourself to make a knowledgeable decision. Although buying a home almost always seems like a great idea, it is important
to understand what homeownership involves.

Of course, being a homeowner is something to be proud of but it also means having to invest money, time and energy and take on added responsibilities. So, before you decide to buy a home, make sure you’re ready.

When most of us consider becoming homeowners, we immediately think of how wonderful it will be. It is true that there are a lot of good reasons for wanting to buy a home. Here are some of the main advantages of owning a home:

• Financial Security. If housing prices rise, your home can provide you with
some financial security due to capital appreciation.
• Flexibility. You can decorate or renovate your home to meet your own
family’s personal tastes and needs.
• Stability. Having a place of your own.

Although it is nice to think about the positive aspects of owning a home, it is
important to consider the downsides as well. Here are some of the main
disadvantages of owning a home: Continue reading >>

Brokerage Contract
Agreement under which a person authorizes real estate broker to act for a given period of time, as intermediary in the purchase, sale, rental or exchange of immovable property.
The brokerage contract officializes the rights and obligations of the broker and his client by mutual consent.
In an exclusive brokerage contract the client agrees, for the term of the contract, not to use the services of a broker other than the one with whom he signed the contract. Usually, the exclusive brokerage contract also states that the client who is party to the contract cannot sell or buy the immovable himself.

Building Inspection
General verifi cation of the state of the main components of an immovable (foundation, structure, roof, heating system, electrical system, etc.) to assess condition. Csystem, etc.) to assess condition.

Historically low mortgage rates pave way to record levels in April

Globe and Mail TAVIA GRANT May 17, 2007

Canadian home prices and sales both set records last month, a stark contrast to a wilting housing market south of the border.

The average price of a home jumped 9.5 per cent in April from a year ago to $323,936, the Canadian Real Estate Association said yesterday.

Canada’s real estate market remains hot amid historically low mortgage rates and a jobless rate approaching its best level in 30 years.

It’s a different picture in the U.S., where sales, home prices and builders’ profits are dwindling while mortgage defaults are on the rise.

“The Canadian housing market remains on a roll, in stark contrast to the ongoing woes in U.S. housing,” Douglas Porter, deputy chief economist at BMO Nesbitt Burns Inc., said in a note. “This persistent divide is a key reason why we believe Canadian and U.S. monetary policies will diverge in the year ahead.”

Hot home prices will likely be reflected in today’s release on inflation numbers, with homeowner replacement costs creeping higher.

Home prices hit new records in Vancouver, Victoria, Calgary, Edmonton, Regina, Saskatoon, Winnipeg, Toronto, London & St. Thomas, Ont., Ottawa, Montreal and Halifax-Dartmouth.

Prices haven’t risen everywhere - they’re lower in the Ontario communities of St. Catharines, Durham region, Windsor and Thunder Bay.

Home sales also hit a peak last month, the association said.

“Resale housing activity in the first quarter was far stronger than anybody had anticipated,” said Gregory Klump, the association’s chief economist. “Home buying sentiment remains strong in all regions, and new listings have been unable to keep pace with sales activity.”

Seasonally adjusted home sales in Canada’s major markets rose 1.9 per cent from March to 30,615 units, led by gains in Toronto and Montreal. Year-to-date transactions also set a new record in April.

New residential listings, meantime, rose 3.1 per cent in April, to their second-highest level on record.

Markets remain strong in the West. “There has been anecdotal evidence that resale activity in some Western markets is getting a boost from a shortage of lots and from buyers who don’t want to wait for their new home to be built,” Mr. Klump said.

His association predicts MLS sales will hit a record this year and edge down in 2008.

“The resale housing market will become more balanced as rising prices erode affordability and cause a gradual retreat in sales activity,” Mr. Klump said.

Act of sale
A contract, usually drawn up by a notary, usedto officialize the sale of an immovable to a buyer.

Amortization
Period required to pay back a mortgage loan in full through regular payments. The amortization is usually based on fixed terms of 10, 15, 20 or 25 years.

Appraisal
A process for estimating the market value of a particular property.

Appreciation
The increase in value of something because it is worth more now than when you bought it.

Approved Lender
A lending institution authorized by the Government of Canada through CMHC to make loans under the terms of the National Housing Act. Only Approved Lenders can negotiate mortgages that require mortgage loan insurance.

Assumption Agreement
A legal document signed by a homebuyer that requires the buyer to assume responsibility for the obligations of a mortgage by the builder or the previous owner.

Association des courtiers et agents immobiliers du Québec
Organization created under the Real Estate Brokerage Act whose main mission is to protect the public by overseeing the activities of all real estate brokerage professionals practicing in Québec.

This very complete article was released this morning by the Financial Post. Richard Croft goes on to explain why is real estate a good diversifier in your portfolio: from owning a home to becoming an investor in Real Estate and it’s positives aspects as well as the negative ones.

Richard Croft, Financial Post
Their principal residence is most people’s primary exposure to real estate as an investment vehicle.

“…Real estate is an excellent diversifier within a portfolio, and in the case of real estate investment trusts (REITs), can provide some decent tax-advantaged cash flow to your portfolio. So here’s the question: Is your home a place to live or is it an investment that will at some point be sold to capitalize your retirement years?

If the former, then by all means include real estate in your portfolio. If the latter, then adding real estate to your portfolio would defeat the purpose of optimum portfolio diversification.

Assuming real estate should be in your investment portfolio, the next step is to understand what it brings to the portfolio in terms of performance enhancement and risk reduction.

As an investment, the real value in real estate is its cash flow. If you buy a rental property, for example, you buy it on the basis of some cap rate, which is really just another way of saying the property value is based on some multiple of its cash flow.

Like any other asset, the multiple accorded to that cash flow is determined by the stability of the cash flow. If you are buying a property with a solid, long-term tenant who pays the rent –like a major Canadian bank– the cash flow is stable and the property will fetch a higher valuation.

Another way to look at cash flow is in terms of how real estate is financed. In Canada, you can borrow 75% (sometimes you can borrow even more of the purchase price) of the value of your real estate, usually financed over a 25-year term. If your cash flow is stable, you can use the excess cash flow to pay down the mortgage, and at the end of 25 years, you own the property free and clear.”

Read the complete article at The Financial Post

Nouveau riche, not old money driving high-end home sales, Royal LePage report

Good old-fashioned hard work, not birthright, is the key to unlocking fortune and the front door of a new luxury home, according to the 2007 Carriage Trade Luxury Properties Report released today by Royal LePage Real Estate Services. Given that the unit sales of high-end homes in almost all cities surveyed increased significantly year-over-year, Canadians appear to be working harder than ever.

According to the 2007 Carriage Trade Luxury Properties Poll (conducted by Ipsos Reid), of high net worth Canadians, almost half (46%) cite hard work as the main driver to attaining wealth, followed by the drive to succeed (27%) and a higher education (18%). Only four per cent (4%) of respondents chalk their success and their financial stability to being born into the right family, while a mere one per cent (1%) attribute it to plain old luck.

The 2007 Carriage Trade Luxury Properties Report includes a market analysis of trends and activity in eight major cities across Canada, combined with a national Ipsos Reid poll that measures attitudes, upbringing and beliefs of high net worth Canadians, as defined as individuals with assets of at least $250,000 (excluding real estate) and a primary residence valued at a minimum of $500,000.

Regional variances were observed across the country with the largest increase in unit sales occurring in the nation’s capital, Ottawa, followed by energy-rich Alberta, as measured by local real estate boards. Increases of more than 200 per cent in Ottawa are due to a large pool of international buyers and local executives and professionals. The number of high-end home sales rose by 71 per cent in Edmonton and 38 per cent in Calgary, fuelled largely by in-migration of executives in the oil and gas sector, as well as homeowners trading up.
“Luxury living is no longer the exclusive domain of a few. Buoyant economic conditions and confidence in the market going forward have ignited a growing passion for investing in luxury property among an increasing number of Canadian families. Consequently, homes in this market niche have been trading briskly, and this has put upward pressure on prices,” said Phil Soper,president and CEO, Royal LePage Real Estate Services. “The poll findings reveal that real estate in the Carriage Trade market is both sought after and attainable for hard working people across the country.”

Rags to Riches

Rags to riches stories are being played out in the kitchens of some of Canada’s best neighbourhoods. The poll results revealed that the majority of the high net worth individuals surveyed started from modest beginnings. When asked, “What was your economic status growing up?” only three per cent (3%) of respondents reported they were raised in wealthy/affluent households, while 79 per cent of respondents came from lower middle class and middle class upbringings. Four per cent (4%) of wealthy homeowners have risen out of poverty and now live in a home worth at least $500,000.

Home Sweet Homes

When it comes to the value of primary residences, 12 per cent of high net worth Canadians live in homes with price tags starting at $1 million, while almost half (47%) of respondents live in properties valued from $600,000 to$999,000.
Added Soper: “Prosperous Canadians see real estate as an important element in their investment portfolios. Demand for well-appointed properties remains strong with a trend of affluent Canadians owning more than one home.
In fact, one-quarter (25%) of wealthy homeowners own two properties, and six per cent (6%) own three residences while two per cent (2%) own more than five properties.”
Success seems to transcend sectors with luxury property owners citing a spectrum of occupations including entrepreneurs (13%), CEOs and senior executives (10%), medicine (10%), sales (7%) and law (3%). The poll found that 32 per cent of high net worth homeowners have already retired and can now enjoy the fruits of their labour.

<<
REPORT FINDINGS

-------------------------------------------------------------------------
                         Luxury Home Market Summary
    -------------------------------------------------------------------------
                                            Units Sold   Units Sold
          Market              Price           Q1 2007      Q1 2006   % Change
    -------------------------------------------------------------------------
    Halifax                 $600,000 +           8           10         -20%
    -------------------------------------------------------------------------
    Montreal                $900,000 +          56           49          14%
    -------------------------------------------------------------------------
    Ottawa                  $750,000 +          23            7         229%
    -------------------------------------------------------------------------
    Greater Toronto       $1,000,000 +         434          357          22%
    -------------------------------------------------------------------------
    Winnipeg                $500,000 +          11            8          38%
    -------------------------------------------------------------------------
    Calgary               $1,000,000 +         130           94          38%
    -------------------------------------------------------------------------
    Edmonton                $950,000 +          12            7          71%
    -------------------------------------------------------------------------
    Greater Vancouver     $1,000,000 +         673          544          24%
    -------------------------------------------------------------------------

Source: Data obtained from various real estate boards (REBGV, CREB, EREB, WREB, TREB, OREB, GMREB and NSAR)
Note: The price categories listed above correlate to the price criteria for a Carriage Trade home. Carriage Trade is a Royal LePage distinction for the most exceptional homes on the market. In Toronto, Vancouver, Montreal and Calgary, the home’s listing price must also be no less than four times the average residential sales price as determined by the local real estate board, or $1 million. For homes located in all other markets the home’s listing price must be three times greater than the average residential price as determined by the local real estate board.

REGIONAL SUMMARIES
>>
(…) Strong consumer confidence and a robust economy have contributed to growth in Montreal’s luxury home market with sales of properties priced above $900,000 rising 14 per cent in the first quarter, year-over-year, to 56 units in 2007 from 49 units in 2006. The strong growth seen in the first quarter is expected to persist throughout 2007. Luxury home buyers are typically between the ages of 35 and 60, are highly successful professionals or executives, and have a keen eye for quality and value. Some of Montreal’s most sought-afterareas include Westmount and Mont Royal.

About Carriage Trade
Carriage Trade is an exclusive real estate service from Royal LePage offering the most distinguished homes in Canada to discerning buyers from around the world. For a property to qualify as Carriage Trade, it must meet a series of criteria, the most imperative being location and price. The residence must be situated in a distinctive, prestigious, sought-after and
exclusive neighbourhood or on prized acreage or land and meet minimum price requirements.
For more information visit www.carriagetradeproperties.ca. and www.royallepage.ca.

Find original article here

Greater Montréal Real Estate Board Statistics

The resale market is heading for another record year with an11% increase of transactions during the first four months of 2007. According to data recorded in the Greater Montréal Real Estate Board’s (GMREB) MLS® system, 21,908 houses changed hands compared to 19,807 transactions between January 1 and April 30, 2006.

“The volume of transactions since the beginning of the year is exceptional,” says Michel Beauséjour, FCA, Chief Executive Officer at the Greater Montréal Real Estate Board. “Economic indicators continue to point in the right direction. Among others, sustained job growth during the first quarter bodes well for the resale market during upcoming months.”

The resale market for condominiums, from January to April 2007, showed an increase of 14% with 4,853 transactions compared to 4,239 for the same period in 2006. We also observe that the average sale price increased by 6%, rising to $204,000 in comparison with $192,000 in 2006.

The resale market for single-family homes also showed an 11% increase, with 14,242 transactions compiled in the GMREB’s MLS® system, against the 12,805 transactions recorded between January and April 2006. The average sale price reached $223,000 this year compared to $210,000 for the first four months of 2006, which represents an increase of 6%.

In the first four months of 2007, the volume of sales reached $4.9 billion, an increase of 19% compared to $4.1 billion recorded for the same period in 2006 in the GMREB’s MLS® system.

From January to April 2007, 39,563 new listings were recorded, representing an increase of 2% compared to the 38,698 new listings counted for the same period in 2006.

As of April 30, 2007, 38,335 residential listings were active in the GMREB’s MLS® system, as
opposed to 36,845 for the same period last year.

Source: CIGM

Dowload the full article

Technorati:montrealmontreal real estatereal estatepropertyhomesmarket conditions

…And hammer away at renovations

Royal LePage survey finds 25% of women searching for a home are looking for a ‘fixer-upper’ and plan to do the work themselves – Currently, 30 per cent of single, never-before married women own their own home, while 45 per cent of divorced or separated women and 64 per cent of widowed women are homeowners, according to the Royal LePage Female Buyers Report released today.

“The notable upswing in real estate activity among females is not surprising given that women are earning higher salaries than ever before,” said Lisa da Rocha, vice president, marketing, Royal LePage Real Estate Services. “There has been a shift in mindset whereby women have distanced themselves from the traditional notion that you must first find Mr. Right and then together you buy a home. Our findings reveal that 66 per cent of women who intend to purchase would not find the process of buying a home on their own intimidating.

“In Montreal, home buying activity among females has increased significantly over the last three to four years. Activity growth has been supported by the larger number of women in executive and professional careers, which has afforded them the financial freedom to purchase a home on their own. Women of all age groups tend to favour condominiums for their maintenance-free lifestyle, and generally spend an average of $300,000 on such properties. They tend to place the style, design, and security of a property at a high priority, and are not interested in undertaking renovations. The centre of Montreal is a popular neighbourhood for female purchasers who are looking to stay close to the city centre, while Old Montreal offers heritage-style properties in a desirable location.”

Additional Poll Findings:

• Among those who own and rent and intend to purchase a home/condo in the next three years, men and women both rank equally (81%) taking out a mortgage from a bank, however, nine per cent of men said they would rely on their family to pay for their entire home, in comparison to only three per cent of women.
• Of women who own, who don’t intend to purchase in the next three years, when asked, “Which one of the following motivations most influenced your decision to purchase your home?” the top three responses included: it makes more sense than renting (36%), want to put my money into a good investment (22%) and pride of ownership (13%).
• Among women who are intending to purchase in the next three years, when asked, “Which methods will you use to educate yourself about home purchasing?” the top three responses cited were speaking with a real estate agent (83%), speaking with friends and relatives (78%) and using real estate and financial websites (64%).

Source: Royal LePage Female Buyer Release

1. Detach your emotions
   Remember, you are about to sell this house and the goal is to create a space in which as many people as possible will be able to envision as their potential home. To properly prepare your home for sale you will have to pack away many of your personal items, including photos, souvenirs and other mementos.
2. Clean and reorganize
   Clean your home from top to bottom and make sure all appliances are spotless. Reorganize the closets and pack away some of your belongings. Storage room is a priority for buyers and a full closet does a poor job of showcasing the amount of storage room available. If you’re using a spare room for storage, pack away the clutter and ensure the space is properly furnished. .
3. Furnish empty properties and rooms
   People buy homes not houses. Empty rooms make it hard for buyers to get a good sense of the space. Large rooms look cavernous and small rooms look even smaller when empty. Oddly shaped rooms make it especially hard for buyers to visualize how to arrange the room. Staging your empty property with the right furniture is key to ensuring that buyers will be able to visualize living in the space.
4. Brighten and lighten
   Light-filled rooms are always appealing. Open blinds and make sure your windows are sparkling clean. If there are no windows in the room, make sure the lighting is adequate and keep all the lights on when showing the property, even during the day. A fresh coat of neutral coloured paint goes a long way to brighten up the space.
   
5. Spark your buyer’s imagination
   Set the dinner table for a formal dinner, light the fireplace on a cold day, and add some fresh flowers to your décor. Creating the proper atmosphere helps buyers envision themselves living in your home.
   
6. Fix minor repairs
   Buyers prefer to see a home in move-in condition, even small things such as a dripping faucet can detract from the value of your home.
   
7. Don’t be too unique
   Keep your décor simple and modern with neutral wall colours. Unusual accessories and strong wall colours will limit your pool of buyers. This is also true for renovations. The right renovations can often boost the price of a home but be careful not to do it with too much flair. Your unique style may set you apart but it will also shrink your potential pool of buyers. Remember to keep it simple and modern.
   
8. Keep your neighbourhood in mind when renovating
   Actual returns on renovations depend not only on the renovations itself but also on how your home compares to your neighbours’. If your home is already above market value for your neighbourhood, your renovation may not yield a higher return. Buyers looking at moderately priced homes won’t be able to pay a premium for luxury finishes. Ask your Realtor to give you an assessment of homes in your area before embarking on costly renovations.
   
9. Improve security
   Household security is a sought after feature in homes and simple measures such as adding window locks and motion sensor lights outside can boost the attractiveness of your property. In densely populated urban areas, simple additions such as blinds and shutters are good additions to provide privacy.
10. Contact your real estate agent for more home staging ideas! :)