On Thursday April 19th from 7-8 pm, we will be hosting a Free Career Seminar. Come to Royal LePage Prime Real Estate to see how a career in Real Estate may be the right choice for you.

The seminar will take place at the Royal LePage Prime Help Centre at 1883 Henderson Hwy. Register at 989.7900 or at royallepageprime@me.com. We look forward to seeing you!

For many, this kind of emotional attachment and other factors unrelated to the home’s true market value end up influencing sound judgment when setting the asking price for a home. To let any emotion (be it nostalgia or financial desire) drive up your asking price is an amateur mistake that can end up costing you big in the end.

Those nicks and scratches that send you on a trip down memory lane? Unfortunately, they tell a very different story to prospective buyers. That’s just damage in the buyer’s eye, and it sure doesn’t offer anything in the way of value to them.

Remember, the buyer doesn’t know about you and the memories you associate with the house. For the most part, they aren’t interested in them. They just want to find a home to call their own and start creating their own family memories.

Determining the right home price is much more a science than an art. Think of it this way: the price for your house has alreadybeen established by the real estate market. There is a relatively narrow price range that buyers will consider for a particular home, with particular features, in a particular neighbourhood. The trick is in determining what that secret number is. Set the price too high, and your house is passed over. Set it too low, and you stand to lose thousands on the sale.

Factors that influence overpricing:

• Attempting to recover money invested in renovations and improvements
• Desire to use profits to purchase a higher-priced home elsewhere
• Original cost of the house was too high
• Lack of housing market information
• Building bargaining room into the price
• Adding on for perceived emotional value

The consequences of overpricing

Many sellers believe that if they price their home high initially, they can lower it later. Unfortunately, when a home is priced too high, it is virtually ignored by buyers and real estate agents alike. This is especially important when a home first goes on the market. New listings typically generate a flurry of activity as selling agents and potential buyers take notice. Overprice, and you stand to lose out on any potential business stoked by early market excitement.

And things don’t improve for the overpriced house as the weeks and months wear on. Gradually, the seller is forced to move the price down to market value, but by that time the home has been for sale too long, and buyers become wary and reject the property. Many will wonder why the house has been on the market so long, and will suspect there is something wrong with your house that is affecting its ability to sell.

You may also be tempted to think interested buyers will simply make a lower offer. But if your home is overpriced, buyers looking in a lower price range may never even see your home’s listing. Those who can afford a home at your asking price will quickly recognize that they can get better value elsewhere.

The benefits of pricing right:

• Your property sells faster, because it is exposed to more qualified buyers.
• Your home doesn’t become stale and lose its marketability.
• The closer your asking price to market value, the higher the offers you’ll receive.
• A well-priced property can generate competing offers.
• Real estate agents will be enthusiastic about presenting your property to buyers.

How is the market value of my property determined?

Enter your Royal LePage real estate agent. Your agent is an expert in the local real estate market, and will give you the facts you need to know to make an educated decision on asking price.

Your agent will prepare a Comparative Market Analysis (CMA) for your home based on the most current housing market information. The CMA will show you current listings, recent sales and expired listings (useful to check, because expired listings often indicate a house that was either overpriced or poorly marketed).

Together, you and your agent will establish a competitive list price for your home based on the following:

• Location
• Size
• Style
• Condition
• Community amenities
• Financing options
• Housing market conditions (Is it a buyer’s or a seller’s market?)

Once you’ve achieved a realistic sale price (along with a wise marketing strategy prepared by your agent), you can expect to sell your home for the best possible price in the least amount of time.

For information on how to secure the highest possible price for your property, contact your local Royal LePage sales representative: Real Estate Agent Search

Mortgage Types/Options
It is best to speak with a professional in the mortgage industry, but some options for younger buyers are: 40 year mortgages, 35 year mortgages, 0% down, etc. But don’t let 0% down fool you, as you will need some money up front for your deposit (this goes to the seller of the house but the bank should reimburse this money if you have a 100%mortgage-0% down), so you will need to have a line of credit that is ready to go.

Ever hear of a 5% Down Payment?
The following is an excerpt from the Canada Mortgage and Housing Corporation website under the topic of “Mortgage Loan Insurance”:
Get into your home sooner. Mortgage Loan Insurance helps you do it. Put as little as 5% down.

When you need a mortgage loan that is more than 75% of the purchase price of your home, mortgage loan insurance is required. It protects the lender and, by law, most Canadian lending institutions require it.

Having mortgage loan insurance means that if you, the borrower, default on your mortgage, the lender is paid back by the insurer – CMHC or a private company. With the risk of losing their money removed, lenders have the confidence to make mortgage loans of up to 95% of the purchase price of the home (subject to price ceilings).

That means your down payment can be as little as 5% of the house price. With mortgage loan insurance, many Canadians who might be unable to obtain a 25% down payment can still buy a home.

What does mortgage loan insurance cost?
There are two components: an application fee and an insurance premium.The application fee typically ranges from $75.00 to $235.00, and mortgage loan insurance premiums range from 0.5%-3.75% of the amount of your loan (additional charges may apply), depending on the size of the loan and the value of your home. The premium can be added to your mortgage loan and paid off as part of your regular mortgage payments, or paid off in a lump sum at the time of purchase to save interest charges on the premium itself.

Where can you apply for mortgage loan insurance?
See your lender, who can obtain mortgage loan insurance from CMHC or a private insurer.

CMHC will insure mortgages of up to 95% of the home’s purchase price or the market value of the property, whichever is less. (Restrictions may apply. Contact your local lender.)

Both new and resale homes are eligible. Here are some of the criteria that must be met:

• The home must be in Canada and must be your principal residence. Housing payments – including principal, interest, property taxes, heating (P.I.T.H.), the annual site lease in the case of lease hold tenure, and 50% of applicable condominium fees – can’t be more than 32% of your gross household income (GDS ratio).
• Your total debt load can’t be more than 40% of your gross household income (TDS ratio).
• Other criteria apply and are subject to change. For details, please contact CMHC or your local lender.

Right now, 3 million Canadians own homes with insured mortgages.

1. To Quit Renting
Why contribute to someones mortgage payments when you could be paying off your own? With programs available such as the new 40-year amortizations and no money down with a good credit score, it is easier than ever to own a home. And with the current market increase in rent it can sometimes be cheaper to own than it is to rent and there is no fear of your mortgage payments suddenly increasing.

2. Security
You don’t have to worry about your house being sold out from under you to out-of-province investors. If renting and faced with this scenario, you could find yourself faced with an unreasonable increase to your rent, thereby leaving you potentially homeless or too poor to eat. These increases could continue indefinitely so the investors can make more money or so that you will feel forced to leave and they can turn your building into a condominium.

3. Investment
The price of real estate continues to increase every year, therefore purchasing real estate is one of the safest long-term investments a person can make. If you had the choice between putting money towards a new car or a new house, a house should win every time as it will appreciate in value over the years whereas a car does the opposite. Once you own one house and build some equity you may also be in a financial position to buy another and rent one out.

4. Low Interest Rates
Right now we have some great interest rates which will help you get your foot on the first rung of home ownership. It is a great time to get into the market and lock into a really good interest rate and build equity.

5. Pride of Ownership
One of the biggest reasons people buy properties is the pride of saying they own something. Even if it is a little starter home or apartment style condo, it is yours and you can do with it as you please, and for that, a person should be proud, as ownership is an accomplishment.

6. Privacy
If you own your own house, you don’t ever have to worry about the owners checking up on you, since you are the owner! You will gain much more independence and privacy when you have your own property.

7. Equity
One of the best things about owning a home is that you are building equity, which gives you more freedom financially as you can access a home equity loan. You may then borrow against the equity you have built in your home for a wide variety of reasons including home improvements, paying for school for your children, medical reasons, or even starting your own business. Check with your lender, as these vary from one to the next.

8. Freedom
You are free to do what you want in your own home, whether you want to paint the walls in pink and black zebra or put carpet on the ceiling (not recommended of course!) You have the freedom to express yourself and your personal tastes and change the house to suit your needs. You can hang as many pictures as you want and do renovations as you please. Just keep in mind that when you are ready to sell your home, not everyone may like what you do.

9. Sense of Community
Owning a house gives you a feeling of belonging in that neighborhood and gives you the sense of putting down roots and getting established. There are also many neighborhood groups that you can become involved in, and if you have children it may be of benefit for schools and friends.

1. It is in poor condition.
2. The house is priced too high.
3. There exists a poor housing market.

If your property isn’t sold within 30 days, a price adjustment should be made!

Statistics are based on National average of homes sold.