Quotations by Dan S. Barnabic

A housing slowdown in Canada may signal the end of a prosperous cycle. A serious market correction, already overdue, is likely to happen sooner rather than later. [2013] - Dan S. Barnabic

In time, it will likely become evident that buying condominium units through a corporation without giving personal guarantees may be prudent even for those who consider themselves financially sound and secure. [2013] - Dan S. Barnabic

Obtain the status certificate of the unit you wish to buy and the condo complex's financial yearly reports. Analyze the current, past, and proposed future budgets of the complex where you wish to buy. Ask your lawyer or accountant to help you if you're unable to make this analysis yourself. [2013] - Dan S. Barnabic

Thoroughly check the yearly financial report of the complex and the status certificate of the condo unit you with to purchase. They should contain: facts relating to financial and management stability of the complex; the most recent audited financial statements; a record of assessment; any pending or anticipated legal actions; anticipated common element repairs; the anticipated common loans; anticipated increases to reserve funds; anticipated structural or mechanical repairs; and municipal work orders. [2013] - Dan S. Barnabic

Check the present, previous, and anticipated future demographics of the area to make sure that you and your children do not end up the victims of crime.  [2013] - Dan S. Barnabic

Condominium units in the suburbs are usually less expensive. Provided that roadways to schools and downtown areas are accessible and public transit is available, there is nothing wrong with locating outside ritzy and expensive urban centres. [2013] - Dan S. Barnabic

The monthly fees can go up significantly if you're buying a newly built condo. It was very common to see maintenance fees rise by 40 to 50 percent in year two and another 20 to 30 percent in year three, after the complex had been registered. [2013] - Dan S. Barnabic

Condo rules tend to be severely restrictive in comparison with living in a traditional home. For example: 1) No pets and even no children. 2) The number of occupants residing in an individual unit may be capped. 3) Operating a home business may be forbidden. 4) Playing loud music or otherwise making loud noises is likely to be prohibited. Other restrictions may forbid walking in heavy shoes on bare parquet or uncarpeted flooring, storing bicycles on balconies, barbecuing on balconies, decorating or changing the exterior of a unit to the extent that it may not conform to the overall architectural design of the complex, and making interior structural changes. In many cases, renting the unit to others may also be subject to restrictions.  [2013] - Dan S. Barnabic

Realty, or property, taxes are not part of monthly maintenance fees but often are required to be paid on a monthly basis along with maintenance fees. Taxes vary from one municipality to another and are assessed based on the value, size, and location of the complex. Taxes fluctuate yearly, but, in general, they range from 0.5 to 2.6 percent of a unit's purchases price. [2013] - Dan S. Barnabic

If the market is depressed, mortgage holders, such as banks, seldom have the patience to await a market rebound. Most are not in the business of owning real estate. Their paramount goal is to sell defaulted units at the best possible price in order to recover as much of their investment as possible. This often means selling these units at a loss. Most mortgage holders are exclusively financial institutions, not obligated to contribute to maintenance fees and other dues on behalf of the indebted unit owner. [2013] - Dan S. Barnabic

The living standards index: Housing costs should be no more than 28 to 33 percent of yearly, pre-tax household income. "Housing costs" includes mortgage payment, utility costs, maintenance fees, and taxes. Typically, banks will not lend mortgage money if the consumer's income is too low to meet this measure. A down payment of 25 percent (or in the case of condominiums, even 35 percent) is required to qualify for a mortgage. [2013] - Dan S. Barnabic

Buyers should not assume that real estate will constantly appreciate and never go down, or that if they don't buy "now" the opportunity will never arise again. History shows that real estate markets fluctuate over time. Waiting for the market to slow and correct itself, so real estate can be purchased at more favourable prices, can pay substantial dividends. [2013] - Dan S. Barnabic

An 8 percent interest rate is a fair measure of safety notwithstanding that prevailing mortgage rates may be much lower. Low interest rates are a desperate move on the part of the government to keep the economy afloat and are not going to last forever. I have been observing real estate trends for over four decades and have witnessed interest rates on first mortgages fluctuate anywhere from 3 percent to 18 percent. In fact, there were long periods when they lingered in the 8 to 10 percent rage. [2013] - Dan S. Barnabic

The most obvious sign of oversupply can be detected by looking at the overall numbers of rental units in any given condominium complex. More than 30 percent of the units rented out or put up for sale is a fair warning to buyers of an oversupply of units. Conversely, if real estate agents are flooded with listings and many For Sale signs appear on front lawns, there is oversupply. It's a buyers' market. [2013] - Dan S. Barnabic