Real Estate Quotes

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

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

When you take the last 20-plus years and graph both the housing market percentage increase and the underlying Bank of Canada rate, you can see that interest rates play quite a minor role. Investors who buy and hold real estate will benefit from interest rate increases because more people will stick with renting rather than buying, thus pushing vacancy rates down and rents up. [2013] - Don R. Campbell

If demand puts upward pressure on housing prices without a corresponding increase in average income, this strong increase is likely not sustainable. [2013] - Don R. Campbell

The Royal Bank of Canada produces a quarterly report on housing affordability (www.rbc.com/economics). A well-balanced market for investors has a Housing Affordability Index of 33 per cent. Sophisticated investors look for cities and towns in the 25 to 29 range. Towns and cities above 39 per cent are most likely going to under-perform over the long term as they are overpriced relative to the ability for the citizens to afford it. [2013] - Don R. Campbell

The real estate Doppler Effect occurs when one city or town's economic windfall (e.g., a new manufacturing factory or plans to increase production and employee numbers) impacts nearby cities or towns. Homebuyers and investors can also take advantage of the micro-Doppler Effect. It occurs in areas that surround economically-strong communities and in neighbourhoods near those being revitalized thanks to a new development (e.g., a new post-secondary campus or a healthcare facility). [2013] - Don R. Campbell

Homes located within 800 meters of public transit stations will appreciate 12-15% more quickly than their market peers. Conversely, values decline more slowly if markets drop. [2013] - Don R. Campbell

10 Fundamentals of Real Estate Investing: 1. Mortgage interest rates. 2. The net wealth effect. 3. Increased job growth and in-migration. 4. The real estate Doppler effect. 5. Local, regional and provincial political climate. 6. Critical infrastructure expansion. 7. Areas in transition. 8. Creating highest and best use. 9. Buy wholesale sell retail: stratification. 10. Quality marketing. [2013] - Don R. Campbell

Here are some of the main players you'll need on your bench: real estate agents, mortgage brokers and bankers, property managers, inspectors/appraisers, bookkeeper, professional advisors (lawyers, accountants), other successful investors, joint-venture partners and life partners. [2013] - Don R. Campbell

Mortgage fraud is complicated. At its most basic level, it involves individuals signing false mortgage documents (like one that says you plan to live in a property even though you do not plan to make it your residence). [2013] - Don R. Campbell

50:50 Partnership: A joint-venture partner puts up the capital for the down payment. The partners share ownership, with the real estate expert doing all of the work associated with finding, managing and eventually selling the property. Profits are shared 50-50 after the initial down payment is returned to the co-venturer. [2013] - Don R. Campbell

Analyze your properties with an interest rate that's 1 per cent higher than today's rate.  [2013] - Don R. Campbell

The money global investors (including Canadians) are putting into Canadian real estate, especially in major centres like Toronto and Vancouver, can definitely skew the market. The sophisticated investor avoids overheated markets--and follows job and population growth instead. Overheated markets eventually cool down. Seasoned investors watch for the strategic advantages offered by cooling markets (think: motivated vendors and dropping prices). [2013] - Don R. Campbell

If you have money to invest and can qualify for financing at the bank, you are in a good position to find someone with expertise, experience and energy to find, negotiate and oversee your investment. In that case, and only in that case, does real estate investing come close to being passive. Most of our JV partners can make 15% or more each year on their money. It's much more than they make on the majority of their other investments, and they can do it without learning anything about real estate or ever handling a troubled tenant call. [2013] - Julie Broad

Your property managers should be getting three quotes for any major work. If it's going to cost you more than $500 to do something, you need options. And you need to insist on this. [2013] - Julie Broad