Posted by Ryan Coffey under: Buying; Financial.
Short answer: Yes.
My usual more detailed type answer: It’s always a good idea to have a backup plan and know how much wiggle room you have. Being in a position to buy a property outright without a mortgage is a great position to be in but things may change for you before you get into that property.
There is a fairly large period of time from the time you start looking at properties to when you move in. Usually a couple of months. During that time there are many decisions made and information revealed with regards to the property. You may end up deciding that it is worth a tiny mortgage or line of credit to get a certain place that is slightly more expensive than what you had saved up for or perhaps you find a place that you can afford but it needs some renos done to it so that it suits you better. Similarly, the inspection may reveal something that you will want to get done fairly soon . Knowing that you have the backing of a mortgage as a ‘just in case fund’ will make the whole process easier and reduce a sense of restrictions. Better to get the pre approval before the serious house hunting as the good ones tend to sell fast and when you see the right one you want to be able to snatch it without having to second guess your finances.
There are of course life’s other factors like illness in the family or a change in your income or any number of things that may make the bank account wane a little before it’s time to pay that big bill. Best to make sure that if something like this happens it is not going to derail your home buying plans. This is especially important if you have arrived at the stage of negotiations and contracts.
Last but not least is the fact that what you owe in property transfer tax, Lawyer’s fees and other costs may not be quite what you expected. Mortgage Brokers take all these into account as well and you will be able to preview the real cost of a property more accurately before you go shopping.
Posted by Ryan Coffey under: Home owner tips.
A home theatre has quickly become a must-have for practically every family. From the simple family room setup to a much more elaborate theatre-seating wonder, today’s home theatres aren’t just for the wealthy anymore.
The decor of a home theatre will eventually influence how well the room functions as an entertainment space as well as how it shows when the lights are turned on. Creating a functional and beautiful home theatre is easy to do on any budget. Here are some ideas for creating a home theatre for all to enjoy.
Start by arranging the space. Choose an easy-to-clean surface or a dark colour carpet for the flooring, and select a dark colour for the walls and ceiling.
A home theatre would not be complete without its supporting cast, the furniture. If you plan on having a couch in your home theatre, get a curved sectional. Since the optimal viewing in a movie theatre is the centre seat, a curved sectional will simulate that effect for everyone viewing your television.
If you have a smaller space or prefer a more intimate area, purchase two recliners in dark leather or other fabric. A simple end table can serve as a shared table between the two chairs. Select comfortable and soft furniture which give luxury while absorbing sound waves to improve audio quality within the room.
Arrange the furniture for best viewing for everyone. If you have an HD television, your seats should be as far back as 3 to 4 times the width of the screen. This provides optimum picture quality and your guests won’t be straining their neck or eye sight to watch the television.
Secondly, consider the lighting. You never want to be in a completely dark room when watching a movie as this can be a hard strain on your eyes. Use wall sconces or other dim background lighting at a very low level while watching the TV.
Another typical visual task in the home theatre is entertaining. So you need to have a layered lighting approach. Add some accent lighting in the room, some general lighting and some decorative lighting. Remember to use separate controls for each of these layers so that you can change the look and the aesthetic feel of the space based on function.
No home theatre is complete without refreshments. If space allows, install a built-in or freestanding bar. A complete home theatre bar should include a microwave and mini refrigerator stocked with water, juices and your preferred drinks.
If your budget allows, consider adding acoustic wall treatments to balance the acoustic properties of a room. You want to be able to turn up the volume while watching your favourite movie without disturbing other people in your home. There are many commercial products available and you can even buy ready to install treatments.
Most wall or ceiling mounted treatments are simply a wooden frame filled with sound absorbing or diffusing material. The material is then wrapped in an attractive sound absorbing fabric of your choice. You can also hang wall treatments from your ceiling to help control floor to ceiling reflections.
Finally, when selecting the focal point of your home theatre: the equipment, keep in mind that you can easily find speakers that are installed into the walls for a clean, less cumbersome appearance. The exteriors of these in-wall speakers can be painted and treated to blend seamlessly. If a drop-down projection screen isn’t in your budget, a large standard television with surround sound will do nicely. Add a tuner and some speakers for maximum sound quality.
A home theatre is a fun, relaxing place for families to spend time together as well as to entertain. The decor of the room should be about comfort and subtly allowing you to enjoy favourite movies or programs in the welcoming retreat of your own home.
Posted by Ryan Coffey under: Uncategorized.
Many of us have grown up with the idea that our first home will be a modest house that needs a little TLC. For some of us, this turns out to be true but as populations increase, so do the costs of land and many other resources associated with building a home. There is also the economic climate to consider. Nanaimo still has some houses under 230k, sure, but every one of them is very small and/or in need of lots of work or has some other thing about it that involves a compromise that is too much for most people. Under 260k is where I am currently telling people to expect fixer uppers in a medium/small sized home. For some, swinging this financially in hopes of getting their foot in the door of home ownership is viable for others they have to look at other options to get out of the rut that is long term renting.
Your best first step in Buying whether you’ve done it many times before or not is to speak to a Mortgage Broker. If after speaking to a Mortgage Broker you find out that houses are out of your price range, there are of course other options. There are a few decent small houses under 250k in Nanaimo, but if you have a family, want a quiet location, and are not especially handy, the pickings are slim. The other options are condos, townhomes and mobile homes.
Mobiles have a bad rep for being a neighbourhood of debauchery, but this isn’t typically the case in the Nanaimo area. In fact, most of the mobile home parks in this area are actually pretty pleasant neighbourhoods and the mobiles themselves are typically surprisingly roomy, clean, and comfortable. That said, it is not what I would recommend to most first time Buyers because of pad fee costs and my belief in the concept of building equity. With a mobile you get a low monthly payment for the ownership of the mobile itself but you don’t own the land. You are going to have to pay a pad rent of about $350-400/month. because the land is not yours. The value of the mobile depreciates over time but the land’s value (which you have no stake in) increases . The name of the game is ultimately ‘equity building’ and mobiles are not so good for doing that. Having a stake in land is key.
Remember that you’re probably going to sell or rent your real estate one day. The more your money goes into the mortgage rather than a monthly fee plus the amount the property goes up over time, the more you’ll get back when you sell the place and use that money to buy something else. If you hold on to it long enough it will go up. Real estate is a long term game so be patient and my advice is to expect to hold on to a place for 5-10 years if or more if you can swing it.
With townhomes and condos most people would probably overlook the fact that they come with a stake in the land they are on. The strata fee vary wildly on them depending on a variety of factors, but in terms of the cheaper than a basic house price range, most of the monthly fees are between $150 and $200 per month. The good news about these fees, is that part of that money goes towards maintenance of the exterior of the complex. If the complex is well managed, this makes looking after the property easier for the would be owner as they don’t have to consider the outside maintenance directly but instead it is done via the mini democracy of strata owners, council and usually a management company. The bad news is that once in a while, extra fees are charged when it turns out that the complex has a leak or some other big project that wasn’t foreseen in the budget. Keep in mind that this happens in houses too in its own way. Typically, that extra fee can be gotten back in the resale value once the work has been done.
The world is changing. It always has been. Those who live gracefully in it are the one who are able and willing to change with it whatever direction it may take. Others wait for the world to go their way, which it may, or it may not. In a world that is approaching a population of seven billion people, space is becoming an ever precious thing. And that’s something they say often about real estate, “Land is the one thing they’re not making more of.”
Posted by Ryan Coffey under: Nanaimo Profile and Events; Uncategorized.
Fall has just shown up on our doorstep and winter isn’t far behind. The carefree joys of summer ease their way into a time of richer foods, many hued leaves and more layers of clothing. For most Canadians this is the beginning of an annual journey towards the sort of winter that Canada is famous for. Temperatures of minus ten, twenty and maybe minus thirty aren’t that strange and in some places minus fourty or lower are plausible along with who knows how many months of snow. For most, this is just part of the Canadian experience. If you are from Nanaimo, or anywhere on the west coast, the tales of this sort of winter is not something you can grasp without having experienced it yourself. We are so spoiled that we whimper when we get up on a winter’s morning and find that we have to scrape the ice off our windshield. For those of us on the west coast of British Columbia, winter is mostly a time of rain and as people from east of here will quickly point out “You don’t have to shovel it.”
I see a fairly consistent pattern of who is moving to Nanaimo from elsewhere in the country. For many of them the weather is definitely a factor, but is not the whole picture. I had one client say that living on Vancouver Island is like living in a giant park but you are allowed to live and shop in it. Nanaimo, located at the eastern centre of Vancouver Island, is in such a position that it is a hub of distribution for people and goods for The Island. Vancouver is close and easy to get to yet far enough away so that we don’t feel very connected to daily life there without making a conscious decision to be part of it. You can fly there in twenty minutes or take the ferry and get there in less than two hours or you can just stay on The Island and for the most part forget about that city. If it’s something more natural you crave, you can hop in your car and visit beaches, mountains, lakes or forest in minutes from wherever you are in Nanaimo. In most neighbourhoods you can simply walk or ride your bike to such things and you don’t need to live in a fancy neighbourhood or own a parka to make this easy all year.
I have seen and lived in much of Canada, and a few other countries, and I have noticed that local attitude and culture vary for many reasons that you can discern but also for many reasons that you can’t. One of the things I have noticed about our local culture is that we enjoy a slower pace of life, but most people aren’t aware of it. Rush hour start at around 4pm and at most means a twenty five minute trip from one end of town to the other rather than the usual twenty. When you go out shopping or to use such and such service there isn’t the same intensity in the air that you will see in nearby places like Vancouver or Victoria not to mention most of the other places I have visited aorund the world. But again, they are nearby if that’s what you crave once in a while.
Nanaimo is large enough so that you can easily find the goods and services that you need to make your life comfortable but small enough to that you can feel part of the community. When I go out in public I will usually see at least one familiar face but at the same time I never have the sense that I have met all the people that I want to.
These, and more reasons which I won’t go into for the sake of brevity, are why I think that living in Nanaimo is its own kind of wealth. I have had and continue to have the opportunity to live in many other places but I have chosen Nanaimo as my home as it fits my values and desired lifestyle. I see my reasoning mirrored in so many of the clients that come to me from the rest of Canada and the world. Sharing something with like minded people makes my job easier to appreciate and do.
Posted by Ryan Coffey under: Real Estate Terminology 101; Uncategorized.
Yes, we can do contracts subject to the sale of an other property. I described it briefly in this post about the various kinds of ‘sold’, but will describe it another way here.
We can add a clause into the usual addendum or add another page/form that is specifically for this purpose of creating a ‘time clause’. The usual way of doing it is that you are given a certain period of time to sell your existing property (or otherwise come up with the funds) and if you can’t do it within the agreed upon time period, the time period must be extended or the contract is cancelled.
Usually a month (maybe two) is what people agree to. You see, the other part is that the Seller can still accept offers from other Buyers. If and when they do, you are given a short period (usually something like 24-72 hours) to come up with the money to save the deal or the other party gets it.
That’s it in a nutshell but the pros and cons and various ways to play such a thing are what’s really important and probably a convoluted read for most people. I’ll do my best to make the next bit clear. If it’s not clear and you’re thinking of doing this sort of thing I am pretty easy to just call.
For the Buyer, the catch is that in order to get people to agree to putting their property into a sold/not sold limbo for such a long time, the Buyer will generally have to give the Seller a solid (higher) price on the property than they would without the time clause. I am speaking regarding averages of many cases here but anything can happen in one particular case. Regardless, the likelihood of paying a higher price to get that accepted offer should make the Buyer think hard about how special that particular property is to them. It should also be kept in mind that they don’t yet know what their existing property will sell for.
Having an offer with a time clause at a price fairly close to asking is double edged sword though as it bears the sting of (probably) paying a bit more money for the property but at the same time can protect that offer from competing offers from other Buyers who don’t want to pay as much. If properly coached by their Realtor, the Seller will know that having an accepted offer with a time clause in it means that other Buyers are less likely to put offers forward because they are afraid of getting their hopes up before being disappointed. Neither the Seller or anyone else knows for sure if the offer with the time clause will hold together or not so there is a risk for the Seller that the property will just end up sitting on the market for a while losing its appeal to the market at large. All of which is the logic behind the higher price. That said, this doesn’t mean that a Seller won’t accept a lower priced offer and then no one else will try to make an offer on the place. That’s less likely, but it can happen and like I always say “There’s only one way to find out.”
But don’t forget, all of this logic takes a back seat to the same thing that happens in every negotiation. The deal either sinks or swims based upon how badly the Buyer wants to and is able to buy and how badly the Seller wants to and is able to sell. The analytically minded tend to want to make everything seem complicated but it’s really just a narrative that lies on top of this fundamental principle of money and motivation.
There are more possible plays here than I am going into but the above gives you an idea of the range of possibilities.
Posted by Ryan Coffey under: Uncategorized.
Having space, whether actual or just a sense of it, is a big component of what attracts people to a property. If you are selling, the game is to use these concepts to your advantage by creating as much sense of space as you can. If you are buying, the idea is to recognize what the actual living space is like despite the concepts explored below either being totally followed or totally ignored.
I have seen many very clear examples that have shown tens of thousands of dollars of difference in value due to use of space. One case that stands out in my memory is when I showed two sides of a very nicely built duplex that both happened to be listed at the same time. Except for only the tiniest of differences (one had a small window above the staircase, too high to peer directly through) the places were identical. The presentation of them differed because side A was very poorly presented and side B was well presented. Side A was being rented to students who were in the process of moving out which basically means it was a disaster inside. The condition of the property was fine, it’s just that everything was dirty and there were boxes, clutter, trash and personal items scattered everywhere throughout the home. Of course, a lack of cleanliness doesn’t help, but let’s focus on how having things strewn everywhere affects the Buyer’s sense of comfort because it is something I see quite often, particulartly in rentals that are for sale. Side B… was pristine. Clean, no clutter. Tastefully and minimally decorated, lights on and drapes open. You felt like you could breathe easily. Side B was something like 15k higher than Side A. I pointed out to my clients that these two places were the same and a broom and a bucket of soapy water made for an opportunity to choose Side A and save some real money. But that didn’t matter in their eyes. That small window above the stairs was in their eyes the justification for the higher price and they considered the place seriously. (Don’t worry, in the end we found them an even better deal.)
Think about that. Even in a situation like this with the Realtor who is able to see past the presentation and is pointing out the easy money, the Buyer still wants the more expensive property. Clutter kills space and it kills the value of a property. I would say that by and large Sellers understand this, but even so there are many who simply don’t get it. In the end, logic usually takes a backseat to how people feel while they are in the home they are thinking of buying. How they feel when they are there is the biggest factor for most Buyers. This is a crucial point for both Buyers and Sellers to keep in mind.
I spend a lot of time thinking about these things and here is a breakdown of what I think are the major factors in creating space:
Floor plan A good floor plan can fool you into thinking a property is bigger than it really is. In general I am pretty good at guesstimating the square footage of a place just by looking at it for a minute or two but once in a while I realize I was totally off when I look at the listing sheet in my hand and then I wonder why. It’s usually because of the floor plan, a kind of hidden evidence of brilliance on the part of whichever architect designed the place. It’s pretty difficult and expensive to change what you’ve got on this one. So, in most cases it’s best to make the most of what you’ve got and in the odd case maybe removing a wall or adding a door or window in the right spot is worthwhile.
Furniture Placement A vacant property feels wide open and is a blank canvas for the Buyer’s ideas but developers stage a new home in a project so that the sense of a beautiful lifestyle is evident and needs less imagination to be seen. Most homes on the market still have people living in them and having the couch and tables and chairs in certain spots have served the Seller very well for many years. At the time of listing, however, it is worth reviewing their placement and perhaps considering selling some of them or putting them in storage until the home sells. In some cases, even just rotating a couch can make a big difference in how homey the property feels to prospective Buyers. For example, if you have a small room with a couch that is just facing a nearby blank wall, it will feel smaller that if it is facing the view out the window, the fireplace or simply out of the way of where foot traffic naturally goes.
Windows Windows provide two things: views and light! Sometimes the view isn’t worth showing off but Sellers shouldn’t totally close those blinds. Even when the view is nothing but the wall of the neighbour’s garage or the condo complex’s parking lot it is still a good idea to leave the blinds slightly open so that at least the light gets through. In general though, leave those blinds and curtains open so that it doesn’t feel like the space ends at the wall, but instead continues to the outdoors. This goes double. no… triple if you have any kind of ocean, mountain, natural or distant city view.
Lights In most properties I show I am turning on all the lights as soon as I open the door. More light feels like more space. Some places have bright lights but others are going for more of that cozy/warm feeling of dimmer lights and more subdued, possibly darker colours. Sellers should go with the former. When it comes to creating space, lots of light is key. Buyers viewing a property have just came from outside in the daytime and even if a home is pretty well lit, it will seem dark at first impression because the outside is so much brighter. It takes more time for eyes to adjust than it usually takes people to be turned on or turned off by a property.
Colours In addition to what I mention just above about lighter vs. darker colours, Sellers also need to remember that their tastes are their tastes. Personally, I love colours and I like rich homey warm things like victorian style wallpaper. My tastes (too) are a poor choice for selling a home so don’t be offended if I tell you that your tastes don’t work for selling either. “It’s just business.” as they say. The basic is always some sort of off white colour and in recent years a light beige has been the other go to. Buyers whose minds are tuned in to the process will realize that changing colours of a home is akin to a change of makeup. Not that big of a deal and being able to see past it will enable you to see opportunities that others can’t.
Clutter It is, or at least should be, fairly obvious that having less clutter in your home creates a sense of space. A Seller should try to think of having less furniture, less stuff on the counters in the kitchen, fewer knick knacks laying around, fewer clothes or boxes in the closet and so on. Also, let’s no forget the clutter of busy decor. Very floral wallpaper or lots of paintings, posters and pieces of art on the walls don’t take up floor space or change the function of the space inside a property but if you have a lot of it, it takes away the sense of that space. It also screams of the Sellers tastes and personality and makes it hard for the Buyer to see themselves in the home. I remember one property I showed in my first year of real estate that was a beautiful home full of character that was clearly owned by a prolific artist. The home was full of really amazing and creative works of art and even the garden path was painted with gorgeous patterns. My clients and I had a great time looking through the house but it was too hard to see them in it because all we could see was the artistic spirit of the current owner. Sellers should be having yard sales and putting things in storage before putting their home on the market. Buyers need to try to see the actual space and not be swayed one way or the other by how much stuff is currently in it because after all, the stuff that’s there now won’t take up space in the same way theirs will.
I previously wrote about what creates value in real estate, and it is worth noting that space was at the top of the list but of course it is also worth noting that there are other factors that I listed as well.
Also, take a close look at the photo I have included in this post. This is a relatively fancy and modern home, but it is a great case study because it is the epitomy of everything I mention above.
Posted by Ryan Coffey under: Buying; Uncategorized.
I have seen many people fall in love with many properties. I’ve fallen in love with quite a few myself and I continue to even though I’ve taken close looks at thousands of homes. But I’m not sure if I’ve ever seen a perfect home.
It is common for Buyers to go through a stage during the home shopping process where they are having trouble reconciling their wish list with what is realistically available. What they really want is usually either out of their price range or is found in pieces that are spread across a handful of different properties. I usually explain that the latter is really just another kind of ‘out of price range’. Having all those things they want combined in one property makes for a property that is not only more desirable to them but also to the market in general and thus commands a higher price. I have come to define ‘luxury’ as ‘not having to make any compromises’ and from what I’ve seen, even the wealthy have to make some compromises.
This is not something all Buyers go through though. Some Buyers enter the property search with a sense of adventure and an open mind to the myriad of possibilities that exist for them. These Buyers have more fun with the process and usually end up getting better deals because they can see potential where others see flaws. This is a point worth remembering if you ask me.
Usually, the only way to get a property that has all of the pieces of perfection combined is to do a custom build with a healthy budget. Certainly possible, but more of a commitment than most people are willing to go through. (Finding the right lot, making sure it has the right zoning and has an appropriate building scheme for what they have in mind, hiring and working things out with an Architect and a Contractor, not getting overly upsold in the process and above all choosing all the tiny details about what they want in the property that they had probably never though of before.) Even if they do all of this, I believe that they will find flaws in what they have created anyway in the end. Over time they will refine their ideas. Maybe they wish they installed the island in the kitchen a few feet this way or that way or made the bathroom a little bigger or had another window on a certain wall. The easier route is really to find a home that has most of what you want but has the potential for you to modify it to make it as close to your idea of perfection as possible.
I also often say that looking for a property is similar in many ways to looking for a spouse. In our youth, we may start out having an idea of a perfect spouse in mind but over time we come to realize that in reality no one is 100% perfect. This doesn’t mean we can’t fall madly in love with a less than perfect someone and spend many happy years with them. Their flaws can also be their charms and over time they become part of who you are too. Same goes for a home. Having said that, it is much easier to separate yourself from a property if down the road if you no longer wish to live there plus it’s much easier to change a home than it is to change a person. (We’ve all tried haven’t we?)
I try not to be too direct in telling my clients all of this because I understand that there is already a lot of pressure on a client plus I know that most of them will work things out naturally anyway. Most will realize that there are in fact quite a few nice homes available to them and choose the best of the bunch. A few decide to save up for a bigger down payment so they can get something fancier. Others keep looking and hoping that the perfect property will show up (relying on luck) but sooner or later they realize they needed to change their criteria or expectations before they can truly fall in love with a property that is within financial reach and actually exists on the market.
And then.. we negotiate the best deal we can.
Posted by Ryan Coffey under: Real Estate Terminology 101; Uncategorized.
While you’ve been browsing MLS listings, you probably come across various terms used to describe the style of house like ‘rancher’ or ‘westcoast contemporary’ and perhaps wondered why you aren’t seeing words that may be common where you come from. Words like ‘bungalow’ or ‘cape cod’ style homes come for example. Below is a disambiguation of terms that Vancouver Island Realtors use to categorize the different types of homes we encounter. It is not exhaustive, as one could argue that there needs to be another category to show that home x has an atrium or some such exotic feature but by and large properties fit into one of these categories or another. Hopefully, this is one of the details that will help you get more out of looking at mls listings, which by the way you would get even more out of with custom mls access and a little guidance from yours truly.
Posted by Ryan Coffey under: Home owner tips; Nanaimo Profile and Events; Nanaimo Real Estate Market; Uncategorized.
The following article was recently brought to my attention as a potential topic for a blog post. I think the article, though possibly not easy reading for those who don’t live in the real estate world, speaks for itself and does not need my interpretation in an attempt to give it more gravity or depth. Suffice to say that many of the nice locations to live, like near the water in Departure Bay, have always been nice places to live and that includes the extensive times before European settlers arrived. The real estate world has many systems, rules and protocols in place to protect Buyers, Owners and Sellers from finding themselves in situations where they are suddenly left with a giant bill for something unforeseen. That said, the article below describes a blind spot in our province’s system. The good news though is that there is progress thanks to the Supreme Court of British Columbia.
Read the article here.
Posted by Ryan Coffey under: Nanaimo Profile and Events; Uncategorized.
Not every single post on here is about Nanaimo real estate. Once in a while I try to point out some of the local charms (especially parks, lakes, beaches and so on) to remind people that Nanaimo has a lot more to offer than just houses and lots of shopping.
This one is a little outside the box but that’s why I like it. Car shares are something I only became aware of relatively recently and it turns out we havone here that is fairly healthy although not booming like the ones in Vancouver. It offers an alternative for people who don’t need a car every day so they can still have access to a car without having to pay nearly as high a cost as they would for owning it all themselves. Being a member of the co-op allows access to one of the cars. For more on this check out the FAQ on the Nanaimo Car Share website.