Edmonton Real Estate Blog

While the newpapers are happy to announce that maybe the recession is over since we had economic growth in the 3rd quarter of this year, things here might be changing.

We also go a report last week that came out that indicated that the number of unemployment claims in Edmonton were rising, which would indicate a slow down for us here in Edmonton.

As of this morning there were 1,762 single family dwellings listed on MLS in Edmonton proper.  That is only a slight decrease over last weeks number1,781.  This would be a seasonal norm and not one that I would be concerned with.

The concerning part is the drop in the sales.  In the last 30 days there were 509 single family dwellings sold in Edmonton proper.  That is a drop from last weeks number of 545, but that also represents almost a 7% drop in sales in one week alone.

You compare that with only a 1% drop in the listing inventory that is a trend of concern.  The listings to sales ratio has also risen to 3.46:1 from last week’s ratio of 3.27:1.  If this trend continues we might see valuations drop slightly before we see them come back again in the spring marketplace.

People make a lot of mistakes, avoidable mistakes, when they’re building or renovating a home. Those mistakes begin at the planning phase – when the homeowners are developing the layout with a designer or architect.

I recently looked over several floor plans for next spring’s reno and construction season, and I have to tell you, some things continue to pop up that make me grind my eyeteeth in frustration. Here are five things that I would ban from all blueprints.

Corner fireplaces

Oh, they rake the eyes. Why would anyone put a fireplace in the corner of a room? This rookie mistake starts a domino effect of ugliness that’s nearly impossible to stop. Developers are fond of doing it because it’s an easy way to parachute in a prominent feature they haven’t adequately planned for.

The problem is focal points. A fireplace is a natural centre of attention, and a room is most comfortable when the furniture aims at it. But when you put the fire in the corner of a room it’s almost impossible to do anything but place the furnishings at odd angles to the walls, which misaligns the room with the structure of the home. (Conversely, if you ignore the fireplace as a focus, people in the room become disoriented and don’t know where to put their eyes.) Fireplaces are best located on a long run of wall. There, they’re easy to centre in the room, making them an effortless focal point around which to plan.

Spiral staircases

Cinematic grandeur is what people have in mind when they attempt to shoehorn a spiral staircase into their floor plan. But more often than not, the stairs come off like clumsy plotting – superfluous of detail and disruptive of flow.

The reason is simple: Spiral stairs are a circle, and most homes have walls that intersect at right angles – that is, they’re squares. And when you drop a circle into a square, everything feels off.

One of the few places spiral stairs feels right is in a home with a grand entrance – picture the 1,000 square foot foyer of a colonial mansion in the Deep South. There, fanciful spindles and expansive treads blend effortlessly with the majesty of the home. There, not here.

The problem is the same as with the corner fireplace: The alignment feels off. A home without room for its spiral staircase feels like a series of circles and squares mashed together. Odd angles proliferate, creating spaces that are difficult to furnish and a house that is challenging to resell.

Getting a spiral staircase to integrate seamlessly into a floor plan demands an investment in good architecture and exceptional craftsmanship. Unless you’re willing to go to the expense, you’d best forgo spiral stairs altogether.

My advice: Stick to straight runs – they’re efficient and much easier to construct. If you want to jazz them up, spend your money on quality materials, finishes that are consistent with the rest of the home.

Grecian columns

Used properly, Grecian columns are a nod to outstanding architecture and engineering, and an implicit statement of affluence. And it’s that savour of affluence people are after.

But in the average house – with flat, eight-foot ceilings and six-inch crown mouldings – a Grecian column looks as natural as a tuxedo in a honky-tonk. It’s foolishly trying to elevate the occasion.

To support the Grecian columns, homeowners often deploy empurpled regal furnishings and many-layered draperies – touches that only draw attention to the original sin. They’re trying to make their home something it’s not.

Regardless of its size, play to your home’s strength, whether it’s a nice floor plan, beautiful wood floors or well-chosen finishes. Structural elements like posts should integrate with the other finishing carpentry (baseboard, window trim and crown).

Superfluous French doors

Good quality French doors are beautiful – solid wood with a thick frame enclosing a grid of bevelled glass. But their appeal leads to frequent misuse.

French doors should be reserved to the entrances of formal rooms, like the living or dining room – spaces intended to impress, where the act of sweeping open two glass doors is a dramatic gesture.

There was a time when the library would have been a room that deserved French doors. But yesterday’s library is today’s home office, and its mishmash of Office Depot furnishings and HP hardware is no enticing thing to see through the glass.

The general rule of French doors should be: Use quality doors with beautiful hardware, and use them sparingly for rooms that you intend to decorate beautifully and share with others.

Avoid slapping French doors on rooms that require privacy – you’ll only end up curtaining the glass.

Pork chop countertops in bathrooms

I’m amazed that this dated detail still finds its way onto floor plans. I’m talking about that odd ledge that extends from the vanity over the toilet in the bathroom. At the best of times it housed a vase with dried twigs in it; at the worst, dingy collections of half-used perfumes and aging soaps.

If space is a concern, then glass or floating shelves over the toilet are far more useful. If covering up the unsightly toilet is the rationale, buy a nicer toilet – there are too many beautiful plumbing fixtures on the market these days to go down that road.

Special to The Globe and Mail

Think spending $50,000 on a total kitchen remodel or $10,000 overhauling the bathroom is the only way to add value to a home? If large, expensive projects are beyond your grasp, you’re in luck: Increasing the value of your home doesn’t have to involve large outlays of cash, especially when you’re willing to put in a little sweat equity. Why spend big money when there are so many low-cost, do-it-yourself (DIY) projects? Whether you’re planning on selling or just want a nicer place to live, read on to find out what you can do to add value to your home for as little as a few dollars.

House-Wide Updates

The following are some changes that can be undertaken for surprisingly little money.

Freshen Up the Walls
If your walls have scratches and dirty paint, an outdated color or tacky wallpaper, a few cans of paint can make a dramatic difference. If you’re trying to maximize the value of your home, it’s best to choose a neutral color scheme that unifies the entire house, makes the space look bigger and will appeal to a wide variety of potential buyers.

Install Crown Molding
This task is surprisingly simple but adds a lot of character. You simply buy the molding, which is nothing more than decorative strips of wood from a home improvement store, cut it to the size that fits your room (or have the store cut it for you), and attach it to the top of the wall with a nail gun. It may even come already painted. This involves a bit of woodworking skill as well as the right tools, but is very inexpensive if you can do it yourself.

Update Fixtures
Switch plates, outlet covers, curtain rods, light fixtures and doorknobs are often boring or overlooked, but a few bucks can add major pizzazz. Attractive metal switch plates and outlet covers can cost as little as $5 apiece but look much more expensive. Light fixtures and decorative curtain rods can be a little pricier, but sometimes you can make an inexpensive piece look elegant with the right can of spray paint. Again, make sure to choose items in colors and finishes that will appeal to a wide audience.

Install Ceiling Fans
Everyone likes to save money on electricity bills, making ceiling fans an appealing addition to any home. Using ceiling fans can definitely cut down on air conditioning costs, and in fact, they can also reduce heating costs by circulating warm air away from the ceiling. A basic fan costs about $50, and a nice one can be had for no more than a couple hundred dollars. If you don’t already have overhead lighting in the room or rooms you want to install fans in, the electrical work needed to install them can significantly escalate the cost of this project as well as take it out of the DIY realm.

Improve Window Treatments
The cheap vertical plastic blinds, paper shades, or horizontal aluminum blinds that may have come with your house definitely don’t add any value to your home. Consider replacing them with plantation shutters, wooden blinds or nice drapes. By the way, it doesn’t matter whether the drapes will come with the house if you are in the market as a seller. The important thing is that they make it look nice while it’s on the market and help you get top dollar for your home.

Reveal and Restore Hardwood Floors
Older homes in particular are likely to have hardwood floors lurking beneath carpet. If your floor squeaks, that’s a decent sign that you may have wood floors. If you’re not sure, pull up your carpet in an unnoticeable corner and investigate. If you do have wood floors, there’s a good chance you’ll have to refinish them to restore them to their original splendor, but that will be much less expensive than installing new flooring from scratch.

Bathroom

Redo the Bathroom Floor
Many people can learn how to do this task themselves with a simple class (your local home improvement store may offer one). Because installation makes up a major part of the cost of most home improvements, saving all that money on labor may allow you to pick nicer flooring than you could otherwise afford. Opting for a neutral-colored tile will add the most value.

Update Fixtures
If you have generic, cheap and/or outdated fixtures, replacing them with newer, more customized versions can make your bathroom sparkle. For about $40-$100, you can replace a shabby bathroom vanity or ceiling light fixture with something elegant. A similar cash outlay will get you a new sink faucet. A spa-style chrome shower head adds a touch of luxury for about $80. Towel bars are the easiest and cheapest fix at about $20-30. Sometimes the upgrade can even be more energy efficient, increasing not only the aesthetics of your home but “greening” it up as well.

Kitchen

Paint or Stain Kitchen Cabinets
You could buy all new cabinets and save money by purchasing prefabricated (rather than custom) cabinets and installing them yourself, but that’s more work and money than painting or staining your existing cabinets. White cabinets will brighten the room, don’t usually go out of style and are easy for future owners to repaint if they want something different. You’ll need to remove all the hardware from your cabinets, including removing the doors. You’ll also need to clean the cabinets first so that residue like grease won’t ruin your work. This renovation can be used to spruce up your bathroom cabinets as well.

Upgrade Cabinet Knobs and Drawer Handles
It’s surprising how a seemly innocuous element like a cabinet door knob can make your kitchen look cheap or dated. Updating this hardware can give your kitchen a face lift whether you redo your cabinets or not.

Living Room

Clean Fireplace Brick
If you have a brick fireplace and it’s ever been used, chances are some of the brick is stained with soot and creosote. Because a nice fireplace can be a major selling point in a home, you’ll want to make yours look as nice as possible. Just use a damp rag to wipe away some of the soot, then follow up with a fireplace cleaner designed to remove creosote. It will take some scrubbing with a stiff brush and possibly several applications, but you’ll have that brick looking spiffy when you’re finished.

Don’t Forget the Exterior

It may be easy for you to ignore your home’s exterior when you spend most of your time inside, but it’s the first and sometimes only impression that others get of your house. Here are a few simple ways to make it look its best.

Install a New Front Door
A very basic steel front door costs about $100, but for just another $100-$200, you can get a door with a lot more character that will improve your home’s curb appeal. If you can’t afford a new door, a fresh coat of paint in an inviting color may be all you need.

Replace the Front Door Mat
When you’ve had the same doormat for years, it can be easy to overlook how worn out or dirty it’s become, but it’s one of the first impressions people get of your home. This is one area where $20 can make a big difference.

Gutters
This is more an issue of maintaining your home’s value than increasing it, but it’s extremely important. Without properly functioning gutters, which are designed to carry water away from your home, rain may seep into your home or pool around it, causing problems like mold and mildew and eventually compromising the house’s structural integrity, leading to very expensive repair bills.

Power wash the Exterior of Your Home
For less time and money, a good washing can make your home’s exterior look almost as good as a fresh coat of paint.

Repaint the Exterior
If washing the exterior of your home didn’t brighten it up as much as you’d hoped, consider a new paint job. With the ladders and heights involved, this may not be a DIY task for everyone, but even if you have to hire others to do this job, it’s still pretty inexpensive as far as home improvements go and can make your house look almost new from the outside.

Power wash the Driveway, Walkways and Patio
As long as you’re renting the power washer, you might as well clean your driveway, your patio, and any walkways. You may be surprised by how new they’ll look afterward.

Upgrade Landscaping or Clean Up Existing Landscaping
Flowers and other plants are a great way to brighten your home’s exterior. Use greenery in front of your house and/or along walkways to draw attention to your house. To get the most for your buck, choose perennial plants, or ones that will come back year after year, rather than annuals, which will die in a year or less and not return. Patch any bald spots in the yard with fresh sod and trim existing trees and bushes to complete the yard’s new look.

Put on Your Tool belt
Upgrading your home doesn’t have to be expensive or difficult and it doesn’t have to involve contractors. There are a variety of projects for all price ranges and all levels of skill and enthusiasm that can improve your home’s value, whether to future buyers or, perhaps more importantly, to you. Putting a few of these home-improvement ideas into action will help you get the most value out of one of your biggest assets whether you’re staying in it or selling.

Article by: Amy Fontinelle Investopedia.com

“Fix it and flip it” is a phrase often associated with real estate investing. The idea behind the concept is that the completion of a few choice remodelling projects will add significant value to the price of a home. With this in mind, many homeowners undertake major renovation projects before putting their homes up for sale with the idea that sprucing up the place will result in big bucks. More often than not, these upgrades fail to pay for themselves. Read on to find out how to renovate strategically and which renovations really add value to your property.

The Difference between Investors and Owners
Updating an investment property is generally a sound strategy because successful advocates of the fix-it-and-flip-it philosophy buy run-down homes at bargain prices and save money on the repairs by doing most of the work themselves. A little sweat equity goes a long way toward making a real estate investment profitable.

Investors carefully choose their remodeling projects, focusing on those that will result in the most value for the least amount of effort and cost. Part of the process includes paying attention to the other homes in the neighborhood to avoid over-improving the property. If none of the other houses in the area have crown moldings and Corian countertops, adding these amenities is unlikely to result in a significantly higher selling price for the property.

Owners, on the other hand, often take a less strategic approach to remodeling when sprucing up their homes prior to putting them on the market. As a result, they can end up putting significantly more money into the project that they will get back out of it when they sell.

To make the most of your remodelling projects, it pays to keep four types of projects in mind : basics, curb appeal, value added and personal preference.

The Basics
The basic are the things that buyers expect when they purchase a home. This includes a roof that doesn’t leak, functioning gutters and downspouts, a dry basement, a good furnace, solid floors, walls that are in good repair, retaining walls that work and all of the other common sense items that you expect to find in a home.

In upscale properties, this includes air conditioning, a certain number of bedrooms, bathrooms and garages, and any other amenities that are common to the neighbourhood, such as a swimming pool.

Adding these items to a home that lacks them doesn’t add value, it merely brings the property up to the standard level of the rest of the homes in the area. Money spent on these items is unlikely to be fully recovered, but should at least result in ensuring that the home sells for a price that is comparable to other homes in the area.

Curb Appeal
Items that add curb appeal help the property to look good when prospective buyers arrive. While these projects may not add a considerable amount of monetary value, they will help the place sell faster. Curb appeal items include a nice green lawn, attractive landscaping, fresh paint inside and out, new carpet and new appliances. If you know that a prospective buyer is due to arrive at a certain time, baking an apple pie just before the arrival is an easy way to set the stage, make your house smell good and create a warm, inviting atmosphere.

Adds Value
The projects that add considerable value are big favourites of fix-it-and-flip it advocates. While most of these efforts will not recoup their costs, some will come close. Projects that offer the most bang for the buck include new siding, kitchen remodelling, bathroom remodelling, new windows, decks and the addition of living space. The National Association of Realtors cites siding, kitchens and windows as some of the most beneficial projects, often recouping 80% or more of their costs during resale.

Personal Preference
Personal preference projects are nifty items that you want but that other people may not like or be willing to pay to get. In most areas of the country, these include amenities such as swimming pools, tennis courts, hot tubs, wine cellars, basement game rooms and ponds. There’s certainly no harm in adding these items to your house, but don’t expect potential buyers to be willing to pay a premium to get them when you are ready to sell.

House and Home
Regardless of the project that you are considering, remember that your primary residence is not just a house, it’s your home. If you plan to live there for many years to come, add amenities that you want to have regardless of their impact on resale. When it’s time to sell, do the basics to get the property up to par for the neighbourhood and add some curb appeal, but don’t bother undertaking an extensive array of projects strictly in an effort to increase the value of the property. Even with the projects that are known to add value, the chances are good that you will spend far more money than you will get back in return.

Article by: Lisa Smith Investopedia.com

Another week another dollar… Maybe.

As of this morning there were 1,781 single family homes listed for sales in Emdonton proper.  That is only a slight drop from last weeks number of 1,794,  So the listing inventory is remaining fairly stable.

In the last 30 days there were 545 single family homes sold in comparision to last weeks 546.  Again, a very stable number.  That ultimately give as a listing to sales ration of 3.27:1.

Stability is good and if the market can continue to hold its own for the next few weeks we shouldn’t see market values dropping over the winter months.

So if you have been waiting for prices to drop over the winter months before you buy you just might be out of luck and end up paying more because you waited.

Time is running out to qualify for Ottawa’s $1,350 home renovation tax credit, and you have even less time to make use of year-end tax strategies. So here a few timely reminders.

You have until Feb. 1 to spend $10,000 on qualifying items or work to earn the maximum renovation credit, and more than $1,000 to get any of the 15 per cent tax credit. Qualifying expenditures include repairs, alterations and preventative maintenance for a home or apartment suite you own, including the cost of labour, materials and equipment rentals.

Remember that labour costs for home repairs, as well as the cost of heating your home, will be going up next July 1 when Ontario adopts the harmonized sales tax.

But going into debt to renovate, insulate or replace a furnace – particularly credit card debt – will negate some of the value of the tax credit.

Anyone who bought his or her first home after Jan. 27, 2009, will be eligible for a $5,000 federal tax credit, which would put $750 back in your pocket, but only temporarily because you now own a house.

Anyone who turns 71 this year should remember to transfer money from their registered retirement savings plans to a registered retirement income fund or annuity before the end of the year. If you don’t, the RRSP will be taxed as though it was all withdrawn as income in a single year.

If you turned 55 or older this year you will now be eligible to convert locked-in money from a former employer’s pension plan to a life income fund (LIF), and start withdrawing a prescribed minimum or maximum as regular income.

It would be better to wait as long as possible before age 71 to start spending retirement savings, particularly in the wake of the investment losses of 2008 and the low rate of interest paid on investments.

But these are hard times and Ontario does permit a one-time withdrawal of 25 per cent of a new LIF for whatever reason. After Jan. 1, Ontario will also permit a second withdrawal of 25 per cent or an initial withdrawal of 50 per cent.

In addition, you may apply for withdrawals from locked-in accounts that have small amounts of money or if you are in financial hardship. See www.fsco.gov.on.ca for details or call the Financial Services Commission of Ontario.

Executors and heirs should be aware that losses on registered savings that occurred after the death of a person in 2009 or later, and before distribution of the estate, may be carried back and counted as a reduction in the taxable income that would have been declared on behalf of a deceased person who had no surviving spouse or dependant.

Things that must be done before Dec. 31 to qualify for a tax refund next spring include making charitable and political donations, paying post-secondary tuition, buying monthly or annual transit passes, spending up to $500 per child for eligible sports and fitness programs and paying charges for a safety deposit box.

If you operate a business, the end of the year is a good time to purchase computers, cars and other equipment for which you may claim a capital cost allowance. The entire cost of a computer purchased after Jan. 27, 2009, and before February 2011 may be written off in the first year.

Parents and other relatives who want to see children in their family obtain a post-secondary education have until the end of the year to contribute to a registered education savings plan. You will not get a tax refund, but the child will qualify for a federal grant equal to 20 per cent of the contribution, or substantially more if the parent contributing has a low income.

To make the most of that government assistance, be careful to consider the sales and management fees that will be deducted from investments. Bonds and other safe investments are not earning much of a return these days.

Anyone investing outside of an RRSP should be careful about buying mutual funds that may pay a taxable year-end distribution of recent investment gains.

If you have sold investments at a profit this year, and have no losses to carry forward from previous years, consider selling investments before late December that would produce an off-setting capital loss.

Be sure to wait more than 30 days before repurchasing the investment sold at a loss or it will be considered a superficial loss. There may be situations where a superficial loss might be advantageous to a couple, but seek professional tax advice first.

One thing you may be asked to consider at this time of year is any pitch for tax shelters built around some charitable activity.

You may get a tax refund before Canada Revenue gets around to checking out the scheme, but tax authorities have made clear they will eventually hunt down and disallow every one of them.

 Source: James Daw from Yourhome.ca

Well another week has gone by and things are not improving.  As of this morning there are 1,794 active single family homes in Edmonton proper which is almost the same as the inventory level we had last week.

The real concern comes from the number of sales in the previous 30 days of single family homes in Edmonton proper at 546.  That is a 5% drop in the number of sales in just one week.  It also brings the listings to sale ratio up from 3.11:1 that we had last week to 3.29:1 this week.  Both of these are indicators that the market is softening.

Sellers will have to be more aggressive in their list price in comparison to their competition, but the ratio is still not high enough to put downward pressure on valuations.  So I would expected the valuations to remain fairly stable over the short term.

Also keep in mind that historically we do get a slow down in the market at this time of year until approximately February when things start to heat up again.

OTTAWA – Canadian home resales improved 41.5 per cent year over year to 42,288 units in October, a record for the month, according to the Canadian Real Estate Association.

The national average price for homes listed on the Multiple Listing Service also reached a new high in October at $341,079. This was 20.7 per cent higher than the same month last year.

* Related: Canada’s hottest housing markets | Coolest markets

New sales records for the month were reported in one-fifth of local markets, including Toronto, Montreal and Ottawa.

On a seasonally adjusted basis, MLS home sales totalled 45,818 units in October, two per cent higher than the previous record set in May 2007 and 74 per cent above the recent low in January.

“Low interest rates and upbeat consumer confidence continue to release the pent-up demand that built late last year and earlier this year,” stated CREA president Dale Ripplinger.

“The release of that pent-up demand has boosted national sales activity to new heights and is drawing down inventories.”

* Tell us: Is Canada experiencing a housing bubble?

The sharp rise in demand for homes has shrunk inventories to 194,994 or a seasonally adjusted 4.1 months worth, the lowest level in more than two years and 20.8 per cent below the peak reached a year ago. This is the sixth month in a row in which inventories are down from year-ago levels.

Seasonally adjusted new listings on MLS were slightly higher in October compared to September at 65,148 units. New listings peaked in May 2008, then declined until March 2009, and have remained relatively steady since then.

“New listings are still expected to rise in the coming months in response to headline average price increases,” stated CREA chief economist Gregory Klump.

“New supply dropped dramatically in December last year and earlier this year in response to a difficult pricing environment. Sellers who moved to the sidelines should be drawn back to the market as prices rise further over the rest of the year and in early 2010.”

Source: The Canadian Press, cp.org, November 16, 2009

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