The Resale Home Warranty – Coming Soon to a Home Near You

I attended an interesting class this week titled “Understanding Home Warranties”. This course was put on by the Oakville Milton And District Real Estate Board. Initially, when I received the invite, I assumed the course would be about Tarion Home Warranties for new construction properties. This course was actually focused on a Real Estate trend that has become quite popular in the U.S.: Resale Home Warranties.

The concept is an interesting one. A client purchasing a home can buy a resale home warranty for a year at a time. This warranty will often cover the major mechanical components and systems in the home including the plumbing, ducting, stove, dishwasher, fridge, garage door opener, furnace, boiler and more. The warranties start at $250 per year. These policies are offered by insurance companies and contain stipulations as to the extent of coverage, often dictated by the age of the system in question. The coverage will usually have a deductible for each claim submitted in the range of $50. The policies will not cover pre-existing conditions in the home however there is no qualification of the home in advance.

If a system or appliance that covered by the policy experiences problems, the insured calls the provider to inform them. They will recommend a repair professional for the system, should you not have one of preference. There are limitations on the amount of coverage and the insurer will often provide a cash payout amount if the system or appliance is not worth fixing – based on physical condition or age. While this approach does not cast a protective net over the entire home, it does offer a level of comfort knowing that you have some protection in the event of a major break down during the first 365 days of home ownership.

This approach has generated considerable following in the United States. In California alone 92% of homes sold last year involved resale home warranties. In fact, sellers often provide a resale home warranty as selling feature to the would-be purchasers. A purchaser looking at two comparable homes that are similarly priced may be swayed toward the property with a one year security blanket.

How likely it is that a home owner would use the policy in that first year? Most policy holders make 1.7 claims per year on average. 1.7 visits by a home repair professional each year will justify the $250 cost of the policy. Keep your eyes open readers, I believe the resale home warranty will become much more prevalent in the Canadian real estate market in the years to come. Who doesn’t enjoy some extra cost-effective protection? If you have any questions about this interesting idea please feel free to contact me at 905-330-1241 or rdavison@trebnet.com .

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Burlington Snow Removal Guidelines

My neighbour and I were recently joking about the fact that it had been a week since the most recent snow storm and our residential street was still snow covered. I decided it might be worth a quick call to the City to gain a thorough understanding of snow removal policies and expectations. This is what I found.

When a winter event starts the sand and salt trucks are dispatched on primary roads followed by secondary roads. After the snowfall reaches 2” on primary and secondary roads the snowplows are sent out to clear them. Once snowfall accumulations reach 3” on residential streets the plows will be sent to clear these streets. The City of Burlington’s aim is to have all roads in the City plowed within 24 hours of the end of a snowfall. The City’s first priority is to keep the main roads clear. They ask you not to call to report your residential street unplowed until 24 hours have passed since the end of a snowfall.

Sidewalk Snow Removal

I was surprised to learn that the City of Burlington is responsible for clearing snowfall from all sidewalks – including residential sidewalks – once accumulation reaches 2”. When snowfalls accumulate less than 5” of snow the City’s goal is to have all sidewalks plowed within 24 hours of the conclusion of the snowfall. Priority will be placed on primary and secondary sidewalks followed by residential sidewalks.

Snowfall accumulations between 5” and 12” alter the City’s goal for sidewalk clearing as follows:

• Primary Sidewalks – 18 hours after snowfall conclusion
• Secondary Sidewalks – 36 hours after snowfall conclusion
• Residential Sidewalks – 72 hours after snowfall conclusion

When snowfalls accumulate in excess of 12” the City will do its best to clear the snow as soon as possible. The City will salt and sand primary and secondary sidewalks only when extremely slippery conditions exist.

Now that I have done the leg work I have realistic expectations of the City of Burlington with regard to snow removal. I hope this has given you similar perspective. Should you need to get in touch with the City to report an unplowed street based on the above guidelines they can be reached at 905-335-7777.

Multiple Offers – Dare I Take Part?


There has been considerable press lately about the real estate market being over heated, feeding fears of a “market bubble” situation. Those that support these views often cite the prevalence of multiple offer situations – driving sale prices $50,000 and $100,000 over asking prices in hot market centres – as a key contributor. What exactly is a multiple offer?

A multiple offer situation presents itself when a property is so desirable that more than one offer for the property comes in at the same time. It may be only two competing offers, however, it can be more as I have personally experienced the misfortune of being one of 15 competing offers on the same property in a certain trendy west Toronto neighbourhood. As you might imagine, the more offers on the table, the stiffer, more emotional and less logical the competition often becomes. How does a property become so desirable that multiple offers occur?

Multiple offer situations can happen on their own, as a result of a premium property being offered when supply is low, but more often than not they are created. They can be created a couple of different ways:

• A significant price drop by a Seller may entice more than one set of buyers who were “on the fence” about the property at the previous
price
• Holding offers until a specific date (often 7 days after listing it) in order to generate the most possible interest
• Pricing the property well under market value to create a buzz with today’s well informed buyers the moment it hits the market (often
combined with holding offers until a certain pre-determined date)

How does a multiple offer situation proceed? When a home has more than one offer registered on it, the offers will be presented in the order in which the offers were registered – a phone call to the listing brokerage to let them know the papers are signed. The sellers will review all of the offers at a specified time and then decide on their course of action. The sellers may accept the best offer, negotiate with the best offer and reject all others, negotiate with one buyer and inform the other buyers their offers are being set aside while the negotiation takes place or reject all offers completely. Often, the listing agent will inform the competing buyer’s agents before the presentation that it will be one round of offers and the best offer will be dealt with.

What about conditions? The winning bid may not always be the highest price. In some instances it may be a bit less money, however, it could have no conditions or be “clean”. An offer containing a home inspection or financing clause provides an “out” for purchasers, which in the eyes of the seller weakens their bid. That being said these conditions may be essential to your comfort level putting a bid in on the property and a home purchased without an inspection can reveal a range of post sale surprises. Should the home be bid up considerably over fair market value, it may not appraise for the amount you are looking to finance. In this instance the inclusion of a financing clause might have cost you the house or, if you are successful with your bid, saved you financial distress should it not appraise.

What is the best strategy in preparing for a multiple offer? Unfortunately, there is no “best strategy” that blankets every situation. Each home and multiple offer situation is unique. I often meet with my clients and create an offer plan. We determine what we feel the value of the house is and a logical limit on what they are willing to pay for this specific home. It is also beneficial to determine a price at which the clients feel someone else can have the home. This way expectations and intentions are clear and some of the emotional lack of logic can be removed from the process. In the instance that your agent also has the listing on the property, be sure to review the Buyer Representation Agreement section on Multiple Representation.

Luckily, multiple offers are less prevalent in Burlington and Oakville than some other centres such as Toronto. However, I have experienced them in the Halton Region as well, albeit less often. My best advice is to be realistic about what you feel the home is worth. Keep in mind that other inventory will eventually become available. Create an offer plan and stick to it. Good luck!

The Regional Municipality of Halton Basement Flood Prevention Subsidy Program

A flooded basement is one of the worst surprises a homeowner can come home to realize. Water can find its way in to your home in a number of different ways. I am always an advocate of being proactive to keep your home tight and dry. As such, I feel it is important to share the news that the Regional Municipality of Halton is currently offering a Basement Flood Prevention Subsidy, for as much as $2,725.

This Subsidy is available to:

• Halton residents who have a history of basement floods caused by a backup or surcharge of the sanitary sewer system.

and

• Halton residents who have not experienced flooding but would like to correct improper storm water connections and install a backwater valve.

A surcharge is an overloaded sewer as a result of severe rainstorms. The sewers become overloaded due to excessive water flow from downspouts, weeping tiles/Foundation Drains and sump pumps that are connected to lines designated for sanitary sewer flows.

A backwater valve is a valve installed where the main-sewer clean out is located. The Mainline Fullport backwater valve is the only one that can be used in Ontario. It allows the sewer line to still vent gasses caused by positive or negative pressure, but will close to protect the home in the event of a surcharge.

What Subsidy Amounts Are Available to Homeowners?

Disconnection of Downspouts that used to tie in to the weeping system then into the sewer: ½ of all costs up to a maximum $250.

Weeping Tile Disconnection/Sump Pump Installation: ½ of the invoiced total by the contractor up to a maximum of $1,800.

Backwater Valve purchase and installation: ½ of the invoiced total by contractor up to a maximum of $675. In order to qualify for the Backwater Valve portion for the subsidy homeowners must demonstrate they do not have any downspout or weeping tile/foundation drain connections to the sanitary sewer.

The funding available for the Basement Flood Prevention Subsidy is limited and will only be distributed while funds last. This funding is also on a first come, first-served basis so be expedient in the process if you wish to take part. Would be participants start with a Household Drainage Survey to evaluate the extent of the work to be done and eligible subsidy amounts. It is worth mentioning that if you do proceed with the program reimbursement is not provided for interior finishes such as drywall, paint or flooring or exterior restoration such as landscaping, gardening, porches, decks concrete or asphalt etc;

Should you wish to proceed with this process you should contact the Program Coordinator Matt Stefanik at 905-825-6000 ext. 7918. The link below will provide all of the specific details on the Basement Flood Prevention Subsidy program. This generous offer from the Regional Municipality of Halton is time sensitive. Should you have concern about your basement flooding, call soon.

CLICK HERE for Basement Flood Prevention Subsidy Program Details Specifics

Residential Real Estate Reefer Madness – How to Avoid Purchasing a Grow House

We are often told that there are three important things to consider when purchasing a property: “Location, Location, Location”. While this carries considerable weight, I would like to add “History, History, History” to the list. The history of any given property can have a substantial impact on a property’s value, especially if that property has been a marijuana grow house. It is the responsibility of any homeowner or Listing Agent to disclose any Latent Defects of a home – known flaws in the property not easily discovered by a thorough inspection — to potential purchasers. This latent defect is in fact a stigma that must be disclosed to future buyers if you decide to purchase the former grow house.
This is why:

Marijuana grow houses pose considerable health and security risks to potential buyers. Often these homes have had the wiring altered by non-licensed “electricians” to meet the excessive power requirements. These alterations range from illegal power hook ups to increase supply – which overloads the electrical system — to cutting the power meter to avoid detection. Often a dangerous fire hazard for would be inhabitants.

Indoor marijuana cultivation demands excessive amounts of water. Plumbing is frequently altered to meet this requirement. Excess moisture is often improperly vented into the attic where, in the short term, it can generate dangerous levels of mould and spores in the attic and throughout the house – a considerable health risk. In the longer term excessive moisture in the attic can compromise the structure of the very roof and home. The growing process also creates noxious gasses which compliment the use of pesticides. Air quality can remain poor long after a grow house is shut down, contaminating the walls, carpets and ceilings.

Add to the this list the fact that the foundation is often damaged when electrical hook ups are altered behind meters and floor joists and load bearing walls are cut and removed to allow the necessary alterations. It quickly becomes clear that there is extensive and expensive damage done to the average marijuana grow house which is why the stigma must be disclosed. According to the Insurance Bureau of Canada (2004), the average claim to repair the damage caused to a former marijuana grow house was $41,000.

An identified marijuana grow house is often given a “prohibit occupancy” order until a plan of remediation of the property can be executed and inspected. Should the plan be accepted and executed to allow occupancy it may prove challenging to find mortgage financing. It is much more simple to avoid the whole situation, but how?

Using a Realtor that is familiar with the physical signs of a marijuana grow house is a good place to start. According to the Canadian Real Estate Association CREA these signs include but are not limited to:

mould where ceilings and walls meets in corners, signs of irregular roof venting, painted concrete basement floors with rings showing through where pots once rested, electric meters that have been tampered with (including the ground around the meter), modified wiring outside the home, brownish stains around the soffit bleeding down/along siding, concrete masonry patches or alterations on inside of garage, patterns of screw holes in walls, alteration of fireplaces, front door dented (police forced entry).

Should you be considering purchasing a home in Burlington, Oakville or other parts of Halton Region that you suspect may have been a marijuana grow house, you have a great resource provided by the Halton Regional Police Services, a list of Identified Marihuana Grow Houses dating back to 2004:

Click here for list.

This list is dynamic and I am unsure how frequently it is updated, so should you suspect a potential property that you are considering purchasing and it does not show up on this list contact them directly 905-825-4747. Knowledge is key in the battle against marijuana grow houses.

Should you be looking for further information on the battle against marijuana grow houses in Ontario be sure to tune in to catch Mike Holmes on the season premiere of Marketplace on the CBC Friday January 8th, 2010 at 8:30pm EST.

Click here for Mike Holmes Marketplace Preview

Halton Region H1N1 Flu and Seasonal Flu 2010 Clinic Schedule

The H1N1 Flu pandemic created quite a stir in Halton Region and the rest of the world. Although there has been criticism of everything from the production to the administration of the vaccine, it seems to me that the Region of Halton has done a good job vaccinating those that wanted the H1N1 vaccine. I am the proud father of 1 year old identical twin boys. They were on the early list of those allowed to receive the vaccine. My family and I spent a solid hour and fourty five minutes patiently waiting for the vaccine, which can seem like an eternity with two toddlers that do not like to sit still. The volunteers at the Halton Regional Centre on Bronte Road provided water and colouring books for those in line to make it a pleasant as well as efficient experience.

It is January 7, 2010 and the Halton Region re-opens their flu immunization clinics today. Halton Region’s flu immunization clinics are offering the H1N1 and seasonal flu vaccine. These vaccines are being offered to those that want them over the age of 6 months. Please go to the link below in order to review the clinic schedule.

http://www.region.halton.on.ca/health/services/communicable_disease/H1N1/clinics.htm

In order to continue the smooth and efficient administration of the vaccines in Halton here is what you can do to help as an attendee:

• Wear a short-sleeved shirt
• Be prepared to present your Ontario Health Card/Driver’s License
• Be on time, the clinic doors close promptly on schedule – those inside the doors will be immunized
• Come prepared for: weather as you may be outside in line (umbrellas/blankets), your children’s needs – bring books, toys, snacks/drinks etc;

Following the immunization, the Region of Halton has a couple of suggestions on how to keep yourself and your family from getting sick:

• Wash your hands often with soap and water for 15 seconds or use a 60-90% alcohol based hand sanitizer
• Try not to touch your eyes, nose or mouth with hands that have not been washed/sanitized
• Should you have flu-like symptoms please stay home and get better
• Cough or sneeze into your upper sleeve or a tissue, not your hand, and disgard tissue immediately and clean your hands
• Keep commonly touched surfaces clean and disinfected

We have all done a great and responsible job to combat the H1N1 flu virus, lets continue to do our part.

The New HST: What It Means To You.

July 1, 2010: Be sure to note that date in your Blackberry, iPhone or gadget du jour. This is the date that the new provincial harmonized sales tax (HST) is set to come into effect. In the simplest sense the HST combines the 8% PST and the 5% GST into one 13% HST. This extra 8% will apply to a list of goods and services that were previously exempt from PST.

One large item of interest will be new construction homes. New construction homes have been subject to GST since its introduction in the early 1990’s. The government did create a GST Rebate to first time home buyers of new construction to help ease the burden. With the introduction of the HST, there is an additional 8% tax added onto the price of a new construction home.

To help offset this cost, the government has created the New Housing Rebate. The rebate will be 75% of the provincial portion of the HST payable on the purchase of a new home, up to a maximum rebate of $24,000 (i.e., $400,000 purchase price × 8% provincial component = $32,000 ×75% rebate = $24,000). This results in a maximum rebate of $24,000 if a vendor spends $400,000. A recent update in legislation has made the rebate available to homes of any sale price, to a maximum of $24,000.

What will the HST mean to Ontario resale home purchasers and sellers?
Should you be purchasing or selling a home on or after July 1, 2010, it makes sense to budget an additional 8% more for legal fees, moving costs, real estate commissions, appraisals and home inspection fees to name but a few. The Ontario Real Estate Association estimates that an additional $1,449 in new taxes would be added to a transaction for a home valued at $302,354. This is estimated to add $262 million in new taxation of resale homes annually in Ontario. Even if you are not planning a move in the next couple of years, all homeowners need to take note.

The 8% PST increase in taxation will apply to services required to maintain your home as well. Many of these services would have previously been exempt from PST including utilities, home renovation labour, landscaping, snow removal and more. Should you be renting, you may think that the HST increase would not apply to you. Please take a step back and think about whether your landlord will be willing to take an 8% increase in operating costs or whether he or she might pass as much of that along to you as possible. In fact, condominium residents will experience a similar effect with maintenance fees as these 8% cost increases will need to be passed along or eventually eat away at reserve funds.

Love it or Hate it, the HST is going to be a Canadian reality as of July 1, 2010. (I have an idea which way you might be leaning.) Be aware of the looming increased costs and make smart decisions with the money you have in hand.

Please feel free to call me direct if I can be of any further assistance: 905-330-1241.

PODS: An Innovative Moving Solution.

From time to time on this Blog, I like to highlight some valuable services that I have personally experienced and consider quite useful. As my licensed assistant, Natalie Chapman, is an Accredited Staging Professional (ASP), we often provide staging advice to our clients. A common challenge in preparing a home for market is the need to pare down the owner’s belongings. One of the fantastic tools that my team likes to use are PODS, or Portable On Demand Storage for many of my clients.

PODS will drop off the correct sized POD — 7’, 12’ or 16’ — to the initial site of your move and then wait for you to tell them when it is convenient to have it picked up. You pack the POD, although packing services are available, and then put your own lock on it. A simple phone call will arrange pick up of the packed POD. You can have it delivered to the new location immediately or store the POD until it is convenient to take delivery of the POD and its contents. Should you be selling your current home with a layover period before possession of your new home, this service is for you. Access to your POD can be arranged while in storage with 24 hour notice. This truly unique answer to the problem of clutter in homes is fantastically flexible and cost effective.

While Staging is much more than simply de-cluttering, it is an important part of the process. PODS can make storage and de-cluttering a simple process. You can obtain a quote from their website www.pods.com or call 1-866-229-4120. All of my clients are eligible for a discount on PODS which I am more than happy to pass along. Good luck and Happy De-Cluttering!

Is It Too Late To Maximize The Home Renovation Tax Credit (HRTC)?

I imagine with the time of year, you’ve been likely more focused on gift giving than receiving.  I wanted to take a moment to ensure you are well aware of the gift the Federal Government has wrapped up for Canadian homeowners.  Keep in mind that unlike the Holidays which have come and gone with considerable speed, there are still two months left to take advantage of the Home Renovation Tax Credit (HRTC).  You may have heard mention and not taken a good look into the HRTC.  Please review the details below as you may be eligible for a tax credit.

Here is how the HRTC works:

-A non-refundable tax credit on eligible expenditures for work performed or goods acquired after January 27, 2009 and before February 1, 2010.
-Based on 15% of eligible expenditures greater than $1,000 but less than $10,000.
-Maximum “non-refundable” tax credit: $10,000 – $1,000 = $9,000 x 15% = $1,350.
-All of the eligible expenditures must be supported by receipts, so be sure to hold on to them.
-Here is a brief list of eligible expenditures under the HRTC: Renovating a Kitchen, Bathroom or Basement, Windows & Doors, Carpets & Flooring, Upgrading your wiring from 100 to 200 amp service, Painting Interior/Exterior Walls, Re-shingling a Roof, New Driveway, New Furnace or Air Conditioner, Installing a Permanent Pool or Hot Tub, New Fence, New Deck, Additions and more.
-All associated costs of installation, equipment rentals, permits, professional services and incidental expenses also count towards the HRTC calculation.
-Ineligible Expenditures include but are not limited to: Purchasing tools, Cleaning carpets, Financing Costs, House Cleaning and Maintenance Contracts.
* Subject to Parliamentary approval
As this “gift” from the Federal Government is a limited time offer, 2009/early 2010 is a great time to take advantage of the Home Renovation Tax Credit while simultaneously increasing the value of your home and doing your part to help jumpstart the Canadian Economy. I would be happy to discuss any work you might be considering at your convenience. Be sure to confirm the eligibility of your expenditure at www.cra-arc.gc.ca/hrtc  or by calling 1-877-959-1272.  These types of gifts do not come along everyday, so be sure to see if you might benefit from the HRTC.  Thanks for checking in!

Welcome

And thanks for stopping by our blog!  We are really excited about having a forum to connect with others who share our passion: Residential Real Estate!  We hope to provide you with all of the information and advice that you could want about the Burlington, Oakville and West Mississauga real estate markets.  And you may find some advice as well.

Who Are We?  Ryan & Natalie.  More specifically?

Ryan Davison, Salesperson with Re/Max Realty Enterprises Inc; Brokerage: Ryan decided to leave his role as a Regional Vice-President in investment sales to follow his passion in real estate in 2007 and has never looked back!  And, he’s got the awards to prove it.  In his first year, Ryan earned a spot in  the Re/Max President’s Club.   In 2009, he joined the ranks of the Re/Max 100% Club.  For fun?  Ryan enjoys boating, fishing and football.

Natalie Chapman, Licensed Assistant to Ryan Davison; ASP : Natalie joined Re/Max Realty Enterprises in 2005 and spearheads print, digital and online marketing for Ryan Davison and davisonhomes.ca.  Very excited about the prospect of building a network via the 905 West Word blog, Natalie will be collaborating with Ryan on both content and creativity.  For fun? Natalie enjoys running, writing and reading.