DID you know that real estate commissions are considered negotiable? ....

Real Estate Commissions

Did you know that real estate commissions are considered negotiable? That being said, there is a standard that many real estate professionals use when it comes to what commissions they require based on the services they offer. The general consensus among Edmonton REALTORS® is based on 7% - 3.5% on the first $100,000 and 1.5% on anything over $100,000 for both the buyers agent and  the sellers agent.
What's All The Buzz About "Flat Fee" MLS® System Services? Some companies have started offering "flat-fee" or low fees for listing services from agents, however, we advise to be weary of these "selling tactics" as in many scenarios a lower commission rate can result in less service from your seller agent. Be careful and read through the fine print - as often times, the savings may cost you in the long run.
What Is Included In The Commission Structure? When the Sherri Naslund team lists your Edmonton Home - we pride ourselves on the service and value we provide to you as our client. We work with you to sell your home in a timely manner, for the best price possible through smart marketing initiatives. We will spend the time and energy needed to showcase your home in the right light to potential home buyer's. By requesting a Free Edmonton Home Evaluation from us, we will visit you in person to discuss the service and commission options available to ensure a great sale.
When Do We Discuss The Fees Involved In Selling My Edmonton Home? Prior to assessing a fair commission structure, my team will want to perform an in-person home evaluation. During the home evaluation, we can take the time needed to assess the services that your home will require to ensure selling success. We will also discuss how hands-on or off you would like to be during the entire selling process. Once we determine the services that you will want included, we can determine a fair commission structure and create a win-win situation for everyone involved.  Remember - there is a fine balance between focusing on service value and price. A lower commission structure - may not always result in a "higher" net rate of return.
Can We Negotiate A Buyer Agent's Commission As Well? Typically this is not recommended. Why? In order to be marketable to other agent's buyer's, it is important to remember that an Agent will always try to steer their client to a home that not only will be what the buyer is looking for, but also one were the agent makes their desired income. Imagine if there are two homes on the same block - with virtually the same features. The only difference is that one house is offering the buyer's agent 2.5% on the first $100,000 and 1% on the remainder versus the other home that is offering the standard. If you were that agent, which one would you try to promote more to your clients?

Click to get access to Realtor Website...
www.sherrinaslund.com

Remax Agent

Over Half of Younger Canadians Plan to Buy Next Year

RBC poll finds over half of younger Canadians plan to buy next year

TORONTO, April 7 /CNW/ - Over half of young Canadians (55 per cent) believe that it makes sense to delay a home purchase until next year, 10 points higher than the national average, and almost half (46 per cent) of younger homeowners admit that their mortgage is using up too much of their income, according to the 18^th Annual RBC Homeownership Study.

"In a more balanced housing market, it makes sense that younger and first time homebuyers are waiting to assess all of their options and do their research before buying a home," said Bernice Dunsby, director of Client Acquisition,Home Equity, RBC. "It's also important to get expert advice on what you can afford and leave yourself with a little extra wiggle room in your budget so you don't become house poor, as home maintenance and lifestyle costs can add up."

The poll found that younger Canadians are more likely to purchase a home than other age groups, as 43 per cent (aged 18-34) are looking to buy in the next two years, compared to the national average of 29 per cent. Older Canadians are much less likely to buy in the next two years, including those aged 35-54 (29 per cent) and over-55 (17 per cent).

When looking for advice on purchasing a home, younger homebuyers (aged 18-34) are more likely to use real estate websites (55 per cent) or family (48 per cent) and friends (35 per cent). The majority of older Canadians, aged 45-54 and over-55, are more likely to rely on a real estate agent as their choice for advice, at 71 per cent and 74 per cent respectively. "Being prepared and working with a mortgage specialist will help you buy with confidence and give you expert advice on current financing options," added Dunsby. "Having a mortgage pre-approval is a critical component of buying a home, particularly for younger homebuyers. It presents you as a serious purchaser to both realtors and sellers."

According to the poll, younger Canadians (aged 18-34) are most concerned about having a good down payment (23 per cent) and rising real estate prices (23 per cent) when looking to buy a home. Canadians aged 35-54 are most concerned with rising prices, as 24 per cent are worried about mortgage rates and 25 per cent about home prices increasing. Canadians over the age of 55 list increasing home prices (36 per cent) as their biggest worry when deciding to purchase a home.

While 43 per cent of younger Canadians (aged 18-34) are paying off their mortgage faster than they expected, two-thirds (66 per cent) say it is larger than they would like it to be.

What types of homes are Canadians looking to buy? (according to the 18th Annual RBC Homeownership Poll):

Younger Canadians (ages 18-34)

• Detached house 59 per cent
• Condo/loft 15 per cent
• Semi detached house 10 per cent
• Townhouse 10 per cent

Mid-range Canadians (ages 35-54)

• Detached house 71 per cent
• Condo/loft 10 per cent
• Semi detached house eight per cent
• Townhouse seven per cent

Older Canadians (55 and older)

• Detached house 68 per cent
• Condo/loft 15 per cent
• Semi detached house five per cent
• Townhouse five per cent

Housing Starts Moved Higher in March!

Housing starts moved higher in March

OTTAWA, April 8, 2011 — The seasonally adjusted annual rate¹ of housing starts was 188,800 units in March, according to Canada Mortgage and Housing Corporation (CMHC). This is up from 183,700 units in February 2011.

“Housing starts moved higher in March mostly because of increases in rural starts,” said Bob Dugan, Chief Economist at CMHC’s Market Analysis Centre. “Urban starts saw little change as the increase in Ontario’s multiples segment was off-set by a decrease in British Columbia’s multiples and a decrease in single housing starts in the Prairies.”

The seasonally adjusted annual rate of urban starts increased by 0.4 per cent to 163,500 units in March. Urban multiple starts were up by 6.6 per cent in March to 101,400 units, while single urban starts decreased by 8.3 per cent to 62,100 units.

March’s seasonally adjusted annual rate of urban starts decreased by 23.4 per cent in British Columbia and by 19.3 per cent in the Prairies. Urban starts increased by 13.6 per cent in Ontario, by 11.5 per cent in the Atlantic region and by 8.6 per cent in Québec.

Rural starts² were estimated at a seasonally adjusted annual rate of 25,300 units in March.

As Canada's national housing agency, CMHC draws on more than 65 years of experience to help Canadians access a variety of high quality, environmentally sustainable and affordable homes. CMHC also provides reliable, impartial and up-to-date housing market reports, analysis and knowledge to support and assist consumers and the housing industry in making informed decisions.

5N Plus completes acquisition of MCP Group in $317-million cash and stock deal

MONTREAL - 5N Plus Inc. (TSXV:NP) completes acquisition of MCP Group SA, world's leading producer and distributor of bismuth and bismuth chemicals in $317-million cash and stock deal; also completes bought-deal public offering of some 13.6 million common shares at $9.20 per share for total proceeds of $125 million.

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Tembec to build $8.4 million pilot plant for

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CONTACT EDITOR

Still have some 35 and 40 year amortizations!

Yep, that is right! Some lenders for conventional mortgages, so 80% loan to value or less, are offering the higher amortizations! Some with out an appraisal cost as well. This is good news for some first time home buyers with cash to put down, but they would prefer lower payments, or maybe this is an investment property for a seasoned buyer that would want to take advantage of the lower payments!
For the insured mortgages, the 30 year amortization is now the norm... but having this option if you want to have more down, or have more equity,  is a nice silver lining that is staying around I think for awhile. With rates going up again and the housing marked really picking up steam, options are always a good thing!

1st Time buyers contribute to strong upward momentum in residential housing markets

Driven by the threat of higher interest rates down the road, first-time buyers are contributing to strong upward momentum in residential housing markets across the country, according to a report released yesterday by RE/MAX.

The RE/MAX First-Time Buyers Report, highlighting trends and developments in 19 major Canadian centres, found that low interest rates and balanced market conditions have provided significant impetus in 2011, particularly at lower price points.

Just over 30% of markets are reporting sales in excess of 2010 levels as a result, while almost 70% have experienced an upswing in average price.

Leading the country in terms of percentage increases in the number of homes sold are Western Canadian markets, including Saskatoon (up close to 15%), Greater Vancouver (up close to 12%), and Winnipeg (up just over 11%). With an average price hike of close to 20% year-to-date (February), Greater Vancouver continues to show unprecedented strength, followed by Hamilton-Burlington (8%), Quebec City (7%), Winnipeg (close to 7%), Greater Toronto (5%), and Greater Montreal (5%).

Click this link to see Remax article and video
http://www.remax-oa.com/media-newsroom/article/65/

Difference between debt in Canadian and the US

Last week CIBC Chief Economist Ben Tal appeared on BNN discussing the quality of Canadian debt and the difference between debt in the Canada and the US.

Click here to watch the BNN link: 
http://watch.bnn.ca/#clip441031

IRD PENALITY COMPARISON RATES

IRD Penalty Comparison Rates

The much-unloved Interest rate differential (IRD) penalty is a mystery to most of the natural born population.
People loathe it, largely because they don’t understand it. We continually come across folks who read their entire mortgage contract and are still confused by the IRD calculation.
Fortunately, federal disclosure guidelines are on their way later this year. These guidelines are supposed to standardize the explanations of IRD penalties to make them more comprehensible.
There is one element of the IRD calculation, in particular, that gets people all tied in knots. It’s called the “comparison rate.”

Here’s a real-life example of how the comparison rate can spoil your day:  Customer fee to pay out mortgage doubles (CBC News).
The story features a regular guy (Mohsen Movahed) who learned how to calculate an IRD penalty…the hard way.
It seems Movahed relied on a penalty quote, only to find some months later that his penalty had doubled.
The culprit, says his bank, was the comparison rate used in the IRD calculation.
A comparison rate is the rate a lender compares to your current contract rate in order to calculate the IRD penalty on a fixed-rate mortgage.
The comparison rate is usually the lender’s rate for the term that most closely matches your remaining term.
For example, if you have 22 months remaining on your fixed mortgage, a lender will typically (there are exceptions) use a 2-year term as your comparison rate.

The kicker is that banks often subtract the discount you received at origination from their posted (comparison) rate—which makes the interest rate differential and penalty even worse!
Some lenders use bond yields for their comparison rates (example). This method can sometimes be far more costly depending on yields and mortgage spreads.
Conversely, some non-bank lenders use regular discounted rates for their IRD calculations, which can be more favourable for the customer.

In any case, Mr. Movahed discovered that the comparison rate can drop considerably as time goes by. That drop can boost the interest rate differential and cost you thousands more.
As a sample test, we ran a quick penalty calculation for breaking a hypothetical $250,000 mortgage. Our example was based on actual historical and current bank rates. It assumed the customer had about 2.5 years remaining on their term and had received a 1.50% discount off posted rates.
Depending on the effective date of the penalty calculation, a bank could quote the penalty based on either a 2-year or 3-year comparison rate. That’s relevant because the penalty difference between these two comparison rates (as of today March 24, 2011) is more than $3,700!
In other words, if our hypothetical customer waited until she had slightly less than 2.5 years remaining in her term, the bank could apply the lower 2-year comparison rate (instead of a 3-year) and her penalty would increase 28%.  (A lower comparison rate makes the IRD bigger.)
The moral is that timing matters when calculating an IRD penalty. A good mortgage advisor can help you plan properly to minimize the IRD, if and when you have to pay it.

---

Rob McLister, CMT

Coming into a BOOM!

 

Real estate analyst says Edmonton on the verge of a boom

 

 

By Bill Mah, edmontonjournal.com April 5, 2011 Comments (32)

 

 

• Story
• Photos ( 1 )

 

 

A sold sign is shown in front of a home in south Edmonton. The city is on the verge of another real estate boom, says real estate expert Don Campbell.

Photograph by: Ed Kaiser, edmontonjournal.com

EDMONTON - Edmonton is on the verge of another real estate boom, says real estate expert Don Campbell.
Robust growth in the region’s gross domestic product and labour market will set off a chain of events over the next few months that will heat up housing again, said Campbell, president of Real Estate Investment Network and the author of the best-selling 97 Tips for Canadian Real Estate Investors. (He donates his royalties to Habitat for Humanity.)
“Alberta is uniquely positioned in the world to be a stable, consistent and growing source of the four things that the world is going to need over the next decade — food, fuel, fertilizer and forestry,” Campbell said during a stop Monday in Edmonton.
Jobs will attract more people to Edmonton from across Canada. That will push vacancies down and drive rents up.
In turn, more people will buy homes.
“The jobs are already starting and the in-migration is already beginning,” Campbell said.
“Eighteen to 24 months from now we’re going to see multiple offers. We’re going to see vacancy rates down as low as 2007, we’re going to see rental increases and we’re going to see the market turn back into a seller’s market.
“I’ve studied this for 19 years and I have not seen this strong of a perfect storm before.”
Campbell didn’t want to forecast prices or rents, saying it would be a guess, but “you can easily see 10- to 12 per cent increases in rents. Rents will go up first and values will go up second.”
His tip for homebuyers: “I suggest that you don’t wait until the frenzy is here because then you’ll be frustrated, putting in multiple offers. Right now you can see it happen and if you know you’re going to be buying in the next year or year-and-a-half, and the interest rates are so low right now, now is a wonderful time to start looking and identify the right neighbourhood.”
Campbell says neighbourhoods within walking distance — 50 to 800 metres — from LRT stations and areas to be serviced by the regional ring road such as Castle Downs, St. Albert and northeast Edmonton — which he says will eventually resemble southwest Edmonton — are good areas to buy or invest.
Premier Ed Stelmach said in March the northeast quadrant of the Anthony Henday Drive ring road has been given the green light and is expected to be completed by fall 2016.
If the arena district goes ahead, interest will also pick up in the surrounding, older areas in the inner-city, Campbell said.
“As a homeowner, you think like an investor: Where’s going to be a spot that’s going to do well that I’m also happy to live in?”
For homesellers: “If you have the chance to wait, you might want to hold off a little bit. If you think you want to maximize your dollar, now might be a little early.”
bmah@edmontonjournal.com
twitter.com/mahspace

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