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Ten Tips for Fix and Flip

Wed, 23 May by melodykilbank

From my own personal experience, I have learned some tips to help you succeed when you buy a property to fix and flip. Here is my Top 10 list.
1. You don’t have to be a handy man. But you do have to have the ability to give overall direction to a large project and see the big picture.
2. Choose your location well. Good neighborhoods always make for a better resale value.
3. Avoid the weird and whacky. A good floor plan is also good for resale. If you view a house which has oddities that can’t be fixed, this is a deterrent to potential buyers.
4. Hire a decorator/designer to give you advice on color/finishes. Don’t rely on your own choices. Professional color choices don’t require more time and they show and sell much better.
5. Do your numbers ahead of time. Work with a template and calculate all foreseeable costs, including carrying costs. Add a little extra for the unpredictable.
6. Work with an experience REALTOR® who knows the buying market and selling market. They can give you the best advice from current market statistics for your purchase price and resale price. They also may have referrals to reliable trades.
7. Establish a timeline for your work projects and use that as a guideline for lining up your trades. Try to get measurements and have your designer/decorator view the property prior to possession.
8. Time is money and anything you can do to overlap projects saves time.
9. Always think RESALE, not personal preference.
10. Quality work is rewarded in the purchase price. Buyers notice details. Don’t take short cuts.
Call me to help you with your purchase or sale! My marketing strategy is aggressive, and it got my selling clients 95.9% list to purchase price in 2017.

Spring has NOT Sprung in Edmonton!

Wed, 04 Apr by melodykilbank

Spring has NOT sprung in Edmonton as yet! Typically by April we start to see a lot of buying and selling activity in the real estate market. This year seems to be an exception. Anecdotally, the cooler temperatures, snow falls, and early Easter seem to be the causes.
That being said, the City of Edmonton has seen a small drop in the number of months of inventory, month over month, in all product categories for March 2018.
Also prices have soften in all product categories year over year. And all product categories have softened month over month with the exception of Single Family Dwellings. Average prices have increased by 1.3% for houses from February to March 2018.
What does this mean for sellers? You still have time to get your home on the market if you were hoping for a Spring 2018 sale.
For Buyers this means there is still lots of inventory to choose from and prices haven’t caught up with the typical up tick in Spring. You still have time to buy your home at Winter prices.
Make sure that whatever you do in buying or selling you are represented by a professional real estate associate. Choose me and I will save you time, money and relieve much of the stress of making these kinds of transitions.

2018 Market Predictions

Thu, 01 Feb by melodykilbank

Every year I look forward to the REALTORS® Association of Edmonton Annual Housing Forecast Seminar. It gives us a picture into the coming year about prices and market activity.

My summary of the predictions is simple. It’s going to be a flat year for Edmonton and area real estate.

 

Here are the predictions.

The NUMBER OF SALES, Single Family Dwellings are up .88% while PRICES are expected to soften by .9%.

Condos are predicted to fall 2.4% in NUMBER OF SALES while PRICES may drop by 2%.

Duplex and Rowhouses are up 3.74% in NUMBER OF SALES while PRICES will only increase by .2%.

All residential, for NUMBER OF SALES may increase by .73% while PRICES are expected to drop by .9%.

The story behind some of these numbers is the INVENTORY, which is expected to increase by 1.96% for Single family dwellings, 4.42% for Condos, and .68% for Duplex and Rowhouses.

 

What does all this mean? 2018 will be a great time to buy a condo. There will be stable prices for houses on both sides of the transaction. If one is downsizing from a house to a condo, you won’t see inflated pricing with your sell, but will get a good deal on your purchase. And the starter home market of duplex and rowhouses will be the hot spot of the market.

Rental Market Report Summary

Wed, 20 Dec by melodykilbank

Canada Mortgage and Housing Corporation (CMHC) has published it’s findings for the rental market research for 2017. “Vacancy rates move lower as improving labour market conditions and positive international migration have contributed to stronger rental demand.” says Lai Sing Louie, Regional Economist for Prairies and Territories.

Alberta urban centre rental vacancy rates were down to 7.5% in October 2017 from 8.1% in October 2016. However vacancy rates in Edmonton have remained relatively unchanged.

Rental rates in Alberta have declined for the second year in a row. Down by 1.1% in 2017 and previously in 2016 down by 5.0%. The average 2 bedroom rental in Edmonton was $1215.

As our economic conditions recover, it is the international migration that has had a positive effect on Alberta. We continue to attract people from other countries to live, work, and develop a life in our City. This ultimately effects where and how people live.

The Edmonton vacancy rate for 2017 is 7%. Bachelor suites are 7.3%, 1 and 2 Bedroom apartments are 7.0% and 3 Bedroom apartments are 5.9% vacancy rated.

So all this means to landlords is the year ahead may not see much cash flow increase in your investment but with all real estate, principle pay down will be your greatest reward this past year!

Benefits of Homeownership Go Beyond Wealth Accumulation

Wed, 24 May by melodykilbank

I posted this great article regarding the positive effects of home ownership to my FB page (Melody Kilbank REALTOR.) https://www.canadianmortgagetrends.com/2017/05/case-for-homeownership/
Buyers are up against some affordability challenges. Not just in the Toronto and Vancouver markets, but all over the country. And not just because of home prices. The Government’s new regulations regarding mortgage qualifying rates has hurt first time home buyers.
The author of the article, Sean Speer*, summarizes the major social and economic benefits to home ownership. He summarizes several studies over the past 5 years which have shown home ownership makes our communities great! I found this information enlightening. Home ownership benefits:
• Creates upward mobility for children by providing a more stable home
• Greater participation in social and political activities
• Greater number of children finishing high school and post secondary education
• Reduces criminal activity over time
• Negative effect on violent and property crimes
• Better quality of home life, greater cognitive abilities, fewer child behavior problems
• Raises educational attainment, earnings and welfare independence in young adults
“…the evidence shows that the benefits are not just limited to homeowners. Society benefits when families have access to affordable, responsible homeownership and thus government policy should continue to support it.” Sean Speer*
Call me if you know someone who would like to be a part of this kind of positive change!

*Sean Speer, Government policy specialist, … previously served as senior economic adviser and special adviser to former prime minister Stephen Harper …has written extensively about federal policy issues

Here’s the Scoop on the Rebates!

Thu, 04 May by melodykilbank

We’ve all been awaiting the Government of Alberta’s incentives to recoup some of the expenses we are now paying because of the carbon tax. The news was released this past week. Here is a quick summary. There are currently 3 areas of savings.
1. Instantly at the till on energy efficient products such as, LED light bulbs, programmable thermostats, lighting control switches, power bars, motion sensors, timer, clothes lines and low flow faucets. YOU MUST ACT QUICKLY as these savings are available until June 11 ONLY.
2. Home improvement rebates are available for insulations, windows and tankless hot water heaters. You must use their contractors and they will walk you through the savings and process.
3. Online rebates are available on refrigerators, washer and smart thermostats. $100.00 per appliance. Filling out an application and submitting a receipt gets you some money back.
For more information visit https://www.efficiencyalberta.ca/. A list of stores, contractors and retailers is provided.

A 4th area of savings is still in the works, and is to roll out this summer. Solar energy! The Government is still seeking a third party to deliver a program!
Happy savings!!!

Real estate is a key part of an improved economy in Alberta!

Thu, 30 Mar by melodykilbank

TD Economics has reported an update to the GDP predictions for 2017-2018. “Alberta is expected to move from the worst performing provincial economy in 2016 to the best in 2017 and 2018 with economic activity expanding by more than 2%.” (March 27, 2017)
Economists* are attributing a key part of the improved growth story relates to housing. More specifically residential construction is on the rise.
By 2018 Alberta and Saskatchewan are at the top of the GDP list with both provinces seeing a stronger 2017 than 2018.
Their prediction for oil prices is that it will hold at current levels until late in the year and into 2018 when prices are expected rise up to mid US$50 per barrel. This uptick in oil will have a spill over effect in boosting manufacturing, transportation and engineering construction.
Another contributing factor to the rise in spending is the reconstruction in Fort McMurray.
Overall Canada’s GDP will also be stronger in 2017 than 2018.
Reports such as these from experts, give hope to hard working Albertans! More reports like this will increases the consumer confidence and provide more stability for real estate purchasing and investing.
2017 is predicted to be a stronger year. So if you are thinking of buying or selling NOW is the time to put your plans into action. Call me for any residential real estate service you require!

 

* Beata Caranci, VP & Chief Economist, Michael Dolega, Director & Senior Economist, Dina Ignjatovic, Economist

Increase your annual income by owning a home!

Mon, 27 Feb by melodykilbank

Alberta Real Estate Association’s January Report says that your home is one of your best long term investments! Check out these statistics and be encouraged!

“January 2017
Homes provide shelter and refuge, but they are also most Albertan homeowners’ single largest investment. Housing represents 47% of total assets for the average Alberta family – much higher than stock market investments and pension plans combined (29%). Why is this important? Because homeownership benefits the economy as a whole, as well as individual homeowners. Let’s look at this in the context of the most recent stats on Alberta’s real estate, reported by the Canadian Real Estate Association.
Investing in housing in Alberta is better than buying stocks
Over the last 18 years, house price appreciation in Alberta has outpaced Toronto stock market returns. Between 1999 and 2016, with average annual residential sales of roughly 57,000, house price growth in Alberta (6.6%) outpaced yearly returns on stocks traded on the Toronto Stock Exchange (6.4%).

Average residential prices up 3.1% in Alberta in January
Total residential sales across the province were up 17.7% year-over-year, totalling 2,679 resale transactions in January 2016. Roughly 3.4 out of every 10 newly listed homes were sold, translating into a sales-to-new listings ratio (SNLR) of 34%. And the average residential sales price rose 3.1%, to $383,040.
Increased home equity = increased net worth
What’s so great about house prices being up? Rising house prices mean homeowners are building equity in their homes. Home equity represents the current market value of the house, minus any remaining mortgage payments. Equity is built over time as the homeowner pays off their mortgage and fluctuates with the market value.
Rising home equity benefits homeowners individually, and the Alberta economy as a whole. By how much? More than $40 billion in 2016.

Calculating Returns to Equity
Using Statistics Canada’s data on Alberta homeowners’ mortgage balances (Surveys of Financial Security), we calculated equity shares by age group. Equity shares multiplied by user costs (average two-bedroom apartment rents used as proxy) provided the income generated (returns to equity) per homeowner, by age class. The annual income generated by homeownership was then derived by multiplying the number of homeowners by age group in Alberta with returns to equity per homeowner.

For those under 35, the income generated by homeownership reached $11,000 a year per homeowner
Over the past five years (2012-2016), the annual income generated by homeownership averaged roughly $57,000 per homeowner (all ages) in Alberta. Returns on equity per homeowner ranged from annual income generation of $11,000 for homeowners under the age of 35 (generally considered as first-time buyers), to roughly $14,000 for those above 65 (annual average).
REALTOR® Tip: First-time buyers build equity in their home as they pay off their mortgage – roughly $11k a year!
Collectively, annual returns on equity (ROE) for all homeowners in Alberta reached roughly 38 billion dollars, or 12% of GDP
Thirty-eight billion dollars a year represents roughly 12% of Alberta’s nominal GDP and 85% of Government of Alberta’s annual revenues. When people build equity in their homes, they borrow against that equity through a home equity loan, or home equity line of credit. An increase in the value of their homes increases the amount of collateral available to households, leading to higher credit. Rising house prices, which imply higher housing equity, may encourage consumers to borrow more, causing a rise in consumer spending. Looking at the data, we know this to be true.

For every $1 rise in housing prices, Albertan homeowners raise their personal spending by 6.7 cents – collectively $5 billion a year
The increase in consumer spending following a rise in in house prices has been referred to as the marginal propensity to consume (MPC) from housing wealth. We found that, for every $1 increase in average residential prices, Albertans raise their personal spending by 6.7 cents, which collectively amounts to roughly $5 billion a year (2012-2016 average).
Five billion dollars a year is 1.5% of provincial GDP, and 11% of government revenues. This is a significant boost to Alberta’s economy. A 3.1% price gain, like the one we just saw in Alberta this January, equals an average increase of $11,420. The associated rise in consumer spending that could come out of that is $868 per homeowner per month, or $10,415 per homeowner per year, or a collective increase of $616 million a year.

Regine Durand
Economist
Alberta Real Estate Association
Suite 300, 4954 Richard Road SW
Calgary, AB T3E 6L1”

Housing Forecast for 2017

Thu, 05 Jan by melodykilbank

CTV News on January 4, 6:00PM reported the forecast for housing in 2017 was “grim”. Don’t believe everything you hear on the news!
I look forward every year to attending the annual Housing Forecast Seminar put on by the REALTORS(R) Association of Edmonton. They invite several economists to present as well as our own Chairperson with predictions for the year ahead. The RAE predicts the following: Prices on average will drop a marginal 2.2% for Single Family Dwellings, 3.8% for Condos, however the Duplex Row housing market will increase by .5%. Although this outlook isn’t on the upswing, the margins are small, and may not be realized if your property is in good shape and is priced right. The rental market continues to have a 7%+ vacancy rate which is going to affect investors.
The Economists from Canada Mortgage and Housing, Government of Alberta and City of Edmonton were primarily in agreement about several things. Interest rates will stay low, oil prices will likely not change much from $53-$58/barrel WTI prices and unemployment rates are going to stay higher than usual until 2018. It is our immigrant population which is off setting the inter provincial migration so we will be at a net zero population growth over the next year.
We are in for a lean year, but not a “grim” one. If you need to buy or sell in 2017, work with a real estate professional who will be able to walk you through how to maximize your real estate investment!

Consumer Alert…Mobey Real Estate

Fri, 16 Dec by melodykilbank

Just passing on information to protect Albertans!

Consumer Alert: Mobey (Moby) Real Estate
________________________________________
Calgary, Alberta – Multiple consumers have contacted the Real Estate Council of Alberta (RECA) about the activities of a company referring to itself as Mobey (or Moby) Real Estate, in Edmonton.

Mobey Real Estate is not a licensed real estate brokerage in Alberta nor are any of the individuals listed on the Mobey website licensed as real estate professionals.

Mobey has been contacting consumers with offers of work-from-home employment opportunities. These emails frequently indicate that Mobey is recruiting assistant property managers and other similar positions. Emails ask the recipient to complete an employment contract, including providing personal information and bank account information.

RECA and the Better Business Bureau of Central and Northern Alberta are warning consumers about these employment opportunities through Mobey Real Estate, and we encourage you to send any emails you receive from a @mobyestate.com email address to your local authorities.

Consumers can find out if an individual is a licensed real estate professional through RECA’s website at www.reca.ca. Use the “Searching for an Industry Professional” tool. If you have concerns about unsolicited employment opportunities, please contact your local Better Business Bureau.

The Real Estate Council of Alberta (RECA) is an independent, non-government agency, responsible for governing real estate, mortgage broker, property management, and real estate appraisal industry professionals under Alberta’s Real Estate Act. RECA’s mandate is to protect consumers and to provide services that enhance and improve the industry and the business of industry professionals.
The authority for a positive real estate experience

Copyright © 2016 Real Estate Council of Alberta, All rights reserved.
RECA News Releases are distributed to the email addresses provided to RECA by industry members, media, and other interested parties. RECA News Releases can also be found on the RECA website. RECA sends these emails using MailChimp. Your feedback on RECA News Releases and other publications is always welcome and can be sent to communications@reca.ca

The data included on this website is deemed to be reliable, but is not guaranteed to be accurate by the REALTORS® Association of Edmonton. The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. Used under license.