Ontario tax credit for seniors

Author: Bernice McNutt  //  Category: Durham Region Real Estate

In an effort to allow senior home owners and renters to stay in their own homes longer, Ontario Legislature passed a law, on October 3, 2012, that will assist seniors in making their homes more accessible.Bill 2, Healthy Homes Renovation Tax Credit Act, 2012, will create a permanent, refundable Personal Income Tax credit to assist seniors with the cost of permanent home modifications that improve accessibility.

The credit would be worth up to $1,500 each year, calculated as 15 per cent of up to $10,000 in eligible home renovation expenses. It could be claimed by senior homeowners and tenants, and people who share a home with a senior relative. Seniors at all income levels can qualify.

Eligible expenses include renovations to permit a first-floor occupancy or secondary suites for seniors, grab bars, handrails, wheelchair ramps, installation of walk-in bathtubs and wheel-in showers, lowering counters and light switches, automatic garage door openers, etc. To view all eligible expenses and learn how to claim the credit, visit the Ontario government website.

As a vocal advocate for tax rebate for Ontario homeowners, REALTORS® supported the legislation and spoke for its support in front of the Standing Committee on Finance and Economic Affairs.

This small victory will help Ontario seniors stay in their homes longer, while encouraging the use of professional contractors.

Would you buy a house by auction?

Author: Bernice McNutt  //  Category: Durham Region Real Estate

In December, 2011 the Lakefront residences at Muskoka Warf went up for auction by Kennedy Wilson. They do hundreds of auctions each year though this is a much more popular option for real estate in other countries than it is here.

So, Evanco Homes decided to clear out their remaining inventory by a live and online auction. Minimum bids were $85,000 and $155,000 depending on the type of unit you were interested in. The kicker was that there was also a reserve bid, and most of the buyers were unaware of this little fact. There they were, all happy with a winning bid of $92,000 only to find out that they needed to pay $179,000 if they wanted the unit. In the end, 30 condos were put on the market and 12 were sold. Maybe not the rousing success the developer was looking for, but not bad considering we’re not used to buying by auction.

So, would you sit in the auction hall and bid on a new home or vacation property? Do you think you’d get caught up in the excitement. The people all sitting around you, the auctioneer talking a mile a minute, the callers in the middle who are just staring at you, hoping to get you go just one bid higher. Would you be able to stop? Sure, perhaps knowing what the other offer is would help you to bid high enough to be able to purchase the house of your dreams, but I believe that with the right advice, knowing your limit and maybe a little luck you can successfully purchase the home of your dreams even with our current, blind bidding system.

Blair and I have purchased three of our own homes in multiple offers. Every time we’ve wanted something, regardless of how many other potential buyers there were, we were successful in our bids. Why? Well, we knew the system, knew our limits and went all in. The key is that if we had lost out on the purchase we knew that we had given it our very best shot. We weren’t willing, or maybe able, to change even one thing in our offer to make it better. If we had lost, we may have been disappointed, but we would have known that we had done everything we could. And in the end, isn’t that the same as in an auction? You set your limit and are o.k. with knowing that if you lose, you did your best.

If you are thinking about buying or selling a house and you want some great advice, why not get in touch with me? I’d love to help you through the whole process, whether you are competing for a house or not.

Smoke detectors

Author: Bernice McNutt  //  Category: Durham Region Real Estate

Smoke alarms are an important defense against injury or death in house fires. The National Fire Protection Association states that nearly two-thirds of home fire fatalities happen in homes with non-working or missing smoke detectors. Most building codes now require smoke detectors in all residential structures, which has resulted in a steep drop in fire- and smoke-related deaths. Homeowners should check with their local public safety office or fire department for specific information on these requirements.

As in real estate, location is important! Smoke alarms should be in installed every bedroom, outside every sleeping area, and on each level of the home.

Alarms should be placed high on a wall or on the ceiling. It’s best to follow the manufacturer’s instructions for placement. High, peaked ceilings have dead air space at the top; smoke alarms should be placed no closer than 3 feet from the highest point.

For areas close to the kitchen, use a detector with a hush button that can be used to silence nuisance alarms triggered by cooking smoke or steam. Alternatively, consider installing a photoelectric alarm, which is better at detecting smoldering fires (vs. flames) near the kitchen. Never remove the unit’s battery to stop or prevent nuisance alarms.

There are two primary types of smoke alarm technology: ionization and photoelectric. According to the National Fire Protection Association, ionization alarms are more responsive to flames, while photoelectric alarms are more sensitive to smoldering fires. For the most comprehensive protection, both types or a combination unit should be installed.

Test the alarm monthly. Put a reminder in your calendar to do this on the first or last day of the month, for example. The units have a test button that will sound the alarm for a brief time when pressed. Any alarm that fails to sound should have the battery replaced. If the test button fails with a new battery, replace the entire detector immediately. Monthly testing is also an ideal time to dust off the unit.

Replace the batteries at least once a year. A common rule of thumb is to do this when changing to or from Daylight Saving Time in fall and spring. Some alarms come with 10-year batteries; for these, follow the manufacturer’s recommendations for battery replacement. Remember, a non-working alarm is no better than no alarm at all.

If the alarms are hard-wired to the home’s electrical system, make sure they are interconnected for maximum effectiveness – meaning that if one alarm is triggered, all of the others will sound as well. Any hard-wired alarms, interconnected or not, should be installed by a licensed electrician.

How to pay off your mortgage faster

Author: Bernice McNutt  //  Category: Durham Region Real Estate

Want to relieve yourself of mortgage stress? Check out our tips for paying off your mortgage faster and saving more money. Buying a home is a major accomplishment, but paying off your mortgage as early as possible will be the best investment you can make.

Ready to save some serious money? Here are a few easy ways you can pay off your mortgage faster:

1. Accelerated bi-weekly payments
Instead of paying your mortgage on a monthly basis 12 times per year, pay your mortgage every two weeks for a total of 26 payments each year.

Example: A $300,000 mortgage paid on a monthly basis with a 3 per cent interest rate over 25 years will cost you $125,920.44 in interest. However, if you increase your payment frequency to accelerated bi-weekly payments, you will shave nearly three years off of your amortization schedule, and save $16,058.57 in interest.

2. Round up your mortgage payments
Make no mistake: Every dollar counts when it comes to paying off your mortgage. The quicker you can pay off your loan, the more you will save in interest. A painless way to make your mortgage disappear faster is to round up your mortgage payments. So if your accelerated bi-weekly mortgage payments are $543, consider rounding up to $600 instead. The extra $57 will do wonders for your mortgage and chances are you will barely notice a difference in your monthly budget.

If you receive a raise, instead of increasing the cost of your lifestyle in the short term, consider throwing the extra amount you make onto your mortgage instead.

Example: Bi-weekly payments on a $230,000 mortgage with a 2.75 per cent interest rate over 30 years would be $468.53. Increase those bi-weekly payments by just $31.47 to $500, and you’ll shave nearly six years off of the amortization schedule.

3. Put ‘found’ money toward your mortgage payments
Unexpected sources of money such as a birthday cheque from a relative or a bonus at work are considered sources of ‘found’ money. ‘Found’ money can be easily applied to your mortgage without any impact to your budget because it wasn’t money you were expecting or counting on.

Consider increasing your RRSP contributions, and then put your tax refund directly toward the principal of your mortgage.

Example: A one-time payment of $5,000 on a $250,000 mortgage at 3.75 per cent over 30 years will decrease your mortgage amortization by over 12 months.

4. Make a lump sum anniversary payment

Most banks will allow you to make an extra mortgage payment each year, which is applied directly to the principal. Taking advantage of this by making a lump sum payment — even if it’s as small as $50 a year — is a great way to chip away at your mortgage.

Example: An annual lump sum payment of $250 on a $400,000 mortgage at 3.50 per cent over 25 years, combined with a bi-weekly payment frequency will decrease your mortgage amortization by over 3.5 years.

5. Stay informed
Once you have a mortgage and start making your payments, it can be easy to just forget about it because it’s an automatic payment. But don’t stick your head in the sand. To be an informed homeowner, you need to keep up-to-date on interest rates and new mortgage options. You could potentially save a ton of money just by understanding what your options are.

Example: Let’s say that interest rates have dropped since you took out your mortgage a few years ago, but you are in the middle of a five-year fixed term with your bank. By understanding what the penalties are for breaking your mortgage, and reapplying for a lower interest rate, you could potentially save thousands of dollars over the long run.

While paying down your mortgage early will mean less interest paid over the lifetime of the loan, and a shorter amortization schedule, it’s not always the best decision for every homeowner. For example, if you have high interest debt on a credit card, no emergency fund savings, or haven’t started saving for retirement yet, the interest you would save on your mortgage will not be as beneficial to you as dealing with other financial issues.



Armed with information and commitment, these tips will help you pay off your mortgage faster. The freedom that being completely debt-free brings is a dream for many Canadians, so take the time to do some calculations and figure out what options are right for you. If you have any questions, give me a call or send me an email! Happy saving!

Should you rent to own?

Author: Bernice McNutt  //  Category: Durham Region Real Estate

Are you thinking about how you will ever be able to buy your own home? Do you think you’ll never be able to save up for the downpayment? I’m sure you’ve seen the ads for Rent-To-Own so maybe you’re wondering if this is the way to go.

Well, let’s talk about that for a minute or two. If you look at websites that talk about renting to own you’ll likely think this option is an answer to your prayers. But things are not always as they seem. There are some options, but let’s look at one common one. You talk to someone (usually someone with lots of money) and they determine that they like you enough (you’re credit isn’t too terrible) and they agree to help you out. Basically what they do is figure out whether or not you are reasonably able to pay the high rent they are going to charge for 3 years. If you have bad credit it still may be o.k. as long as you have strong monthly income and the ability to repair your credit. They’ll also want to know if you have any money at all to give them as a downpayment or else it will be extremely difficult to ensure your end purchase is successful.

A typical senario may be like this. You meet and they agree to help you rent to own a home. You and they determine a budget based on monthly lease budget, downpayment and eventual purchase price and you go shopping for a home you like. Once you find one they will try to buy it for you (or you may choose a home they already own).

So, let’s say you qualify, have the downpayment they require and have found a home. It can take as little as two weeks to months to get you into your home, depending on circumstances surrounding the purchase of the property by your new landlord. The legal documents will be prepared, including a lease agreement, occupancy agreement and an option to purchase. You should definitely have a lawyer look over these documents on your behalf. Most leases are for a three year term and, if at the end of three years you can’t purchase the home, the landlord will consider the circumstances and decide if they will allow you to get out of your contract. You will forfeit any rent credits and deposit monies.

If we look at a typical transaction, it could look like this:
– $275,000 home in the town of your choice within the Durham Region
– Three year lease term
– Monthly lease payment of $2,100 (includes property tax, but does not include utilities, tenant insurance or maintenance – those are extras that you will pay)$350 of this monthly payment will go toward your eventual down payment.
– Initial deposit of $9,000
– Option to purchse at end of year 3 for $324,000 + typical closing costs
– Combined credits of $9,000 and $12,600 go toward eventual purchase (representing over 6%)

On the average, home prices in Durham Region have been increasing 4% per year. If that were true in the above example (taken from www.housecents.ca) a house purchased at $275,000 this year would be worth approximately $309,337 in three years, but you would be agreeing to pay $324,000 for this home. All the senario above is doing is taking your original $9,000 and holding it so you can’t spend it, then saving $350 a month for you (in a non-interest bearing account) so that you would eventually have the 5% downpayment required to purchase a house. If you talked to a mortgage broker or finacial advisor or accountant, they could all likely tell you faster ways to improve your credit and save your downpayment. For instance, if you used RRSP’s and then saved up your tax savings and then withdrew from your RRSP when the time was right, you’d be able to purchase the home of your choice with your own money and not be paying inflated rents for three years.

We haven’t even talked about what would happen if the market declined over the next three years! You’d be agreeing to purchase a home for an inflated amount that is not supported by current market values and if you walked away from the deal, you would loose the $21,600 you had paid toward the house you had been renting for three years. Do you see how this system definitely benefits the owner of the home and not you?

I’m not saying that this situation never works out. It’s been an option for years and will likely always be an option for some people. Just remember to keep your eyes wide open when you are looking into these contracts. Have a lawyer review the forms for you and check out all other options available before you sign on the dotted line.

Want more information? Please call or email me.

How small is too small?

Author: Bernice McNutt  //  Category: Durham Region Real Estate

So, I’ve written about big house and small houses and the right sized house, but these homes, designed by Tumbleweed Tiny House Company have got to take the cake!

The walk in closet in my new bedroom is just under 85 square feet. 84.84 square feet to be exact. O.k. maybe it’s a little excessive, but the bathroom and bedroom parts of the addition were already oversized, so why not afford a little more space for the closet? We will move into this space in the next few days and I’m sure that by the end of the year, the closet will be filled to overflowing and we’ll be kicking ourselves for not putting in another hanging rack.

Tumbleweed House

Just bigger than my closet!

I don’t know what we would do if we had to live in one of the houses made by Tumbleweed Tiny House Comany. There are fishing huts out on the local lake that are bigger than some of these houses. Jay Shafer, the owner, has lived in an 89 square foot house since 1997. Well, good for him! While I agree that we sometimes are a little (ok, a lot) excessive with the size of house we live in, I believe this is taking things a little too far in the other direction. How do you market this home to sell once you’ve outgrown it? Sure to cause a breakup with your girl/boyfriend after just two dates in! Save on heating oil, just use your own body temperature to regulate the heat. Too cold? Do 15 push-ups and the heat radiating off your body will warm the entire home! Electricity costs are low – only one light bulb to light up the place! Would the words cute and cozy apply to this house?

Looking at the website does get me thinking about how much is too much. Do you really need an entire living room inside your bedroom? If you can fit 4 couches in your family room, is that too big? Though Jay has taken size down to an extreme, how many of us really use the space we live in. If you have a garage, you likely have two of the exact same screwdrivers. You bought the first one so that you would have one in case you ever needed one and you bought the second one when you needed the first one, but couldn’t find it! Maybe we all need to rethink how much is too much, how much is too little and how much is just right. Looks like Goldilocks knew what she was doing all along!

What do you think? Let me know. But if you’re calling, let the phone ring a little; I don’t know where it is!

How big should your home be?

Author: Bernice McNutt  //  Category: Durham Region Real Estate

So you, your spouse, three children and mother-in-law are thinking about your ideal house. Perhaps it goes something like this; four bedrooms – the mother-in-law will have the master bedroom and ensuite so that she can have a little privacy. The two boys will share one room, your little angel will have her own room and you’ll take the final room. Since you definitely wanted two bathrooms, you sacrificed a little on living space. No main floor family room, but that’s o.k., you have a finished basement, and the kitchen is small, but functional and there’s plenty of room for family dinners in the dining room. It’s not a palace, but you’re there, you’re together and you love it!

Maybe you are able to afford a few more luxuries. A four bedroom home, three and a half baths, main floor family room, large, eat-in kitchen, formal dining room and a separate suite for your mother-in-law. You are happy here. The family is close but there is a quiet nook for reading and one on one time with each of your children. Maybe even a double car garage.

Well, if you are Mukesh Ambani, the fourth richest man in the world, you definitely don’t think either of these descriptions fit your idea of the perfect house. Instead, a cute and cozy, 27 storey building, with over 400,000 sq ft of living space and room to park 168 cars is in order. When the home was completed in 2010 it was estimated to be worth as much as US$1 billion.

When looking at homes with buyers I often hear that they want an open concept home. One where the cook can see the children playing or be a part of the conversation when company drops by for dinner. But in a home with only 5 residents and 600 employees, you are more likely to run into the maintenance staff than your Mom. With more than four floors per person you could cook, eat, clean up and sleep for weeks without ever running into your family. Hmm, on some days that might be preferable!

Thankfully there is a perfect house for all of us, sometimes it just takes a little while to figure out what our “perfect” is. But once we find it, there’s nothing like going home each day.

Student housing investment properties in Oshawa

Author: Bernice McNutt  //  Category: Durham Region Real Estate

Purchasing a home in north Oshawa as an income property does come with some restriction. Residential properties located in the vicinity of Durham College and the University of Ontario Institute of Technology (DC/UOIT) must be licensed through the Residential Rental Housing Licensing (RRHL) By-Law and they must compy with the city’s zoning by-laws.

The RRHL By-Law came into effect in Jun 2008 and it requires homes within a certain area near DC/UOIT to be licensed. Number of rental bedrooms are limited to four on all streets in the rental area.

Property owners must consider five main criteria with their houses:

1. The property may only be used as permitted under the city’s zoning by-laws.

2. An R1 zoned home must function as a single housing unit.

3. Only a maximum of 4 bedrooms are allowed.

4. The home must comply with the fire code, building code, electrical code and property standards by-law

5. The owner must carry a minimum of two million dollar liability insurance policy.

If the owner complies with all these things, they can apply for a license and pay the required fee. Once reviewed, the owner will be contacted to set up the required inspections. The owner must schedule their own inspection with the Electrical safety Authority.If the application is denied, the owner may appeal.

The licence is valid for up to one year and expires on August 31 of each year and it is the responsibility of the owner to apply for a renewal each year.

Have a look at the map attached here. If your property falls within the boundaries and you’d like to rent it out to students, have a look at oshawa.ca/rrhl. If you are thinking about purchasing a home in Oshawa and you’d like to know a little more about renting it out, give me a call so we can get together and discuss what your best options are in today’s market.

Financial planning – It’s about more than money.

Author: Bernice McNutt  //  Category: Durham Region Real Estate

Planning for your future involves more than just money. It involves you, your needs, values and dreams. Your financial planner should learn more about you and what’s important in your life. This understanding, along with a review of your financial situation, your investing preferences and your tolerance for risk, will guide your chosen planner as they recommend strategies and provide solutions that will help you achieve your goals.

Whether you’re saving for a rainy day, for retirement, for your future or to send your kids to college, there is a saving plan for you. There are four registered savings vehicles available to you. Registered retirement Savings Plans (RRSPs), Tax-Free Savings Account (TFSAs), Registered Education savings Plans (RESPs) and Registered Disability Savings Plans (RDSPs). You need to work with a planner who fully understands you and the programs available. Helping you get to where you want to be in 5, 10, 25 years.

Planners can also help you achieve your home ownership dreams. They know what it takes to get you into a home, one that you can afford and that will allow you to sleep at night, knowing that you can afford the payments and the maintenance issues that come with owning a home. The other great thing is that if you have been working with a planner for a while, you’ll have a healthy amount in your RRSP and you can take advantage of the Home Buyer’s Plan. You can borrow the funds from your RRSP to help you purchase your first home (you and your spouse can each withdraw up to $25,000).

Financial planning may not be the funnest task you do, but it is one that you should not put off for tomorrow. You want your tomorrows to be full of financial freedom, so you’ve got to start today! Do you need a recommendation to someone great who can help you? Let me know and I’ll recommend some names.

Look to the future when buying your home

Author: Bernice McNutt  //  Category: Durham Region Real Estate

With today’s interest rates at near record lows, many people are recognizing that a mortgage payment on a house can actually be comparable to what they would spend on renting an apartment or home.  Perhaps you’re one of them and are ready to take a step up the property ladder.

For most people, buying a home is the most significant financial investment they’ll ever make, and there’s a lot of planning that goes into a successful transition.  With that in mind, here are a few tips to help you navigate the home buying process:

Consider future needs. Look ahead and anticipate what your family may look like just a few years from now.  If you’re a single buyer, you may someday add a ‘significant other’ to your household.  If you’re a young couple, you may be planning on children.  Or you may already have children whose needs will change within just the next few years.  As they get older, perhaps your children will need a bedroom of their own, or some private play space.  Though additional space may not be needed immediately, it’s important to consider potential future plans for a home.  Keep in mind that there is no such thing as the “perfect” house. Instead, determine what’s essential for the near future – number of bedrooms, approximate square footage, community, etc.  But be cautious.  Look to future needs but don’t overextend yourself buying space you may not ever need.

Remember resale. Purchasing a home is a great long-term investment. However, there are many reasons home buyers may need to move again, such as relocating for a job or a major lifestyle change. Think about the length of time that the home may be owned and during your search, also consider the potential resale value of prospective properties you are viewing.  I can help by sharing such valuable information as the average price of resale homes in the area, how long each property has been on the market and what features increase – or detract – from a home’s value and appeal.

Plan for maintenance and repair costs. Owning a home is a rewarding experience. However, along with a set of house keys come certain responsibilities for upkeep.  A leaky faucet and unkempt lawn won’t take care of themselves, so be sure to include future repairs and maintenance in your household budget.  Keep in mind that certain properties such as condominiums and town homes require less exterior maintenance and might be a good option for those who find the idea of maintaining a yard a bit daunting.

Want to know more about the home buying and selling in the Durham Region?  Contact me so we can talk about the best options for you in today’s market.