Durham Region Real Estate Blog

If you have read my past blogs, you know that I am opposed to the new Harmonized Sales Tax (HST), and I did try to get as many people as possible to write all the politicians they could, in order to have the new tax defeated.  This didn’t work and it looks like we are going to have the new tax, like it or not. So let’s embrace the new tax!

The Ontario provincial government has announced that it intends to combine the eight percent Provincial Sales Tax wit the five percent federal Goods and Services Tax, creating a thirteen percent HST. The tax is not yet in effect, but will start on July 1, 2010. While the new tax will not apply to the purchase price of a re-sale home, it will apply to services such as moving costs, legal fees, home inspection fees and Realtor® commissions.

There are transitional rules that will apply to HST and Realtor® commissions. The HST will general apply to services, expressed as a percentage, that the services are performed on or after July 1, 2010. However, if 90% or more of the services are performed before July 1, 2010, the HST will not apply.

For example, if I am selling your home and list it on June 1, 2010, receive an offer on June 15, 2010 and the transaction closes on July 2, 2010 then, since more than 90% of my services were performed before July 1, 2010, only GST will apply to the commission at that time.

In another example, let’s say that my services to sell your home are performed from May 1, 2010 to July 31, 2010 with the sale of your home closing on July 31, 201o. Since 2/3 of my services were performed from May 1, 2010 to June 30, 2010, only 1/3 of my services were performed after the July 1, 2010 HST start date. You would be charged GST on 2/3 of the commission and HST on 1/3 of the commission.

Sure, the new rules are a little confusing, but we’ll figure it out. You should keep in mind that while my topic covers how HST will affect home sales, it will also affect all business owners. Keep in mind that if you have a GST number and are able to get GST rebates, you may want to hold off on large purchases that are currently subject to 8% PST. If you buy the item after the HST comes into effect, you can apply for the HST rebate.

You have been told, over and over, that kitchens and bathrooms sell houses. And it’s true! You need to make the most of what you’ve got and keep it looking great.

So, when is the last time you looked up at your bathroom ceiling? Are you feeling brave? Get up right now, and go have a look. It’s o.k., this blog will still be here when you get back! How was it? There’s a pretty good chance that you’ll find peeling paint and mould growth. Moisture is the reason why – moisture and inaccessibility. Most of us aren’t tall enough to wipe the ceiling dry after a shower. And putting a coat of latex paint isn’t going to help your problem. So what are you to do?

Peeling bathroom ceiling paint is common. You need to begin by scraping. Try using a four inch wide putty knife for this job. Lift up any loose edges and get that old paint popping right off the ceiling. Be ruthless and eliminate everything that’s weak. And don’t worry about damaging the drywall because you’ll be filling the whole area later.

Once you’ve removed all the loose paint, sand the area to further refine the ceiling. You could tackle this job by hand, but an electric quarter-sheet finishing sander is an inexpensive power tool that does a much more thorough job. Put a piece of 120-grit sandpaper in the machine then go over all regions of the ceiling that include mould or area of damaged paint. Sanding removes roughness, though it will also highlight areas you thought were sound but actually need more scraping. Keep your putty knife handy!

Now you’re ready to fill the area. It may look like only a small ridge, but it’s more than paint can cover. Genuine drywall joint compound is the best stuff to use here, because it’s smooth and fine grained. Use your putty knife to apply a skim coat over the scraped areas, extending out several inches past the point where sound paint begins. Aim to apply slightly more depth of compound than necessary, then sand the area flush with the surrounding ceiling by hand. An abrasive sanding sponge is the ideal tool to use for this application.

Now you are almost ready for paint, but don’t get out the roller just yet. You much kill the remaining mould spores. If you don’t, the mould could (likely will) return sooner rather than later. You could use a solution of bleach and water for this task or search your local hardware store for a non-toxic product. Spritz it on and let it dry.

Take just two more steps to keep the mould from re-emerging. The first is coating the filled-and-killed surface with a stain-blocking primer. Look for one that is especially rated to hide mould stains. The second is to choose your paint wisely. Look for a mould resistant kitchen and bathroom paint. It will include compounds that prevent new mould from regrowing, even in the damp and challenging conditions so common on our bathroom ceilings.

So, it might not be a pretty job, but it is one that is well worth the effort, both now and when you decide it’s time to sell!

Did you know that the average Canadian uses 1600 cubic meters of water per person, per year?  That’s enough water to fill more than 2000 bathtubs!  We use twice as much as the average person from France and six times as much as the average Brit.  With 80% of Canadians surveyed in the 2009 Canadian Water Attitudes Study commissioned by RBC expecting a fresh water shortage, you’d think we would want to change our habits. 

Have you thought about the small changes you can make to use water more wisely?  Toilets use 30% of household indoor water.  By installing a low flow, dual flush toilet you can reduce your consumption by up to 60% over your old toilet.  An efficient shower head can use up to 70% less water and since showers and bathing count as 35% of indoor water use, you’ll quickly see a change in your water bill when you just make these two changes.

Then take your new attitude for water conservation outside.  Water lawns and plants early in the morning. Less water will evaporate from your lawn so you won’t need to water so much.

Blair and I tried out these measures about 10 years ago while living in Oshawa.  We weren’t great at sending in the meter readings so our bills were often estimated.  When I finally sent in the actual reading, the water department called to confirm that I had given the correct numbers.  When I double checked they asked about any changes we may have made so I mentioned the new toilets and shower heads. We ended up with a credit of over $450!

The other bonus about nice bathroom renovations is that they always pay a high return when it comes time to sell your home and now you can take advantage of the renovation tax credit too!  If you make some changes, let me know the results you’ve had.  Happy renovating!

We are all looking for a way to save money and the amount we spend on energy heating our homes is something we all think about.  If you are thinking about making some improvments to your home, you may be able to take advantage of the Ecoenergy Retrofit Grant available through Natural Resources Canada.  It encourages home owners to make their homes more energy efficient by offering a grant of up to $5,000.00  Whether you are planning to replace your furnace, windows or re-insulate you home buy installing energy efficient products you should be eligible for a substantial rebate.  You would also increase the energy efficiency of your home, effectively saving you money on your energy bills.  Go to www.oee.nrcan.gc.ca for more information.

If you purchased your first home after January 27, 2009, you could be eligible for the First Time Home Buyer’s Tax Credit.  This government initiative realizes that the cost of a new home can be overwhelming and offers monetary relief.  Beginning with the 2009 personal income tax return, a new line will be incorporated to allow you to claim the credit.  It is calculated by multiplying the lowest personal income tax rate for the year (15% IN 2009) by $5,000.  For 2009, the credit will be $750.

In order to qualify for this incentive, neither you nor your spouse or common-law partner owned and lived in another home in the year of purchase or any of the four preceding years.  If you are a person with a disability or are buying a house for a related person with a disability, you do not have to be a first time home buyer.  However, the home must be acquired to enable the person with a disability to live in a more accessible dwelling or in an environment better suited to the personal needs and care of that person.

  In order to claim the credit you do not need to provide supporting documentation, you just need to ensure that the information can be provided should the Canadian Revenue Agency request it. 

Low mortgage rates, competitive home prices, a chance to build your equity and now the HBTC may just be enough to send you into the exciting world of home ownership.  If you’ve got questions, just call or email me.

The proposed Home Renovation Tax Credit (HRTC) will provide a temporary 15% income tax credit on eligible home renovation expenditures for work performed, or goods acquired, after January 27, 2009 and before February 1, 2010. The credit may be claimed for the 2009 taxation year on the portion of eligible expenditures exceeding $1,000, but not more than $10,000, and will provide up to $1,350 in tax relief.

For more information on all the home ownership and housing related stimulus in Budget 2009, go to http:///www.budget.gc.ca/2009/plan/bpa5a-eng.asp#Personal or to the Canada Revenue Agency Web site at www.cra-arc.gc.ca and search for “Home Buyers Plan.”