That’s right 2012 is a Leap Year! February 29th doesn’t come around that often – but this year it will make an appearance. Every four years, we get an extra day, so in 2012 we will be rounding out the year with 366 days. The extra day, February 29 is the leap day of the leap year.

This year is particularly special. If you look at a 2012 calendar, you will see that February has five Wednesdays. The most recent year in which February comprised of five Wednesdays was in 1984 – it won’t be until 2040 that we’ll see five Wednesday’s again!

Speaking of calendars, did you get your 2012 Calendar? If not, I do have a few extra ones available, just send me an e-mail or give me a call and I can get one out to you right away.

We are in February already! Time seems like it is really flying. We have seen brisk sales in Etobicoke so far this year. It is definitely a seller’s market when there is a low inventory of houses for sale and they are selling in an average of 14 days or less!

If you have been sitting on the fence or thinking about selling, now is really a good time to get ahead of your competition. I find every year more people are thinking about getting their houses for sale and preparing them for a spring market.  In my opinion, the best time to sell is when you do the opposite of everyone else.  Think about it, if there are no other houses for sale but yours and it is a seller’s market where will the buyer’s focus their attention on? The advantages of putting your house on the market are many if you use this strategy and I would be happy to provide you with a more detailed report outlining the reasons why.

In the meantime, don’t stop those newsletter subscriptions!  If you would like to be kept up to date with the Toronto West and Etobicoke Real Estate Market, would like free tips on how to prepare your home for sale or add value to it, you need to subscribe to my monthly newsletter and get on the list! Just visit www.mcizmar.com

Judy did the same thing last month and is our winner of the Staged to Sell contest.  Judy receives a copy of “Staged to Sell (or keep)” Easy Ways to Improve the Value of Your Home by Jean Nayer. Congratulations Judy!

Do you have any questions about the real estate market in Toronto West or Etobicoke? Please let me know how I can help you today by posting your question or comment below.

Click on the latest issue of Your Cizmar Report to read the rest of the story and to see what the market is doing in New Toronto and Mimico.

Paul Lachine illustration

I thought I would take the time to answer some of the more common questions here on my blog. Hopefully it may provide you with some insight and possibly answer a question or two of your own!

Question: Any tips on how to pay off my mortgage sooner?

Answer: The faster you pay down the principal amount of your mortgage, the more you can reduce the interest costs. You can find the exact amount of interest you have been paying on your mortgage by taking a look at your most recent mortgage statement.

If you are looking to change that amount I have the following 5 Tips for you:

1. Shorten your amortization period. Instead of your current 25 or 30 year amortization period, shorten it to 15 or 20. Doing so will increase your payment amount but you will be mortgage free sooner and will incur less interest during the duration of the mortgage.
2. If you are currently making monthly payments, switch and increase your payment frequency to a weekly or bi-weekly payment schedule.  This is one small tip you won’t feel and you will end up making an extra month’s payment every year.
3. Increase your payments permanently or temporarily. Did you know some banks or lending institutions will let you increase your regular mortgage payment by 25-50% sometimes even 100!  These extra payments go directly towards your mortgage principal!
4. Make a lump sum payment if you can. Not everyone can do this but it’s nice to have the option! If you’ve come into a cash bonus lately or expecting an income tax refund, use it. Don’t spend it all. Put even a portion of this towards your mortgage.  As long as you have the prepay option you can pay up to 15-20% of your principal mortgage each year!
5. Change from a fixed interest rate mortgage to a variable interest rate mortgage. Keep your mortgage payments the same but switching to a variable interest rate mortgage offers you today’s lower rates and allows you to pay off your mortgage sooner by applying more of the payment towards the principal. Think about it, you haven’t changed your current payment amount but you are paying off your mortgage sooner.  Now that’s a win-win!

If all of these tips are a little too much for you to handle all at once, try one of them and slowly build from there.  You’ll feel good about making some positive changes towards paying down your mortgage sooner and free up some options for you once you have. Then before you know it, you will be looking to upgrade your home to a bigger one or buy that recreational place you’ve been dreaming about!

Do you have a question for me? Send an e-mail to milana@mcizmar.com and let me know how I can assist you today!

Your home is a reflection of who you truly are and of those who live there. If you are looking for a little inspiration and not sure where to start, try this:

Take a fresh look at each room with pen and paper in hand and think about ways in which you can update and improve them.  ALL updates will provide you with a return on investment when it is time to sell.  You cannot go wrong with updates.  Just remember to keep them simple without too much fuss and you will always appeal to a broad audience.  Even if you are not thinking of selling your home, updating a room can always add fresh appeal, create inspiration and a whole new space for you to enjoy!

Ask yourself some of the following questions to get started with your ideas:

What is the first thing you see when you walk into a room? Do you like it?

What type of mood is created in the room? What type of mood would you like to create?

What is the purpose of the room?  I know this one seems obvious but seriously – I have seen bedrooms cluttered with everything from desks, outdated furniture and exercise equipment.  Hint: These are the rooms you should tackle and turn into your little oasis when you are thinking of selling your home.  These are the rooms future buyers will envision themselves in, so try to create a mood for them and the return on your investment will pay off ten-fold!

Some dream rooms that buyers are looking for today? The dream home office, the gourmet kitchen, a home theatre, spa-like bathrooms and master bedroom retreats.

Simple fixes and updates to any of these rooms include modernizing and replacing items that are completely outdated or broken. These are quick and inexpensive fixes that can completely transform a room.  Try modernizing all your light fixtures, putting on a fresh coat of a new paint colour, changing faucets in kitchen and baths, doors and hardware and even updating furniture that you’ve always wanted to.

Looking for more inspiration, tips and tricks for adding value for your home? Get on the list and I’ll have you finishing off your to-do list in no time!

There is a little known program that you could be taking advantage of that can increase the chances of finding a home in this market where bidding wars are the norm and you don’t have the money to buy a “fixer upper”. With a great product out there you now have more flexibility to buy a house that you may have previously overlooked due to the fact the house is in need of some TLC. Whether it is a new kitchen, bathroom, windows, hardwood flooring, etc you have the flexibility to purchase a home and include the cost of renovations in the purchase. This program is ideal for first time buyers who typically have a smaller down payment and can’t afford to put money down on a house and pay for the renovations they desire.

CMHC (Canada Mortgage and Housing) is the government insurer that anyone with less than 20% down payment must pay in order to purchase a home in Canada. They have a program called Purchase Plus Improvements that allows qualified borrowers the ability to borrow up to 10% of the value to pay towards the costs of renovations. Let me give you an example: If the purchase price of a house is $500,000 the clients have the ability to borrow up to an additional $55,000 (10% of the purchase price plus 10%) in order to pay for the costs of renovations. This allows borrowers to not have to eat into their down payment in order to pay for the costs of renovating a home. With a lot of younger first time buyers trying to find creative ways to get into this increasingly expensive market, this allows you the flexibility of looking at homes that need a little TLC and allows you the ability to build some of your own equity by renovating the house. Why pay more for a house that someone else has renovated when you can include the renovation costs in your mortgage loan approval and renovate to make something your own dream home?

How it works is that borrowers must provide a quote from a contractor prior to the closing of the house, which is submitted off to the lender and insurer for approval. You must make sure you have a visit to the house prior to closing written in your purchase contract so that you can have a contractor review the work required and provide you with a quote that breaks down the scope of work and the costs associated with that work.

Once both CMHC and the lender have approved the improvement amounts, the amount is added into the mortgage and on the closing date the amount is advanced to the lawyer to hold onto until the renovations have been completed. That means you don’t get the money until the work has been completed so we recommend that our clients ensure that they have access to an unsecured line of credit available to them so the initial deposits/costs can be paid and work can begin. Once the work has been completed the lender sends an appraiser out to confirm that the scope of work that has been outlined on the quote has been completed and the lender authorizes the lawyer to release the money to you.

So what’s the catch? Borrowers cannot include the costs of appliances in the quotes as they are not part of the actual house and can be taken if you ever decide to sell. From our own experience, CMHC and lenders usually will not approve renovations to do things like add another unit to the property (like a basement apartment) or fix something like a furnace that should be in good working order when you buy the home. So keep that in mind when you are considering the options.

For additional information on your house hunting process or for your FREE copy of my Buyer’s Guide click here

Content written and provided by Jason Friesen of The Calum Ross Team

Second-Best Year on Record for Sales.

Greater Toronto REALTORS® reported 4,718 transactions through the TorontoMLS® system in December 2011 according to the Toronto Real Estate Board. The December result capped off the second-best year on record under the current Toronto Real Estate Board (TREB) boundaries. Total sales for 2011 amounted to 89,347 – up four per cent in comparison to 2010.

“Low borrowing costs kept Buyers confident in their ability to comfortably cover their mortgage payments along with other major housing costs,” said TREB President Richard Silver. “If Buyers had not been constrained by a shortage of listings over the past 12 months, we would have been flirting with a new sales record in the Greater Toronto Area,” added Silver.

The average selling price in December was $451,436 – up four per cent compared to December 2010. For all of 2011, the average selling price was $465,412, an increase of eight per cent in comparison to the average of $431,276 in 2010.

“Months of inventory remained below the pre-recession norm in 2011. Very tight market conditions meant substantial competition between Buyers and strong  upward pressure on selling prices,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.

“TREB’s baseline forecast for 2012 is for an average price of $485,000, representing a more moderate four per cent annual rate of price growth. This baseline view is subject to a heightened degree of risk given the uncertain global economic outlook,” continued Mercer.

On the flipside by reducing your taxes, it creates one of the largest hurdles for self-employed individuals; their ability (or lack thereof) to obtain credit at reasonable rates or terms. It is considered the largest tradeoff for being aggressive and reducing your net income. Whether it is applying for a personal loan, line of credit and most importantly qualifying for a mortgage it creates there are usually hassles that regular salaried employees do not have to face.

There are now several options available that cater to self-employed individuals. Usually the big three items that lenders/insurers look for when qualifying an applicant are credit, downpayment and income. Take one of the 3 out of the equation and the client usually ends up paying for it with less favorable terms, but with the self-employed programs being offered by lenders/insurers you have some flexibility on the income part, provided you can come up with a minimum of 10% downpayment and have a credit score (beacon score) that is above 700 – two very reasonable requirements. This is a stated income program meaning the income you put on the application is the one used to qualify the loan. The lender and insurer will look at the reasonability of the income for the profession and base their approval on it accordingly. In other words, you can’t claim to be a dog walker making $400K year. The CMHC premium that you pay is approximately 4.25% of the mortgage amount for a 10% downpayment vs. the 2.00% premium you would pay for a regular qualified mortgage. This is great because it allows clients to get into the market with a slightly higher premium (the premium is rolled into the mortgage so it isn’t an out of pocket expense at closing) and still at best interest rates and the same flexibility you would get if you were fully qualified.

There are also some great options with 20% or 25% down that self-employed stated income mortgage that people can now take advantage of as well. Given that a 20% to 25% down payment is a substantial amount of money for someone to put down, lenders realize that the borrower has some “skin in the game” decreasing the likelihood of the borrower to walk away from the mortgage obligation. The larger the down payment the less likely you will default on your loan. The risk of defaulting on your loan is as great to you, as it is the lender, because the lender knows if they have to sell your home that they will still get their money out of it. So, with a 20% or 25% downpayment you can still qualify at usually the best rates, some lenders will want to confirm your net worth (up to 25% of the purchase price in some cases) so not everyone qualifies under these programs. The credit score also must be over 700 and your downpayment must be coming from own resources.

There are also some options that allow lenders to add back some of the write offs that self-employed people write off to bring up the net income in order to qualify the loan.

A lender will generally add back into your net income, write offs from your “statement of business activities” or from your T1 Generals to help make an application qualify are: • Motor Vehicle expense • Business use of home • Capital cost allowance • Meals and entertainment (some lenders accept this and some don’t)

Of course there will always be alternative type lenders that are willing to lend to self-employed people, albeit at much higher interest rates and terms than a traditional bank or mortgage lender, sometimes pricing several people out of the market. Interest rates can be as high as 1 to 2% higher than a regular mortgage and that limits the purchasing power of many borrowers.

There are several options available to self-employed individuals to help them qualify for a mortgage without being subject to higher rates that were not as readily available 10 years ago. Lenders and insurers realized that there is a large demand in the market for self-employed borrowers that have strong credit and assets. Allowing more people to purchase homes that were previously unable to in the past and helping to foster growth in our economy.

Written by Jason Friesen of the Calum Ross Team Please visit their website today for futher information.

If you are looking for a project and are a builder, contractor or handyman, I just listed a  25 x 105 Foot Lot with Approved Building Plans and Permits for a Modern Two Storey New Build with 3 Bdrms and 2 Baths including Master Bedroom with Walk-in Closet and Ensuite.

It’s very hard to find something in Toronto West at this price! The lot is situated in a Great  Location on a Quiet Dead End Street, Close to TTC, Shops, Schools, Parks Etc.

Many New Builds are Selling For Over $500K in the Area.

Check it out and let me know what you think!

After that was all done it was time for some relaxation and family get togethers. It seemed like every day there was someone to visit and more food to eat. It was Great!

And here we are in 2012 and I’m ready to start a New Year! Are you?

To start the year off with a little bang, I thought I would take the time to thank all of you who read my blog and visit my website.

From now until January 31st if you subscribe to my NEW newsletter and “get on the list” you are automatically entered into my contest to win a copy of “Staged to Sell (or keep)” Easy Ways to Improve the Value of Your Home by Jean Nayar. This is a fantastic resource for anyone who wants to add value to their home. Many of the improvements cost very little to do and some are even FREE! An easy read filled with photos of inspiring rooms, this is a mush have for your personal library.

Subscribing to the newsletter is my monthly promise to keep you in “the know” with anything Real Estate related that matters to you! I know your time is precious so I’ll give you quick real estate market updates, buyer and seller’s tips and helpful resources for you to add value to your home or help you add value to your portfolio so you can buy a new home!

So, what are you waiting for? Subscribe today! And Happy 2012!