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How To Get The Most Out Of Your Real Estate Investment
June 29, 2010 at 11:28 am 1
oz_house_streetlevel Today's post is from guest editor, Julia Stepanova, a local real estate expert who has done some great investments herself, and is on board to help guide us in our wealth building activities. --- In Toronto the real estate market has not been as affected as it is in the USA. In fact we've had a hot market for the past few months. Our 2010 Forecast called for a strong first half in sales and a slower second half due to three factors. Factor One - the introduction of the HST (which will NOT impact prices in the resale market but will increase the cost of services and new properties over $400,000). Factor Two - we are expecting a bump in Bank of Canada interest rates in the second half of the year, which will make it harder for some people to afford (and therefore fewer people will buy). Factor Three - more listings are coming to the market (particularly in the condo segment). Right now the market is still hot but will be softening towards the end of June/2010. And if you like to take your time looking for a place and multiple offers is not your thing this means it is your time to shine. If you are looking to get into the real estate market it's a great time. But how do you get the most out of it? First, make sure you're taking the right steps. 1. Get yourself preapproved by going to your local bank. 2. Decide on the area. 3. Write your wish list. 4. Find an agent specializing in your preferred area. 5. Do not forget to allocate 1.5% of the purchase price towards the closing cost. If you want a steady return on your money, houses can be a sure bet and it have two strong things going for them as an investment. First, any capital gains on your principal residence are tax-free. If your house appreciates by 6 per cent, you get to keep every cent of your gains. Now 6 per cent may not sound like much, but in terms of how much you end up with, you'd have to earn as much as 12 per cent on a fixed-income investment such as a GIC to match that return, after tax. Second, you don't have to come up with the full purchase price, meaning you're able to harness leverage. The conventional mortgages require a down payment of 25 per cent of a house's appraised value. Where as the High Ratio Mortgage, requires only 5% down payment. For example, if you buy a $200,000 home, you need to come up with around $50,000 for a conventional mortgage. If the home's value rises to $220,000, that's an increase of 10 per cent. But what's really happened is you've put up $50,000, and made $20,000. Your real gross return on your invested funds is around 40 per cent. But notice the word “gross”. Don't forget that your real return will be less. Buying a home and having a mortgage is also a tremendously powerful forced savings program. You need to pay for housing, whether you are renting, leasing, or paying your mortgage. So why not put your money towards a mortgage, and if you invest wisely when you sell you will get it all back. If you rent, you never get anythign back. ---- Julia is a real estate agent with Re/Max Condos Plus and you can find her here.
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Life
Dream House
January 20, 2010 at 12:08 pm 2
I love real estate. I watch shows on it, I check listings online all the time, I come up with different dream houses, investment opportunities and everything in between almost every day. And yesterday I saw a house online that has taken the new spot on my dream house list. From the outside it doesn't look like much. Just a simple one level house

oz_house_streetlevel
But the house is actually built on the side of a hill, so what looks like a one level house is really three stunning levels with sweeping views from every room.

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the dining room

the dining room



the living room

the living room



the kitchen

the kitchen



the outdoor dining room

the outdoor dining room



the bedroom - can you imagine waking up to this view

the bedroom - can you imagine waking up to this view



even the bathroom has a gorgeous view!

even the bathroom has a gorgeous view!

The only challenge is that this house really only works in a year round hot weather environment. I guess we'll just have to move somewhere tropical! ...What I can dream, can't I? Photo Credit: Propgoluxury.com
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Life
Would You Pay $25,000 For a Mattress?
December 2, 2009 at 2:45 pm 0


three little monkeys laying on the $25,000 mattress

three little monkeys laying on the $25,000 mattress



This past weekend I went with my brother and fiancé to a historical part of the city to walk on the cobblestone streets, sip some gourmet locally roasted coffee, peruse the art in the galleries, and sample some Toronto micro brewed beer. Just as we stepped out of the car I happened upon a mattress store. It seemed a tad out of place to be in this area, but since we're in the market for a new mattress we decided to step in. And step into another world we did indeed! At the Hasten's store(Swedish for extremely expensive...I think) we decided to try out the mattresses. They were divine! If a pea were under that bed you would never notice. You could probably have a pea farm under your bed and not notice! We were all having a lovely time on the bed and my fiancé was ready to buy one. I said "honey, these are not your average mattresses, these are $25,000!" He brushed it off and said "Well, if one at a different store is $1,000 I think it's worth it, this feels amazing!" I pulled him aside and gently said "No, not $2,500, I mean $25,000, kind of like you're sleeping in a car". He raised his eyebrows and said "ohhh". That's right, it's $25,000 for this fancy schmancy horse hair mattress. I can't imagine paying that much, even if it's the official mattress of the Swedish royal family. Would you pay $25,000 for a mattress?
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Life
What’s Your Home Style?
December 1, 2009 at 2:13 pm 0




Recently I discovered this super fun quiz by Ethan Allen to help figure out my house style, and the timing couldn’t be more perfect. Since I’m getting married next Spring I’ve been trying to find a place to live that my future husband and I will both like. As a part of my magazine project I’ve been clipping my dream houses out and also one’s that I think my fiancé will like. But every house I’ve chosen for him has been dead wrong! So now we’re going back to basics to try and figure out what style “category” each of us likes. That way we can figure out how to appropriately mix our styles. Hopefully we have it all figured out before we move in together!
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Life
What’s Your Home Design IQ?
November 30, 2009 at 1:52 pm 0




Ever wondered if you are really as style savvy as you think you are? I think I'm pretty smart in the home decor category...but when I did this Style at Home quiz it didn't agree. I'll tell you how I did if you tell me how you did!
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Life
Home Design Obsessions
November 25, 2009 at 11:12 am 0


I love home decor and designs. I could spend weeks browsing through stores looking at nick knacks, paint colours, home accessories and design elements. I could go to open houses every weekend. I could buy all the coffee table books and magazines on beautiful houses and homes. If I had it my way I'd be changing my apartment design every month. But, clearly that gets a little pricey. So, for now I'll stick to my pink 377 square foot apartment, and keep the plan to redecorate in my back pocket. But even then, the styles of homes I like are so varied. Stone and wood detached homes look cozy, deep red brick square homes look traditional, and I love modern townhouses too. I just can't decide! I think I'll have to be a house flipper in the future so I get to experiment with all these different styles! Photo Credit: Young House Love Blog
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Life
Buying My First Place – On My Way to My Dream Life
August 20, 2009 at 2:53 pm 1

I’m a big believer in having life goals, and working towards those goals with solid plans. But one of the funny things about achieving a dream life, is that it takes a lot of work and determination to get there. For me, buying my first condo in 2007 was a dream come true. I bought my condo at a bit of a turbulent time in my life. I’d recently broken up with my long term boyfriend and it was a less than perfect ending, I was pulling crazy hours with a full time job and endless nights at university finishing my master’s thesis, and I was in a long distance rebound relationship. Needless to say there was a lot going on in my life, but I stayed on track so I could get that much closer to my dream life. When I bought my place I felt so accomplished. I’d dreamed of getting into the real estate market for so long, and scrimped and suffered to save up for my down payment. It was something that I had wanted to do for years, but my long term relationship was holding me back from doing this. While I sacrificed to save up to buy a place, without a supportive partner when you are in a relationship it’s almost impossible to make your dreams a reality. So when things ended I moved into a different phase in my life where I didn’t have to compromise my goals anymore. Finally I was able to buy my first place. I was filled with pride that I’d been able to succeed in one of my long term dreams…and best of all, it made me realize that I am able to achieve my dream life. Not only did I feel so proud for getting my first place, but it made me realize that relationships should bring out our better selves and make us closer to achieving our dreams. After I bought my place I was done with spending time in relationships that held me back, or didn’t enhance my life. And that’s one of the little changes in my life that has made a huge difference overall.
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