Category Archives: real estate

Is now a good time to buy a home in the US?

Canadian snowbirds or real estate investors considering a home purchase in the United States can be confident in the state of the market according to a new survey.

Results of a poll conducted in the fourth quarter of 2019 have been released this week by The National Association of Realtors and show that 63% of American consumers felt it is a good time to buy (33% strongly) while 74% said it is a good time to sell.

The strength of the jobs market and economic conditions are boosting sentiment.

“The mobility rate has been very low as many have opted to stay put for longer,” said NAR chief economist Lawrence Yun. “However, this latest boost – Americans saying now is a good time to move – is good news. With mortgage rates low, the timing is indeed ideal for those who want to enter into homeownership and for those looking to move on to their next home.”

Older respondents (the Silent Generation and Baby Boomers) showed the highest confidence in buying conditions and higher earners ($100K+) and those in the West are more likely to feel that it’s a good time to sell.

“The Western region has seen home prices increase to the point that costs have outpaced income,” said Yun. “So, it is no wonder that those living in the West would think that now is a perfect time to place a home on the market. California especially is seeing some of the highest prices ever.”

Home prices

The NAR survey has also asked about home prices with 64% saying their believe that prices in their communities have increased in the past 12 months.

More respondents expect local home prices to rise in the next 6 months (48% said so) than those that expect them to stay the same (41%) or decrease (11%).

On the economy, 52% believe it is improving although this falls to 47% among millennials and 41% of those living in urban areas (66% among those in rural areas).

“Whether it is a reflection of politics or true economic conditions, there is a difference of views between rural and urban areas,” added Yun.
Source: Real Estate Professional – by Steve Randall 10th January, 2020

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How to Buy a Second Home (Hint: It Won’t Be Like Your First)

As a home buyer, you braved the real estate buying circus when you bought your first home, and you have a great place to show for it. You’ve trudged through the open houses, experienced exactly how stressful closing can be, and dealt with legions of moving trucks. And still, a part of you wants something more: an escape in the mountains, a beach cottage, or a pied-à-terre in the city. You want to buy a second home.

With current mortgage rates at a historic low, you might be tempted to jump in. But beware; buying real estate as an investment property or second home won’t be the same as your first-time home-buying experience. Here are some differences and advice to keep in mind.

First things first: Can you afford to buy a second home?

If you scored a sweet deal on a mortgage for your primary residence, don’t expect lenders to give you the same offer twice.

“Second-home loans generally require more down payment and a better credit score than owner-occupied home loans,” says John Lazenby, president of the Orlando Regional Realtor Association.

You may have to pay a higher interest rate on a vacation home mortgage than you would for the mortgage on a home you live in year-round, and lenders may look closely at your debt-to-income ratio. Expect a lender to scrutinize your finances more than when buying a single-family primary residence.

“Lenders look carefully to ensure that second-home buyers are financially capable of paying two mortgages,” Lazenby says.

Make sure to review your budget with a second mortgage payment in mind, and make adjustments if necessary after you know what interest rate you will receive. And make sure you can afford the real estate down payment—a healthy emergency fund and cash reserves are essential if an accident or job loss forces you to float two mortgages at once.

Evaluate your goals

Understand exactly how you plan to use the property before you sign on the dotted line.

“Buyers should consider their stage of life and that of their children to ensure they are going to actually use the home for the amount of time that they’re envisioning,” Lazenby says. “A family with young children may find that their use of a second home declines as the kids grow older and become immersed in sports.”

If you’re certain you’ll get enough use and enjoyment out of your new purchase, go for it—but make sure to carefully consider the market.

For most homeowners, a second home shouldn’t be a fixer-upper. Look for homes in high-value areas that will appreciate over time without having to sacrifice every weekend to laborious renovations on your “vacation home.”

Buying in an unfamiliar area? Take a few weekend trips to make sure it’s the right spot for you. In the long term, you’ll want it to be a good investment property, as well as a place to play. Pay close attention to travel times, amenities, and restaurant and recreation availability, otherwise you might spend more time grousing than skiing and sipping wine. And make sure to choose a knowledgeable local real estate agent who will know the local real estate comps and any area idiosyncrasies.

Understand your taxes

You may be familiar with a bevy of home credits and tax breaks for your first home, but not all of them apply to your second.

For instance: You might be planning on using your new home as a vacation rental when you’re out of the area. If that’s the case, you need to calculate the return on your investment property purchase price that you can expect over the course of a year. How much can you charge per night or per week for your rental property? How many weeks will you rent out the property? And what expenses will you incur?

“Property tax rules and possible deductions for second homes used as rentals are complicated and vary widely, depending on both the number of days per year that the owner occupies the home and the owner’s personal income level,” says Lazenby.

vacation home offers more flexibility to buy based on your potential property tax burden—for instance, if you’re looking to buy in an area of high real estate taxes, consider widening your real estate search to another county, which can save you thousands of dollars. Your real estate agent should be able to help you find property you as a buyer can afford.

Lazenby recommends consulting with a tax professional about tax implications, especially if you’re planning on renting out the house.

A vacation home you use part time and also rent out may be considered rental property for tax purposes, depending on personal-use days as the homeowner, and the number of days you rent it out. If you rent out the vacation property for more than 14 days in a year, you must report the rental income on Schedule E of your individual tax return, and you can deduct the rental portion of expenses such as mortgage interest and property taxes. However, renting out your home as a short-term vacation home for 14 days or less in the year means you cannot deduct rental expenses, but the income from your renters is tax-free.

Jamie Wiebe writes about home design and real estate for realtor.com. She has previously written for House Beautiful, Elle Decor, Real Simple, Veranda, and more.
Source: Realtor.com –  | Aug 28, 2019
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Is investing in Canadian real estate still viable?

When a series of tax and mortgage rules was introduced in Canada in 2016 to prevent a housing market bubble, activity slowed down significantly in the years that followed. Given the current circumstances, is it still viable to invest in property?

In a think piece in Macleans, market watcher Romana King said even with fears of a global recession, real estate is still a smart way to invest.

“For investors, the key to making strategically smart decisions is to consider the underlying economic factors that impact your investment,” she said.

King said the housing market could climb out of negative growth forecasts this year. Citing figures from the Canadian Real Estate Association, she said the national sales activity was on target to increase by 5% in 2019 and could expand further by 7.5% in 2020.

“Canada boasts strong population growth, and government budgetary decisions are acting as stimulants for the national housing market, all of which point to a healthy future for Canada’s real estate market,” she said.

Investing in real estate, however, is not without risks. For investors, it is crucial to know some strategies to lessen the potential risks, King said. The first is to be aware of additional debt. Investors must keep an eye on their credit scores and pay bills on time.

“Most investors will require a mortgage to purchase rental real estate. This can alter your debt ratios, which can impact whether or not you get the best mortgage or loan rates. Talk to an advisor before applying for new credit or renewing a current loan,” King said.

Another must-have strategy is budgeting. King said investors need to control how much they spend on maintenance and repairs to ensure that their rental properties are cash-flow positive.

“An investor needs to budget for a contingency fund. If the anticipated monthly rent covers all monthly expenses, including a repair fund, then the property is cash-flow positive, which is fundamental for a good investment,” she said.

Getting insurance could also mitigate the risks of catastrophic events.

“Virtually all insurance policies will cover a catastrophic loss of a building, but as a real estate investor, you must also consider the loss of income due to damage or destruction. A comprehensive rental policy will provide a landlord with income to replace lost rent at fair market value,” she said.

Overall, investors need to treat real estate investing as a business. Citing Edmonton-based investor Jim Yih, King said the key to successful real estate investing is positive cash flow, and not just the purchase price and the potential sale price.

Source; Canadian Real Estate Magazine – by Gerv Tacadena 12 Nov 2019
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    Building wealth through the property market

     

    From 1948 to1970, close to half a million people from the Caribbean were invited to what was commonly referred to as the ‘mother country.’  Arriving as British citizens (despite never living in Britain) is a trait rooted in the legacy of the Empire. Whilst there were many reasons for their arrival in Britain, many were seeking superior opportunities for themselves and their offspring. Early settlers spoke about a five-year plan to save money and return back to the Caribbean. Prohibited to find suitable accommodation, many migrants were confronted with signs such as, ‘No Coloureds or Blacks’, which was routinely used alongside the use of ‘No Irish and Dogs.’

    Where Caribbean’s were permitted to rent, the standards and conditions of the dwellings were typically unsavoury. Consequently, there was a determination to purchase one’s own properties using a system popularly known as pardner, which involves the collaborating of resources to provide access to funds. This system was particularly useful when banks would not loan to black people. Early settlers from the Caribbean owned houses in what are now some of the wealthiest locations in Europe, such as Notting Hill and Paddington. It was not rare for these residents to own more than two houses that were rented out, characteristically large three or four story Victorian terraced houses. As the decades proceeded, many of these houses were sold due to the owners returning to the Caribbean, or simply moving. Similar trends occurred in Shepherds Bush, Balham and more recently in Dalston, Brixton, Peckham, leaving a decline in property ownership amongst succeeding Caribbean heritage peoples within the UK.

    While the cost of properties has been exorbitant in London, where according to the last Office for National Statistics’ (ONS) Census for England and Wales, 58.4% of black people reside, the cost of properties in locations such as the West Midlands (which is said to host the second largest population of black people) at 9.8%, is considerably lower.

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    Black Landlords UK (BLUK) in Birmingham aims to revitalise the calibre of not only black home ownership, but also the number of black landlords. Founded in late 2017, one of the committee members Garfield Reece revealed how the organization came into fruition. ‘’It evolved (BLUK) from conversations that Rod Shield (senior investor in Birmingham) had during his networking meetings. People were asking him the same questions wherever he went.’’ Some of the questions that Reece cited were ‘’How we got into property management? How to turn a single let property into a high yielding HMO (House Multiple Occupation)? How to resolve issues and conflicts with tenants.’’

    Initially, Rod Shield decided to establish a Whatsapp group to address the myriad of questions he was bombarded with and to mobilize the engagement of black people within the community. The Whatsapp group quickly demonstrated the demand for such an organization and according to Shield, “The Whatsapp group numbers exceeded the allowable quote on Whatsapp; well in the excess of 200 investors in the group. So that’s really where it all started.’’ It was during this time that the committee (who volunteer their expertise for free) decided to galvanise all those that expressed an interest in property to congregate in one room. This lead to BLUK’s quarterly meetings; “The first meeting was held back in January this year,’’ declares Reece.

    The first BLUK meeting in January 2019 had approximately 50 people in attendance, and numbers have been growing rapidly. At BLUK’s last quarterly meeting for 2019, the committee expect to have 120 investors. “We are giving service providers and businesses within the community, an opportunity to sell and promote their businesses,’’ Reminiscent of a market stall, there will be six tables with businesses each discussing topics such as finance and how to raise mortgages. Half of the meeting will consist of Keynote Speakers, who will talk about the process one has to go through when acquiring property. The other half of the meeting will be dedicated to roundtable discussions, “It will be like mini workshops,’’ states Reece. “Each roundtable is going to talk about a different investment strategy,’’ Reece adds.

    The next BLUK meeting will take place on Saturday, November 23rd, 2019 from 14:00 – 18:00 at the Legacy Centre of Excellence (formerly known as the Drum) 14 Potters Lane Birmingham, B6 4UU.

    Source:

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    Why Black Homeowners in Brooklyn Are Being Victimized by Fraud

    Broadies Byas was deceived into signing away the deed to her townhouse in Bedford Stuyvesant, Brooklyn, after she fell behind on her mortgage payments, federal prosecutors said.

     

     

    Broadies Byas’s home is a hidden gem. From the outside, it looks unassuming, if somewhat neglected.

    But past the porch of the Victorian townhouse a rich interior reveals itself: tall ceilings, a mahogany staircase, stained glass doors and picture frames virtually untouched since the home was built in 1856.

    The house, in the Bedford-Stuyvesant neighborhood in Brooklyn, has an even more remarkable story — Ms. Byas’s father, a teacher who was born into a family of former slaves in South Carolina, bought it in 1957 for $7,500.

    But now the house is going through a tumultuous chapter. Ms. Byas, 54, is working to reclaim it after she was duped into signing away her property deed, according to federal prosecutors. Though the house is worth about $1.2 million, she gave it up, unwittingly, for a mere $120,000.

    “I pride myself as a true New Yorker — angry, skeptical, not trusting,” Ms. Byas said. “But I felt like the stupidest person on the planet.”

    A booming real estate market in Brooklyn is fueling a crime that law enforcement authorities say has taken hold in largely African-American neighborhoods that are being gentrified — deed theft, which involves deceiving or sometimes coercing a homeowner into signing forms that transfer ownership of a property.

    In many cases, a homeowner is made to believe the documents involve some type of financial assistance, but in fact turn out to be the property deed.

    Bedford-Stuyvesant and Crown Heights, both known for their collection of largely intact townhouses that cost a fraction of what similar homes sell for in Manhattan, have become hotbeds for deed theft, according to law enforcement authorities. Homeowners in Prospect Heights, Brownsville and East New York have also been targeted.

    Real Estate Shell Companies Scheme to Defraud Owners Out of Their Homes

    Of the nearly 3,000 deed fraud complaints recorded by the city since 2014, 1,350 — about 45 percent — have come from Brooklyn, according to data compiled by the city’s Department of Finance. (The borough accounts for roughly 30 percent of the city’s housing units.)

    The authorities believe the problem may be more widespread since homeowners may not realize right away that they have been victimized.

    “It’s just a drop in the bucket,” Eric Gonzalez, the Brooklyn district attorney, said at a recent town hall meeting in Bedford-Stuyvesant. “It’s really hot in the real estate market in Brooklyn. People want to steal our homes.”

    In Ms. Byas’s case, which led to the arrest of a man and his son, the aim was to flip her home and try to resell it to buyers who have been flocking to central Brooklyn seeking more affordable homes in lower-income neighborhoods.

    ImageHomeowners in largely African-American neighborhoods, like Bedford-Stuyvesant in Brooklyn, have become targets of deed theft.  
    Credit…Elias Williams for The New York Times

    Those orchestrating the schemes often hide behind limited liability companies and shell companies, making it difficult for homeowners to determine if they are being swindled and by whom.

    “By the time a homeowner realizes what has happened, the home may have already been sold or mortgaged multiple times,” said Christie Peale, executive director of the Center for N.Y.C. Neighborhoods, a nonprofit organization that helps homeowners.

    Even though rising property values in neighborhoods like Bedford-Stuyvesant have provided homeowners with more equity, many remain cash poor.

    As they grow older or lose a spouse, their homes can accumulate liens stemming from unpaid property taxes or water and sewage charges, making them vulnerable to fraudsters who often search public records to identify homeowners under financial stress.

    “Deed theft has become a common tool of career criminals and unscrupulous real estate developers to illegally obtain real estate, most often with the goal of selling it at a huge profit in high-demand housing markets,” Letitia James, the state attorney general, said in an email.

    Dairus Griffiths, 65, has been mired in a five-year legal battle to recoup his home in Bedford-Stuyvesant after he was ensnared in a scheme and ended up giving up the house, which was worth $1.3 million, for $630,000.

    Mr. Griffiths was facing foreclosure after a tenant stopped paying rent, causing him to fall behind on his mortgage payments.

    Not long after foreclosure proceedings began, a man named Eli Mashieh approached Mr. Griffiths claiming to run August West Development, a real estate firm in Queens, according to Theresa Trzaskoma, Mr. Griffiths’s lawyer.

    He told Mr. Griffiths that he was going to lose his house and offered him a cash advance, Ms. Trzaskoma said. Feeling pressured and fearful that he would soon be evicted, Mr. Griffiths signed a document selling his home for $630,000, believing it was a preliminary sales agreement that he would have the chance to reconsider.

    After talking to his daughter, Mr. Griffiths did try to cancel the sale, but when he called Mr. Mashieh he refused, saying it was a done deal. Mr. Mashieh obtained a default judgment and the sale eventually went through.

    Image

    A brownstone building under renovation in Bedford-Stuyvesant. 
    Credit…Elias Williams for The New York Times

    But Daniel Richland, a lawyer for Mr. Mashieh, disputed Mr. Griffiths’s claims and said a court had effectively ruled that the sale was legitimate.

    Some homeowners may not even know that their deeds have been stolen, the authorities say. Documents proving the sale of a property are recorded by the city registrar’s office, but not necessarily checked to ensure that they are legitimate. Owners might continue paying the mortgage for a property they no longer own.

    “It is, in fact, easier to steal ownership of a home than actually burglarizing it,” said Travis Hill, who oversees real estate fraud for the state attorney general’s office.

    Recovering a home whose deed has been illegally transferred can be difficult unless there is clear proof of wrongdoing, like a forged signature. In one case, the authorities arrested a man accused of committing fraud because the signature on a deed came from someone who had been dead for years.

    It is also challenging to determine whether the person had entered a bad, but not necessarily fraudulent, financial deal. “It’s often a very hard line to straddle,” said Noelle Eberts, a lawyer at the New York Legal Assistance Group who represents Ms. Byas.

    In Ms. Byas’s case, two men, Herzel Meiri, 64, and his son, Amir, set up a limited liability company called Launch Development.

    The two men instructed employees to search online for financially distressed properties in Brooklyn, Queens and the Bronx, according an indictment filed by federal prosecutors in Manhattan. Ms. Byas was among 60 homeowners the two men, along with five other accomplices, were accused of swindling.

    The men described themselves as foreclosure specialists who helped property owners with loan modifications or promised that they would be able to transfer their properties to trusted relatives to avoid losing their homes.

    Homeowners were encouraged to sign documents that were later used as proof they had agreed to sell their homes to Launch Development, prosecutors said.

    The company also deceived banks into approving the sale of homes by providing falsified documents, including paperwork edited or completed after homeowners had signed them.

    “Launch Development resold many of the homes, which were purchased at fraudulently deflated prices, for an enormous profit,” the indictment read.

    The Meiris pleaded guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 30 years in prison. Herzel Meiri was sentenced to 10 years’ imprisonment in August 2018, and Amir Meiri to five years’ imprisonment in November 2018.

    Ms. Byas’s ordeal began in 2008, after she learned she had multiple sclerosis and could no longer work. By 2014, she owed about $69,000 in unpaid mortgage payments and other bills and was facing foreclosure.

    She believed a second mortgage would prevent her from losing her home.

    One day, a young man rang her doorbell claiming he worked for Homeowners Assistance Services of New York, an organization specializing in foreclosures that turned out to be linked to Launch Development.

    He was polite, had a cherubic face and was someone Ms. Byas said she would feel comfortable inviting to a cookout. “When you’re in a panic, you think, ‘I can’t believe my luck,’” she said.

    After several visits from the man, Ms. Byas was taken by a private car service to Launch Development’s offices in Queens, where she described being, at various turns, cajoled or pressed into signing reams of documents. Instead of a loan agreement, she had signed a deed document, giving away the title to her home.

    In total, the company schemed to buy her home for $120,000, about 10 percent of the property’s value. She was able to show that she had been swindled because the check came from Launch Development, which had been on the radar of law enforcement authorities.

    Still, five years later, the title to her property is in the hands of the government and she is waiting to hear when she will get it back.

    “We were living the American dream,” Ms. Byas said. “This is a house that your ancestors worked for. They came from nothing.”

    Real Estate Shell Companies Scheme to Defraud Owners Out of Their Homes

    7-Year Fight to Reclaim a House Stolen in the Wave of a Pen

    Think You Own Your House? Check the Deed

    Source: The New York Times – By Oct. 21, 2019
    Kimiko de Freytas-Tamura was previously based in London, where she covered an eclectic beat ranging from politics to social issues spanning Europe, the Middle East and Africa. Born and raised in Paris, she speaks Japanese, French, Spanish and Portuguese. @kimidefreytas  Facebook
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    Millions of Americans still trapped in debt-logged homes ten years after crisis

    EAST STROUDSBURG, Pa., 2018 (Reuters) – School bus driver Michael Payne was renting an apartment on the 30th floor of a New York City high-rise, where the landlord’s idea of fixing broken windows was to cover them with boards.

    Click here to hear Payne’s story. 

    So when Payne and his wife Gail saw ads in the tabloids for brand-new houses in the Pennsylvania mountains for under $200,000, they saw an escape. The middle-aged couple took out a mortgage on a $168,000, four-bedroom home in a gated community with swimming pools, tennis courts and a clubhouse.

    “It was going for the American Dream,” Payne, now 61, said recently as he sat in his living room. “We felt rich.”

    Today the powder-blue split-level is worth less than half of what they paid for it 12 years ago at the peak of the nation’s housing bubble.

    Located about 80 miles northwest of New York City in Monroe County, Pennsylvania, their home resides in one of the sickest real estate markets in the United States, according to a Reuters analysis of data provided by a leading realty tracking firm. More than one-quarter of homeowners in Monroe County are deeply “underwater,” meaning they still owe more to their lenders than their houses are worth.

    The world has moved on from the global financial crisis. Hard-hit areas such as Las Vegas and the Rust Belt cities of Pittsburgh and Cleveland have seen their fortunes improve.

    But the Paynes and about 5.1 million other U.S. homeowners are still living with the fallout from the real estate bust that triggered the epic downturn.

    As of June 30, nearly one in 10 American homes with mortgages were “seriously” underwater, according to Irvine, California-based ATTOM Data Solutions, meaning that their market values were at least 25 percent lower than the balance remaining on their mortgages.

    It is an improvement from 2012, when average prices hit bottom and properties with severe negative equity topped out at 29 percent, or 12.8 million homes. Still, it is double the rate considered healthy by real estate analysts.

    “These are the housing markets that the recovery forgot,” said Daren Blomquist, a senior vice president at ATTOM.

    Lingering pain from the crash is deep. But it has fallen disproportionately on commuter towns and distant exurbs in the eastern half of the United States, a Reuters analysis of county real estate data shows. Among the hardest hit are bedroom communities in the Midwest, mid-Atlantic and Southeast regions, where income and job growth have been weaker than the national norm.

    Reuters Graphic

    Developments in outlying communities typically suffer in downturns. But a comeback has been harder this time around, analysts say, because the home-price run-ups were so extreme, and the economies of many of these Midwestern and Eastern metro areas have lagged those of more vibrant areas of the country.

    A home is seen in the Penn Estates development where most of the homeowners are underwater on their mortgages in East Straudsburg, Pennsylvania, U.S., June 20, 2018. REUTERS/Mike Segar

    “The markets that came roaring back are the coastal markets,” said Mark Zandi, chief economist at Moody’s Analytics. He said land restrictions and sales to international buyers have helped buoy demand in those areas. “In the middle of the country, you have more flat-lined economies. There’s no supply constraints. All of these things have weighed on prices.”

    In addition to exurbs, military communities showed high concentrations of underwater homes, the Reuters analysis showed. Five of the Top 10 underwater counties are near military bases and boast large populations of active-duty soldiers and veterans.

    Many of these families obtained financing through the U.S. Department of Veterans Affairs. The VA makes it easy for service members to qualify for mortgages, but goes to great lengths to prevent defaults. It is a big reason many military borrowers have held on to their negative-equity homes even as millions of civilians walked away.

    A poor credit history can threaten a soldier’s security clearance. And those who default risk never getting another VA loan, said Jackie Haliburton, a Veterans Service Officer in Hoke County, North Carolina, home to part of the giant Fort Bragg military installation and one of the most underwater counties in the country.

    “You will keep paying, no matter what, because you want to make sure you can hang on to that benefit,” Haliburton said.

    These and other casualties of the real estate meltdown are easy to overlook as homes in much of the country are again fetching record prices.

     

    But in Underwater America, homeowners face painful choices. To sell at current prices would mean accepting huge losses and laying out cash to pay off mortgage debt. Leasing these properties often won’t cover the owners’ monthly costs. Those who default will trash their credit scores for years to come.

    DREAMS DEFERRED

    Special education teacher Gail Payne noses her Toyota Rav 4 out of the driveway most workdays by 5 a.m. for the two-hour ride to her job in New York City’s Bronx borough.

    “I hate the commute, I really, really do,” Payne said. “I’m tired.”

    Now 66, she and husband Michael were counting on equity from the sale of their house to fund their retirement in Florida. For now, that remains a dream.

    The Paynes’ gated community of Penn Estates, in East Stroudsburg, Pennsylvania, is among scores that sprang up in Monroe County during the housing boom.

    Prices looked appealing to city dwellers suffering from urban sticker shock. But newcomers didn’t grasp how irrational things had become: At the peak, prices on some homes ballooned by more than 25 percent within months.

    Slideshow (19 Images)

    Today, homes that once fetched north of $300,000 now sell for as little as $72,000. But even at those prices, empty houses languish on the market. When the easy credit vanished, so did a huge pool of potential buyers.

    Eight hundred miles to the west, in an unincorporated area of Boone County, Illinois, the Candlewick Lake Homeowners Association begins its monthly board meeting with the Pledge of Allegiance and a prayer.

    Nearly 40 percent of the 9,800 homes with mortgages in this county about 80 miles northwest of Chicago are underwater, according to the ATTOM data. Some houses that went for $225,000 during the boom are now worth about $85,000, property records show.

    By early 2010, unemployment topped 18 percent after a local auto assembly plant laid off hundreds of workers. At Candlewick Lake, so many people walked away from their homes that as many as a third of its houses were vacant, said Karl Johnson, chairman of the Boone County board of supervisors.

    “It just got ugly, real ugly, and we are still battling to come back from it,” Johnson said.

    While the local job market has recovered, signs of financial strain are still evident at Candlewick Lake.

    The community’s roads are beat up. The entryway, meeting center and fence could all use a facelift, residents say. The lake has become a weed-choked “mess,” “a cesspool,” according to residents who spoke out at an association meeting earlier this year. Association manager Theresa Balk says a recent chemical treatment is helping.

     

    “A gated community like this, with our rules and fees, it may be just less attractive now to the general public,” he said.

    Source: Reuters.com – Reporting by Michelle Conlin and Robin Respaut; Editing by Marla Dickerson SEPTEMBER 14, 2018

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    What property rights do I have if I’m in a common law relationship?

    Property right in a common law relationship

    When it comes to the division of property in Ontario after a common law relationship comes to an end, many people believe that they benefit from the same legal rights as any married couple, especially when children are involved.

    It’s true to say that legal rights pertaining to children will be the same as if you were married, however, the biggest difference between married and unmarried couples is that you’re not automatically entitled to make any claim to the property you’ve shared and possibly contributed to, nor do you have an automatic right to live in the home that you have resided in.

    Property right in a common law relationship

    When am I entitled to make a claim on a property owned by my common law partner?

    Firstly, you would need to be considered to be in a common law relationship according to the Family Law Act and then you would need to provide evidence to prove monetary or another contribution, such as your time, which significantly bettered the household and benefited your common law partner. You may also have a claim if you can establish that the manner in which you operated as a couple greatly prejudiced you while benefiting the other side; thereby entitling you to have an interest in their property.

    How do I know if I’m in a common law relationship?

    The rules around this vary from province to province but in Ontario, this usually comes down to the length of the relationship and whether any children are involved. If there are no children involved, you are required to have lived together for at least three years before being deemed to be in a common law relationship and where there are children from the relationship, this time may be reduced to one year, although every case is different.

    How can I prove my contribution to the household?

    This is where the division of property becomes more complex in a common law relationship scenario as the responsibility falls upon the non-owner of the property to provide evidence of their contribution.

    Most people in this situation will need to consult a lawyer to represent them in court as it becomes a matter of contract law as opposed to family law. If you feel as though you’ve made a valuable contribution, monetary or otherwise, over the course of the relationship, there are essentially two claims that you might be able to bring to court; unjust enrichment and constructive trust, both of which have different factors that need to be proved for the judge to make an award.

    Protecting your interests

    Whether you’re in a relationship and about to move into a property owned by your partner or, already in this situation and concerned about protecting your interests, there are ways in which you can be proactive and feasibly avoid the need for court should the worst happen.

    Cohabitation Agreements can be drawn up by an experienced family lawyer, outlining how property should be divided if the relationship were to break down. Although this might seem like an awkward conversation at the time, once you and your partner have come to an understanding about where you both stand, it’s much less stressful to address it at the start of a relationship than it is when things may have become strained. You can get a sample cohabitation agreement but you will each need your own lawyer to advise on what your legal rights and obligations are under it for it to be legally binding in Ontario.

    If you’re already going through the process of separation from a common law partner, the other arrangement that you could make is a Separation Agreement. As long as the parties are able to agree, a well drafted agreement sets out how the property is to be divided and can again save on time and money in going to court, but it is also enforceable by court should the need arise (again, so long as each party has made full financial disclosure and had independent lawyers acting for them).

    Need advice on your particular situation?

    If you want to understand how to best protect your assets or you need some help determining what you might be entitled to, contact our team today to book your free consultation with a member of our Family Law team.

    Epstein & Associates, Barristers and Solicitors – Posted on August 12, 2019

     

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    Pharrell Williams is collaborating with developers on a new Toronto condo project

    <img class=”aligncenter size-full wp-image-197263″ src=”https://d3exkutavo4sli.cloudfront.net/wp-content/uploads/2019/11/untitled_condo_pharrell.jpg” alt=”” width=”1200″ height=”1034″ />

    Photo: Anthony Cohen

    Grammy Award-winning artist, songwriter and producer Pharrell Williams is collaborating with developers on a new midtown Toronto condominium project.

    Westdale Properties and Reserve Properties launched the marketing for their two-tower residential development, called untitled, today during a press event in Yonge-Dundas Square. Williams, who introduced the project via video on the screens across the public square, partnered with the developers on the design and creative elements of the condominium tower.

    “This partnership has evolved from a desire to do something really unique for Toronto in architecture and design as a whole,” said Sheldon Fenton, president and CEO of Reserve Properties, at the launch. “We believe that by bringing in a cultural icon with vision and ideation, from outside the realm of real estate, it would allow us to break the mold in terms of what has been traditionally done.”

    <img class=”aligncenter size-full wp-image-197266″ src=”https://d3exkutavo4sli.cloudfront.net/wp-content/uploads/2019/11/untitled_condos_pharrell.jpg” alt=”” width=”1200″ height=”1333″ />

    Photo: Norm Li

    Untitled is said to focus on key themes surrounding, “essentialism, connections to the elements and the universality of space,” according to a project press release. Williams desired to create an ethos of universality within the project, whereby “physical space is only a backdrop.” Drawing from these ideals, the project team landed on the name, untitled.

    “We wanted to make sure that it continued to give you the message of this amazing vibration of being home, and once you get in it, you make it you,” said Williams via a recorded video, who could not be present for the launch in person. “It’s universally beautiful, but there’s enough space for you to get into it and make it yourself.”

     

    Working with the project team, which also consists of Toronto-based architects IBI Group and local interior design firm U31, Williams played a role in crafting the vision and material aspects of untitled. His involvement ranged from consultation on the architectural and interior design, to choosing the furnishings in specific spaces. Williams is best known for his appearances as a judge on The Voice and his 2013 chart-topping single, “Happy.” Untitled marks his debut into multi-residential development.

    “The opportunity to apply my ideas and viewpoint to the new medium of physical structures has been amazing,” wrote Williams in the release. “Everyone at the table had a collective willingness to be open, to be pushed, to be prodded and poked, to get to that uncomfortable place of question mark, and to find out what was on the other side. The result is untitled and I’m very grateful and appreciative to have been a part of the process.”

    Source: Livabl.com –

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    How to Choose an Out-of-State Market for Investment (in 3 Easy Steps!)

    Aerial view of of a residential neighborhood in Hawthorne, in Los Angeles, CA
    You’ve decided, for whatever reason, that you want to invest outside of your local area or state. Your next question is—where should I invest?

     

    I’m going to offer you a list of things that you can consider when trying to figure out what market to invest in. These things are in no particular order, and some of them may not apply to you or your particular situation. My intention with each one is to give you something to think about and hopefully some ideas on where and how to start looking for a market that suits your investment needs.

    Here we go!

    Step #1: Narrow Down Your Market Options

    First, if you are brand new to out-of-state investing and don’t have a clue where to start, your location choices are likely going to feel extremely overwhelming. I have two things for you to think about that will hopefully at least get you moving in some kind of direction.

    Where do you have friends and family?

    Are there any cities where you have friends or family who might be good assets to have on your “team” on the ground? I’m not necessarily saying go into business with your friends or family or make them an official part of the team. But if you already have ties to any particular cities, maybe take a little time to decide if any of those cities might be good ones to get started.

    Even if your friends or family there aren’t part of your team, they may be able to occasionally drive by your property once you own it and tell you if anything crazy seems to be going on. It never hurts to have an extra set of trustworthy eyes on an investment property!

    Where are other investors buying?

    Thanks to technology and the internet (and websites like BiggerPockets!), you can easily and quickly network with other out-of-state investors. Ask people which markets they are buying in, and if they seem friendly and interested in chatting more, find out why they are buying in those markets.

    Don’t struggle to reinvent the wheel when experienced investors are already out there succeeding with out-of-state properties. I did secretly throw a keyword in there—experienced. Don’t take just anyone’s word for what they claim to be a good city to invest in. But remember, you’re just trying to get a list started. You can dig into details later as you go along.

    Start there. Make a list of the cities that come up when you consider those two things. Again, this isn’t your final list, but at least your list is much shorter now than it was when it had all 19,354 U.S. cities on it as investing options.

    You may not have known you had a list of 19,354 cities on it, but if you were starting from scratch, the whole country was a possibility! That would have to be intimidating and overwhelming—and almost an impossible point to start from. Now you have a less intimidating starting point.

    Related: What Moving Out of State is Teaching Me About Remotely Managing Rentals

    Step #2: Analyze Those Markets

    So, you are looking at your list of some number of cities or major markets, and now your question is—how do I know a good city to invest in from a bad city?

    In my mind, there are only two major questions I ask to determine whether I want to invest in a particular city:

    • Do the numbers work?
    • How likely am I going to be able to sustain those numbers?

    If you don’t know what numbers I’m talking about, I’m talking about your returns. Returns (aka profits) can be generated in two major ways: cash flow and appreciation. This is at least true for rental properties.

    If you are flipping out of state, some of this will not apply to you, and there are some slightly different considerations that you’ll need to incorporate into your analyses. You’re on your own, though, for those—I’ve never flipped, so I definitely shouldn’t be the one to tell you how to rock that method out.

    Most likely, if you are wanting to invest out of state, you’re probably doing so because you want cash flow. Most of the investors who invest out of state do so because the numbers locally don’t pencil out. This is often the case in a lot of the bigger markets—Los Angeles, San Francisco, New York, etc.

    businesswoman doing paperwork at office desk, working through finances, using calculator and making notes in her notebook with pen

    And while those markets don’t usually pencil out for cash flow, they are the bigger players when it comes to appreciation. So, in thinking of anyone who lives there and wants to buy out of state, it’s probably because they want cash flow. See my logic?

    Either way, let’s assume you are going after cash-flowing rental properties out of state because you can’t find cash flow locally. If that’s the case, the numbers need to work in the market you choose to invest in. Otherwise, what’s the point?

    So, let’s think about the numbers. What kind of numbers do you need to understand when it comes to cash flow?

    If you are in it for cash flow, you want to be able to determine the projected cash flow on a property. To help you do that, use the easy formulas in this article: “Rental Property Numbers so Easy You Can Calculate Them on a Napkin.”

    In addition to the equations in that article, a term you will want to be familiar with is “price-to-rent ratio.” This term compares the price of a property to how much rent it can collect. The reason these two things matter is because they will determine whether you can cash flow on the property or not.

    As you saw in those cash flow equations, you need the rental income you collect on a property to surpass the expenses of buying and owning that property in order to have positive cash flow. If the expenses of buying and owning that property are higher than the rent you can collect from the property, you’re in a negative cash flow situation and losing money (on the cash flow front at least).

    Knowing this term now, if someone asks you if you’re interested in a particular market for investing, your first question might be—how are the price-to-rent ratios there? What you’re ultimately asking here is—is there an option for cash flow in that particular city?

    For instance, I can tell you that hands-down the price-to-rent ratios in Los Angeles are not supportive of cash flow. I can tell you that the price-to-rent ratios in Indianapolis are generally favorable for cash flow. In no way does that mean every property or every location within Indianapolis will cash flow, but it does mean there is an option for it—whereas in Los Angeles, there’s really no option for cash flow.

    Now, let’s say a particular market has generally favorable price-to-rent ratios for cash flow.

    Oh wait, I just heard you ask—how do I know if a market has favorable price-to-rent ratios? Great question.

    The fastest way to find that out is to network with other investors. You can either ask other people where they are investing, which I already mentioned, or let’s say you have a family member in a particular city and you’re curious about whether or not you can cash flow there. Post in a BiggerPockets Forum and ask people if they have any knowledge of cash flow potential in said market.

    Look for people investing there, and find out the best places for cash flow there. If all of that fails, start looking up properties and running those equations I taught you, and see if you’re coming out ahead on cash flow.

    Let’s say a particular market has generally favorable price-to-rent ratios for cash flow. This is where that second question I asked comes in—how likely am I going to be able to sustain those numbers?

    The answer to this question is lengthy, so I’ll just give you one basic thought to consider for now. Is the market you are looking at a growth market or a declining market? The reason this matters is because you can project cash flow numbers until the cows come home, but if certain factors come into play with your property, you may never see a single bit of that projected cash flow materialize.

    Bad tenants, for example, can cause you to not see a penny of your projected flow because they can cost so much in expenses—IF they are even paying the rent.

    For details on growth versus declining markets, check out “How to Know If Any Given Real Estate Market is Wise to Invest in (With Real Life Examples!).”

    To help you understand the potential consequences of investing in a declining market, check out “5 Risks of Buying Rental Properties in Declining Markets.”

    Step #3: Decide on a Market

    Your list of potential markets should be even shorter now than it was when you narrowed it down from 19,354 cities to either cities you know people in or have ties to or cities other investors recommend. It should only include markets/cities where the numbers not only work but also where the numbers have good potential of sustaining themselves. (That last part is purely my own personal investment strategy preference—it’s certainly not a requirement.)

    You may have one market on your list at this point, or you may have a handful. Which one you ultimately decide on may just come down to personal preference at this point—or it may depend on your situation and your resources.

    At this point, here are a few more things you can look at.

    Budget/Capital

    You just might not have enough capital to invest in all of the good options out there. For instance, I know of some amazing deals in Baltimore and Philadelphia, but those particular deals require a minimum of $90,000 up front.

    You may not have $90,000. You might only have $20,000. Well, good news—$20,000 can get you a great cash-flowing property in other cities!

    So, for your budget, you may stay focused on one area over another. I used to work with triplexes in both Chicago and Philadelphia. At that time, you could get a good cash-flowing triplex in Philadelphia for $130,000. The triplexes in Chicago at the time were bigger and nicer, and they were around $270,000.

    The cash flow on the Chicago properties was higher, of course, but not everyone’s budget would support buying one of those triplexes. But many of those people could get one of the Philadelphia properties. So, more than anything, your available capital may further limit you on where you can invest. This isn’t always the case, but it is a consideration.

    Property Type

    This is simply a personal preference factor. For example, some markets like Philadelphia and Baltimore tend to have properties with more of an urban feel. They are often more of the row house-type of structure. Not everyone likes the urban feel, and not everyone likes adjoined buildings.

    The other option would be properties with a suburban feel that are free-standing. You can find lots of these in the Midwest. Additionally, some markets offer a lot of multifamily (MFR) options, and some markets only have single-family (SFR) options that will cash flow. So, if you prefer urban or suburban over another, and if you prefer SFR or MFR over another, those personal preferences will steer you toward particular cities and away from others.

    Related: Forget the Demographics and Focus on Researching THIS Before Investing Out-of-Area

    Look! You’re continuing to narrow down your list! Here’s how to further narrow it.

    Returns vs. Risk

    At the end of the day, some cities and property types will be more risky than others. Even if you are looking within stable growth markets and none of the areas you are looking in are majorly dangerous, some may have significantly better schools than others, etc.

    Maybe one market is slightly more in a “gentrifying” stage than another more matured market. It’s always fine to take on a little more risk, but make sure the proposed returns are high enough to justify it. Or if you are more risk-adverse, you may choose to accept slightly lower returns in exchange for staying with a less risky market and property. That’s totally fine as well.

    So, you want to have a feel for the returns versus the risk available to you in each potential market and weigh that against where you are on your own personal scale of desire. What’s more important to you: returns or playing it safer? That should help you further whittle down your list.

    Ease of Commute

    This one may be less significant than others, but it could play a role. If you have narrowed your list down to say, two markets, and those two markets are weighted pretty evenly against each other—which one is easier to get to? If a nonstop, not-too-lengthy flight is available to one and to get to the other would require a couple stops and a longer travel time (which would also probably be more expensive), go with the one you can get to easier!

    Ultimately, the most important thing about whichever market you decide on is whether or not you will lose sleep over investing there. Maybe it’s because you can’t stomach your investment property being so far out of reach, maybe it’s because the market is a little riskier, maybe you hate single family homes and really wanted a multifamily. Whatever the situation, go with what will put a smile on your face (and hopefully some cash flow in your pocket).

    marketing-strategy

    Summary

    A quick summary on the steps you can take to help you decide on a market:

    Step 1: Narrow down your market options.

    • Where do you know people?
    • Where are other people investing?

    Step 2: Analyze those market options to further narrow down your list.

    • Is it a good market to invest in?
    • Do the numbers work?
    • Will you be able to sustain the numbers?

    Step 3: Choose what you like!

    • Decide on your personal preferences and see which markets fit those.

    Then, once you have your market decided on, go shopping! Even if you only narrowed your list down to a couple of cities, that’s fine. Two cities is easier to shop in than 19,354.

    And here’s one last tidbit for you. At the very end of it, no matter how or why you chose the market(s) you did, you need to confirm one last thing. Are you ready?

    The last thing that matters is that you can form a good team in the market you choose.

    If you can’t find good team members to help you with your property, go to another market. If you don’t have a solid team as an out-of-state investor, you’ll be up that famous creek without a paddle.

    If you’ve narrowed your list down to a couple of cities you’d be willing to invest in, choose the one that offers the best team. If you’ve narrowed your list down to one city you want to invest in but then you can’t form a solid team of good people there, start over and choose a new market. You must have the team!

    There you have it! Now go market shopping.

     

     

    Source: BiggerPockets.com – By Ali Boone November 5, 2019

     

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    Here’s Where You Can Buy a Home if You Make Less Than $50,000 a Year

     

    The conversation around homeownership in Mississauga and surrounding cities has been a challenging one, especially as prices remain high across all housing types in the city and surrounding municipalities (in fact, the average 905 condo is selling for over $400,000 and has been for sometime now).

    But while it’s frustrating for experts—and non-experts who entered the market years ago—to tell prospective homebuyers that they’ll have to move to find an affordable housing, some people might be interested to know that there are indeed still places in Canada that offer affordable homes for single buyers with more modest salaries.

    And a recent Zoocasa report reveals where solo homeowners-to-be on a budget might be able to purchase a home.

    “While having a dual-income household can greatly improve purchasing power and the ability to qualify for a mortgage, that’s not to say homeownership isn’t in the cards for single-income earning buyers. In fact, according to recent calculations by Zoocasa in celebration of Single Awareness Day (February 15), there are a number of markets where it’s possible to buy a home on one income – and even have money left over,” says Penelope Graham, managing editor, Zoocasa. 

    Graham says that, to determine which markets were affordable, the average and benchmark home prices were sourced from regional real estate boards. It was then assumed the buyer would make a 20 per cent down payment and take out financing with a 3.29 per cent interest rate amortized over 30 years, to determine the minimum income required to qualify for a mortgage on the average home.

    Those findings were then compared to median income data of “persons living alone who earned employment income” as reported by Statistics Canada.Buying Single - Income Gap - Age 25-64

    • Buying a Home Single - Age 25 to 34
    • Buying a Home Single - Age 35 to 44

    Buying a Home Single - Age 45 to 54

    So, where can solo buyers most easily afford a home?

    Overall, single home buyers will see the best bang for their buck in Eastern Canada and the Prairie provinces, with Regina taking top spot out of 20 cities for greatest affordability.

    There, a single buyer earning the median income of $58,823 would enjoy an income surplus of $20,025 on the average priced home of $284,424.

    That’s followed by Saint John, where someone earning the median of $42,888 would see a surplus of $18,038 on a $181,576 home, and Edmonton, where earning $64,036 would net a $17,826 surplus on the average home price of $338,760.

    MLS listings in Calgary, Lethbridge, Winnipeg, and Halifax also fall within the realm of affordability for single-income purchasers.

    So, where are single buyers less likely to purchase a home? As expected, Zoocasa says the Greater Golden Horseshoe (which includes Toronto and the GTA), is out of most people’s budgets.

    Graham says a buyer earning the median of $50,721 would fall a whopping $88,361 short on the average $1,019,600 for MLS listings in Vancouver. Toronto real estate listings are the second-least affordable with an average home price of $748,328; a buyer earning $55,221 would face an income gap of $46,858.

    Victoria is the third least affordable with an average home price of $633,386, still $39,359 above what the relatively high median income of $86,400 could afford.

    Other markets not considered affordable for single buyers include Guelph, Kitchener-Waterloo, London, Montreal, and Ottawa.

    Naturally, the housing market is more difficult for single millennials to navigate.

    Zoocasa says the research also compared how earnings ranged by age group per location, and which demographic enjoyed the greatest affordability when purchasing a home. Across every market, Gen Xers (35 – 44 and 45 – 54 age brackets) enjoy the greatest earnings and purchasing power, with 11 markets considered within affordable reach (compared to 10 markets across all age groups).

    Millennials (aged 25 – 34) had the least earning power in each city, behind Boomers (aged 55 – 64).

    Overall, single home buyers aged 35 – 44 purchasing a home in Regina enjoyed the greatest affordability of all, with an income surplus of $24,215. A millennial purchasing in Vancouver had the least, facing a gap of $92,774.

    Check out the infographics below to see which Canadian housing markets are most affordable for single buyers, courtesy of Zoocasa.

    • Buying a Home Single - Age 55 to 64

    Top 5 Most Affordable Housing Markets for Single Home Buyers


    1 – Regina

    Average home price: $284,44

    Income required: $38,798

    Actual median income: $58,823

    Income surplus: $20,025


    2 – Saint John

    Average home price: $181,576

    Income required: 24,769

    Actual median income: $42,888

    Income surplus: $18,038


    3 – Edmonton

    Average home price: $338,760

    Income required: $46,210

    Actual median income: $64,036

    Income surplus: $17,826


    4 – Saskatoon

    Average home price: $290,736

    Income required: $39,659

    Actual median income: $55,758

    Income surplus: $16,099


    5 – St. John’s

    Average home price: $295,211

    Income required: $40,270

    Actual median income: $51,964

    Income surplus: $11,694


    5 Least Affordable Housing Markets for Single Buyers

    1 – Vancouver

    Average home price: $1,019,600

    Income required: $139,082

    Actual median income: $50,721

    Income gap: $88,361


    2 – Toronto

    Average home price: $748,328

    Income required: $102,079

    Actual median income: $55,221

    Income gap: $46,858


    3 – Victoria

    Average home price: $633,386

    Income required: $86,400

    Actual median income: $47,041

    Income gap: $39,359


    4 – Abbotsford

    Average home price: $590,900

    Income required: $80,604

    Actual median income: $46,714

    Income gap: $33,890


    5 – Hamilton-Burlington

    Average home price: $550,058

    Income required: $75,033

    Actual median income: $51,253

    Income gap: $23,778

    Source: Insauga.com – by Ashley Newport on November 1, 2019
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