Should you sell your home before buying?- The Toronto Star

A Toronto Star article by Tony Young from May 1, 2011.

 

---

Scott and Elizabeth McNeil plan to buy a larger home in the future as their family grows.
But first, they have to sell their existing one. It’s a simple strategy used by move up buyers everywhere. Take the money you’ve invested in the first home, and then buy another one.
But for some buyers, it gets a little more complicated. Should you buy your home first, then sell, or should you sell your home first, and then buy?
For the fiscally conservative McNeil’s, selling first was the best strategy.
“I just didn’t feel comfortable buying a new home, and then getting stuck having to sell my existing home quickly so that I wouldn’t be stuck with two mortgages,” said Scott, an information technology consultant. “One problem that would be worrisome is the possibility of taking less money for your existing home if you had to sell it fast so that you could close on the other property.”
Selling your home first before buying another is the generally accepted route in the home buying process. But that’s changing. The figures aren’t officially tracked by the Toronto Real Estate Board, but some realtors report that buyers are increasingly willing to purchase a new property, even if they still haven’t sold their existing one first.
With 16 years of consistently rising home prices in the Toronto market, it’s not hard to see why some buyers can get complacent.
Buying a new property in a rising market means you can always get rid of your existing property at a potentially higher price down the road.
But the reverse is true in a down market. If prices start to fall, buyers could end up trying to finance two homes which are steadily losing value.
Bill Johnston, president of the Toronto Real Estate board says market conditions are “critical” before triggering a “buy or sell first” decision for homeowners.
“You really have to do your research. If the market is good and homes are selling well on your street, then there is a good chance you can sell your home quickly. If the market is slow, it might not be a great idea,” said Johnston.
In the current spring market, listings are down by 19 per cent and homes are still selling well. Fewer listings means there is less competition if you put your house up for sale.
However, the average days that the house sits on the market are up by 15 per cent to 23 days from 20. Analysts also expect the market to slow during the summer and fall. Most economists expect the market to be relatively flat on pricing moving forward. But some expect prices to fall over the next 12 months.
Buying first in a down market has some serious pitfalls, says Johnston. During the 1989 market peak and subsequent crash in the Toronto market, many buyers got burned when they purchased a new home before unloading their existing property.
“It was as if the brakes had slammed on the market,” said Johnston. “If you were caught holding two properties, that was a tough time.”
One way to hedge your bets if you want to buy first is to make your offer conditional on selling your current property. But Johnston says this typically isn’t practical in the current marketplace, since the vendor will take the offer with fewer restrictions.
“Conditional offers just aren’t popular,” said Johnston.
John Andrew, director of the executive seminars on corporate and investment real estate at Queen’s University says in a strong market where there might be multiple offers on choice properties, some people don’t have a choice when it comes down to buying or selling first. In other cases, buying first could be prompted by a divorce or by a relocation.
“It really boils down to how flexible you are in your search criteria and your circumstances. In a hot market for example, when you think you might not get what you want, you may have to be more aggressive. But it’s also a really tricky game to play because the risk is real.”
Paul Swartz, an agent with Sutton Group Old Mill Realty says as a rule of thumb, he usually counsels buyers to sell first. However there are times when this isn’t possible.
“You’ve got buyers who are very specific that they can only live on a certain house on a certain side of the street. If that’s the case, then when the property comes up for sale you’ve got to buy it. But if you’re a little more flexible, I would sell first and buy later.”
Jim Wong, a mortgage broker with the Royal Bank, says clients should get pre-approved before bidding on a home to determine what they can really afford.
But sometimes emotions get in the way. One client recently ended up in a bidding war for a home earlier this month, even though she had an existing home, and hadn’t checked with a broker about what she could afford, said Wong. In one sense she was a lucky loser, since her income didn’t support having two properties.
“Their are some people who have good income. But realistically, the majority of the clients would not qualify for having two mortgages,” said Wong. “In this case they would be in a stressful situation if they bought the house, because they would have to sell before closing, which could be 30 days, and that’s not always possible.”
Queen’s University professor Andrew warns that vendors should carefully consider the advice they receive from agents, but ultimately decide for themselves whether they want to buy or sell first.
One underlying issue is that most people wouldn’t necessarily talk about is that agents are more incentivized to have their listing clients buy first and then sell later, he said. In the up market of the last decade, that wasn’t necessarily bad advice. But if the market goes south, watch out, he says
“If you sell first, it could take months to do that transaction, especially if you are waiting for the right price,” said Andrew. “That’s not good for the agent because it will take longer. But if you buy first, the commission is available right away to the agent, and then you really have to sell your home quickly to pay for your purchase, triggering a second transaction. Buying first would certainly cut down on the agent’s time horizon and they could move faster to the next deal. So there is some incentive.”
Not everyone agrees with that analysis. Veteran realtor Swartz argues that most agents wouldn’t last long in the business if they kept putting their interests ahead of the client.
“There are some bad apples, but not all agents are self-serving, you wouldn’t be in business for very long giving that kind of advice,” said Swartz.
The McNeil’s, meanwhile, listed their home earlier this month for $374,900, without an agent, relying on their own advice.
The urban townhouse near trendy King West village in downtown Toronto has been home to the family for about a year and a half. But it’s time to move on to larger digs for their family, which includes one year old baby Hunter.
“So far the spring market has been good, the phone’s been ringing off the hook, probably because there isn’t that much out there,” said McNeil.
With a hot property that appeals to the key demographic of first time buyers and young families, McNeil could likely have afforded to buy first and wait to sell.
But for those contemplating whether to buy first, make sure that you can financially withstand holding two mortgages in case the market turns, said RBC’s Wong. The bank could also conceivably rescind a mortgage approval if the first property is not sold before closing of the second property.
And whatever you do, try not to impulse-buy.
Mississauga based publicist Pat Cairns said she was walking by a condo in her home town of Dundas, Ont. last fall when she found the ideal condo unit.
“It was beautiful, exactly what we wanted,” said Cairns. “We absolutely fell in love with it.”
Cairns and her husband spent a feverish couple of days crunching numbers to see if they could afford the property. The condo was already completed and the developer was trying to sell off a few remaining suites. But the seller wanted an early closing.
“We were very seriously considering buying, but were worried about the risk. At this stage of our lives we decided we couldn’t carry a lot of debt if we didn’t sell,” said Cairns. “I think the lesson is, if you don’t think you can afford it, stay away from those open house signs until the cash is in the bank.”

Thermal imaging- Find out where you are losing heat in your house

Below is an article by Ian Harvey written for the Toronto Star about thermal imaging, an interesting heat-loss detection system that has been around for a number of years and has now become quite affordable. 

---

What’s behind your walls? What you don’t see can hurt your home — but a simple and inexpensive service could be just the tool for peaking into the hidden recesses of your biggest investment.
Thermal imaging technology — taking pictures of objects with a special camera which sees minute variations in temperature and displays them in a corresponding colour scheme — has been around for decades but has only recently become affordable for the residential market.
“These cameras used to cost tens of thousands of dollars,” says Toronto electrical engineer turned thermal imaging specialist Gabriel Gal. “Even more recently, they were $10,000 but now you can get them for around $2,500.”

The same economics that has driven down the cost of your computer, laptop, big screen TV and digital camera, is also at play on these scientific devices. The real trick is being certified in how to read the  thermal images.
But for homeowners, it also means that for between $200 and $300, depending on the size of your house and how detailed a report you need, services like Gal’s Atlantis Thermal Imaging can identify issues such as faulty wiring, termite damage, uneven insulation, air leaks, moisture or condensation penetration, and where your in-floor radiant heating system has sprung a leak or whether it was installed properly.
“Even in my own house, I’ve found things I didn’t know about,” he says. “I renovated and had a new roof put on but the water and ice shield wasn’t laid properly. I found where the ice had started to push under the shingles.”
For home buyers and builders alike, it’s a small investment and could pay for itself since a standard home inspection may not catch hidden issues.
“With energy costs today, people want to know if they have a problem,” he says. “If they feel ‘ghosts’ or drafts in their rooms, they want to know where that leak is coming from and a camera allows you to find those things.”
For home buyers, he says, a thermal imaging scan can find problems they can demand be fixed or reflected in a better price; for builders it’s a way to ensure their sub-trades have done their job.
“I’m a certified home inspector as well,” says Gal, who also builds houses through his company Atlantis Homes. “And even with my experience, you don’t always see everything. There are some 80,000 homes sold each year in the GTA and only 70 per cent are inspected. Even fewer are thermally scanned.”
While the thermal imaging can’t “see” mould, for example, it can see moisture which shows up as a different temperature.
“It feeds on paper and the sugars in wood,” he said. “We can see the moisture which usually means mould, too.”
As a custom home builder, Gal knows the value of thermal imaging — and so does Claude Spethmann, who is also a custom builder
“We’ve had problems in the past with radiant floor heating which we put oak flooring over,” says Spethmann of Spethmann Works Ltd. “Sometimes they (the sub-trades) nail right through the pipes and cause a leak, which causes all kinds of problems.”
He hired Gal to image the floor to ensure there were no leaks.
“You energize the heating system and before it really heats up you can clearly see the lines,” Gal says. “If there’s a leak, you’ll see it start to pool.”
In other inspections, Spethmann was able to see insulation was not installed properly and was able to address the problem before turning the finished home over to his clients. “These are custom homes and people expect a level of quality,” he said.
Any tool that gives buyers an insight is invaluable, says realtor Don Gault of Royal LePage/Johnston & Daniel.
While a good home inspector is worth every penny, it can be hit or miss depending on the inspector’s skills and level of experience.
“I take my own advice,” he says. “With imaging, you can see things the naked eye would miss. It can also confirm suspicions.”
Home inspectors aren’t allowed to drill into walls or pull things apart to investigate forensically, he notes, but the thermal imaging can get to the heart of things.
“Nothing takes the shine off a new home purchase like discovering something you wish you’d known about before the offer. It’s rare, mercifully, but I wouldn’t buy from the older housing stock in Toronto without this kind of investigation.”

BMO: Canada real estate market heading for bubble—but not Toronto

Article from Toronto Life magazine by John Michael McGrath dated March 4, 2011

A new report out from BMO Capital Markets suggests that Canada is in increasing danger of a housing price collapse—especially if prices keep going up. The good news for Toronto is that while other provinces are steadily inching closer to the danger zone, Ontario doesn’t seem to be.

The problem is that the value of homes have increased much faster than incomes. The bank says average home resale prices compared with personal incomes are 14 per cent above the long-run trend, up from last summer, although still below the 21 per cent peak that preceded the 1989 crash.

But that is not the case in all markets. Five provinces are currently in the danger zone, led by Saskatchewan, where the ratio is 39 per cent above historic norms.

Also well above the long-run levels is Newfoundland, 34 per cent higher; British Columbia and Manitoba, 31 per cent, and Quebec, 23 per cent above.

By comparison, in Ontario, the price-to-income ratio is only 10 per cent higher than historic norms, suggesting prices are moderately overvalued but not in bubble territory.

Hurray for Toronto—overvalued against historic prices, but not quite as bad as other places. It’s like we’ve been saying: when the collapse of the housing market comes, Toronto may get hit, but we won’t need to stockpile ammo, canned goods and drinking water.
Of course, this also means Toronto shoppers might be able to pick up real estate in other provinces for a song after the crash. Anyone interested in a waterfront property in Regina Beach?

Choosing a Real Estate Agent

You see so many different For Sale, Sold and For Lease signs with so many different Realtor names. You browse the listings on MLS and see so many more. With so many agents out there, how do you choose? Do you go by their picture? Do you look at how many listings they have? What's a home buyer to do?

Here are a few recommendations when beginning your search:

1) Get referrals from family, friends and co-workers.  

2) Meet with a few agents to conduct mini interviews.

3) Check the online search of The Real Estate Council of Ontario to see if the agent is registered. RECO regulates the activity of trading in real estate in the public interest and has been put in place to protect your best interests.

4) If you are a seller, find out how much their commission is.

5) Normally, it is helpful if the agent is familiar with the area you are looking in. 

6) Choose someone who displays professionalism and a willingness to work for your needs.

7) Should you want, your agent should be able to assist you with other necessary real estate related services, for example, arranging a house inspection, arranging a mortgage and finding a real estate lawyer.

8) If you are selling your home, does the agent have a plan of attack for marketing your house. MLS, ads, open houses?

9) Not all agents work the same schedule. If you are only available to view properties on Sundays, make sure your agent works weekends. Communicate your availability during your interview with them.

10) This isn't a deal breaker, but if your sales representative has a website, that is a very good way of gathering even more information about them and seeing what affiliations they have.

Did you know our children are struggling in school?

Latino students are struggling in our schools, but nothing is being done! As parents, we must support our children as they make their way through school and do everything we can to empower them during this time in order to succeed. 

Below is an article from Fox News Latino describing a study done of 60 Latino students in various Toronto high schools and the struggles they face.

---------------------------------------------------------------------------------------------------------

Pedro, a 10th grader whose family emigrated from Colombia a few years ago, was labeled a slow learner because he didn’t speak English. Rita, a high school student, said that when she arrived from Mexico, she was shunned and berated by her peers for not knowing English.

Both are students in the Toronto school district, which, with over 250,000 students and 600 schools, is both the largest in Canada and the one with the most Latin American students. And both were part of a study released last month which examined Toronto’s high Latino drop-out rate: About 40 percent of these students—nearly double the number of the overall population—fail to finish high school.

Compared to generations of Latin American migration to the U.S., large numbers of Hispanics started settling in Canada relatively recently. The first wave came in the 1970s, as political asylum seekers fled South American dictatorships. The largest wave, however, came after 2000, when the immigration debate in the U.S. became most heated.

About 350,000 Latin Americans are now in Canada, where the overall population is about 32 million. The largest concentration – a little more than a third – have settled in Toronto. But some say that the Canadian school system was not prepared for a sudden influx of Spanish speakers – which now total about 5,200 – and the young Latinos who migrated there have paid the consequences.

Rubén A. Gaztambide-Fernández, an education professor who headed up the University of Toronto’s years-long study, said many students told researchers scarce resources for Spanish speakers and economic stress impacted their performance.

They also said teachers and their peers had such negative stereotypes about them, that it bred low expectations.

“In the U.S., depending on where you live, all the stereotypes about Latinos tend to be bad, but at least there are a lot of stereotypes,” said Gaztambide-Fernández, whose final report, released this month, was 103 pages long. “What we found in Canada was that everyone assumes that because you are Latin American, you are Mexican. And because you are Mexican, you are poor, lazy and you belong to a gang. That was it.”

Gaztambide-Fernández believes the narrow view may be due to Latinos’ relatively recent arrival. “The only images many Canadians consume of Latin Americans are those that come from Hollywood movies,” he said.

A Puerto Rican Harvard University graduate, Gaztambide-Fernández moved to Toronto from Boston in 2006, around the time the Toronto school district began collecting demographic information about its students.

It was the first time the city was able to look into student success based on race and ethnicity, which turned out to be a long and arduous task. But when the results came in, the school district realized Latin Americans were dropping out at double of rate of the rest of the student population. No one knew why, so a group of Hispanic Torontonians decided to find out.

Sixty students from six Toronto high schools filled out surveys and were interviewed in focus groups or alone. Over and over again, Gaztambide-Fernández said, the students complained about not having enough Spanish-speaking support or ESL classes. Many reported they had to work to help their families, and said juggling those hours with school was affecting their class work. They also said the negative stereotypes sapped them of academic motivation.

“It is like a little burlap sack, you throw in discrimination, you throw in work, you throw in that you have no money, you throw in that, well, you don’t like school, you throw in this and you throw in that, and the burlap sack gets heavy,” said Mercedes, a 12th grader who was interviewed for the study, which published only first names. “It is not just one factor that leads you leave school.”

The 250,000-student Toronto school district, the largest in Canada, acknowledges that Latino students have struggled there. Members of the school board say they have tried to address the group’s problems in the past but nothing has worked. But now, following the University of Toronto study, the school board plans to launch a more far-reaching program.

The school board will adopt a series of recommendations in the study and has already reached out to the community, universities – and even school officials in New York – to address the issue.

“It is very clear to us that in order to help specific students improve their achievement we have to have innovative approaches,” said Jim Spyropoulos, Coordinating Superintendent for Inclusive Schools at the Toronto District School Board. “If we keep doing the same things, we are going to keep getting the same results.”

As part of its efforts, the district will kick off a pilot program in February that will offer cultural sensitivity classes to teachers so they could understand the Latin American culture, offer support programs for newcomers, and give low-income students part-time jobs at the school. Latin American history courses will also be part of the curriculum.

If the pilot program is successful, it will expand to all schools.

“What our kids keep telling us is, 'they don’t get us',” said Spyropoulos of the school board. “This is our best attempt to try and support them.”

To reach the writer, email carolyn.salazar@foxnewslatino.com

Entrevista del 23 de febrero en AM1610 Voces Latinas

Aquí se encuentra la entrevista del 23 de febrero de Antonio Guerrero con Silvia Mendez en radio AM1610 Voces Latinas.

Haz click en el logo para escuchar la entrevista grabada.

Antonio Guerrero será en la radio hoy

Escuchen al programa en Voces Latinas 1610AM a las 7:15pm donde Antonio hablará otra vez de temas relacionados con la Ley Familiar.


Haga click sobre el logo de Voces Latinas para escuchar.

       en     

Mastercard commercial

This is somewhat out of character, however this video caught our interest, because of the Spanish of course!


We sat mesmerized, not knowing what the commercial was for. We threw out a string of guesses, and were then surprised to see that it was for Mastercard!


For those who haven't seen this, check it out.

Will you be participating in Earth Hour 2011?

Earth Hour started in 2007 in Sydney, Australia when 2.2 million individuals and more than 2,000 businesses turned their lights off for one hour to take a stand against climate change. 

Last year on March 27, 2010, a record 128 countries and territories  united across the globe making it the largest voluntary action ever witnessed.

Earth Hour is a worldwide event started by the World Wildlife Fund that rallies millions of people to show support for action on climate change. This year, after the lights come back on, residents are being challenged to think about what else they can do to make a difference and be part of a solution.

Last year, Hydro One Brampton reported a five per cent drop in power usage in Brampton, which is equal to 21.7 megawatts, or enough electricity to power 18,000 homes.

Climate change is the biggest environmental threat to life on Earth wreaking havoc with the natural systems that

regulate the earth’s climate: 

• Melting glaciers and ice caps on every continent, creating heat waves, and dehydrating forests and

wetlands

• Affecting the lives and communities of everyone on the planet

On average, every person in the world is making a footprint 50% more than what the planet actually produces per person, per year. In other words, it takes 1.5 Earths of productivity to support humanity each year, but we have

only 1 Earth!

Half our footprint is carbon from fossil fuel emissions. Canada is one of the top 10 nations contributing to global climate change. While other leading countries of the world are pioneering green energy technologies and solutions, we are holding on to an old strategy based on developing increasingly carbon-intensive forms of energy in the Arctic and the tar sands. We must value carbon more, consume less, insulate better, and hasten the switch to alternative fuels like wind, solar, tidal and hydropower. WWF-Canada is calling on business and political leaders to drive this fundamental shift. Our success will ensure that Canada is on the right path for future generations, our economy and the planet.

Guerrero Law’s employees will be participating by switching off their lights for Earth Hour at home. Antonio Guerrero has prepared his guitar to play music by candlelight for his family during that hour.

What will you be doing during Earth Hour?

If you need ideas, visit the Earth Hour website to find out how you can participate.

Guerrero Law in Mexico City / Guerrero Law en la Ciudad de México D.F.

Guerrero Law is very excited to announce the expansion of its office to Mexico City.


We are pleased to welcome Gabriela Guerrero to our team, and look forward to working with her.

Our office in Mexico City can be found at the following address:

División del Norte 1167
2o. Piso, Colonia del Valle
C.P. 03100, México D.F.

To reach us by phone from within Mexico, contact: 5350-6592
From outside Mexico, we can be reached at: +1 (416) 840-5807

Guerrero Law tiene el placer de anunciar la expansión de su oficina a la Ciudad de México D.F. 


Damos la bienvenida a Gabriela Guerrero a nuestro equipo quien será nuestra representante en México.


Nuestra oficina en México, D.F. se encuentra a la siguiente dirección:

División del Norte 1167
2o. Piso, Colonia del Valle
C.P. 03100, México D.F.

Para contactarnos por teléfono desde México: 5350-6592

De fuera de México, nos pueden contactar al: +1 (416) 840-5807

Taping for Now What? Rogers TV / Grabando para Now What? Rogers TV

Today, Antonio Guerrero had the pleasure of being interviewed by Martha Pinzón from the Rogers TV show Now What?.
He was invited to the show to briefly speak about divorce and alternatives to court proceedings.
The show will air in two weeks at which point we will upload the clip.

---

Hoy, Antonio Guerrero tuvo el privilegio de ser entrevistado por Martha Pinzón de Rogers TV del programa Now What?.
Fue invitado al programa para hablar en breve de los temas de divorcio y alternativas al proceso judicial.
El programa estará en el aire en dos semanas en cual momento cárgaremos la entrevista.

Grabando para el programa Now What?

Martha Pinzón y Antonio Guerrero

New Mortgage Rules Effective Today

Don't forget homebuyers, Canada's new mortgage rules go into effect as of today, March 18, 2011.


In case you've missed all the discussions, the three new rules are as follows:


1) The maximum amortization period has been reduced to 30 years from 35 years for government-backed insured mortgages with loan-to-value ratios of more than 80 per cent.


2) Ottawa will lower the maximum amount Canadians can borrow in refinancing their mortgages to 85 per cent from 90 per cent of the value of their homes.


3) Ottawa will withdraw government insurance backing on lines of credit secured by homes.

Finance Minister Jim Flaherty announces Canada's new mortgage rules in January 2011.

Feliz Día de la Mujer

Photos courtesy of Antonio Guerrero