Caution, not immediate gratification, should be the mantra for buyers looking to buy their first homeCredit where credit is due, indeed.It's easy, but financially dangerous to be mortgaged to the hilt based on today's ultra-low teaser interest rates
Mortgage rates are going to increase by two to three per cent over the next two to four years
First-time buyers should be thinking more long term, arranging their financing based on expected rises in mortgage rates that will be a reality in two years
buyers should not expect their real estate investment to make a fast or big payoff when it comes to sell
Younger buyers should be paying attention to the financial restraint of older buyers
Sound advice if you don't want to eat macaroni most of the time while sitting at your granite kitchen island
Monday, June 29, 2009
Credit where credit is due
I've taken a lot of swipes at the MSM and the real estate industry for their perceived lack of balance over the years. Today I'm not. I'm praising them for this article instead. Here are the highlights:
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18 comments:
B&F,
delete your false accusation post at KIV. Until you do, you are not welcome here. Should you choose to escalate your game, be aware that I save e-mails, google is grand, and ISP addresses are easy to obtain/block.
It was also really mean and completely rude to post that comment in a thread which should be only congratulatory. That in itself shows a true indication of his/her character.
HHV,
I thought your post on KIV was very classy. Well done.
This brings up a good question for those contemplating purchasing a home that has yet to be built?
For example, if you are buying from a builder of a large project what should you insist in your contract?
The first thing I would want is access to the property whilst under construction. Some developers limit this to only 3 site visits.
I understand the safety concerns when building a condominium and town house complex, but if the properties are detached homes and you give the developer a day and time you will be there - I don't see the problem of you visiting your future home.
I would also make sure that you retain the right to approve changes - something that developers do without consulting you. Maybe you really wanted that window in the garage - which has now disappeared?
Especially in multi-home developments, the pace of the sub contractors may lead to sub standard quality. The things that I have seen in other developments include: concrete slabs that are not level. Windows installed upside down, tile floors not installed correctly, only one coat of interior paint, exterior siding not meeting at tight joint ends, stairs that are over cut resulting in a wobly staircase, door and baseboard trim that is poorly or sometimes not at all properly mitred with large gaps, windows that were in the house renderings, but never installed. Interior drywall installed before the exterior siding has been installed. And the home is smaller than what you thought you were purchasing.
Any other thoughts to watch out for?
Just Jack,
New home construction, especially in the SFH category has a whole plethora of things that can go wrong. I'd insist on taking a copy of the new home warranty to a lawyer that has experience with these documents to go over. I'd also insist on doing a search to see if the developer had other warranty claims against them and how they were handled.
I've seen a lot of kitchens being billed as "luxury" and all wood end up being a combination of plastic, metal and real wood doors with some cheap looking granite thrown on top. If you're paying for a $30K kitchen, make sure you don't end up with a $13K kitchen.
And here is a thing that bugs me about upgrades.
The developer will upgrade the standard counter tops to granite at cost. Huh? This is a statement that sounds good - but what does it mean?
I've seen builders add another $5,000 for granite counter tops. Okay, but should it not be $5,000 less the cost of the standard counter tops? Else, your paying for both the standard and the granite?
Will upgrade your carpets to laminate floors - This is an upgrade?
Because of the boom in construction, lack of expierenced trades and items like drywall and flooring from China, personally I would have a problem with buying anthing new. But that's me. Others will pay premium prices for a property that has never been lived in before. Frankly, I'll just call in a maid service.
I also don't like being in the position of buying from a single seller. The developer has a lot of control and if your just one of 6000 families, your not going to get that personal touch.
Take the Reflections Condominiums. Initially people were told that there was to be a roof top lap pool and running track. Bye bye pool. How about that Sooke development Sun something or other, was there not to be a shuttle from Sooke to Victoria in the plans?
A bio mass heating system in Dockside Green? Was to be wood chips - now its natural gas (not so green now). Sorry the developers reserve the right to make changes. I believe it is planned to be built, but once the development has been sold out. Huh? who would be paying for it then - when the developer is living in Tahiti?
Nail pops, sagging walls and foundations, leaking pipes, roofs not properly nailed down. Things like these happen in the first couple of years. Most will be covered by the new, new or is it the new,new,new home warranty programme. That is as long as the programme is solvent. Leaky condo anyone - seems that the programme has run out of money - again!
If I were to buy new, it would be from a smaller company that builds a few homes a year. Has been checked out with the Better Business Bureau and I have a list of his last half dozen projects that I can drive by or ask the owners and neighbours about. I'd visit the site regularily and work with the builder on the thousand and one things that DO go wrong when building a home. Some changes he will absorb and others I will - like upgrading to that 6 jet, rain shower steam unit with self scrubbing shower heads for those hard to get at places.
The preceeding has been provided free of charge - and in this case you are getting what its worth.
from KIV
Here's what I wrote in response to his false accusation on my blog: "Look at the times of posting: On Greater Fool: 9:26pm. On KIV 9:34pm. On HouseHuntVictoria: 9:44pm." These posts were all made last night in a span of less than 20 minutes. I know who this individual is and I can assure you he is in fact a "he."
I hate to bring it up but I gotta ask. Is B&F Garth?
MD,
No, and I doubt very much if Garth bothers trolling online anywhere other than Garth's own websites.
Victoria Real Estate Board Month-to-Date stats: New sales: 870 New listings: 1350 Total Active Listings 3796
Via Tim Ayres on Twitter.
Chasing the developer to correct problems on new construction can be a nightmare. New home warranties don't really put pressure on them to act quickly or completely. In our previous Ottawa townhouse, we had a problem with drainage between adjacent end units because the builder put the minimal amount of topsoil over clay base. This went horribly bad during the summer thundershowers and the spring thaw. It felt like walking on a wet sponge to get to your back yard. Also, I hate to think of how much water was in constant contact with the foundation.
This and many other issues required consistent nagging to get them to even look at the problem, let alone resolve them.
Working with my RE lawyer, he identified that attempts to amend the purchase agreement wouldn't get anywhere in the short time you can retract your offer. He said at most, they would cave in on adding one more site inspection prior to the pre-delivery inspection.
In my opinion, it's not worth the money you "save" by purchasing pre-construction. In hindsight, I call it a good learning experience only because I made a profit from offloading it to a buyer.
HHV if you know who B&F is why not just out him?
I would like to direct your attention to the
Internet Dickwad Theory
Maybe if you remove the anonymity he will go away or learn to play nice.
I'm really not liking that a few bad eggs are turning me into a censor. Please refrain from directing inappropriate remarks at identifiable people.
Psst.. Wanna buy a pre-sale?
Selling a presale contract may not end matter..
Is anyone watching Bear Mountain and can share what is happening there?
S2
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