If you’re looking to complete a property flipping project in one of Alberta’s sought-after neighbourhoods like Spruce Grove, Stony Plain, Parkland County, or the Edmonton region, you’re in for a fun and rewarding experience. Just as it is a fun hobby to some or a means of added income for others, property flipping can also be a business or main source of income for many people who are well versed with real estate and renovations. There are a variety of reasons why you might want to flip a piece of Parkland County real estate or one of the many Edmonton acreages available for purchase. Before you start, though, it’s important that you understand what you’re getting into. If you’re looking to flip a piece of Edmonton real estate, consider these advantages and disadvantages before committing to the project.

Pro: Great Financial Gain

Of course, the number one advantage of property flipping is the financial gain that so many people achieve. Many people have amassed significant wealth with a simple property purchase, renovation, and sale at the right place and the right time. A major part of their success involved having a solid understanding of the trends in the real estate market. If you can buy and sell at the right time, you could earn a lot of money simply by flipping a property.

Con: Relatively High Risk

One major disadvantage when it comes to property flipping is the relatively high risk involved. In order to profit from a property flip, you will need to buy low, invest into the property, and sell high. This means leveraging changes in the market – knowing when prices will drop and when they will rise. Either buying or selling at the wrong time will greatly reduce your property’s value – and if you happen to both buy at a poor time and sell at a poor time, you could find that your newly renovated property is worth less than it was worth when you purchased it.

Pro: A Fun Project

Many property flippers who thoroughly enjoy the project have a keen sense of interior design or a good grasp of home renovations and improvement, or both. Having a passion for design and renovation will certainly help to make property flipping a fun and rewarding experience. This is especially true for home flippers who are able to undertake certain home renovation or decorating projects themselves, without having to involve too many contractors. First and foremost, your property flip should be a labour of love.

Con: A Big Mess

For those who don’t have an understanding of home renovations, especially for those hiring contractors for the first time, it is common to find yourself in a big mess – both literally and figuratively – when it comes to renovating the home in preparation for its sale. When dealing with contractors, it’s very common for things to run behind schedule or for fees to go well above what was initially quoted. A property flip is a major project with all sorts of intricate details, and there are a thousand different things that could go very, very wrong. If you’re not prepared to take that risk and deal with the fallout, you will neither enjoy nor profit from a house flip.

If you are interested in undertaking a project with a piece of Spruce Grove real estate, Stony Plain real estate, or Parkland County acreages, you can find immediate financial benefits as well as longer term financial gains in each of these areas. Most importantly, it’s crucial to understand your own qualifications and knowledge when it comes to property flipping, and to be able to assess your ability to deal with challenges that will arise when you flip a property.

For a better understanding of what’s involved in property flipping, I’m always happy to answer your questions. Feel free to call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

Investing in real estate can boost the value of your financial portfolio in several ways while also giving you flexibility. People will always need housing, and depending on your goals, you may decide to use your second home as a rental property or simply renovate and flip it. There are lots of great homes in Spruce Grove, Stony Plain, Parkland County and the Edmonton region. Here are just a few reasons why you should consider buying one as an investment property.

Housing Values Tend to Rise

Buying real estate is a good investment because the value of a property tends to appreciate over the long-term – sometimes at a rate of as high as 6 percent per year. In Edmonton, the total value of all property sold went up by 15.3 percent from June 2013 to June 2014, according to the REALTORS Association of Edmonton. Buying an investment property in Edmonton is a great way to take advantage of rising property values.

Diversify Within The Sector

Real estate can diversify your portfolio by putting money in something other than stocks or bonds. Even within your real estate portfolio, though, you can diversify even further.

When you start purchasing investment properties, you may decide to put part of your money toward single-family homes, part of your money toward duplexes, and part of your money toward acreages. Investing your money in different kinds of real estate means that if one market does poorly, you can still recover.

Hold the Property in a Trust

When real estate is held in a trust, it may be possible to hand that property down to future generations. This means that an investor’s children or grandchildren will be able to take advantage of a mature revenue stream to pay for college or other living expenses.

Property placed in a trust or a retirement account may also enable the property to grow in value while shielding those gains from some or all capital gains taxes. Over the course of many years or decades, this savings could be in the tens or hundreds of thousands of dollars.

Someone Else Can Manage it for the Owner

Those who don’t have the time or skills to do repairs or otherwise manage a property can hire someone to do it for them. This can free up your time to focus on your investments, even if you don’t have a lot of experience maintaining homes or commercial property.

For those who may live in another part of the country, being able to have someone else oversee the upkeep of the property and manage tenant needs ensures that your responsibilities as a landlord are being met. If a tenant’s minimum needs are not met, that tenant may be able to leave the property without paying current or future rent. Having a caretaker or property manager means you get a great income stream without the hassle.

If you’re looking for a house that you can rent out to tenants, the Edmonton area is a great rental market where you can turn a profit. Buying an investment property can sometimes get complicated, but an experienced real estate agent can coach you through the process.

For more information about investing in real estate, or to find your next great investment property, call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

If you’re about to become a landlord in Spruce Grove, Stony Plain, Parkland County and the Edmonton region, it’s important to get your ducks in a row. Under the law, landlords and tenants both have certain rights that must be respected and certain responsibilities that need to be fulfilled. Not knowing or understanding the laws that affect you as a landlord can bring legal problems down the road. It doesn’t matter if you own Spruce Grove real estate, Stony Plain real estate, or Edmonton acreages—knowing your rights and responsibilities as a landlord is vital. Here’s what you need to know about the laws that influence landlord-tenant relationships.

Landlords’ Obligations Toward Tenants: Privacy, Prompt Repairs, and Eviction Notices

If you are the landlord of a rental unit in the province of Alberta, you have certain obligations toward your tenants that you must fulfill. Though you own the rental unit, you must give your tenants their privacy. You may enter your rental unit uninvited if you give your tenants 24 hours notice, and if you have a valid reason for being in the rental unit. Valid reasons include inspection, repairs, and showing the unit to potential new tenants if your current tenants are moving out. You may enter the unit between 8 AM and 8 PM, but not on holidays or on a day the tenant considers a religious day of worship.

You must also keep the rental unit in good condition. As a landlord, it is your responsibility to repair anything that breaks as a result of normal use or wear and tear. You are also responsible for any plumbing and heating repairs that are needed during a tenancy. You must make sure that your rental unit’s heater can keep the unit at a minimum of 22 degrees Celsius at all times.

If you decide to evict your tenant, you must give your tenant early notice. Notices of eviction or rent increases must be given to tenants in writing. When you serve an eviction notice, you must serve it either in person, by certified or registered mail, or (if the tenant is avoiding you) by posting the notice somewhere the tenant is highly likely to see it.

Landlords’ Rights in Tenancy Agreements: Timely Rent Payments, Respectful Tenants, and the Right of Eviction

As a landlord, you have several rights in dealing with tenants. You have the right to receive rent payments on time. You also have the right to rent your suite to tenants who act respectfully toward you, who do not cause damage, and who do not create noise issues. If your tenants fall behind on the rent, you can evict them with a 14-day notice; there is no required grace period for late rent. You can also use a 14-day notice to evict tenants who are causing noise problems. If your tenant has caused significant damage to the rental unit or has attacked you, you may evict them with a 24-hour notice. You are allowed to evict tenants during the winter months.

Consequences for Failing to Meet Expectations

If you fail to meet your expectations under the law, your tenant may take you to provincial court or open a case with the Residential Tenancy Dispute Resolution Service. The RTDRS is a faster and less expensive option than filing a lawsuit, and it can award amounts up to $25,000. As the RTDRS is a provincial government branch, any decision that is made in dispute resolution is legally binding. Your tenant may complain to the Alberta Ministry of Health or a government health inspector if you do not take care of bug problems, heat outages, and other health threats once you become aware of them. Your tenant can also complain to Alberta Health Services if they find you are using (or have used) the rental unit for illegal drug production.

If you’re looking to rent Parkland County real estate or a property in Spruce Grove, Stony Plain, or Edmonton, it’s important that you know your rights and responsibilities as a landlord. Being informed is the best way to make sure that you follow the law and avoid the problems that come with violation of tenancy rights.

For more expert advice or to list your property, call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

In the hunt for a new home so far you’ve covered Spruce Grove real estate, Stony Plain real estate, Parkland County real estate, Edmonton real estate, Parkland County acreages and Edmonton acreages. That’s quite a bit of land to cover, but for good reason. There’s one feature in particular you’re looking for in your new home: a secondary suite.

What Is a Secondary Suite?

A secondary suite is a section of a single detached house that contains all of the features of an apartment, like a kitchen, a bathroom, a bedroom and a living space that remains separated from the main house. Basement apartments are a common example of this type of living space.

What Size Should It Be?

According to Edmonton bylaws, a secondary suite should be at least 30 m² (about 325 square feet) and no more than 70 m² (about 750 square feet). In total, the main house and the secondary suite should be at least 360 m² (3875 square feet).

What Are the Advantages to Owning a Home With a Secondary Suite?

The biggest advantage of purchasing a home with a secondary suite is being able to rent out the unit. Depending on how the space has been divided, most suites can accommodate one or two people. The rent collected on the suite can serve as additional income for homeowners, which is a fantastic way to supplement mortgage payments. Adding a secondary suite can also be beneficial when it comes time to sell your home. Houses with secondary suites usually have a higher property value compared to other houses of a similar size. With a secondary suite, you’ll earn more on the sale.

Are There Any Restrictions to Be Aware Of?

As with most major renovations, zoning restrictions and certain bylaws act as guidelines for building and maintaining a legally sound secondary suite. Check zoning policies for your location to determine how they will impact your situation. In general, there are a few standard rules with which a secondary suite should comply. First, only single detached homes may contain a secondary suite. Second, the suite must fulfill all fire code regulations upon inspection.

Does Owning a Secondary Suite Impact My Taxes?

The short answer is, yes, it does. If you chose to rent out the suite and take on tenants, the rent money collected must be documented with the CRA as earned income when it comes time to file your income taxes for the year.

Is City Funding Available for Suite Renovations?

There are certain grants and funding options available for homeowners seeking to either add a secondary suite to their home or renovate an existing suite. Upon receiving approval and funding, renovated suites will be subject to inspection by city officials to confirm that fire code and building code regulations are met.

Secondary suites are the next wave in creating affordable housing solutions for homeowners and renters.

Have more questions about secondary suites that need answering? Bring them to me! I would be more than happy to discuss any issues related to home ownership and Alberta real estate. Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

Technology has changed the way we do almost everything, including home buying, whether in Spruce Grove, Stony Plain, Parkland County, the Edmonton area or elsewhere.  Here are a few smartphone apps home buyers and investors might find useful.  (Many are available free for all types of smartphones; check with your app store.)

SHOPPING FOR HOMES

Google Maps and Google Earth for mobile can show you where homes are located, but you can learn much more about a property, giving you a feel for the neighborhood, the quality of other housing, accessibility, distance from busy streets and more.

Yelp Mobilewith its reviews of businesses can give you some idea about what a neighborhood has to offer (shopping, restaurants, gas stations, etc.).

Realtor.cais the official mobile app of the Canadian Real Estate Association (CREA) with access to about 350,000 Canadian properties for sale on the Realtor.ca website.  Search using your smartphone’s built-in GPS for properties near your location or a specific address; receive listing details, photos and agent contact info.

Zoocasa[iPhone; free].  Similar to Realtor.ca.  Search for properties based on your current location and receive full descriptions of properties.  This app also allows users to email listings from within the app.

Home Tracker [iPhone; $3.99].  Keep track of all the details of the homes you visit with your REALTOR®.  “HomeTracker allows you to document each property in detail as you visit it. Properties are grouped into a Tour, which is a set of homes you visited with your real estate agent, or homes in a specific area. In addition to storing property information, HomeTracker can easily take Photos, Map a property, E-mail property information, and perform a Google search!”

MORTGAGE APPS

There are plenty of mortgage calculator apps out there but most are not Canadian.  One with some limited application to Canadian situations is Canadian Mortgage Calculator.

CIBC Home Advisor app provides mobile access to mortgage tools, advice, neighborhood information.

“The CIBC Home Advisor App for iPhone and BlackBerry lets home buyers:

* Track and compare properties visited by taking and storing photos and completing a home buyer’s checklist for each home

* View neighborhood maps and get immediate access to average property valuations and trends

* Request detailed neighborhood reports for properties of specific interest

* Post, tweet, text or email details of the properties and neighborhoods you are considering to share them with family and friends in real-time

* Access four different built-in calculators to help determine what the customer can afford, if they should rent vs. buy, the equity in their home, or mortgage payment options

* Request a CIBC pre-approved mortgage certificate for financing to lock in an interest rate

* Contact the nearest CIBC Mortgage Advisor and arrange to meet to get advice on mortgage options.”

RECalc – Real Estate Mortgage Loan Calculator [iPhone; free]  “RECalc is a Real Estate Mortgage Loan Calculator that is also a traditional Mathematical Calculator.  You can use RECalc to calculate the Monthly Payment, Term, Interest Rate or Loan Amount for a loan, as well as standard mathematical calculations as you would in any other calculator. Once you modify any of the Calculation variables you can re-calculate any of the other values. You can also figure in Annual Property Tax, Homeowner’s Insurance and Mortgage Insurance, as well as a Down Payment amount/percentage.  RECalc supports semi-annual compounding (Canadian Amortization) in addition to normal monthly compounding.”

MISCELLANEOUS

Flashlight [iPhone; 99¢].  Turn your iPhone into a flashlight!   This app allows you to choose from a variety of styles and colors.  For even more features, try Flashlight+ [also 99¢]

Evernote [free; available for all smartphones and computers].  This handy app allows you to create and save all kinds of documents:  text notes, web pages, video clips, your digital photo scrapbook, and much more.  Text-recognition software makes for easy searching.

Awesome Note (+ToDo) [iPhone; $3.99].  Get organized with this versatile and customizable app that allows you to create regular notes, notes with photo attachments, To Do notes, Post-It style Quick Memo for quick jotting, daily diary, travel diary checklists, shopping lists, schedules, and more.  You can send notes as email and even synchronize your notes with Google Docs and Evernote.

Do you know of a great app that should be added to this list?  I’d love to hear from you.  Call me at 780-910-9669, email me at btwynam@telusplanet.net, or contact me here.

Whether in Spruce Grove, Stony Plain, Parkland County, the Edmonton area or elsewhere, REALTORS® love statistics.  We like to know how many and what kind of properties are being listed and sold, and for how much.  We also like to examine trends over time because this helps us help our clients determine realistic property values when they buy or sell a home.

We often hear about the ups and downs of the real estate market, but what does this really mean?  Is real estate a good investment?  Does real estate always appreciate? 

Answers to these questions can be seen fairly easily by looking at a few statistics, especially when these are presented in graphic format.   If we look at the average residential selling prices for homes in the Edmonton area from 1962 to 2009, we’ll see some interesting trends.  Even more interesting is that these trends tend to repeat themselves.

From 1962 to 2009 the average selling price of a residence in Edmonton increased from $12,556 to $320,392 – an increase over 47 years of 24 times the starting value!  Does this mean that the value of one’s home doubles every few years?!  Well, sort of…  Examining the numbers year by year, we see that while the overall price trend has been ever higher, the movement is not always steady and not always upward.  There were a number of times during those 47 years when the average selling price in one year, or even for a series of years, was lower than the previous year.

Prices stumbled in 1964, recovering the next year.  Steady, and in some cases significant growth, continued until 1981.  Looking more closely at the gains during those 16 years, and doing a little math, we discover that double digit percentage gains over the previous year occurred in 1967 (12.3%), 1968 (12.9%) and 1969 (17.7%).  During the next 3 years prices continued to increase but at a more modest rate.  1973 saw prices take another leap (14.6%), and that was followed by 3 more years of huge year over year gains (1974 – 28.2%; 1975 – 26.4%; 1976 – 32%).  A house that sold in 1972 for $24,777 was suddenly “worth” $59,450 only 4 years later.  By 1981 the average selling price had risen to $91,438, a gain of 369% in just 9 years.  Many people buying and then re-selling property during this time made substantial financial gains.

But the sometimes cruel nature of the real estate market took over in 1981.  A person buying a home in 1981 would have seen prices drop for the next 4 years, and then increase modestly for another 4 years but still not rebound to the price paid in 1981.  A hard lesson perhaps.

By 1990 the average residence sold in Edmonton for $101,014.  Prices rose for 5 years, fell in 1995 and 1996, and then rose for the next 11 years, up to 2007.  This is eerily reminiscent of the trend mentioned above starting in 1964.  Several of the 11 years between 1997 and 2007 saw a price gain that was dramatic.  In 2002 and 2003 percentage increases were 12.6% and 10.2% respectively.  In 2006 prices rose 29.4%.  This was followed in 2007 by the largest one-year percentage increase since these statistics began:  34.7%, or a rise to a dollar value of $338,009.  Most people are probably aware of what happened to the housing market in the US during this period of time and its effect on house prices throughout North America.  The average selling price of a home in Edmonton dropped 1.5% in 2008 and 3.7% in 2009 but appears to be trending upward so far in 2010.

These trends are even easier to spot in a chart like this one:

Looking at the proverbial big picture, we see the following:

• The average annual price increase is roughly 7.8%
• The average 5-year price increase is about 49%
• Only 9 years between 1962 and 2009 showed price decreases
• If you held a property for 9 years, you would always see an increase
• Edmonton values appear to double every 9 years, on average, since 1962

Statistics and facts suggest that yes, real estate is definitely a good investment, and yes, it does appreciate over time.  

What about right now in the marketplace?  Are we once again in the trend of a couple years of soft prices followed by a decade of increases?  Are prices going to continue to fall before they recover as they did in the 1980s and 1990s?  Is now a good or bad time to buy and sell?  Hard to predict and impossible to know.  This is, of course, exactly what makes real estate interesting!

Interested in learning more about the real estate market in Spruce Grove, Stony Plain, Parkland County or the Edmonton area?  Phone me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

A Market Evaluation is a comparison of your home, whether in Spruce Grove, Stony Plain, Parkland County acreage properties, the Edmonton area or elsewhere, with homes that are currently on the market or were recently on the market. They include “Active Listings”, “Expired Listings” and properties that have recently “Sold”.

 “Active Listings” are homes currently on the market that are similar to yours and are considered to be your competition.

“Expired Listings” are properties that were on the market but didn’t sell.  There can be a number of reasons for a property not selling:  poor marketing, bad location, a house that needs extensive work…   But the main reason that a house doesn’t sell is the price was too high.  There are generally buyers for most segments of the housing market, if the price is right.  There are also strategic ways of adjusting the price of a listed property, usually downwards, while it is on the market.

Recently “Sold” properties that compare closely to your house probably tell the most about how much your house is worth.  These are properties that buyers felt were the best value for them, given the choices available to them at the time. Now if one of those houses that “Sold” were next door to your home, sold yesterday, was built in the same year, same square footage, identical lot, same development and layout, same parking amenities, same number of bathrooms and bedrooms, same basement development, same condition… and was exposed to the market for all to see and then sold, then you would have a really good idea of what your home should sell for.

However, it is never that simple.  So we compare similar homes (“Active”, “Expired” or “Sold”) and we make adjustments to the probable value of your home, either up or down), to compensate for the differences.  The more homes we compare yours with, the better idea we have of the true value of your home.  Some examples would be: busy street versus a quiet cul de sac, larger home compared to a smaller home, large to small lot, extensively renovated compared to everything being original, in let’s say a 20 year old home.  And if you are fair and honest in these comparisons, adding value or subtracting value, one can start to visualize how much your home is worth.

Usually when I do a market evaluation I bring along all the relevant comparisons, full highlight sheets of “Active Listings”, “Expired Listings” and recently “Sold Listings”.  Although I could select a few properties that closely compare and then have a computer program break down averages (days on the market, square footage, number of bedrooms, etc), I find it more informative to show my clients everything I see and explain to them how I analyzed the information to come up with what I think their home is worth.  It is surprising how people will comprehend a seemingly complex calculation when given all the information, and a slight tutorial on how to analyze the information at hand.

See also the article on BarryT.ca entitled “What is Fair Market Value?”

If you are thinking of selling your home in Spruce Grove, Stony Plain, Parkland County or the Edmonton area, I would be pleased to do a Market Evaluation for you.  Please call me at 780-910-9669, or email me at btwynam@telusplanet.net. 

Not intended to solicit properties currently listed.

With the popularity of all sorts of home renovation shows, people in Spruce Grove, Stony Plain, Parkland County, the Edmonton region and elsewhere are experimenting with home decorating home improvement, and home flipping at unprecedented levels.

I have to admit I watch a lot of these programs myself. We humans are drawn to watching other people work. It is amazing how easy some professionals make things like framing, dry walling, painting, decorating, etc, look. The key word here is professional. I often say to people you can do any improvement yourself and save the labour cost (about 60% of the cost of the improvement); however, the end result has to look like a professional did the job.

I understand the motivation to want to do the work yourself. First off it doesn’t look that hard to do. Second you don’t have the extra money to hire someone to do the work, we have all been there. But one day (statistically within 5 years) you will be trying to sell your home and the improvements in it to someone else. Even unsophisticated buyers, people who have never owned their own home, recognize poor or amateurish work. If a home has a number of areas where a home owner has done home improvements poorly, a potential buyer may perceive negatively.

Here’s how perception works

Perception is a buyer’s belief system.  Whether right or wrong, what buyers perceive they believe. A buyer’s perception can extend beyond any poor work done by you or someone else.  It could be perceived that most of the improvements in your home were done amateurishly or cheaply. I cannot overemphasize the importance of making your home improvement projects look like they were done by a professional. Here are a few hints:

1. Do some research before you take on a project. The internet is a great source. Be careful to select the right tools for the job. For instance when painting, not all brushes, rollers or paint are the same. They are all designed for different purposes and applications. Also if painting, make sure you learn to cut in properly. Roller hit marks on the ceiling are a trademark sign of a home improvement project gone bad.
2. Sign up for home improvement seminars at your local building supply centre, Home Depot, Rona, etc.
3. Find someone who is handy at doing their own home improvements and offer free labour to help them take on a home improvement that you feel most comfortable with.
4. Start in an area that is less visible, like a bedroom (preferably down stairs), closet, or storage room.
5. Be prepared to invest time. It will probably take you 2 to 3 times longer the first time you tackle a renovation, compared to someone experienced at it. If it doesn’t go right the first time you do it, be prepared to re-do it. Remember that by learning to do it right you are accumulating cumulative knowledge that will come in handy the next time you need to use it.

Although you feel you are doing the improvement for yourself, remember that when you decide to put your house up for sale, you are now trying to sell the improvement to someone else.

If you do decide to do home improvements on your own, either by necessity or desire, take it slow. Do the research, take your time, make sure you select universally appealing colours, and do the job well. It can be rewarding, both financially and emotionally. But remember:  whatever improvements you do to your home should look like a professional did it. Enjoy the savings and the added value of your home.

Looking for more information about Spruce Grove real estate?  Call me at 780-910-9669, email me at barry@barryt.ca, or contact me here.