Here are three important reasons why you should get pre-approved when buying a home.

Save Time

Getting pre-approved for a mortgage is important because it informs you of how much the lender is willing to lend you and helps you understand how much you can afford. This information makes it easier to determine where to buy and what type of property to consider.

It doesn't mean you need to spend the entire amount offered to you by the lender; you can purchase a home that is priced lower than your pre-approved amount.

To be Protected

You will know your interest rate and regular payment amount, what you are paying toward principal and interest, and also how long it will take to pay off your mortgage. It will also protect you from future interest rate increases.

Peace of Mind

Some lenders will require you to pay off certain debts before closing to receive your loan. This will save you from future concerns.

Buying:

When buying a property, several costs are involved beyond the purchase price. Here are the key expenses that buyers should consider:

1. Down Payment

It can vary from 5% to 20% (in some special cases more) of purchase price

2. Closing Costs

Closing costs include various fees and expenses associated with finalizing the real estate transaction. They typically range from 2% to 5% of the purchase price and may include:

• Loan Origination Fees: Charged by the lender for processing the loan application.

• Appraisal Fee: Paid to a professional appraiser to determine the property's value.

• Home Inspection Fee: Paid to a professional inspector to check the property's condition.

• Title Insurance: Protects the buyer and lender against disputes over the property’s ownership.

• Recording Fees: Paid to local government entities for recording the property's sale.

• Attorney Fees: If required or desired, for legal representation during the transaction.

• Credit Report Fee: Charged by the lender to check the buyer’s credit history.

3. Property Taxes

Buyers may need to pay a portion of the annual property taxes at closing, depending on the time of year the purchase is made. These are often prorated based on the closing date.

4. Homeowners Insurance

Lenders typically require homeowners insurance to protect the property against damage or loss. The first year’s premium is usually paid at closing.

5. Private Mortgage Insurance (PMI)

If the down payment is less than 20% of the home's value, the lender may require PMI. This insurance protects the lender if the borrower defaults on the loan. The cost of PMI varies based on the loan amount, down payment, and credit score.

6. Homeowners Association (HOA) Fees

If the property is part of a homeowners association, buyers may need to pay a portion of the HOA fees at closing. These fees cover the maintenance and upkeep of common areas and amenities.

7. Prepaid Interest

If the loan closes in the middle of the month, buyers may pay interest on the mortgage for the days between the closing date and the end of the month.

8. Moving Costs

Moving costs can include hiring movers, renting a moving truck, purchasing packing materials, and other related expenses.

9. Miscellaneous Expenses

There may be other costs, such as utility setup fees, repairs, or upgrades needed before moving in.

Being aware of these costs can help buyers budget effectively and avoid surprises during the home-buying process.

Selling:

Selling real estate involves various costs that sellers should be prepared for. Here's a breakdown of the key expenses:

1. Real Estate Agent Commissions

• Typically the largest expense, real estate agent commissions are usually around 5% to 6% of the sale price. This amount is split between the seller's and buyer's agents. For example, if a home sells for $300,000 with a 6% commission rate, the total commission would be $18,000.

2. Closing Costs

• Sellers are responsible for certain closing costs, which can include:

  • Title Insurance: Protects the buyer and lender from title defects. The cost varies by location and sale price.

  • Escrow Fees: Fees for the escrow service that manages the transaction, including holding and distributing funds.

  • Transfer Taxes: Local or state taxes imposed on the transfer of property ownership. The rate varies by location.

  • Attorney Fees: If an attorney is involved in the sale, their fees are part of the closing costs.

  • Recording Fees: Fees charged by the local government to record the sale of the property.

3. Home Repairs and Improvements

• Sellers often invest in repairs or improvements to make the property more appealing to buyers. This can include fixing structural issues, updating outdated features, or making cosmetic improvements. The cost varies depending on the scope of the work.

4. Staging Costs

• Staging involves arranging furniture and decor to make the home more attractive to potential buyers. Staging can significantly impact the property's perceived value and marketability. Costs vary depending on the size of the home and the extent of the staging.

5. Mortgage Payoff

• If the seller has an existing mortgage, the remaining balance must be paid off at closing. This includes any prepayment penalties that might apply.

6. Capital Gains Tax

• If the property has appreciated in value, sellers might owe capital gains tax on the profit. However, primary residence exemptions may apply. For example, single homeowners can exclude up to $250,000 of capital gains, and married couples can exclude up to $500,000, provided they meet certain conditions.

7. Home Warranty

• Some sellers offer a home warranty to the buyer as a selling incentive. This warranty covers repair costs for major home systems and appliances for a set period after the sale. The cost usually ranges from $300 to $600.

8. Utilities and Holding Costs

• Sellers may need to continue paying for utilities, property taxes, and homeowners insurance until the sale is finalized. If the property is vacant, there may also be costs associated with maintaining the property, such as landscaping and security.

9. Relocation Costs

• These costs include expenses related to moving to a new home, such as hiring movers, renting a moving truck, and temporary storage.

10. Miscellaneous Fees

• There may be additional costs, such as notary fees, courier fees, and fees for obtaining required documents like a property survey or homeowners association documents.

Understanding these costs can help sellers budget appropriately and maximize their net proceeds from the sale.

What to know exactly how much will cost if you buying and selling real estate? Please contact us and find out what is included in our service fee!

Here are 5 things to avoid as a Buyer during the your process when facing multiple offers and bidding wars:

• Do not get emotionally attached to a property before the deal is Firm: Avoid attaching yourself emotionally to a home before the conditional period ends. Be prepared for the possibility of not securing the property due to being outbid or issues with financing or inspection. Getting emotionally attached can lead to disappointment if you don't get the property and may affect your future choices.

• Do not go in Blind: It's crucial to work with a Buyer Agent who represents your interests and guides you through determining the property's market value. Stay in touch with your mortgage broker to understand your financial situation and the steps required for financing.

• Do not wait: Act swiftly when you find a property of interest. In today's fast-paced market, properties are selling within hours. Make necessary inquiries, ask questions, and decide promptly whether to present an offer to avoid missing out.

• Do not go over what you're comfortable with: Never exceed your comfort level when making an offer. Ensure that the price you offer aligns with what you are comfortable paying, even if it means losing out on a few offers. Find a balance where you won't regret the decision the next day.

• Do not quit: The home buying process can be stressful, especially in a market with multiple offers. Despite setbacks, work closely with your Realtor to adapt your search criteria and persevere in finding the right home. Don't give up on your goal of buying a property.

Why are they different?

When a homeowner can no longer pay their mortgage, two significant legal processes can come into play: Power of Sale and Foreclosure. Your lender can take legal action to force the sale of your home because a mortgage is a form of secured debt with your property as collateral. They can recover the unpaid debt by repossessing your home and selling it on the open market.

Always read the fingerprint of any mortgage commitment to be sure which process your lender will use in the event of default. Power of Sales are more common in Ontario however, foreclosures are still possible.

There are some differences between them, especially regarding how the home's equity is used. Understanding the key differences between these two is crucial.

Power of Sale:

• Typically, it is faster than foreclosure.

• Allows lenders to sell the property without lengthy court proceedings.

• The homeowner retains the right to any sale proceeds exceeding the debt owed and costs incurred.

Foreclosure:

• Often, it is a slower process as it involves going through the court system.

• The lender takes full ownership of the property, which means all homeowner's rights are extinguished.

• Any excess proceeds from the sale after debts and costs go to the lender, not the homeowner.

While both methods ultimately lead to the loss of a home when a borrower defaults on their mortgage, the implications for the homeowner’s finances and future housing prospects can be quite different between Power of Sale and Foreclosure.

The Main difference to be aware of is how the sale proceeds are divided. In a power of Sale, the homeowner retains the right to any sale proceeds exceeding the debt owed and costs incurred. In a Foreclosure, any excess proceeds from the sale after debts and expenses go to the lender, not the homeowner.

As a Buyer, looking for these types of sales might benefit you. Although the number of distressed sales has fallen over the years, they still come up on the market occasionally. Although most people are attracted to price, some risks are involved when purchasing a Power of Sale or Foreclosure property. The main risk is that these properties usually hold no warranty or disclosures since the seller hasn’t lived or knows much about the property. 

We at Unna Real Estate Group are always on the lookout for distressed Properties for our clients, and you can be too by accessing our VIP section of our website. Here, you can search thousands of properties and access sold data and neighborhood reports. 

Reach out to us anytime with any questions or concerns; we're always ready to chat.

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As we smell the summer air and feel rejuvenated, there's no better time to cross some home project off your bucket list. We've compiled a list of projects that will make you and your home feel better and may also increase the value of your property.

Let's start with the Cheapest of them all...

A Deep Cleaning

Have you heard of spring Cleaning? Of course you have, let's make it a summer cleaning. Clean the areas of your home that don't get much attention during your routine cleaning, like curtains, Blinds, Basement, Storage Areas, Closets, Kitchen Cabinets, Garage etc etc. Take out the power washer and give the outside of your home a deep clean too. This is the cheapest of all improvement projects but can have a significant increase on the value of your home.

Painting

While painting can become expensive if you hire professionals, which is usually the best way to go, some people have the artistic touch and can give it a go themselves. Summer is a great time to get out that paintbrush and give it a go. Painting not only the inside of your home but some areas outside can give you a significant boost in the value of your home.

Landscaping

What better time to get some landscaping done than summer. Be careful though, landscaping costs can get out of hand. Some people believe that by spending $50,000 on landscaping, their home is now worth 50K more. That is NOT how it works. Improve your home's curb appeal by cleaning up the front yard, planting flowers, adding a flower bed, solar lights, and some decorative touches. That will most likely increase your property's value.

Deck Addition

Well, if you don't have a deck, summer is a great time to build one. If you already have a deck its also a good time to think about some add-ons. Nicer Railings, Accent lighting, or maybe just freshen it up. Power washing your deck and then staining/painting it will definitely give it a better appeal, translating to an increase in value.

New Kitchen/Remodel

We promised to leave the most expensive for last. Kitchens and Bathrooms seem to be the thing that most buyers pay close attention to. So using the summer months for a Kitchen Remodel is ideal. You'll also be able to use the nice weather outside to cook some meals while you're under construction.

Of course, Real estate is so unpredictable and for that reason we at Unna Real Estate Group always advise, never to put all your eggs in one basket. Most buyers are looking for a "complete package". So if you've spent 100K on your kitchen but the rest of your home doesn't look a par, then you probably won't get a good return on your investment.

Reach out to us any time before starting your projects and we can have a chat about them.

We’re back at it again with a review of Market numbers for the month of June. Lets have a look at the numbers.

We’re back at it again with a review of Market numbers for the month of May. Lets have a look at the numbers from the first month of Spring.

Laneway & Garden Suites in Toronto

(Laneway & Garden Suites… What are they? Why are they becoming so popular?)

The housing crisis in the Greater Toronto Area, particularly in the city's core, persists despite market changes, with property values remaining high and homeownership challenging for many.

In response to financing challenges, homeowners have explored options like secondary units to generate extra income for mortgage support, with basement or second-floor apartments traditionally being popular choices.

The Changing Lanes Program introduced by the City of Toronto in 2018 allows homeowners to build Laneway Suites, providing new rental housing options within established neighbourhoods.

A Laneway Suite is a self-contained residential unit situated on the same lot as the main house, typically located in the backyard next to a public laneway, offering additional housing choices.

The Changing Lanes program simplifies the process for homeowners to construct a laneway house without the need for various approvals, making it easier to enhance their property.

Homeowners interested in building a Laneway Suite can reach out to the City of Toronto to determine eligibility based on property criteria.

For properties without access to a laneway, the City of Toronto introduced Garden Suites in 2022, offering detached housing units in the backyard as an additional housing option.

Garden Suites, like laneway suites, provide smaller housing units that can accommodate family members or serve as rental units, aligning with the city's efforts to diversify housing options.

Both Laneway and Garden Suites contribute to various housing factors, increasing property value, expanding rental opportunities, and enhancing homeowners' financial flexibility.

These initiatives offer additional housing solutions and benefits to homeowners, tenants, and buyers in Toronto's competitive real estate market.

As always, different rules and regulations apply on every property, feel free to contact us to discuss this or any other Real Estate Related topic. 

Some Key Roles in the Real Estate Industry:

(Choosing your dream Team that works for you)

When it comes to your personal Real estate journey, it is usually the most important decision you make in your whole life. Although we at Unna Real Estate Group buy and sell real estate every day, we understand that this process is very important to you and can sometimes be confusing to get started. 

At Unna, we believe that choosing the right team of professionals is key to making sure that everything is a success. We have compiled a list of other Real Estate professionals who are usually involved in a real estate transaction. It is important that every single person in your team communicates with one another so you have a seamless experience.

• The Listing Agent:

  • Works with individuals selling real estate, listing properties under their name and brokerage for potential buyers to discover.

  • Responsibilities include determining selling prices, listing and marketing properties, managing showings, answering buyer inquiries, negotiating sale prices, and overseeing the sales process.

• The Buyer Agent:

  • Assists individuals looking to purchase real estate by finding suitable properties, arranging showings, negotiating on their behalf, and guiding them through the purchasing and closing procedures.

  • Typically, buyer clients do not incur costs for working with a buyer’s agent.

• The Broker:

  • Positioned above agents, brokers usually possess more education and licensing.

  • Brokers can establish their own real estate brokerage and recruit agents as salespeople.

• The Mortgage Lender:

  • Provides funds for mortgage loans, essential for real estate purchases.

  • Prospective buyers are advised to obtain pre-approval for a loan before engaging in property viewings and bidding.

• The Appraiser:

  • Independently assesses property value, crucial for mortgage lenders to ascertain accurate property valuations.

  • The appraiser's role is vital to ensure the property’s value aligns with the contracted sales price for loan approval.

• The Inspector:

  • Hired by potential buyers to assess property structure, safety, and potential defects or damages.

  • Inspectors play a critical role in informing buyers of any issues that may affect the property's condition.

• The Closing Attorney (The Lawyer):

  • A real estate attorney specializing in real estate law, providing legal guidance during property transactions, particularly at the closing stage.

  • These attorneys assist buyers and sellers in understanding and navigating the legal documentation involved in real estate transactions.

When to Sell Your Home…

(when is the best time to sell my home?)

The question of when is the best time to sell my home comes up almost every single day, the truth is there is no black-and-white answer to this question but this may help you find the right answer.

Some people buy a home to eventually sell it and turn a profit. This can be a very lucrative idea when the market is right, but if more people are selling than buying, it can be particularly tricky.

Not everyone wants to hold onto a home for their lifetime. The real estate market can herald a lot of money when the timing is right, and for someone who is comfortable with the process of selling and buying again, this can be a very exciting possibility. It is, however, important to understand how the timing can influence the value of your home.

A good rule of thumb: when in doubt, talk to a Professional. If there are ever any questions on the fluctuating market, your Sales Representative can answer them all. It is always important to contact your preferred Real Estate Professional. The one you trust most.

There are so many factors to keep in mind when trying to figure out the best time to sell your property. Remember that it will always depend on your specific neighbourhood and even the type of property you want to sell.

With this in mind, there are a few chief rules to consider when finding the right time to sell your home:

- Is the market good for selling? For example, are there more people looking to buy than sell?

- Will you be buying a new home once your existing one is sold?

- Is there a better time to sell your home? (i.e. will you make more of a profit if you hold onto the property?)

Selling a home can be exhausting, but with the right advice and a good guide of current market values, you can make the selling experience comfortable and stress-free.

We at Unna Real Estate Group are always ready to answer all of your questions and concerns. Feel free to contact us anytime.

As you may know, the Bank of Canada reduced the overnight lending rate from 5% to 4.75%. It continues to focus on elevated shelter costs as a significant contributor to inflation. However, it also noted that inflation measures are showing signs of downward momentum and are close to historical averages. To better understand how it works, we have asked one of our mortgage agent partners Lorena Sarnaglia to breakdown the numbers.

Variable-Rate Mortgages - If you’re holding a variable-rate mortgage, this rate cut signals a decrease in interest expenses. For example, for anyone with a variable rate with adjustable payments, you will see payments drop roughly $14 per $100,000 of mortgage (depending on your rate, amortization, etc.)

HELOCs - Interest-only payments would drop almost $21 per $100,000 as well.

Fixed-Rate Mortgages - Unchanged for now, but fixed rates are mainly influenced by the bond market and its expectations of the overnight rate’s direction. As we enter a rate-cutting cycle, bond yields should trend lower from here… and so should fixed mortgage rates.

We from Unna Real Estate Group, believe that the relationship between interest rates and home prices is a critical dynamic in the real estate market. When borrowing costs were at their lowest, home prices skyrocketed due to increased demand. As the overnight lending rate began to climb, the rapid growth in home prices started to slow down, illustrating the direct impact of interest rate policies on the housing market.

It is important to know that if the Bank of Canada reduces interest rates in response to economic conditions, it could stimulate the housing market, potentially reversing the recent price declines. The response of buyers to lower interest rates will be crucial. If confidence in the market remains high and borrowing costs decrease, a resurgence in home prices is likely.