Randy Miller

Broker Of Record

Urban Avenue Realty Ltd., Brokerage

Whitby & Brooklin Real Estate

Office 905-430-1800

Direct 905-430-9444

Email: randy@randymiller.ca

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Randy Miller
Broker of Record
Royal Heritage Realty Ltd.
Offices in Pickering and in Whitby

905-430-1800

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Randy Miller
Broker of Record
Royal Heritage Realty Ltd.
Offices in Pickering and in Whitby

905-430-1800

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Buyers Beware

 

 

When residential properties are for sale and the seller is shown to be a bank, this usually indicates that the owner could not make their mortgage payments and the lender is selling the property to recover the mortgage amount owing. If you are considering making an offer on one of these homes, here are 5 things you need to know: 

1.    The process that most lenders will follow in Ontario is Power of Sale, and not Foreclosure. The main reason is that a Power of Sale can be completed much faster than a Foreclosure. Powers of Sale can be completed generally in 3-4 months, while the Foreclosure process will typically take up to a year to complete. Banks also prefer this method as it permits them to get bad loans off their books quickly and if there is any shortfall, they can immediately sue the original borrower for the deficiency.

2.    Lenders are supposed to try and get fair market value for the property that is sold, so it is not automatic that you will be able to buy the property at a substantial discount. Use a professional buyer agent to make sure you know what this property is worth before making any offer.

3.    The lender will usually contain special clauses in this contract that will be important to any buyer. For example, all appliances will be sold on an "as is" basis, with no warranty, meaning you are out of luck if the appliances are not working when you close. No warranty will be given regarding the room sizes or even the lot size for the property. If there is a tenant on the property, no guarantees are given about the length of any lease or how much the tenant may be paying in rent. If HST is payable, for example if the property had a business running in it before the lender took over, or if it had been substantially renovated, then this extra HST has to be paid by the buyer on closing. Finally, if the original owner comes up with the money before closing to pay off the mortgage, then the deal is over.

4.    In order to deal with the above clauses, buyers should make sure that any purchase is conditional upon a detailed home inspection condition so that everything can be verified, including the condition of the home, the room and lot sizes, and whether there was any business, such as a day care, operating in the home before closing. This could involve discussions with the neighbours as well as well as any tenant that the buyer will be assuming after closing. Regarding the lot size, ask the bank's real estate agent if the bank has any survey relating to the property and if not, check at www.landsurveyrecords.com  or www.protectyourboundaries.ca as there are over 1.5 million surveys available for purchase through these websites to assist you when the boundaries are not certain.

5.    Buyers should attempt to close the deal quickly, once they have satisfied themselves as to all conditions, to avoid having the original owners come back and pay off the mortgage before closing, thus ending the deal.

When you understand what is involved in buying a home from the bank, you should not have any unwelcome surprises either before or after closing.

Story provided by Mark Weisleder BA., LLB

Research, professional knowledge and advice make for good decision-making. Knowledge is power and helps the buyer make the best decisions possible for his family. So it’s important to find the right agent that has experience with sale-of-power properties. Contact me today! I will be working for you every step of the way to make sure that you get what you want.


Randy Miller
Broker of Record
Royal Heritage Realty Ltd.
Offices in Pickering and in Whitby

905-831-2222

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Chattels and Fixtures


Here is a great article from Mark Weisleder, a real estate laywer, author and speaker:

 

5 things to remember about chattels and fixtures

The buyer notices that the oven is not working when they do their final home visit, 2 days before closing. Can the buyer refuse to close or hold back money to repair the oven? These are just some of the questions that I receive from anxious buyers during the course of a home purchase.

Here are 5 key lessons to remember:


1. The buyer cannot refuse to close a real estate deal if an appliance is not working, or if there are minor damages on the property, unless the contract says so. What the standard real estate contract says is that the buyer can only refuse to close if there has been substantial damage to the property before closing. This would cover a house burning down or a major flood before closing, but would not cover a cracked window or appliance that is not working.


2. The buyer or the buyer lawyer is also not permitted to decide on their own to hold back money to complete any repairs, unless the contract says so. In my experience, sellers rarely agree to any clause in an agreement that permits a buyer to hold back money, for example, to make sure that the seller has completed any required repairs before closing. The problem is that in practice, buyers will typically say that they are not satisfied with the repairs and the holdback money cannot be released to anyone.


3. Here is my advice to settle repair or damage issues: get an estimate for the damage and then have your lawyer send it to the seller lawyer, offering to just settle the matter by the seller either fixing the problem before closing or the seller providing a credit equal to the estimate and the buyer fixes it themselves after closing. I am usually able to work this out with seller lawyers before closing. Unfortunately, if there is no settlement, there is no automatic right to hold back money and the buyer will be required to sue the seller in Small Claims Court after closing to get their money back. This is not a good solution for anyone, because of the time it takes to go to court to resolve this. Be reasonable and solve your problem.


4. What if the oven breaks down 2 days after closing? Unfortunately, the way the contract is written, the buyer does not get an extended warranty. The seller will typically only warrant that appliances and home systems will be working on closing, not after closing. Make sure that even if you are not moving in until a few days after closing that you go to your home immediately after closing and check to make sure that everything is working properly. If anything is not working or there is a damage, have your lawyer immediately contact the seller lawyer the next day about your issue. Also consider buying after sale insurance protection to cover your home systems and appliances. Canadian Home Shield is a company that offers this type of protection at a reasonable price.


5. Little things matter. If your seller is removing a chandelier, make sure they are required to replace it with a standard light fixture so you do not walk into a dark home on closing. If your seller is removing a TV bracket from the wall, make sure that they are required to fill in any holes that are created. Make sure you are to be given 2 full sets of keys, FOBs if a condominium, garage door openers and mail box keys. If the agreement is silent, the seller may only get you one set and it is costly to obtain a duplicate set, in most cases.


When you understand the rules about chattels and fixtures and properly protect yourself, you should be able to minimize any problems that arise after closing.

 

By Mark Weisleder

Randy Miller 
Broker  
Re/Max Rouge River Realty Ltd., Brokerage  
905-668-1800 or 905-427-1400


 

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Today I found an interesting blog article about 'Bidding Wars' which I want to share with you. It tells the story of a couple who tried to find their dreamhome in Toronto and all the bidding wars they found themselves in. Bidding wars are a seller's dream but can be a buyer's nightmare...

Cait: Walk us through your first bidding war. What happened?

KL: The first bidding war we got into was for a condo, which is very rare; this is when we realized how competitive the family-friendly condo market was in Toronto. Generally, it’s a good idea to see a home at least twice: once privately (so you can look at it in-detail) and again at the open house (to see how many people show interest in the property). However, with this first property, offers were accepted anytime and there were three offers on the first day it was listed.

You can usually submit your offer 1 of 3 ways: at the property itself, at the listing agent’s office, or you can send it in via fax. Most real estate agents will recommend you do it in-person (i.e. not via fax), so you can build some rapport with the listing agent and sellers, as well as be available to change your offer on the spot. For the condo, the listing agent held the offer presentations at her office, which was in Markham – and on a Friday night at 10pm. It was a really strange experience, and our real estate agent said he’d never seen that before, especially for a downtown Toronto condo.

Anyway, as the buyer, you don’t go in yourself. You basically sit and wait, while your real estate agent goes in and presents your offer to the listing agent + sellers. It’s done this way so hopeful buyers don’t get emotional, make rash decisions, etc. and also adds a level of professionalism to the whole experience. But I was literally sitting in a car waiting while our agent presented our offer and then we waited together until all the other offers were presented. After that, the listing agent + seller may decide to accept an offer (in the first round) or choose a few offers that are close and ask if you’d like to improve yours (in a second round). We didn’t make it past the first round.

Cait: Were you disappointed you’d lost?

KL: I was. I’d fallen in love with that condo and had basically already moved in, in my head. Then people tell you “everything happens for a reason” and you kind of roll your eyes at that, especially when you’re disappointed… but it’s true! It’s good we lost that one, or else we wouldn’t have bought the amazing house we have now.

Cait: Did you stop looking at condos after you lost?

KL: No, we still looked at them a bit, but just added houses to the mix. When we did the cash flow analysis on large two-bedroom condos with large corresponding condo fees versus houses, a three-bedroom house was not that much more expensive.

Cait: What was different about the second bidding war you entered?

KL: Once we decided to start looking at houses, I fell in love with the first one we saw – and this is a bad idea! Our real estate agent always told us to see multiple properties, so we wouldn’t make any rash decisions or jump into something just because we loved the “idea” of it. But after seeing so many condos, that first house had everything we were looking for in a condo, and I loved the idea that we could actually afford a house!

This brought us into another highly competitive segment of the market for renovated three-bedroom starter homes. The next house we decided to submit an offer on had an “offer date”, which meant all offers were accepted only on that date. On top of being in the neighbourhood we wanted, the house was nicely updated and had a basement apartment. (Tip: If you see a home that has income potential, be prepared for the bidding war to be extra competitive!)

We registered our offer early, at our real estate agent’s suggestion, because when you do so, the listing agent has to tell you if any bully offers come in. (A bully offer is when someone submits an offer that they think is amazing, in hopes they can buy the house before it goes to a bidding war.) Most of the time, sellers won’t even look at bully offers, because they know they can get more out of a bidding war – but it’s still good to know if any have been submitted, because then you can get a sense of how competitive the bidding war is going to be. In the end, 10 offers were registered on the house, which is high, even for Toronto. All offers were presented at the house itself, which meant there were 10 hopeful buyers + their real estate agents waiting around to present.

Before you enter a bidding war, you and your real estate agent will decide between two different strategies: either go all-in with your “first and best” offer, or bid slightly below it and know that you’d be happy to go up another increment (say $10,000). Typically, if there are a lot of people (and therefore a lot of offers), you’ll want to go all-in with your highest offer. If there are only 2-3 people, though, you may go in lower and know you have some wiggle room. Because there were 9 other people making offers, we decided to go all-in. Our real estate agent thought we had a good offer, but also warned us that it would likely sell for more because of the income potential. (We’re also grateful he was honest and told us not to bid any more than we already had, as he didn’t think the house was worth more.) Like our first bidding war, we didn’t even make it past the first round. And here’s where the numbers may shock people: we went in at $140,000 over asking, and we still lost by $35,000.

Cait: That’s crazy!

KL: Yea, list prices on houses are basically irrelevant in Toronto. Actually, that’s not always true. Most houses are underpriced to spark a bidding war, but once in a while you’ll find a house that’s listed for what the sellers want. When you see something that’s accurately priced, you freak out and mentally add like $100,000 on top of that. It takes time and a lot of viewings to figure out what a house is worth, which is why it’s really important to not fall in love with the first place you see. Plus, if there’s one truth to the Toronto housing market, it’s this: a house is worth whatever amount a buyer is willing to pay.

Cait: Are you happy you lost the second bidding war?

KL: We would’ve been happy if we’d won, but it’s also fine that we lost. Looking back, the house was on a busier street, it didn’t have great curb appeal, the upgrades weren’t done exactly to our taste, and my partner actually wasn’t keen on having a basement apartment because he didn’t like the idea of having a stranger living in our house. We definitely weren’t willing to pay $35,000 more for it, even with income potential. But if our offer had won, we would’ve been ahead on a monthly cash-flow basis, compared to the house we ended up buying.

Cait: Let’s talk about the third and final bidding war you ended up in, then. Walk us through what happened.

KL: By the time we went into this one, we had built up the right mentality for bidding wars. After losing a couple bidding wars already, you can’t help but feel defeated, and you’re not exactly hopeful the next one will be a success. This mentality is both good and bad. It’s good because it prevents you from getting attached, and it helps you map out your plan from a strategic standpoint vs. an emotional one. But it’s a little depressing, too! After seeing so many homes, and losing two bidding wars already, I was emotionally exhausted and didn’t have any hope that we’d actually win this one – but we wanted to try.

We saw the property multiple times, first privately and then again at the open house. When we were at the open house, we saw a lot of foot traffic, so we knew it would be another competitive situation. I told you (and showed you) all about the house last week and we obviously loved it. I could tell my partner really loved it, because he upped our budget by quite a bit in the end. I also think we’d also just gotten to the point where we had to decide to go all-in – like really all-in, with as much as we could – because we just wanted to buy a house and move on with our lives.

This time, there were 14 offers! The listing agent gave every real estate agent a 5-minute slot to present, so our real estate agent and I (and Kingston!) went for a walk around the neighbourhood during that time. We didn’t feel great about our offer, this time, just because of how many offers there were. But less than 2 hours later, we got a callback saying that ours was 1 of 6 offers that were extremely close to each other, and asking if we had any room to improve.

When you go into the second round, you can do one of two things: leave your offer as-is, or improve it. Since there’s a chance your original offer was the highest one already, you can take the gamble and choose not to increase it. But we decided to improve our offer, because we really liked the house. Thirty minutes later, we got another callback saying that ours was 1 of 3 offers that were extremely close, and asking if we could improve our offer yet again. (A third round!) With the help of our agent, we were able to improve our offer a little bit again. The sellers also asked if we could move up the closing date by 2 weeks, which was no problem for us, because we were renters (didn’t have another house to sell first) and could move anytime. The date is what helped seal the deal, because we won!

Cait: What conditions did you release in your offer?

KL: When you enter a bidding war, you need to make a clean offer (no financing or home inspection conditions) or else there’s little-to-no chance you’ll win. So we released both, and decided to use the seller’s home inspection.

Cait: What are the risks involved with releasing both conditions?

KL: You usually don’t need to get a home inspection on a condo in Toronto – at least not new ones – so we felt fine about the first one. But for the houses, we just had to read through and trust that the seller’s home inspection was accurate. Some people still feel more confident commissioning their own inspection, but that can get expensive when you end up participating in multiple bidding wars.

Source: http://www.ratehub.ca/mortgage-blog/2014/10/team-case-study-on-winning-and-losing-bidding-wars/

 

If you find yourself in a bidding war for the house of your dreams, prepare to be flexible and accept that the seller is in control. How much the property is worth depends on how much the buyer is prepared to pay. In a bidding war, I can help you determine how much the house is really worth cause the last thing you want is to over-pay for a house. I'm an experienced real estate agent who knows the market and I can help you get the house of your dreams. So, contact me today!  

 

 

Randy Miller 
Broker  
Re/Max Rouge River Realty Ltd., Brokerage  
905-668-1800 or 905-427-1400

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 How to sell a house where pets live


Almost everybody loves pets. Me too,  but just not when I am helping clients buy and sell houses. And the reason for this is simple:  Pets can distract in many different ways.


Your pets stink. As a loving pet owner, you may not realize this because you’ve grown accustomed to it. But don’t expect a potential buyer to feel the same way. Potential buyers don’t want to purchase stinky houses.


Allergies. Some buyers are allergic to pets (their saliva, fur and urin). You can’t blame the buyers for leaving your house before even having seen it.


Fear. Especially if people are coming with small kids, pets can become a problem. Pets are not always predictable. Some buyers are afraid of being bitten or terrified of catching fleas.


Barking and Meowing. Pets sometimes get noisy and this distracts the showing.


Nervousness. The buyers may feel uncomfortable when a pet rubs, sniffs, or jumps on them. Even if buyers like your pet they may miss out on the wonderful features of your house because they concentrate too much on your pet.

 


What to do before a showing

Owning pets could reduce the value of your house if potential buyers notice odors or other pet issues. If you want to get the highest final sale price, you'll have to stage your house and create the illusion that you are not a pet owner  or at least eliminate any signs that your animals were destructive.

Dogs, cats, birds, fish, reptiles, bunnies, hamsters, guinea pigs: they all shed or/and stink (litter boxes, cages, fish tanks). So what can you do before showing your house?

The best thing to do to ensure top price for your home is to relocate your pets while your home is on the market. Removing the family pet while selling a home is not usually the option most homeowners want to hear, but it is the best solution not only for potential buyers who want to tour a home which smells fresh and clean and is free from pet hair, but also for the pets who can be upset with strangers touring the property on a daily basis. Let a friend or family member take care of your pet or send it to a boarding kennel until the house is sold.  Putting your pets in the back yard, in the garage or in another room that you keep locked is insufficient, and it's not fair to them.

If you don’t want to take the professional advice and absolutely refuse to move your pets out of the house, then at least minimize their presence in your home.


Get rid of the evidence!


Deep cleaning. Before your house goes on the market, make sure that it gets a huge deep cleaning, behind all furniture, all closets, under all beds, etc.!


Remove litter boxes. Keep cat litter boxes and dog potty pads out of sight and impeccably clean. Nothing turns off buyers faster than opening the door of a house and being greeted by a full or stinky cat box.


Remove stains. Hire professionals to remove pet stains. Buyers will spot them and form unfavorable opinions about the rest of the house. If the stains can't be removed, then remove the floor covering and replace it.


Get rid of the stink. Not only are odors very obvious when buyers first enter your a home, they are usually very difficult to get rid of (cat urine is the worst). Home buyers know this and could immediately scratch your house off their list. Have all of the carpet and underlay in the home replaced or at the very least professionally cleaned.  You should also have your furniture steam cleaned at the same time.


Other useful tips:

  • Remove pictures of your pet (e.g. photo of showing your cat asleep on the bed)
  • Seal up pet doors
  • Put away food and water bowls when not in use
  • Vacuum  as often as possible
  • Put away pet toys
  • Remove cat trees
  • Pack up all cages, carriers and other tell-tale signs

Curb appeal. The outside of your home is the first thing potential buyers will see, so it's the first place you should look for signs of pet damage.  Curb appeal is hugely important to buyers, so lets make sure that all outside areas of your home are pet free as well.  From your front yard, your back yard, your courtyard, etc.  Make sure your backyard shows no signs of pets. The most obvious issue to address is holes in the yard from a dog that's been digging. Make sure to fill any holes before you open your home to buyers.  Remove all toys and ‘poop’ that may be present.


Selling a home is not easy. With a pet it’s even harder. But if you keep all the above things in mind, it’s all worth it in the end… 


If a move is in your future, let’s sit down and talk about your plans. I will be working for you every step of the way to make sure that you get the highest possible price for your home in the shortest period of time. So, contact me today!

 

Randy Miller 

Broker  

Re/Max Rouge River Realty Ltd., Brokerage  

905-668-1800 or 905-427-1400


 

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