Buying • 02/01/2024

6 Signs It Could Be Time to Buy A Home

by Scott Somerville

Have you been renting for a period of time wondering when would be a good time to buy? The answer isn’t as straightforward as you think–it’s a mix of both what’s happening in your personal life and what’s happening in the real estate market.

Whether you’re simply ready to settle down or you’re facing increasing rent, this article explores signs that may let you know it’s time to start the home buying process.

1. You’re ready to settle down

What “settling down” looks like changes from person to person, but generally, if you’re ready to commit to one home and one location for the foreseeable future, and you’ve grown tired of renting, you may be ready to buy. While the home buying market can be tough to enter at times, when you compare rent with mortgage payments, in some cases you could be saving money with homeownership—or at least building up your equity.

“Even with high interest rates, when you’re paying a mortgage, a portion of that is going into your own equity in comparison to rent which all goes to paying someone else’s equity,” explains Sunny Duggal, a REALTOR® and broker with RE/MAX Excellence Real Estate in Mississauga, Ontario.

2. You’re financially ready

Buying a home is one of the biggest purchases someone can make in their life. The transaction involves a lot of moving pieces including a good credit score and a sufficient down payment. Plus, after the sale, there are many costs from property taxes to mortgage payments, to new furniture and maintenance.

Depending on your purchase price, down payments can be as little as 5% or as high as 20% of the home price. With pre-construction, you can put down 5%, and then pay in installments at a later time which can be ideal for people hoping for some extra time to save.

A bank, lender and/or mortgage broker will also make sure you have a good credit score. So, if you’re paying your bills on time, have a good debt-to-income ratio, and your credit score is steadily increasing—these are all good signs it’s the right time to buy.

3. You’re comfortable with the long game

“The real estate market, like any other, can and will continue to cycle,” says Alex Strothard, a REALTOR® and sales representative with Sage Real Estate Brokerage, in Toronto, Ontario.

One sign you’re ready to buy is you’re thinking long term, which helps to eliminate some fear that comes along with market turbulence. Having a long-term strategy can ensure you’re not waiting on the sidelines for the next best time.

When interest rates go down, home prices typically go up, so getting in the market now may help you to see larger gains in the next few years. You may be ready to buy if you’re looking to build equity and believe in the market growth of the area you’re thinking of buying in, and are in a position to make an investment that could take some time to vest.

4. You have a stable career

“If you have a secure job and money saved, real estate is one of the best ways to secure your future,” says Duggal.

Having a stable career can be a good sign you’re ready to purchase. Mortgage lenders want to see you’ve been at your company for a good period of time and are typically more favourable towards permanent, full-time work.

You should also consider the overall employability in a given region. If you decide to leave your current job in two years’ time, will you have to move again in order to find something in your field?

Strothard says although the right length of employment will differ depending on the job and career path, no matter what, having a plan B is important. A plan B can help you plan for the unexpected like job layoffs and emergencies. Plan B might be additional savings or other living arrangements, says Strothard

5. You’re itching for projects

Renting has a full suite of benefits, but your ability to renovate or do some more intensive DIY projects around the house are typically limited. If you find yourself wanting to personalize a home, it could mean you’re ready to buy a place to make it your own.

There are a few different avenues if this is the case. You could look into pre-construction homes, understanding there’s a different down payment structure and it might be more than a year before you’re in the new space. New construction means you can pick the fixtures, finishes, and sometimes certain layout aspects of a new home, but it’s not a full customization.

You could also look at purchasing an unfinished home, which allows you to personalize specific elements without having to do a complete custom-build. It does require specific permits and loans, so you’ll need to understand the specifics—a REALTOR® can help you with this.

There’s also the option of buying an older home that needs some renovations. The benefit here is you’ll be able to live in your home while the work is done (provided it passes inspections) and you can do your projects gradually.

6. You’ve met with a REALTOR®

Some think the right time to talk to a Realtor® is when you’re ready to pull the trigger on a home, but actually you should start much sooner.

A REALTOR® can give you insight, knowledge, and resources that can inform your choices. They can help you wrap your head around all the big and small aspects of homeownership and provide you with market research that can help you get closer to finalizing your decision to buy.

“It’s all about when you feel ready and you’re within your means,” says Duggal.

Buying your first home can sometimes feel like a lifetime away, but you may be closer than you think. If you’re still unsure of whether the time is right, meet with a REALTOR® to explain your situation and get their professional opinion.

Mary Ann Boateng – 6 Signs It Could Be Time To Buy A House – Realtor.ca

Tips & Tricks • 02/01/2024

Real Estate Tip #2

by Scott Somerville

Real Estate Tip #2

Real Estate Tip #2 – BEAT THE COMPETITION WITH CONDITION!

When it comes to selling your house, first impressions matter. Potential buyers are more likely to be attracted to a well-maintained property that appears move-in ready. While major renovations can be costly and time-consuming, addressing minor repairs can significantly enhance the appeal and value of your home. In this blog post, we will explore the reasons why getting minor repairs done before selling your house is a wise decision.

Boosting Curb Appeal

The exterior of your house is the first thing potential buyers see. By addressing minor repairs such as fixing cracked sidewalks, repairing loose shingles, or repainting faded exteriors, you can instantly enhance the curb appeal. A well-maintained exterior creates a positive first impression and sets the tone for the rest of the viewing experience.

Creating A Positive Perception

Minor repairs inside the house can greatly influence a buyer’s perception of its overall condition. Fixing leaky faucets, squeaky doors, or loose cabinet handles may seem insignificant, but they demonstrate that your home has been well-cared for. Buyers are more likely to feel confident in their purchase when they see a house that appears to be in good condition.

Maximizing Value

Addressing minor repairs before selling your house can help maximize its value. Buyers often associate a well-maintained property with higher quality and are willing to pay a premium for it. By investing in minor repairs, you can potentially increase your asking price and attract more interested buyers.

Avoiding Negotiations

Negotiations can be time-consuming and may lead to price reductions. By proactively addressing minor repairs, you can minimize the chances of potential buyers using them as bargaining chips during negotiations. A well-maintained house sends a message that you have taken care of your property, reducing the likelihood of buyers seeking further concessions.

Faster Sale

In a competitive real estate market, a house that requires fewer repairs is more likely to sell quickly. By taking care of minor repairs beforehand, you can eliminate potential obstacles that may delay the sale. A faster sale not only saves you time and effort but also reduces the carrying costs associated with owning a property.

Investing in minor repairs before selling your house is a smart decision that can yield significant benefits. By enhancing curb appeal, creating a positive perception, maximizing value, avoiding negotiations, and expediting the sale process, you position your property as an attractive option for potential buyers. Remember, first impressions matter, and a well-maintained house can make all the difference in securing a successful sale. So, take the time to address those minor repairs and reap the rewards when it comes time to sell your home.

Tips & Tricks • 01/25/2024

Real Estate Tip #1

by Scott Somerville

Real Estate Tip #1

Real Estate Tip #1 – START SAVING NOW!

Cut Down On Unnecessary Expenses

Saving for any sort of down payment on a home will require sacrifice. It’s a lot of money. Fortunately, the easiest way to cut back is the best way to save. That’s eliminating small purchases that have become habitual but likely provide relatively little value to your life. Cut down on things like eating out, premium coffees, shopping for things you don’t immediately need. First-time savers are invariably surprised at how much you can save each month—because they never really know how much they were spending on the little things each month. And that savings will almost certainly mean thousands of dollars over the course of a year.

Save On Rent

Rent tends to be one of the biggest monthly expenses, so if you can find a way to save there, your path to homeownership will become shorter. Can you move into a smaller place that’s cheaper? Get a roommate? Sacrificing space and privacy will be tough at first, but your new digs are temporary housing, a waystation, a halfway house where you don’t have to live with criminals! (We hope.)

Use Cash For Most Of Your Daily Transactions

Paying with cash instead of a card can make you more aware of your spending. By committing to using cash for day-to-day expenses, you’ll become more mindful and conservative in your spending decisions.

Put Money Into A Savings Or Investment Account

Make the most of all your newly saved money by putting it in a savings account or by investing in a balanced investment portfolio. By committing to saving or investing a portion of your paycheck each month, your savings will steadily grow without requiring constant action on your part.

Add Large Lump-Sum Payments To Your Savings

Whether those be your tax returns, a bonus, or a cash gift: Instead of spending it, save it to quickly move closer to your goal.

Have An Emergency Fund

To protect your down payment savings from unexpected financial emergencies, it’s crucial to have a separate “rainy day fund” with three to six months’ worth of expenses. This fund will ensure that your homeownership plans remain on track, even in the face of costly surprises.

Keep Your Credit Score In Good Shape

The better your credit score, the better the interest rates on any loans you apply for will be, which will save you money in the long run.

Saving for a home down payment requires discipline and strategic financial planning. By implementing these strategies, you can make significant progress towards your goal of homeownership. Remember, every small step you take today brings you closer to the home of your dreams.

Neighbourhoods • 01/03/2022

Perth’s Historic Shaws Building Sold

by Scott Somerville

Commerce is returning to the historic Shaw’s building at 1 Gore St. E. after it was sold to a local businessperson.

New owner Peter Blier took possession on Nov. 30, and “my wife and I are really excited. That’s an understatement!” he said during a telephone interview on Wednesday, Dec. 8. “I’m quite passionate with the heritage buildings and their storied past.”

He had sought to buy it in the past, but new plans for the building came to mind more recently.

New Plans

As part of the $1.3 million sale, “we have rights to the ‘Shaw’s of Perth’ name,” he said. He intends to create the “Shaw’s of Perth Collective,” several individual retail spaces replicating the look and feel of an “old, small town department store,” though they will be individually owned and operated, and can be “secured” if need be, with delineated spaces.

He hopes that all of those new businesses operating under the one roof will turn that intersection into “the hub of growth in the downtown core.”

He commended the former owners for their good upkeep of the building, but as it is a heritage building, any changes or repairs “will be up for some discussion.” For example, the old store’s fading motto (“The Store With A Smile”) on the Foster Street side of the building, will not be touched up as the original paint is no longer available, and there are restrictions against painting on stone in the heritage district.

“We are going to leave well enough alone,” he said, and any changes will be “cosmetic,” though work may need to be done on the chimney. There are also plans for a second level luxury apartment.

Heritage Love

Asked why he was so passionate about heritage buildings, he said: “I think I was born in the wrong era!” He explained that he has an “insatiable appetite for the craftsmanship of yesteryear,” that such work was carried out “with what we would call primitive tools,” today. “We need to restore as much of it as possible … when it is gone, it is gone.”

He opened Mex. and Co. 25 years ago this past April, on the Festival of the Maples weekend.

“It seemed to have worked out well for me,” he said, so he would like to see if he can open the newest incarnation of Shaw’s that weekend.

Interested vendors can email shawscollective@gmail.com.

Realtor

Scott Somerville, realtor with Century 21 Explorer Realty, has been working on the sale since August. In a telephone interview the same day, said that for years Shaw’s was the “flagship store in Perth,” and that when it comes to potential renters, “we’d like to arrange sizes to what people need before they go in,” he said. “We can gauge to the size of the store. The two men have been finding memorabilia at the store, and are putting a call out for any artifacts that they can borrow for a possible poster board presentation of the building’s history. If you have any such items to share, contact Somerville at scott.somerville@century21.ca or by phone at 613-390-2450.

History

According to the historic plaque on the side of the building, 1 Gore St. E. was the first site to the Hon. Roderick Matheson’s harness and saddle shop in 1818 until 1840. That year he commissioned the building of the two-storey cut stone and yellow brick structure as part of his commercial and residential complex on Gore and Foster streets.

In 1859, Henry D. Shaw of Smiths Falls married Flora, Matheson’s daughter, and became part of the family run merchandizing operation, according to the plaque. The clothing store he opened later became one of the oldest family-owned and operated stores in Ontario.

The building was recognized as a historic site in 1984, according to historicplaces.ca, and was, for a time, the print office for The Perth Expositor newspaper.

Selling • 12/20/2021

3 Valuable Tips to Selling a Townhouse!

by Scott Somerville

Are you ready prepared to sell your townhouse?

This can be an exciting venture with a lot to look forward to, but it’s important not to make a rushed decision. You should know the process before you get started, otherwise, you could end up making a lot of expensive mistakes.

If you want a little bit of insider information to get started, check out the information below. This valuable information will likely be just what you need to get started.

Selling a townhouse is different from selling a single-family property! There are a lot of similarities between marketing a townhouse and a single-family home, but they are not exactly the same. There are a few major differences that you need to be aware of ahead of time.

Marketing a Townhouse

When a townhouse is marketed, it’s extremely important for agents to talk about the amenities of the condominium complex. Special emphasis should be placed on the nearby parks, tennis court, swimming pools, available parking stalls, zero maintenance, security and any other amenities that appeal to people.

These are things you wouldn’t likely talk about when selling a detached home, as most communities don’t have exclusive private pools or even fitness centres for their homeowners.

Talk About Condo Fees

You pay condominium fees to help pay for snow removal, trash pickup, outdoor maintenance and other things, so it might seem obvious that this is an expense a buyer will have to consider. But, remember that a lot of people, especially first-time buyers, don’t know that these dues exist. Talk to your agent about these fees before placing an offer.

Tip: If you’re motivated to sell but aren’t getting offers because the market is slow, you can sweeten the deal for buyers by paying for their first year of condo fees.

Have Condo Documents Ready

You’ve got a buyer, great! But, don’t get overly excited and forget that you need to have the condo association documents (rules, regulations, etc.) to your buyers as soon as possible. If you don’t provide these by a certain deadline then they could very easily back out of the offer, leaving you in your condo for a lot longer.

Now that you know all of this information, you should be ready to hire an agent and get your townhouse on the market. Don’t be afraid to tell them what you want, but also take time to listen to their expert advice. Together you should be able to come up with a marketing/sales plan that is perfect for your property. And, if all goes well you may be able to move into your home before you know it!

Investment • 12/20/2021

Tips For Buying Rental Property in 2022

by Scott Somerville

The real estate industry has rapidly flourished in Canada for the past few years. Inarguably it is a wise choice to invest in rental property. The only thing you need to know is that are you prepared for it.

Is it right for you to plunge into the rental property investment? Investing money in rental property can provide you with massive returns. The need is to understand the different dimensions of this business. What type of rental property do you want to buy? What is the financial potential of the property you are purchasing? Do good research and be prepared. This article proposes valuable tips that can prepare you for rental property investment in 2022.

Is Buying an Investment Rental Property Right for You?

Rental Property purchase can be the path to grow your financial capital. The first requirement is to educate yourself about all the concepts of real estate investment that you can leverage. Figure out how much skill, time, and willingness you have for rental business. A rental residence business is a source of passive income; however, it requires an active engagement. For instance, you might need to learn the laws associated with rental property income. You can hire an expert realtor to help you invest in and earn from a rental property.

How to Find Ideal Location

The perfect location for an income property depends on cash flow and appreciation for that property. Higher appreciation property with slower cash flow can favour an investor and vice versa. The indicator of an ideal income property is that at least one of these factors is higher; is working in favour of the investor. Greater appreciation will increase the value of your rental property – increased rental cash flow will fill up your capital quickly. Other key factors to keep in mind include nearby schools and offices, security, amenities, and tax laws on the property.

Tips for finding the Best Landlord

If management is your niche, you can be the best landlord of your rental property. Being a landlord requires one to do a background check on tenants, security contract development, rent payment assurance, and property maintenance. If that is too much for you, you can always hire a specialist in management affairs. Hiring a manager as your rental property landlord can make executive decisions, negotiate with tenants, keep an eye on the property, and ensure monthly cash flow.

Getting the Ideal Tenants

Tenant eviction affects your income and requires a quickly addressed turnaround. How to seek long-term tenants? For your residential rental property, prefer elderly tenants as they are likely to stay longer and take care of the property. For student tenants, do background checks for on-time payment, income, and be responsible enough to cover any damage with an advance security deposit. In the case of commercial rental property thorough background check should be done. A professional realtor can help you rent out your property safely.

Do Financial Planning for the Unforeseen

A thoroughly devised plan is required to manage innumerable expenses of your rental property. Carelessness can lead to a disaster; your wish is to save around 20-30 % of rental income for expenditures of property maintenance or any emergencies. Make sure personal debts are not excessive and constantly save from the rental cash flow.

Learn the Technicality of Rental law

Understanding the local landlord-tenant laws is very important. Authorities set rules on security deposit returns, residential rental licences, appliances inspections and eviction rules. The rule breaker is held accountable for their action. For instance, in Canada, if the tenant breaks the lease without informing the landlord, the lawbreaker can be obliged to pay till the end of the lease term. The landlord is responsible for an effective tenancy contract that is in coherence with local policies.

Housing Costs • 12/20/2021

Canada Has The Biggest Gap Between Real Estate Prices And Incomes In The G7

by Scott Somerville

Canadian real estate is unaffordable, but you don’t appreciate how bad the reality is until you look at its G7 peers. The latest house price-to-income ratio data from the OECD shows all G7 countries are seeing affordability decline. However, Canada has consistently seen home prices outgrow incomes. Since 2005, no other G7 country has seen the gap between home prices and incomes widen this much. It’s not even close.

House Price-To-Income Ratio

The house price-to-income ratio is a fundamental measure of home price valuation. It’s straightforward, just measuring home prices divided by disposable income. When the ratio rises, home prices become more expensive relative to incomes. If the ratio falls, they’re becoming more affordable.

Directly comparing countries doesn’t make much sense, so the OECD created an index. By using an index, we can rebase all countries to see how they’ve performed over time. For example, if the index reads 125, home prices grew 25% faster than income. Today, we’re using a base year of 2005 to compare pre and post-Great Recession data.

Canadian Real Estate Prices Are The Most Overvalued In The G7

Canada’s house price-to-income ratio has soared higher than any other G7 country since 2005. The index came in at 164.8 in Q2 2021, up 19.8% from five years prior. Home prices have increased a whopping 64.8% faster than income since 2005. A whole analysis on just these numbers could be done (and will be!), but let’s look at some obvious takeaways.

G7 House Price-To-Income Ratio

The indexed value of the house price-to-income ratio for G7 countries, as well as the OECD average.

Region	CAN	DEU	FRA	GBR	OECD	JPN	USA	ITA
2005 Q1	100	100	100	100	100	100	100	100
2005 Q2	100.17	96.85	102.84	99.81	100.3	98.03	101.26	100.9
2005 Q3	99.97	98.84	105.65	100.31	101.23	96.96	102.61	101.61
2005 Q4	101.54	96.18	107.83	100.88	101.85	96.83	103.34	102.55
2006 Q1	101.96	96.46	110.52	102.32	102.05	96.39	102.5	103.51
2006 Q2	106.09	95.59	111.29	103.21	102.19	93.77	102.18	104.09
2006 Q3	107.75	94.59	112.49	103.85	102.4	92.39	101.66	104.67
2006 Q4	108.82	94.18	113.05	106.44	103.06	92.21	101.28	105.39
2007 Q1	108.03	91.22	113.78	107.26	102.97	91.88	100.47	105.57
2007 Q2	113.07	91.95	113.68	109.15	102.97	92.36	99.16	106.19
2007 Q3	115.87	92.06	113.98	109.32	102.57	92.42	97.41	106.97
2007 Q4	116.21	90.95	114.17	110.45	101.42	92	94.78	108.03
2008 Q1	115.63	92.11	113.58	109.34	99.99	91.73	91.89	107.65
2008 Q2	115.41	89.83	113.15	104.64	98.02	96.27	86.98	107.64
2008 Q3	114.07	88.77	112.42	99.8	96.66	94.01	85.8	107.98
2008 Q4	112.45	91.28	109.53	93.39	94.75	91.22	83.95	107.8
2009 Q1	110.71	90.72	106.35	90.98	93.97	88.32	84.39	108.05
2009 Q2	108.28	90.95	103.7	88.97	92.84	89.68	82.59	107.57
2009 Q3	109.88	92.06	103.39	91.65	93.41	90.19	82.82	106.99
2009 Q4	113.65	93.24	104.17	93.63	93.41	89.68	82.16	106.66
2010 Q1	115.15	91.13	105.5	96.11	93.1	90.91	80.64	107.87
2010 Q2	118.31	90.74	106.57	95.63	92.42	90.41	78.97	107.73
2010 Q3	117.25	90.63	107.47	95.56	91.44	90.51	77.2	107.71
2010 Q4	114.82	88.94	109.36	94.72	90.79	92.04	75.8	107.39
2011 Q1	116.17	91.19	110.55	95.47	89.54	91.97	72.94	104.72
2011 Q2	117.59	90.54	112.08	93.06	88.95	91.38	71.93	106.87
2011 Q3	119.22	89.96	112.95	92.43	88.68	91.48	71.64	107.55
2011 Q4	119.44	89.97	112.59	92.74	88.31	91.17	71.47	108.24
2012 Q1	119.74	89.52	111.3	91.19	87.39	90.16	70.13	110.24
2012 Q2	121.04	90.74	110.4	90.12	87.31	90.27	70.59	109.1
2012 Q3	120.5	92.52	110.17	90.32	87.69	89.9	71.83	106.99
2012 Q4	120.37	93.54	111.37	90.27	87.2	90.67	70.67	104.85
2013 Q1	119.01	93.14	110.13	91.32	88.66	90.09	74.92	102.55
2013 Q2	119.79	93.41	109.59	89.46	88.99	90.93	75.97	101.38
2013 Q3	120.03	93.21	109.18	88.45	89.32	92	76.71	99.7
2013 Q4	120.8	93.79	109.32	90.36	89.72	92.94	77.04	98.47
2014 Q1	122.91	93.89	107.93	92.98	89.79	92.26	76.8	97.67
2014 Q2	123.02	94.53	107.57	93.84	89.58	92.41	76.24	95.81
2014 Q3	123.23	94.54	106.18	96.1	89.53	92.87	76.14	94.31
2014 Q4	124.44	94.42	105.16	96.3	89.69	93.58	76.3	92.79
2015 Q1	124.45	96.44	104.53	95.74	89.93	93.91	76.79	90.93
2015 Q2	124.42	96.68	103.96	94.6	90.26	93.1	77.32	90.06
2015 Q3	126.14	96.86	103.61	94.11	90.7	93.95	77.81	90.5
2015 Q4	128.97	97.87	103.51	96.77	91.32	93.55	78.64	89.63
2016 Q1	135.71	100.04	103.34	99.8	92.11	92.92	79.16	89.93
2016 Q2	137.53	100.7	103.31	100.3	92.91	95.56	80.07	89.38
2016 Q3	141.6	102.33	103.21	101.42	93.54	94.91	80.71	89.05
2016 Q4	144.15	103.11	103.49	103.47	94.12	94.98	81.29	88.24
2017 Q1	148.57	103.16	104.05	104.45	94.46	96.17	81.21	87.24
2017 Q2	151.66	104.07	104.32	102.94	94.84	95.9	81.73	86.44
2017 Q3	153.24	104.91	104.8	103.86	95.28	95.55	82.3	85.79
2017 Q4	151.44	106.18	103.93	104.19	95.56	95.84	82.67	85.39
2018 Q1	154.15	106.45	105.03	103.17	95.83	96.8	82.86	84.85
2018 Q2	155.59	107.47	104.69	103.44	95.87	96.48	82.81	84.15
2018 Q3	155.93	109.28	105.05	103.33	96.1	96.71	82.99	83.5
2018 Q4	155.06	108.9	104.27	102.1	95.9	96.02	83.02	83.66
2019 Q1	154.96	109.72	104.08	102.44	96	97	83.39	82.28
2019 Q2	151.49	110.57	104.97	101.18	96.42	97.09	84.29	82.75
2019 Q3	151.38	111.13	105.58	102.33	96.88	96.9	84.71	83.37
2019 Q4	151.31	113.11	105.97	101.23	97.4	95.92	85.16	84.27
2020 Q1	153.31	116.46	108.84	103.38	98.67	94.87	86.2	85.76
2020 Q2	142.38	119.12	111.66	106.45	96.05	91.28	79.21	87.97
2020 Q3	150.25	119.04	110.42	103.39	99.01	93.5	85.13	86.92
2020 Q4	157.97	121.55	110.64	106.82	102.47	95.65	90.29	88.2
2021 Q1	158.55	125.51	112.16	109.03	100.77	97.81	83.47	88.66
2021 Q2	164.79	128.46	113.15	111.7	107.54	102.65	94.19	87.57

Source: OECD; Better Dwelling.

The detachment between home prices and incomes is like nothing any other G7 country has seen. Home prices grew faster than incomes at over double the rate of the following country, since 2005. To complicate it further, about half of this disconnect occurs after 2015. Not only is Canada’s recent bubble growing as fast as Germany, but it’s on top of an existing issue.

Germany Home Prices Are Growing Much Faster Than Incomes

Germany’s residential real estate market is next, and it’s not even really that close. The country’s index hit 128.5 in Q2 2021, up 27.6% from five years before. Home prices have grown 28.5% faster than disposable income since 2005 — about half the rate Canada has seen. It’s also worth noting that more than half of Germany’s growth since 2005 is from Q3 2019 and forward.

US Incomes Have Outgrown Real Estate Prices Since 2005

The US, not known for its fiscal restraint, looks like a country of penny pinchers compared to the rest of the G7. The country’s index is 94.2 in Q2 2021, up 17.6% over the past five years. You may have noticed that this number is less than 100, meaning it’s more affordable than in 2005.

Disposable incomes have outgrown home prices by about 5.8% since 2005. Due to recent growth, the US real estate market might technically be in a bubble. It’s not nearly as bad as it was back then, though, and compared to other G7 countries — it looks cheap… ish.

Neighbourhoods • 12/20/2021

What To Look For When Choosing A New Neighbourhood

by Scott Somerville

Choosing a Neighbourhood

It’s tough to know which neighbourhood you should settle down in. In large cities, you might have dozens of options, each with their own pros and cons.

Before considering a number of factors, which we list below, ask yourself this question: What do you want to do in your downtime?

Tip: You might be the type of person who doesn’t care about their neighbourhood. If you’re single and spend a lot of time at home, the physical house or condo will be what’s important. Use your day-to-day and week-to-week activities as a launching point and go from there.

As obvious as it seems, your neighbourhood’s features exist for the time you’re not at work. When you wake up Saturday morning, what do you want to do? If you have small kids or a dog, you might want to live near a park. If you want to meet with friends, maybe you want nearby cafes and restaurants. If you spend a lot of time with your family, you night consider a neighbourhood close to them.

As much as you may like a certain street or the reputation a neighbourhood has, you need to think about what you actually do on your downtime and situate yourself in the midst of that.

Before you decide on an area, here are some things to consider.

How you get around

While you might like a large home on the outskirts of the city, and you could save money by living further away from downtown, if you walk or take public transit to get everywhere, that wouldn’t be the best decision.

Think about how often you walk, bike, and drive, and use that information when you’re shopping around for a home. Be honest with yourself when deciding if you’re willing to change your transportation habits for a neighbourhood.

Cost trade-offs

Consider a cost-benefit analysis when discussing neighbourhoods. For example, would you rather live in a two-bedroom, semi-detached home in Kanata or a four-bedroom, detached house in The Glebe? You’ll get more space if you’re removed from the core, but the neighbourhood may be more desirable.

If you work downtown, you know that commuting can take a good chunk of time out of your day. But living on the outskirts of the city will save you a ton of money, if you’re willing to spend extra time on the train or in your car each day.

Weigh time versus cost to determine which is more important to you, then work with your agent to choose the right area.

Outdoor space and recreation

While you can jog anywhere, other physical activities, like spin class or Crossfit, require specific facilities. If you have small children or a dog, a park is good for health and exercise. Think about pools, tennis courts, skating rinks, community centres, and other recreational resources.

And, like so many of the points on this list, be realistic—if you don’t swim already, you might be choosing a location based on something you’ll never use.

Tip: If you have a certain church or place of worship and you don’t want to transfer to another, limit yourself to a reasonable distance.

Family and friends

If you have small kids and need regular babysitting help from your parents, you probably don’t want to be across town from them. If you see your friends often, buying a home in the same neighbourhood will make visits easier. But, in both situations, if you’re buying solely to be near the people closest to you, be sure they aren’t moving in the very near future, and that they actually want you to live nearby. (If you live beside your best friends, it could cause more problems than solutions.)

The bottom line, when choosing the neighbourhood you want to live in, is to weigh these factors with many others—type of home, school zones, home prices, etc. Don’t base your entire move on one factor or you could regret neglecting the others in due time.

School Zones

The quality of education your children receive should be at the top of your list.