155 DALHOUSIE ST., NO. 1019, TORONTO
ASKING PRICE: $558,000
SELLING PRICE: $551,000
PREVIOUS SELLING PRICES: $512,000 (2012); $219,563 (2000)
TAXES: $3,600 (2014)
DAYS ON THE MARKET: 6
LISTING AGENT: Elli Davis, Royal LePage Real Estate Services Ltd.
Published in The Globe and Mail, Thursday September 4th, 2014.
The Action: There were numerous units for sale this summer in the Merchandise Lofts – a converted Sears warehouse near Church and Dundas streets. But demand for large, true loft conversions is strong, so this two-bedroom, sub-penthouse suite sold briskly.
What They Got: This 1,200-square-foot, two-bedroom loft has a rotunda leading to an open principal room with 12-foot ceilings, a wall of windows and polished concrete floors, along with a gas fireplace and granite-topped kitchen island.
Hidden behind sliding doors are two bedrooms, including a master suite with his and her closets and a five-piece bathroom.
Monthly fees of $697 pays for water, concierge, salt-water pool, basketball court, party room and rooftop deck, plus $59 and $7 for its parking spot and locker respectively.
The Agent’s Take:
“The building is really sought after because of the location downtown and the original loft feel,”
agent Elli Davis states.
“It showed very well, it had good views and it was a great space with high ceilings.”
Buyers also liked having amenities within close reach.
“There’s a big Metro downstairs, which is great, and lots of shops nearby,”
says Ms. Davis, who fielded inquiries largely from young professionals,
“who like to walk to work, and work and play downtown.”
Design Exchange is Canada’s only museum dedicated to the pursuit of design excellence and preservation of design heritage. Located in downtown Toronto, in the historic Toronto Stock Exchange building, DX annually attracts thousands of visitors of all ages.
One of the last exhibitions This Is Not A Toy, curated by John Wee Tom and DX Associate Curator Sara Nickleson with Guest Curator Pharrell Williams, was the world’s first exhibition featuring a collection of contemporary sculptures, figurines and artworks created by artists including Takashi Murakami, KAWS, FriendsWithYou, Coarse, Huck Gee, and Frank Kozik.
The exhibition explores the conceptual toy - a form made solely as an expression of an aesthetic, concept or idea as an art and design object as well as a contemporary cultural signifier. On display until May 19, visitors dive headfirst into the realm of designer toys as the Exhibition Hall is transformed into a vibrant and whimsical environment, filled with forms ranging from tiny trinkets to enormous free-standing pieces.
The upcoming exhibition: TAPAS: SPANISH DESIGN FOR FOOD will be opened on Thursday June 12.
MEET THE PHOTOGRAPHER: BEA LABIKOVA
Bea is a Toronto based musician, photographer, teacher and a multidisciplinary visual artist. Growing up surrounded by her father’s antique camera collection, Bea was naturally inclined towards photography since an early age. She loves taking portraits of unique faces and always tries to capture the colours of the world around us. Her main areas of interest are documentary, performance and travel photography.
Toronto Dance Theatre’s (TDT) On Display is a well named piece of work. With barely any music, next to nothing in the way of staging or sets, and fewer than ten props, the already close and personal setting of the Dance Theatre Stage (the repurposed church on 80 Winchester St) becomes even more intimate. The substance of On Display only enhances this further.
Rather than presenting one long piece with a story line or overarching theme, On Display consists of ten utterly unconnected solo dances, each one choreographed by a different person – none of whom are professional choreographers.
The program for the show includes a message from TDT Artistic Director Christopher House, in which he explains that the outsider choreography reflects the fact that “the boundaries between the traditional art forms have become even more porous, with a pan-disciplinary interest in the expressive potential of the body”, as well as an “increased curiosity around expanded definitions of choreography and a growing appetite for collaboration in its many forms.”
House wasn’t kidding when he talks about expanding the definitions of choreography. There’s hardly anything on display in On Display that your grandparents would recognise as dance. The first of the ten solos involves of the Artistic Director himself squirming on the floor in a fashion reminiscent of some new born animal. After finally removing one shoe and an undershirt with minimal use of his arms, Mr. House resumes his seat in the audience.
Not all of the pieces are quite as obscure as this first one, and there is a welcome strain of humour through a few of them. Yuichiro Inoue hops about with a smile to embrace the world, talking about the geographical distances he’s travelled in his life.
Alana Elmer contorts and drapes herself over what appears to be pet furniture, and Brodie Stevenson recites a grimly amusing story of murder and perversion (if it wasn’t obvious already, this is not a show for kids), followed by a dance segment featuring extremely unusual use of a microphone.
The most traditionally choreographed pieces are probably the distraught and disturbing one created by Paulette Philips (and danced by Kaitlin Standeven, whose mute, tormented character may either be grappling with demonic possession or mental illness), and Tawiah M’Carthy’s athletic, engaging piece brought to foot-stomping life by Pulga Muchochoma.
Muchochoma’s performance is particularly impressive not just for its energy, but because of vocal accompaniments (consisting of singing, clicking, and birdlike sounds) provided by the dancer himself.
Another notable segment is Aleesa Cohene’s vignette highlighting the physical struggle of a practising performer. ‘Hard Moves’ is responsible for On Display’s partial nudity warning. Dressed only in a pair of quietly comical striped shorts, the beautiful Mairi Grieg invokes our compassion for the real work involved in professional performance through deep backbends and one very high leap.
Regardless of choreographer or dancer, there’s no theatre magic here; nothing hidden, and no elaborate costumes or makeup for the performers to hide behind. Everything really is on display; in several instances, the dancers aren’t even assuming any sort of persona, but are clearly themselves, and speak directly to the audience about their lives. Sometimes the evening feels a little like a well-rehearsed talent show among friends; informal, but polished, and comfortable enough to try out even the strangest ideas. At other moments, we feel on the threshold of something new, strong and completely fresh. TDT has a reputation as one of the Toronto’s more mainstream contemporary dance companies: it’s good to see Christopher House continue to push the boundaries.
Photos Courtesy Guntar Kravis
Yorkdale Shopping Centre has some big changes coming its way! With more than 240 retailers ranging from affordable favourites like H&M and Smart Set to higher end stores like Michael Kors and Tory Burch, the large shopping mall at Dufferin and the 401 has always had a little something for everyone. But it’s about to have even more to offer us. In a press release, the Yorkdale team revealed construction is underway for a $331 million expansion that will add nearly 300,000 square feet of retail space!
Among the roughly 25 new stores and boutiques opening up in the expansion will be the first stand-alone Jimmy Choo and Versace boutiques. Gone are the days where you had to shop online or search through the small collections available at department stores to find these luxury brands. Hopefully there will be news soon of which collections will be making the journey to Toronto!
The expansion will also include the first Moncler location as well as Bulgari and Mont Blanc shops. In addition there will be some more affordable options like Forever 21, Garage, Justice and LUSH. And your feet can rejoice too because Canada’s first Vince Camuto store will be opening as well. As if all that weren’t enough, the expansion will also include the largest Nordstrom in the Greater Toronto Area.
“Construction of our expansion is on track and we’re building momentum by welcoming brands that will inspire shoppers from head to
announced Yorkdale General Manager Claire Santamaria in the press release.
“These retailers are helping set the stage for what’s to come in 2016.”
The new retail space is set to open in the fall of 2016 — just in time for our holiday shopping! We already can’t wait to check it out!
There are many different reasons people collect art and antiques. It’s generally accepted that collecting art makes people happy and reduces stress, and it may have a positive impact on your quality of life. Many people purchase art to enhance their interior design or add an element of luxury to their homes. There’s no doubt that art is an investment — maybe not always a monetary one, but definitely an investment in your quality of life. Either way, art is an asset that should be protected. So, as soon as you start thinking about purchasing a piece of art, you should consider obtaining a suitable insurance policy.
Consider Purchasing Special Fine Arts Insurance Policy
Many first-time art buyers do not realize that their homeowner’s insurance provides only limited coverage on high-value items such as artwork. This means that their valuable pieces of artwork are not sufficiently protected against theft, damage, or loss. In some cases, it might even be that without proper fine art insurance, the piece they have just bought is completely unprotected from the very moment they purchased it. Many people forget to insure their new pieces of artwork after they purchase or inherit it. As Robert Pittinger, director of underwriting, AXA ART Americas, which is one of North America’s leaders in art insurance, pointed out a few reasons, suggesting,
There may be strong sentimental value attached to the inherited piece(s) which might not have financial considerations. Also there could be lack of awareness about the benefits art insurance brings, such as assisting with costs associated with conservation or loss replacement should damage occur.
The first step you should do before purchasing a valuable work of art is check what your existing insurance covers. It is very likely that your homeowner’s insurance policy is limited and does not cover your new piece of art. In such case, you can either purchase an extension to your homeowner’s policy coverage or get a separate insurance policy for fine arts. We recommend buying separate fine arts insurance coverage, which might be more expensive than an addition to a homeowner’s insurance but has several advantages. Special insurance includes coverage relating to fine art that makes it easier to prove what you have, and you will also receive better coverage. Robert Pittinger noted,
There are various insurance options available to help safeguard the collection in your care. Whether you collect fine art, collectibles, wine, antiques, jewellery, musical instruments, comic art, sports memorabilia, rare books, stamps, rugs or coins there are various art insurance options. Take the guesswork out of choosing the best coverage for your collection. Seek the advice of a fine art insurance specialist who understands collector’s passion for fine art and collectibles and employs insurance professionals with training in fine art.
The most important aspects to consider when purchasing fine arts insurance include the risks covered by the policy, exclusions, the amount of coverage, whether it covers transit from one location to another, the valuation policy, and the claims policy of the insurer. Furthermore, we recommend that you obtain defective title coverage. It will cover you in case you purchase a piece of art from someone who is not a rightful owner. This means that if someone claims that the item you purchased (during the period that you have been insured with defective title coverage) is not rightfully yours, you will be reimbursed by the insurance company.
Of course it is important to choose the right insurance provider. We recommend that you consider a provider that specializes in insuring art. Not only will they be able to tailor an insurance policy that fits you perfectly, but they will also provide valuable advice on art insurance as well as on restoration and protecting the art from deterioration, theft, and other threats. Moreover, large all-purpose insurers often lack experience and expertise in certain works of art and may have problems evaluating values.
Some insurance companies will automatically cover a new addition to your art portfolio if you inform them about the purchase within a certain period. However, this is not a common practice of all insurance providers, so be careful and contact your insurance company before you make any new acquisitions. If possible, we recommend that you purchase coverage for your collection that automatically expands with all new additions to your set.
Determine the Value of Artwork
It’s of crucial importance to get the right amount of coverage. Art is a unique area of commerce and the value of a piece of work is often subjective. The value of your collection can change each year — not to mention that it has both intrinsic as well as personal value. However, when determining the value of artwork for the sake of insurance, you have to be as objective as possible. It is possible to determine a common market value. Art insurance providers will not rely on a single index to determine the value of your artwork, but would rather consult numerous sources.
In addition, we recommend that you get an individual professional appraisal on a regular basis. An up-to-date appraisal will ensure that you will receive the right amount if something happened to your artwork. For example, if the author of the artwork dies, the price of the piece increases by up to 200 per cent. In this situation, you should review your insurance policy to make sure that it covers the whole value. As Robert Pittinger remarked,
Art values are dynamic and constantly changing. It is always advisable to monitor the value of your collection. AXA ART recommends at least once per year. We work with top Canadian brokers to provide art insurance solutions for creditors. Contact your insurance broker who can assist with making adjustments necessary.
On the other hand, if the price of your collection goes down, you can reduce the premiums on your art insurance policy and save some money. A professional appraisal should include different explanations, comparisons, and conclusions. It should also provide evidence that the artwork is authentic. Watch out for fake appraisers who give out useless certificates that do not include any relevant information.
Do your research; speak to a fine art expert or dealer about the condition of the art work; sales and auction activities of the artist and trends in the market. Seek the advice of a qualified appraiser.
Professional Fine Art Appraisers in Toronto:
- Appraisal Associates, 95 Trinity Street, Suite 104, 416-368-4334
- Mayberry Fine Art, 110 Yorkville Ave, 416-923-9275
- Waddingtons.ca, 275 King Street East, 2nd Floor, 416-504-9100
- Odon Wagner, 198 Davenport Rd, 416-962-0438
- Art Advisory.com, 2389 Bloor St. West, Floor 2, 416-366-9770
- A. H. Wilkens Auctions & Appraisals, 299 Queen Street East, 2nd Floor, 416-360-7600
Do Your Homework
When buying a new car or television, we usually consider a variety of different parameters and characteristics to make sure that it is the right one for us. The same works for purchasing an insurance policy. In order to know whether a certain insurance policy suits you or not, you have to understand what is covered and what happens in cases of loss or damage. Read the whole fine print and do not hesitate to discuss any part that is unclear with a professional. Try to anticipate different scenarios and verify that your insurance policy will protect your art collection in such cases.
Moreover, gather all the important documents regarding the purchase and ownership of the artwork and file them in a safe place. These include, current appraisals, sales receipts, provenance, a replacement estimate, and photographs of the works. It is also important that you protect your art collection by different possible means. Your art insurance premium depends on the risk profile of the art that you are insuring. We recommend that you take precautionary measures such as installation of a decent security system, smoke detectors, and storing the collection in a safe and dry area.
Art insurance is not cheap, and many people neglect it. However, considering the value of fine artwork and its vulnerability to damage or theft, you must obtain an insurance policy covering your collection. The value of your collection changes and you should take care of your art insurance accordingly. Insuring your art collection will not only protect your future financial commitments but also provide you with peace of mind.
Carolyn Ireland of the Globe and Mail interviewed Elli as part of her fascinating article on current trends in luxury real estate in Toronto. It is hard to imagine, but even in the multimillion dollar price range the supply cannot keep up to the demand. Read on to find out what happens when these distinctive homes go on the market.
Published in The Globe and Mail, Carolyn Ireland, 31 January 2014
On a snowy day in Rosedale last week, luxury cars lined the antique cobblestones in front of a neoclassical Georgian, and guests lingered near the warmth of a log fire in the main entrance hall.
Five Hawthorn Gardens had just hit the market with an asking price of $15.9-million and real estate agents were eager to view the splendours inside.
Welcoming agents to the busy open house were Elise Kalles of Harvey Kalles Real Estate Ltd. and Jimmy Molloy of Chestnut Park Real Estate Ltd., who share the listing on the ravine property. They started receiving requests for showings as soon as word got out that the house would be hitting the market.
Agents say sales in the upper echelons of the market in Toronto are lively again after a moribund stretch that began in 2012.
Ms. Kalles believes buyers were hesitating as economic pundits warned of a possible downturn. But when a few buyers stepped up, a spate of “sold” signs appeared in areas such as Forest Hill, Rosedale and Teddington Park. Those deals bolstered confidence and spurred others to take action.
“These are landmark houses,” Ms. Kalles says. “It’s not like if this sells you can tell a client, ‘don’t worry – another one will come up.’”
Ms. Kalles recently sold a house on Riverview Drive for close to its $15-million asking price. A week ago, she represented prospective buyers who lost out on a house on Roxborough Drive in Rosedale. The house, which will likely be torn down, was listed for $1.9-million and drew four competing bidders.
Looking back to 2012 and 2013, many luxury properties languished as a list of global observers that included Deutsche Bank, the Organization for Economic Co-operation and Development, the International Monetary Fund, the Economist magazine, the Wall Street Journal, and marquee economist Nouriel Roubini all warned of frothiness in Canada’s housing market.
“I think that we had a lot of people who were sitting on the sidelines,” says Mr. Molloy. “People have been waiting for this correction. The correction never came.”
Mr. Molloy also reckons that the market has adjusted to the tighter restrictions on lending imposed by the federal government in July, 2012. Among other interventions, Finance Minister Jim Flaherty clamped down on high-ratio mortgages of more than $1-million as market watchers fretted about perilous levels of household debt.
Although corporate titans and entrepreneurs can often afford to pay cash for their high-priced real estate, many took out mortgages in years past to take advantage of low interest rates and maintain their investment in assets offering a higher return, Mr. Molloy says. “They had the money, but they had better uses for the money.”
Buyers have now absorbed the change and are taking some profits out of financial markets and shifting cash into property, he said. Still, he doesn’t see the upper end of the market getting overheated.
“When you’re dealing with that higher end, every deal is done prudently. Deals are being done at a high level, not a crazy level.”
He adds that people who want to live in great downtown neighbourhoods don’t have a lot of choice in listings. “There’s not an overwhelming supply of great product. There are people with $2-million or $3-million to spend and they’re frustrated.”
Sotheby’s International Realty Canada says that sales of Toronto homes of all types in the $2-million to $4-million range rose 17 per cent in 2013 compared with 2012. For houses above $4-million, sales swelled 52 per cent in the same period.
Ross McCredie, chief executive of Sotheby’s International Realty Toronto, says that a lack of listings in the single-family home market have made “attached homes” more popular and he predicts that trend will strengthen in 2014. Mr. McCredie believes condos, townhouses and row houses will see bidding wars as we head into the spring market.
In Leaside, meanwhile, workers are still installing the kitchen and nailing down the trim in a traditional, red brick house on Hanna Road. As soon as real estate agent Patrick Rocca placed a photograph with the words “coming soon” on his web site, he heard from prospective buyers.
“I’m getting people calling me about it and it’s not even finished. I don’t even have a sign on it yet.”
The asking price will be somewhere around $2.3-million.
In the past 10 days, Mr. Rocca says, he has sold two houses with asking prices above the $2-million mark and both received multiple offers.
One of the properties, near Edwards Gardens, received six offers and sold for more than $50,000 above the asking price.
Mr. Rocca believes one reason is that inventory shrunk after builders slowed down their rate of new construction. Last fall, he says, 17 or 18 houses priced north of $1-million were on the market in Leaside.
When people drive by lots of houses for sale and see them sitting, they become more hesitant to buy because they figure they might be able to hold out for a price cut. Houses are no longer sitting, and that boosts confidence in the market, Mr. Rocca says.
“You’re starting to see movement and, in some cases, really crazy movement. People are picking up that the high end is moving now.”
Real estate agent Elli Davis of Royal LePage Real Estate Services Ltd. has tallied nine deals in January and many of them were at prices above $2-million.
One house she sold this week in Forest Hill had previously been listed at a much higher price. The buyers were able to negotiate a price about seven per cent below the asking price and about 30 per cent below the original asking price with a different agent. She’s not seeing a lot of price cuts, but she says some sellers are unrealistic when they set the listing price.
“Ironically, she says the recent vigour in the market has made some homeowners more reluctant to list. “Now we’re getting seller resistance because they’re afraid they won’t be able to find anything to buy.”
In more moderate price ranges, multiple offers are continuing to amaze sellers, Ms. Davis says. This week she sifted through 24 offers on a semi-detached house listed for $499,000 near Leslie and Finch. The successful bidders paid $640,000, or $141,000 above asking.
Over three days, she had more than 150 showings, says Ms. Davis.
“I was getting calls all weekend, so I knew it would be very, very busy.”
Ms. Davis says the lack of supply in January is one reason that sellers get so many parties vying for one house.
“I really think that people have to realize that January and February are excellent months to put your house on the market.”
People who wait until the spring have to contend with the surge of listings that come out in April and May.
“The weather’s nicer but that doesn’t mean you can’t sell swimming pools in January. You just put photos out and let people dream.”
Susan Smith of the National Post spoke with Toronto Realtors, including Elli, about the current housing market and why it is a good idea to list your property for sale in the middle of winter.
by Susan Smith in National Post on 29/01/2014
Winter tends to be a relatively slow time for selling real estate. But while many people wait for the spring thaw to list their property, slow season might just be the best time to attract a buyer. At least that’s the philosophy of Royal LePage veteran Elli Davis, who clinched eight deals in December and has been busy so far this month.
“I encourage people to list in December and January,”
she says, speaking from 30 years of experience.
“Many listings expire Dec. 31. But when I take a listing in September or October, I try to get it to the end of January to really cover that holiday season.”
Her reasoning has served her well over the years: Many people hunker down for the holidays or go south for the winter, so there’s not a lot of competing properties on the market. But there always seem to be buyers, their ranks filled by people with pre-approved mortgages due to expire and shoppers who don’t mind braving the cold to avoid the spring crowds.
One of her recent buyers was a retired professional with a house in the Yonge and Eglinton area. He and his wife, also retired, were ready to downsize and had security concerns about leaving their home when travelling and vacationing in Florida. Not thinking they were ready to buy immediately, they had a chat with Ms. Davis about what their house was worth and found themselves looking at condos.
Then they saw one they wanted and found themselves buying it. They got the 2,170-square-foot unit in a building in the Bay corridor close to Yorkville for just over $1-million, a bit under asking. No bidding war, which the buyers were happy to avoid.
“When everyone else is sleeping, lots can happen,” Ms. Davis says. “It’s a 12-month business. There are always buyers and sellers every single day.”
One of the deals Ms. Davis closed during the recent spell of frigid weather was a North York home that sold for $902,000, $114,000 over asking.
“That was an example of looking at it in mid-December and they were going to wait [to list], and I said, no, let’s do it now. There’s nothing on the market in your area.”
The timing was perfect, generating 13 offers and a quick sale.
Royal LePage’s latest house price survey is one of many reports showing the Toronto market finishing the year on a strong note, in line with the national average for Canada’s largest cities.
According to its figures, the average price of a standard two-storey home in the fourth quarter rose by 2.75% year-over-year to $686,000. This compares with a rise of 3.6% to an average of $418,000 nationwide for this type of property.
The average price of a detached bungalow in the city rose 3.9% to $580,000, compared with a rise of 3.8% to $381,000 for the country as a whole. For a standard two-bedroom, 900-sq.-ft. condominium, the rise was 1% to $360,000, compared with the national average of $247,000, a 1.2% rise.
The report predicts a continued “positive momentum” and a sellers’ market for the first half of the year.
According to the Toronto Real Estate Board, the average selling price in the GTA for December was $520,398 up 8.9% compared to the average of $477,756 in December, 2012.
“The average selling price will be up again in 2014 and by more than the rate of inflation,” said board president Dianne Usher. “The seller’s market conditions that drove price growth in the second half of 2013 will remain in place in many parts of the GTA.”
So why wait for spring, when everyone else lists?
Christopher Bibby, an agent with the Sutton Group in Toronto who specializes in condos, sold two properties in the week before Christmas. One was a loft at King and Spadina area that went for a little under asking at $415,000. The other, at King and Jarvis, attracted multiple offers and sold for $3,000 over asking for $372,000.
“Even during the ice storm there were agents out there, and a lot of people looked at it as an opportunity, and without a lot of competition out there, as a good time to go out and shop.”
Mr. Bibby says it can be a good time to list rather than wait, especially if a unit is sitting empty.
But in this market of ample inventory, with condos generally taking longer to sell, he says it’s more important than ever to make a good impression and stand out from the crowd. In other words, get rid of the crazy paint colours and spring for a good staging.
“The sellers have to be more hands-on and the agents have to be a lot more hands-on,” he says.
Standard tips for selling in winter include making the space look comfy and warm, lighting a fire or wooing buyers with the smell of baking cookies.
But like Mr. Bibby, Ms. Davis says it’s more important to get the basics right — declutter, make the place immaculate and send the pets away for a little holiday even if you’re not taking one of your own.
“I’m not a big cookie person,” she says. “Clean and presentable are much more important to me. Provide easy access, make sure the key is available, allow showings when people want to come.”
Even though buying a home is one of the biggest investments in our lives, many Canadians overlook one important aspect of this complex process. People can easily become overexcited when they finally choose the house of their dreams and figure out their mortgage and down payment, forgetting that there are other expenses involved in buying a home. They also forget that these expenses can account for as much as 4 per cent of their purchase price. According to the 2012 TD Canada Trust First Time Home Buyers Report, 13 per cent of polled Canadians overlooked some of the one-time fees associated with purchasing a home, such as appraisal fees or land transfer taxes, and 6 per cent did not prepare their budget for anything other than the down payment and monthly mortgage payment. James Loewen, owner of the Burlington-based Loewen Group Mortgages, who also runs a blog packed with useful information about mortgages, commented,
Most clients are aware that there will be some amount of costs (land transfer and legal costs) but very few we speak with know what to expect. One of the major things we have noticed is the lawyers fee; the difference between lawyer fees versus disbursements (or what disbursements are).
Anticipating closing costs is crucial for creating a budget because your deal might not go through if you don’t have sufficient funds to pay your closing costs. Also, closing costs vary across municipalities. For example, if you are buying a home in Toronto, you should be prepared to pay both the municipal as well as provincial land transfer taxes. Some of the fees you will have to pay before closing the deal can be negotiated, and some of them cannot. So you should always seek professional advice to find the best solution, instead of relying on unverified information. As James Loewen told us, one of the reasons Canadians overlook closing costs is,
Generally a friend or such just tells them to set aside $5,000 for closing costs; not explaining that there is no fixed amount payable or educating them on where to find out the variable cost based on purchase price.
Buyers should be aware of what closing costs entail so that there are no surprises during the final stage of buying a new home. Here is a list of the additional costs you will have to pay during the closing process.
Down Payment and Deposit
It is possible to buy a home with a down payment of only 5 per cent, but in this case, you should expect a high-ratio mortgage, which has to be insured by a third party. The rule is simple: the more you put down, the less you have to spend each month on mortgage payments. In addition to the percentage of your down payment, the insurance premium also depends on the amount you are borrowing. You can add it to the principal balance and pay it off as part of your mortgage or you can pay it off in a lump sum at the time of purchase.
If you don’t want to pay high mortgage premiums with additional mortgage insurance and qualify for a conventional mortgage, then you should put down a larger percentage of the purchase price. The function of a down payment is to prevent the lender from losses in case the borrower defaults on his or her mortgage. However, deciding how much to put down is not easy â especially in these market conditions.
As James Loewen pointed out, this decision depends on everybodyâs financial situation. First of all, if we decide that the answer to the controversial debate of buying versus renting is buying, then a down payment on $300,000 to get preferred rates would be 5 per cent ($15,000) with a default insurance of 2.75 per cent capped onto your mortgage. He added,
To obtain the next tier of insurer premium at 10 per cent down payment is then going to save you 0.75 per cent of premium (approximately $2,250) but require an additional $15,000. If you’re around the median income in Canada, saving $400 a month of after-tax dollars at present cost of living figures would be, I feel, for most, doable at best (but more than likely challenging). Given this amount and some modest growth of investing, we can assume then it would take three years then to save that further $15,000 of down payment.
Plus, there are some aspects you should consider when calculating a down payment, such as its impact on your mortgage payment, future savings ability, the overall budget of your family, and how much the home will appreciate over the period you save up for the down payment.
A deposit is a payment that you pay when you make an offer to purchase in order to show that you have a sincere interest in buying the home. It is usually 5 – 10 per cent of the purchase price, but it can vary. The amount of the deposit forms a part of your down payment and is written in the contract of purchase and sale. If you decide to terminate the purchase, you might not get your deposit back, and in some cases, you might even be sued for damages.
Mortgage lenders usually require an appraisal before approving a mortgage loan. This is a document that provides an estimate of the market value of the home and ensures lenders that the loan does not exceed the value of the property. The appraisal fee goes out of your pocket, and the cost varies depending on the value of the property and how difficult it is to assess its value. Appraisals are performed by licensed independent appraisers who evaluate the property’s value so you know you are not paying too much. The appraisal includes an evaluation of the whole property, its location, amenities, and physical conditions, recent comparable sales, and an assessment of current market conditions affecting the property.
Home Inspection Fee
In addition to an appraisal, you might want to have your new home inspected by a qualified home inspector evaluating the condition of the home. The inspector will provide you a written report identifying any other potential issues that are not visible to the naked eye yet may have a significant impact on the costs and upkeep of the home. It is not mandatory, but it is very helpful to be aware of the hidden flaws of the home before purchase. Keep in mind that it is important to make sure that your inspector is certified and to confirm his or her credentials. Manny Johar, a Toronto mortgage agent from Expert Mortgage, warned us,
Unfortunately, regulation in this industry is not very good, and virtually anyone with some experience in the building trade can get a certificate. The home inspector’s job is to confirm that the house is in physically sound shape. It includes inspecting walls, floors, roof, furnace, et cetera. Most inspectors will not go up on the roof and just do a physical inspection from the ground, which is a total scam!
Moreover, the Canada Mortgage and Housing Corporation recommends making a home inspection a condition of your offer to purchase. The cost of a home inspection varies depending on the age, size, and complexity of the house as well as on its overall condition.
Survey or Certificate of Location
A survey or a certificate of location is a document that specifies the exact location of the building on the property and describes the type as well as size of the building with all its additions. Some mortgage lenders ask for an up-to-date survey of location before signing off on the loan, to ensure that the house youâre about to purchase is located on the property without any encroachments. Manny Johar pointed out,
The document describes the exact dimensions of the property. The importance of such a document is that it proves exactly what the deed holder owns and its relation to its neighbours. Normally a survey is not required to close a file in that most lawyers obtain title insurance on closing, which insures the purchaser from faulty title.
In most cases, you can obtain one from the seller, especially if there were some recent additions to the house, but if this fails, you will have to pay for one yourself. The cost of a survey of location varies between $1,000 and $2,000, and the survey can be conducted only with permission from the property owner.
Property and Title Insurance
A property insurance policy does not only provide protection and peace of mind for you and your family, but it also protects the interests of your mortgage lender, as your home is security for the mortgage. So, many lenders require borrowers to purchase property insurance. It covers the cost of replacing your home and its contents in case of unavoidable loss and it has to be valid already on closing day. In addition to property insurance, your lender, lawyer, or Realtor might suggest that you purchase title insurance as well. As James Loewen noted, they are very different coverages, and asking if people should purchase title insurance in addition to property insurance would be like asking if people should obtain life insurance in addition to auto insurance! He added,
Title insurance protects against ‘title defects’ like encroachments or fraud as well, while property insurance will cover you (and is required by law at closing) for liability issues and home replacement costs. Example: a guest injuring themselves on your property, or if your home should suffer loss due to a fire or theft.
It covers issues that may arise as a result of defects of title to the property, such as encroachment issues, existing liens against the property’s title, title fraud, undischarged mortgages, et cetera. The cost of title insurance is paid as a one-time premium.
Land Transfer Tax
Land transfer tax is charged whenever a property changes owners, and it must be paid when you close the sale. In most Canadian provinces, there is a provincial land transfer tax, but some cities (like Toronto) also charge an additional municipal land transfer tax. This is a percentage of the property’s purchase price. People buying a house in Alberta and Saskatchewan donât have to pay land transfer tax but a transfer fee, which is significantly smaller. Moreover, some provinces have exceptions and rebates for first-time homebuyers. A piece of advice from James Loewen is,
Ensure you’re working with an industry professional mortgage broker that in your first meeting reviews and calculates for you the specific closing costs related to your unique circumstance (i.e. geographic location, first-time homebuyer or not, if there is any provincial sales tax on default insurance, etc.). They should outline the process of purchasing from end to end and the costs and steps you’ll be taking together.
Status Certificate Fee
If you are planning to buy a condominium or strata unit, you might want to review a status certificate. This is a document that outlines the financial well-being and legal state of a condominium corporation, which is very useful to know before purchasing a unit. In addition to providing information about the condo corporation, the certificate also outlines important data regarding the unit including the amount of condo fees, the way condo fees are paid, the total amount of fees and arrears that have not been paid by the current owner, the defaults of the current owner, et cetera. A status certificate fee can cost approximately $100.
Property Tax and Utility Bills
It is very common that the seller has already prepaid property taxes and utility bills for the time after closing the sale, especially if the closing date does not fall on the last day of the month. In these cases, the amounts that the seller has already prepaid will be adjusted and you will be required to reimburse them for these costs. Still, closing costs are different with every deal, so you should not rely on information from your relatives or friends and you should consult a professional. As Manny Johar noted,
The best person to consult for closing costs is the lawyer that will be handling the closing. Most lawyers give free 30-minute consultations to new clients. Take advantage of it! Thirty minutes is plenty of time to discuss this matter.
In addition to all these costs, you will also be required to pay legal fees and related costs charged by your lawyer or notary. These costs should include the costs of conducting a title search, drafting a title deed, and preparing the mortgage and registration fees as well as other disbursements. Legal fees vary and you should check with your lawyer for his/her fee.
Anticipating closing costs is very important for determining whether you are financially ready to purchase a home. As James Loewen remarked,
Ensuring you not only have enough for closing costs is also not enough. The only certainty in life is uncertainty. Plan to have unplanned costs when moving, closing, renovating, and even just maintaining the home after closing. Lenders will also require confirmation that you cannot only cover your down payment but the cost to close on your new home as well.
As you can see, the home closing process includes quite a lot of additional costs that might be easily overlooked but can add up to a significant amount. You should discuss these costs with your Realtor or mortgage broker, as some of them are negotiable.
“Priced to sell, Rosedale home gets two quick offers”
By Sydnia Yu in The Globe and Mail on Nov, 22 2013
66 PRICEFIELD RD., TORONTO
ASKING PRICE $1,550,000
SELLING PRICE $1,625,000
TAXES $9,223 (2013)
DAYS ON THE MARKET 3
LISTING AGENT Elli Davis, Royal LePage Real Estate Services Ltd.
The Action: Late in the summer, this semi-detached house was pitted against a few other Rosedale residences for sale, so it was priced at $1.55-million for better detection on buyers’ radar. Before the open houses could be held, two offers materialized after a dozen midweek showings.
What They Got: Across the street from a park and tennis courts of the Toronto Lawn Tennis Club, is a 25-by-115-foot lot supporting this three-storey, brick structure with an unfinished basement and private driveway.
Hardwood floors are a common feature in the living room, formal dining space and family room with a walkout to a flagstone patio, while tile was laid in a remodelled kitchen with stainless steel appliances.
On the top two levels, there are two out of three bathrooms, a fireside den on the second floor and three newly carpeted bedrooms.
The Agent’s Take: “It’s in a very good location in north Rosedale, adjacent to a park and an easy walk to Yonge Street,” says agent Elli Davis. “There are a good number of buyers waiting for a property like this that weren’t exceeding $2-million … because it wasn’t detached and it wasn’t gigantic.”
This property was also hassle-free compared to others. “It was in very good condition, it had some updates and renovations over the last several years,” Ms. Davis notes. “It has a private driveway at the rear of the house and that has a lot of appeal for buyers.”