We Sold our Condo
May 6th, 2008
Over the past couple weeks things on my end have been very crazy and hectic; not only was there a great deal of work that I had to do but I’m also slowly plugging away on a couple projects that I wanted to complete. The projects are still moving forward but everything unessential was effectively placed on hold while we bought a new house and sold our condo.
The great news is we sold our condo last night! All of the cleaning and preparation to ensure that the unit was in prime selling condition paid off. We didn’t get quite our asking price but what we got was better: we got an offer without any conditions! Now its up to the lawyers and banks to get all of the details in place. But all of the major hurdles have been completed.
This has been a very new experience for me in that I have never purchased or sold a house successfully. It was a stressful event since we were buying and selling what will be our home. This wasn’t an investment or a recreational property. We needed to take everything into account including all of the repairs and upgrades that will be going into our new home.
I’m glad that this process is effectively over and we can move onto the packing and preparing for the move. There is still a lot of work that needs to be done but we don’t need to do this on a crunched time line. Our lives can go back to a more normal pace and we can go back to some of our regular routines. This also means that I’ll have more time to put into this blog and a couple other projects that I have going!
Posted in Real-Estate | 2 Comments
A Possible House Purchase
April 24th, 2008
We have found a house that we like and we’ve placed an offer for; now its time for the making sure everything with the house is sound. After a few weeks of looking for a house we actually found one that we liked and wanted. We placed an offer on the house and after a little bit of negotiation our offer was accepted. Needless to say we want to make sure that everything is ok with the house before the deal is 100% done. The house inspection turned up a few things that will need to be looked at though other than the electrical system there’s nothing major wrong with the house.
Before anyone jumps on this we knew the wiring in the house would need to be replaced before we placed our offer. Other than this as a major expense everything else seems to be mostly in order. A lot of smaller to medium sized jobs over the next few years which will increase the value of the house. The only thing that remains is to make sure that there are no termites (the house is in a region that is known to have them even though the street we bought on is quiet). The whole point for us here is to make sure that we’re not buying a house with more problems than we’re ready to deal with. Some known issues that we’re planning for is one thing but to discover a massive problem such as a termite infestation would not be a pleasant surprise.
The expense of getting a house inspection in my opinion is totally worth it. And unless your uncle Bob is a real house inspector get a professional - they do this for a living and know what to look for. The report we’re getting for our $400 inspection will make sure we fix everything necessary to make the house safe and get a better insurance rate. Not to mention it minimizes the unpleasant surprises.
We’ll know the results of the termite inspection later today and by the end of the day we might have a finalized house deal. This is very exciting for me as its my first house purchase - I’ve learned a great deal about the process so far.
Posted in News/Misc, Real-Estate | 1 Comment
House Hunting in an Uncertain Market
April 16th, 2008
House hunting can be daunting at the best of times but it can be truly unnerving in an uncertain market. My wife and I have just started to look at houses to purchase. This is right around the time that things in the overall marketplace seem to be as uncertain as I can remember them. For many people this is not the time that they should start looking for a house, but for others there are many deals to be had. I can’t say that we’re debt free with huge cash reserves but we’re financially sound for this huge investment.
As some of the readers of this blog know I’m a Canadian and the real estate market in Canada and our region specifically aren’t nearly as bad as in parts of the US. Our economy has slowed a little but there hasn’t been a sub-prime meltdown in Canada. The whole world might have been impacted by it but there are many markets that are still quite sound, thankfully we’re in one of those.
Since there is a lot of risk in taking on a large purchase such as a house we’re taking what I see as a cautious approach. We’re trying to find a house that either one of us could pay the mortgage on. The whole idea here is that we’re going to make sure not to put ourselves into a situation where we might not be able to make ends meet. This does mean that we’re not going to buy the best we could possibly afford. The good thing is that we’re looking for good value and places that might need a little updating, which we can do over the next couple years.
The other thing that we’re trying to be conscious of is investment value. Our real estate agent is also very firmly in our court when it comes to this. We’ve made sure that we’re not in a rush to purchase the house and we can find the right fit for our needs as well as getting a house that will have a good return on our investment over time. The locations we’re looking in are also regions where there is a lot of potential to flip houses. The prices are going up and there is a lot of room for value increase.
The most important thing to keep in mind when house hunting in an uncertain market in my opinion is taking the extra precautions that will ensure you don’t put yourself into financial hot water. Making sure that you know what you’re looking for is extremely important. It’s not only the house that you need to consider but also the investment value of your purchase and the financial implications in the short and long term. I think we’re entering the market at a great time for us and we’ve already seen some houses that have a lot of potential.
Posted in Investments, Real-Estate | 3 Comments
House Flipping – Why I’d love to do it but can’t
January 25th, 2007
First off I wanted to apologize for not posting yesterday, it was bit of a hectic day. Now onto a topic I’ve wanted to cover for a while but simply haven’t gotten around to: House Flipping. There are all sorts of stories about people making tons of money house flipping, including shows dedicated to the topic such as TLC’s Flip That House. Unfortunately there are also the horror stories of people who just didn’t know what they were doing and lost lots of money (think iamfacingforeclosure.com).
All of this leads me to think that there is a market in flipping houses, especially if you’re smart about it and do your homework. Buying a house that could do with some upgrades and renovations in a neighborhood that is expanding is merely a matter of research rather than luck. If you think about it, in all of the major cities in North America people will want to buy a nice house and there will be houses that are being sold off below market price. Taking that house, cleaning it up, fixing it up and then selling it is something that’s happening every day.
So why am I not doing it? Well there are two reasons – first off I don’t know enough about renovations and real estate to get into it. I will fully admit I am green on the subject and I don’t want to pour hard earned money into something I know nothing about. In my case this is enough for me to not do it; unfortunately this doesn’t stop a lot of people. Having a good real estate agent would help a great deal but I don’t know any and if there is a great house for flipping what are the chances that the house will be on the market for long? Probably pretty small. This is a topic I’m interested in and one that I will learn more about in the next little while, but not right now mostly because of the second reason I won’t get into house flipping just yet.
The second and main reason for not investing my money in flipping houses is that I don’t have money that’s dispensable. I don’t have money that I can live without at the moment and I am not willing to try a no money down approach to house flipping. This is because I don’t know enough about it and it would be more like gambling than investing. I think having some investment capital is absolutely necessary for getting into any form of investment in real estate. I don’t have this money, therefore I will have to wait for now. I will get into some form of real estate investment, hopefully in the not to distant future but I need to learn a lot more before I do this, education is the key to most things and this is no different.
Technorati Tags: real estate, house flipping, flipping a house, investment
Posted in Investments, Real-Estate | 3 Comments
The Housing Bubble
November 13th, 2006
Since starting this PF blog I’ve encountered the term the housing bubble more than a few times and as far as I understand it (please feel free to correct me if I’m wrong) is that in some regions of the country the housing prices have risen to such heights that the property values are quite simply overvalued and due for a significant drop. In some of these regions builders put up lots of additional housing to cash in on the strong market and in others people just kept buying for more. The problem with any form of ‘bubble’ is that inevitably someone will loose money.
I’ve always been a firm believer of the Latin saying Caveat Emptor which is let the buyer beware in Latin. If you’re buying a house or anything that will take years to pay off you cannot blame the market or ignorance if you loose money on the purchase. Granted some people don’t want to spend a lot of time or effort making sure their purchase is 100% bang on. This is why specialists like bankers and real-estate agents have jobs! If you’re not certain about a purchase then seek help; get professional opinions. Buying a piece of property that will subsequently loose say 15% of its value in a year or two is something that is potentially preventable. I know that if I were to buy a new condo in the region I live in I stand a chance of loosing money on the deal. Why? Well there are 6 condo developments in the area either under construction or will be under construction soon. I am not a real-estate agent but loosely track prices in the area and I see more units coming in. Without even knowing a lot of information I can see that there might be a downward pressure on condo prices, this isn’t necessarily going to happen but I can see this as a possibility. I would be a wary buyer in this market.
So when I hear about the housing bubble bursting I don’t really feel there’s anything to be alarmed at. Surely all the people buying houses in these regions are aware of this and have taken this into account. Unfortunately I doubt this is the case; we wouldn’t be hearing about a bubble if someone wasn’t complaining. The next thing that crosses my mind is the fact that this isn’t some drastically huge loss coming to a lot of people (don’t yell at me yet), a housing bubble isn’t like the dot.com bubble that evaporated billions in wealth. A house in an overvalued region will retain a significant portion of its value when all is said and done; in the dot.com days companies folded leaving no retained value.
A housing bubble for me is more of a price adjustment to more realistic prices. Prices will inevitable rise and fall over the course of time; what was once an expensive and exclusive neighborhood might be a slum now and 25 years down the road it might be an expensive neighborhood again. When it comes to things like real-estate I would tend to look at longer trends rather than the price increases over a year or two period.
Now with all that said people will still loose money, some will loose their homes and it is very unfortunate because the value of these homes will drop. The worst part is that the people who are likely to loose money probably couldn’t afford the prices in the first place. They overextended themselves only to find they might loose $25,000 or $50,000 of their savings if they were to try selling (maybe more). The lesson learnt here: don’t spend lots of money on something unless you know what you’re getting into be it property or an investment; use common sense and if you have none find someone who does to help you.
Technorati Tags: Housing Bubble, property, property value, overvaluation, common sense
Posted in Investments, Real-Estate | No Comments
