The Pros and Cons of Open Houses

Pros and Cons of the Open House

Open houses have been traditionally held to introduce a home listing to buyers and gain exposure. The open house allows many people to view the home in one afternoon. Realtors do not like to hold open houses because they are tied down on a weekend afternoon, prime selling time, and open houses often do not result in sales. The thing is that sellers ask for open houses. They think it is a sign that the realtor is working for them so they demand it. Here's a list of the pros and cons to holding an open house.

PROS
• An open house attracts buyer’s attention.
• A person walking or driving by may become a potential buyer.
• A neighbour considering moving to a larger or smaller home, may prefer to stay in their neighbourhood. An open house gives them an opportunity to visit without any pressure.
• Open houses are often advertised in a local newspaper or online. This brings potential buyers.
• Some buyers prefer to visit a number of open houses on a weekend, instead of having their agent make appointments.
• A potential buyer, who hasn’t yet decided to contact an agent, may be swayed by the opportunity of an open house.
• An open house can give the agent and buyer an indication of the market in the neighbourhood and let them know if the house is priced right.

CONS

• Most homes are not sold through open houses.Only 1-3% are sold as a result of an open house.
• Curious neighbours and other people who are not serious buyers will waste your agent’s time. Nosy neighbours poke around your house because they want to see your décor, compare your house to theirs, or learn your selling price.

• Buyers want personal service and don’t want to share the agent’s attention with other people.
• Safety can be a concern if an open house is busy and the realtor is unable to keep an eye on everyone. Thefts have occurred in some instances.
• An open house can last for an afternoon. Sellers who wish to relax at home on a weekend, will have to leave and take any pets with them.
• Groups of people traipsing in and out can track mud into the house.
• Some people treat open houses as a form of recreation, bringing the family and eating the real estate agent’s cookies.
• The weather may not cooperate. People will not show up for an open house if there is inclement weather. In winter, this can be a real problem in Calgary.
• If there are no visitors, a seller can become worried or stressed.
Open houses are something that everyone needs to talk to their realtor about. If you need information on mortgages or lines of credit contact me. As a Calgary mortgage broker, I have the answers to the questions you have.

Canada Census 2011: Calgary was the country’s fastest-growing city – Calgary Mortgage Broker

Census highlights

Canada’s population as of May 2011 was 33,476,688.
Population grew by 5.9% between 2006 and May 2011.
The greatest growth rate among all provinces/territories was Saskatchewan
For the first time Saskatchewan’s population exceeded 1 million.
Between 2006 and 2011 every province experienced positive growth.
The country’s fastest-growing city was Calgary, Edmonton, Saskatoon and Kelowna, B.C. since 2006.
Population decline was Windsor and Thunder Bay, both in Ontario.
10 of the fastest growing census agglomerations (communities or groups of communities between 50,000 and 100,000 people) were in Alberta.
The largest decrease in population was Thunder Bay, Ont. losing 10.3 per cent.
Urban centres grew to more than 10,000 people and became census agglomerations was: Steinbach, Manitoba, High River, Strathmore and Sylvan Lake and Lacombe — all in Alberta.

15 fastest growing metropolitan areas

Calgary: 1,214,839, 12.6% increase
Edmonton: 1,159,869, a 12.1% increase
Saskatoon: 260,600, an 11.4% increase
Kelowna, B.C.: 179,839, a 10.8% increase
Moncton, N.B.: 138,644, a 9.7% increase
Vancouver: 2,313,328, a 9.3% increase
Toronto: 5,580,064, a 9.2% increase
Ottawa-Gatineau: 1,236,324, a 9.1% increase
St. John’s: 196,966, an 8.8% increase
Brantford, Ont.: 135,501, an 8.7% increase
Regina: 210,556, an 8.0% increase
Oshawa, Ont.: 356,177, a 7.7% increase
Abbotsford-Mission, B.C.: 170,191, a 7.0% increase
Quebec City: 765,706, a 6.5% increase
Kitchener-Cambridge-Waterloo, Ont.: 477,160, a 5.7% increase

Source: National Post

With 42-45,000 more people expected to move to Alberta , most of them coming to Calgary, you can expect housing prices to rise above the 2% forecast last month.
If you want to be preapproved for a mortgage Contact me here

RBC Cancels 4-year Promo Early

RBC’s 2.99% four-year fixed promotion was intended to last until February 29. RBC is instead cancelling it early, effective Wednesday February 8.

The nation’s biggest bank is raising its:

4-year fixed “special offer” by 40 bps to 3.39%
5-year fixed “special offer” by 10 bps to 4.04%
5-year fixed posted rate by 10 bps to 5.24%

Some quick points on these changes:

Other major banks are expected to match some or all of RBC’s rate increases, but that's far from guaranteed.
Some lenders and brokers may continue offering 4-year fixed terms at 2.99% (or less), at least for the time being
For just 10-20 bps more (i.e., 3.09-3.19%) you can find several brokers offering 5-year fixed mortgages. That’s a reasonable premium for one extra year of rate protection.
RBC’s 4.04% five-year “special offer” is almost a full point above 5-year fixed rates on the street. No one other than the most novice mortgage shoppers take this rate seriously.
RBC spokesman Matt Gierasimczuk attributed today’s rate increases to this:

“Our long-term funding costs have gone up considerably due to global economic concerns and, while we have held off in passing on these rate changes to our clients, it is now necessary for us to increase this mortgage rate.” (Source: Bloomberg)

interest-ratesWe can find nothing to suggest RBC’s 4-year fixed funding cost rose 40 basis points since mid-January. It has among the lowest cost of capital in Canada and other lenders have recently launched new 2.99% four-year specials of their own (one of them today).
The Globe and Mail quotes sources who say that regulators were unhappy with the “price war” that followed BMO’s 2.99% five-year special. That may be somewhat linked to this announcement, hints the article. The government is clearly worried that low rates may incite borrowing and inflate the debt balloon further.
If you want to lock in a rate now so that you can shop for a home over the next 3 months Contact me today.

New video going viral

Mortgage Alliance is usually a quiet financial services company. They started to stir things up when they started the MAC Rally of Hope , a motorcycle ride across Canada to raise funds for breast cancer but now they have gone to a new level. Mortgage Alliance have come out with an ad that makes fun of people who have just got the news that they have been approved. There's no mention of mortgages and how great our service is or how low our rates are, it's just fun. The You Tube video is spreading quickly across the internet. Check it out here.

The Pros and Cons of an Open House

Pros and Cons of the Open House

Open houses have been traditionally held to introduce a home listing to buyers and gain exposure. The open house allows many people to view the home in one afternoon. Realtors do not like to hold open houses because they are tied down on a weekend afternoon, prime selling time, and open houses often do not result in sales. The thing is that sellers ask for open houses. They think it is a sign that the realtor is working for them so they demand it. Here's a list of the pros and cons to holding an open house.

PROS
• An open house attracts buyer’s attention.
• A person walking or driving by may become a potential buyer.
• A neighbour considering moving to a larger or smaller home, may prefer to stay in their neighbourhood. An open house gives them an opportunity to visit without any pressure.
• Open houses are often advertised in a local newspaper or online. This brings potential buyers.
• Some buyers prefer to visit a number of open houses on a weekend, instead of having their agent make appointments.
• A potential buyer, who hasn’t yet decided to contact an agent, may be swayed by the opportunity of an open house.
• An open house can give the agent and buyer an indication of the market in the neighbourhood and let them know if the house is priced right.

CONS

• Most homes are not sold through open houses.Only 1-3% are sold as a result of an open house.
• Curious neighbours and other people who are not serious buyers will waste your agent’s time. Nosy neighbours poke around your house because they want to see your décor, compare your house to theirs, or learn your selling price.

• Buyers want personal service and don’t want to share the agent’s attention with other people.
• Safety can be a concern if an open house is busy and the realtor is unable to keep an eye on everyone. Thefts have occurred in some instances.
• An open house can last for an afternoon. Sellers who wish to relax at home on a weekend, will have to leave and take any pets with them.
• Groups of people traipsing in and out can track mud into the house.
• Some people treat open houses as a form of recreation, bringing the family and eating the real estate agent’s cookies.
• The weather may not cooperate. People will not show up for an open house if there is inclement weather. In winter, this can be a real problem in Calgary.
• If there are no visitors, a seller can become worried or stressed.
Open houses are something that everyone needs to talk to their realtor about. If you need information on mortgages or lines of credit contact me. As a Calgary mortgage broker, I have the answers to the questions you have.

No Bank of Canada rate change

The Bank of Canada announced that it is maintaining its target for the overnight rate at 1 per cent. As a result, the prime rate will remain at 3.00%, much to the benefit of variable rate mortgage holders.



In a press release, the Bank of Canada gave the following reasons as to why they took another pass on a rate hike this time around:



"The outlook for the global economy has deteriorated (since October)."
"...very favourable financing conditions are expected to buttress consumer spending and housing activity."
"...the ratio of household debt to income is projected to rise further."
"The economy is only anticipated to return to full capacity by the third quarter of 2013, one quarter earlier than was expected in October."
"With the target interest rate near historic lows and the financial system functioning well, there is considerable monetary policy stimulus in Canada."



The next Bank of Canada rate meeting is March 8, 2012. It is expected to continue with no rate change at this meeting too.
What does this mean for you , the average consumer? If you have a variable rate mortgage or a line of credit, your interest rate will remain the same at least until March 8th. If you have a fixed rate mortgage, this announcement does not affect you at all.
By the way, if you have an unsecured line of credit you are probably paying about 6% now. If you own a home, you can get a line of credit secured against your home and pay about 3.50%. This can be a considerable saving. Contact me for more information on how you can save money.

Popularity of reverse mortgages increasing - Study

The need for an improved cash flow in retirement is leading to record number of reverse mortgages in Canada, according to a HomEquity Bank study.

The report released by the only national provider of reverse mortgages in Canada notes its reverse mortgage originations were up 42% in the fourth quarter of 2011. On an annual basis, the company originated $239 million in reverse mortgages, a 16% year over year jump.

As at December 31, 2011, the bank’s portfolio of reverse mortgages of $1.2 billion was 17% higher than at the end of 2010.

“Since its inception 25 years ago, HOMEQ Corporation has analyzed the demographic wave of Canadian seniors and how our business can address these trends,” said Steven Ranson, president and CEO.

“Now, the wave is here and we are meeting seniors’ needs for improved cash flow in retirement. This tremendous market demand is fuelling our strong growth in originations, while our disciplined approach to operating the business is resulting in healthy net income growth.”

Reverse mortgages are offered to Canadian homeowners 55 and older and have no income, credit or health qualifications. Unlike traditional loans, borrowers don’t have to service the interest or repay the principal for as long as they own their home and are living in it.

Experts like Bryan Yu, economist, Central 1 Credit Union, are watching this trend closely. “It really speaks to the overall economic environment, but also over the longer term we’re looking at the demographic that are involved with reverse mortgages.”

Over the next 20 to 25 years, the Canadians population over 55 years will reach 10 million, Yu says, predicting that retirement tools such as reverse mortgage are going to get more popular.

“Instead of making a downward move [selling property] they might want to stay within the own home and [a reverse mortgage] provides them another tool that allows them to stay in place, but also obtain an income flow from that asset without selling it.”
If you have any questions about reverse mortgages and whether they are right for you or your parents Contact me to discuss this without any obligation. .