Purrfect Properties Blog

Archive for August, 2015

Can You Unlock Property Secrets by Looking at its’ Condo Fees?

Wednesday, August 19th, 2015

Hi Folks,

I am often told by buyers that they are frustrated with the purchase process of condominiums in Edmonton, Alberta. You see in Edmonton, a client is generally not granted the opportunity to review condominium documents before the buyers write an offer on the property.

The contracts used for MLS® purchases (not most Builders) is created by the lawyers over at the Alberta Real Estate Association and included in a Residential Condominium Property purchase contract is a condition of satisfaction with the condo documents. This is great; as a consumer, you need to know how well the property is being managed and how much money it has in the bank.

You will most likely be waiting for a few days after you negotiated with the Sellers and reached final acceptance before you receive the condo documents. The Sellers will have to request a copy of the documents from the property management group and they will take some time to produce the results.  Even a rush job can lead onto to a week or more, especially in straightening out everything that is needed for the buyer to make an informed decision.  A part of the reason that the Sellers aren’t asked to provide the documents before the offer comes in, is the cost.  To get all the documents necessary, it could cost the Sellers up to 600 dollars and that may not even include a rush service.  Another reason is tied to the information statement which needs to be current to the month that you have written your offer; and that makes it nearly impossible to do ahead of time. (See Sellers Note 1 at the bottom of this post.)

So how do you make an informed decision quickly?

Real Estate is a quick industry and the best homes at the best prices always go right away.  So how do you beat the rest of the public to a smart decision about that particular property and move onto the next one, while maximizing your time spent looking?

Simply put; look at the amount of the condo fees.

High Condo Fees in Edmonton

All Condo are not created equally, you could have a 1000 ft2, 2014 built, apartment styled condominium with condo fees of $175 per month no utilities included.  You could also have a 1000ft2, 1976 built, apartment styled condominium with condo fees of more than $1,100 per month condo fees. What makes the difference in the fees is if; utilities are included, what kind of building it is, how much maintenance costs for that building and the historical as well as professional management of the property.

If those condo fees are high, you can bet they have had to raise the fees to offset future repair and replacement costs.  Sometimes the condo fees get so high they are just as much as your mortgage.  If the condo fees get that high, you will need to be earning a fairly good wage as condo fees are considered a part of debt to the Financer and you will need to be able to cover this cost, plus your mortgage and still have a significant portion of your wages left over for things other than housing.

What is considered High Condo Fees?

Yikes, this is a tough question.  Like I noted earlier, it depends on what is included in your condo fees.  I’m going to talk generals or averages here. 1000 ft2 apartment style – low rise, 2000+ build, with heat, water and power included – maybe $550 per month. Same type of property, no utilities included; maybe $250. 1000 ft2 apartment style – high rise, 1970+ build, with heat, water and power included – maybe $900+ per month. Your 2 storey townhouse condos also known as row housing; probably won’t have utilities included and those condo fees fall in ‘normal’ ranges of $200-$275.  You should know though, that these averages do not include Bare Land Condos.  This is a different type of condominium structure and less exterior maintenance is paid for by the corporation.  It is a type of condominium where you own the land the property is on; not just have exclusive use of it.

So check out those condo fees and use your smarts or your REALTORS® help for knowing if it is even going to look at in the first place. Save yourself time, money and frustration. Not every condo is a welcome choice.

If you are thinking about buying a condo and would like a valuable, subject matter expert on your side; I hope you will give me a call. I’d like the opportunity to help you make an informed decision for your home purchase in Edmonton.  I consider this as one of the ways in …

How to save thousands on your next home in Edmonton. Now that’s the Cats’ Meow.

SELLERS NOTE 1: If you are a Seller, I suggest leaving the Information and financial statements to when you have a negotiated offer in place and ordering the by-laws, property management agreement, full reserve fund study, reserve fund plan, reserve fund study, annual general meeting minutes and the budget when you list your home for sale.

As Summer slows and cools down, are your home prices losing value?

Wednesday, August 19th, 2015

Hi Folks,

The last few weeks of summer are upon us and I hope you’re getting out there and enjoying the last long days of summer. Alongside the flip-flops of summer, late summer in Edmonton bounces back and forth between a balanced and buyers market.  At 3.99 Months of inventory, we’ve just tipped back into that buyers market. If you are moving, or thinking about it, have a look at the latest Edmonton Market trends below.

Inventory: July finished with a strong amount of inventory. We are just a few dozen listings short of the same number of properties being listed this month as last.  Yet, there is 14.9% more inventory in Edmonton this year than last.

Total number of homes available to buy in Edmonton: 7,266                       Total sales for last month: 1,812.

Days on Market: We’re starting a slow down of the summer market with just a few less properties coming available for sale.  3,123 New listings for July in Edmonton, with only 2,718 listings added this time last year.  So with just tiny little changes in the number of listings from month to month, we see very little change in Average days on market, the average being 50 Days on Market, here in Edmonton, up from 49 dom’s the previous month and 46 dom’s the previous year.

Odds of Selling: This year is a game changer for the city.  We have had a record number of listings come on the market, but those sellers, turn around and within 30, 60 or 90 days, they buy everything right back up again.  Your chances have dropped just a wee bit.  You basically have a 1 in 4 chance of selling your home in the next 30 days. In fact, you have a 25.08% chance of selling, especially if you are already listed for sale. lol. Worse than last year. Worse than last month.

Average Selling Price: Condo: $256,708 Townhouse: $356,237 Single Family Dwelling: $436,948 and the average selling price across the City of Edmonton is $372,910.

Home sales by Price Range: The highest percentage of properties are selling in the $300,000-$399,999 price range at 33.57%. Second position goes to the $400,000-$499,999 price range at 21.62%.  Third place is the $200,000-$299,999 and 19.90%. These haven’t changed very much from month to month as this works in with Edmonton average earnings per family.

TOTAL NUMBER OF HOMES SOLD YEAR TO DATE IN EDMONTON 10,925

Prices have not gone down in Edmonton since 2011, when we saw a decrease of 1.41%. Prices are up by 2.10% this year.

If you, your firends or family are thinking of moving, please keep me in mind, your referral is the best compliment I can recieve.

780 916 9739  … Now that’s the Cats’ Meow.

Edmonton-Real-Estate-Market-Report-July-2015

Peta Action Alert – Putnam County Fair

Thursday, August 6th, 2015

Animals won as “prizes” often become victims of cruelty or, as the novelty wears off, are surrendered to already overburdened shelters or bounced around from home to home, relegated to lonely rooms and backyards and forgotten. Others are abandoned outdoors to fend for themselves, only to die as a result of starvation, dehydration, exposure, stress, or attacks by other animals. Upon hearing that rabbits are being doled out as booth prizes in Cookeville, Tennessee, at the Putnam County Fair, which is scheduled to run through August 8, PETA implored the members of the fair board to cancel this aspect of their event but to no apparent avail. We need your help now!

Action alert for animals

Action Alert for Bunnies and Rabbits

Please call or send polite comments to: John Allen, President
info@putnamcountyfair.com |     Putnam County Fair Board |     931-528-9316

My letter:

Dear Members of the board for the Putnam County Fair and president John Allen,

I strongly urge you to reconsider your policy and plan to give away live animals at the County Fairs that you hold.

Animals are not prizes to be won, they are creatures that deserve warmth, food, shelter and attention.

To purchase, adopt or guard an animal requires responsibility, time, effort, money and most importantly love.  Often when a person is forced to pay for something they take much better care of it.  Even online community sales organizations like Craigslist and Kijiji have stopped allowing ads to run that give away free animals.

If a member of your public wishes to purchase an animal for companionship, they will.  They animal will then most likely have the best chance of survival, having had its’ shots and a person who sought out ownership/guardianship of a live being.

Please re-consider, animals are NOT TOYS, NOT PRIZES and should be shown to the public as something more than a “stuffy’ that is discarded after the novelty wears off.

Please give these bunnies a fighting chance and don’t replace the bunnies with any other living creature.

In thanks for what you can do to alleviate unnecessary animal cruelty on this planet,

Jeanine

If it Looks Like an Under Priced Condo, Beware of Looming Assessments!

Wednesday, August 5th, 2015

Hi Folks,

You might be looking at buying a condo these days.  They are an affordable option for many reasons; perhaps you plan to be sailing your boat in another country while you’re in retirement and you don’t want to have to cut the lawn or shovel the snow.  Perhaps you’re new to home ownership, and your funds are limited to the townhouse range of condos.  In any case that you might find yourself in, if you live in Edmonton, you’ve recently heard of the outrage surrounding Oliver Gardens Condominiums and the $56,000 special assessment each owner in the building was issued.This month, I had a very affordable, built in the 90’s condo recently go up for sale, and it sold in 10 days.  That’s it, 10 days. It was listed for $147,000.  It was one of the Savills Condos over by NAIT on 118th ave and 101 Street. I got quite a few calls from the public, wondering about this condo and if it has any special assessments on it.  Thanks CTV and Global, no special assessments or levies here.  The condo fees were reasonable at $308 per month, adjusted last year to make up for a projected shortfall in the future.

Edmonton Special Assessments

Special Assessments for Condos in Edmonton

Condo fees go to the management and operation of the condo and some of your condo fees go into the Reserve Fund.  The Reserve Fund is meant to cover future expenses on the property.  Sometimes though, there just isn’t enough money. Too much maintenance at the end of the money.

A Reserve Fund Study is prepared…

You see, the rules are that every five years a condo board has to have a reserve fund study completed on its’ property. Thanks to the Government, years ago, it was decided that condo corporations were being run into the ground,too many sellers were being foreclosed upon and properties were being under-maintained and under-managed.  So the powers that be decided Reserve Funds were the answer, and to re-visit those reserve fund studies every five years, with a commence-able action plan as a result of the study.

A certified personnel member (hopefully an Engineer) of an accredited organization with a permit to practice will come out and perform a review of all the elements in the property.  Everything from roof top units to parking paint lines is reviewed for deterioration as well as remaining age and assigned a remaining life expectancy.

A Reserve Fund Plan is created…

The results are cross referenced to the expected amount in the reserve fund and both charts are placed together to compare results and see if there will be enough money in the reserve fund when the time is necessary.  These Reserve Plans can be made for 5,10,15,20,25 or even 30 years into the future.

Sometimes, it is easy to cover the shortfall over a large number of years, and a condo board may opt to choose a recommended plan that only increases the condo fees by a small percentage.  Perhaps the fees are increased gradually over a number of years.  Though the worst is that sometimes, a special assessment is needed to cover major repairs that are immediately necessary.  Special assessments are generally not approved just to put money in the bank and gain interest.  I have seen special assessments as low as $200, and I have heard of special assessments at $90,000 here in Edmonton.

Some board OPT and VOTE NOT to complete these studies and surveys because they don’t have the money or feel it is a waste of the owners’ resources.  I’m not sure why they get away with it for so very long; however I have seen with my own eyes, a condo corporation that has not done a reserve fund study for 20 years.

The Vote is Cast by Your Board Members…

That’s right, your friendly neighbours on your Condo Board voted which way to go, how much the special assessment was going to be (within the confines of the Condo By-laws) and out went your notice in the mail.  It will be nearly impossible for you to get a loan to cover the assessment from the banks, unless you can pull some money out of a line of credit, etc.  Hopefully if that doesn’t work, you’ve got enough equity built in the property to sell, cover REALTOR costs and pay off the special assessment.  You will need to as the contract states the Seller is responsible for all special assessments up to the closing date.  If not, the next options aren’t going to get any more pretty.

In the end, it is up to you, BUYER BEWARE.  READ your Condo documents. The Savills Condos turned out okay, but they don’t all go so jolly.

Often when I am showing condos to my clients, I will find someone in the hallways and ask them if they live in the property, for how long, if they have any problems with the condo board, if repairs are coming up on the building and what the reserve fund is it.

Whether it is a high number or low, 99% of the people I run into can’t tell me what’s going on with the maintenance of their building or where the reserve fund is it.  Why they don’t know is foreign to me.  In fact the last woman I ran into, who had lived at her home for under a month responded with:

“Oh I don’t know, all those documents are still with my Lawyer.”

The best part, when we got to the main floor, the Reserve fund amount of $825,000 which is awesome (Go Carrington build, Promenade Eaux Claires) was posted on the Condominium board, right outside the elevator.

Let your Lawyer rad your documents, sure.  Let your Lawyer give their advice to you about the future of the property.  Get your REALTOR to help you.  I know I can’t sleep at night unless my client is making a solid investment that I CAN COUNT on.  Just read those documents for yourself folks, know what’s going on, be involved, be a board member, send your proxies to the meetings and remember, even one voice can make a difference.

How to save thousands on your next home.