Home Ownership is the Key to Your Future Joanne Lozinski Sales Representative The Realty Connection Inc. Brokerage 905-567-1411 416-562-8334 jlozinski7751@rogers.com www.joannelozinski.com not intended to solicit sellers or buyers under contract with a real estate broker

FINTRAC It is important to be aware of the new federal law regarding selling/buying property in Canada. On June 23, 2008, new federal money laundering and anti-terrorist financing regulations came into effect that require real estate agents and brokers to collect personal identification information from buyers and sellers. For further details please feel to visit my website to view video. www.joannelozinski.com

Real Estate is Unlike Any Other Commodity And here’s why… Real Estate Principal residence Tax Free Practical (everyone requires shelter) Offers security(can be income generating)   Other commodities Taxable You can’t raise a family living in a mutual fund Less Secure

5% Down-Payment Plan 30 Year Amortization Available Why NOW is the Time to Buy First Time Buyer Land Transfer Tax Rebate RRSP & Home Buyers Plan (First Time Buyer) Low Interest Rates First Time Buyer Tax Credit

Market Trends and Prices 1980- $ 75,694 1985 - $109,094 1986 - $138,925 1987 - $189,105 1988 - $229,636 1989 - $273,698 1990 - $255,020 1991 - $234,313 1999 - $228,372 2000 - $343,255 2001 - $251,508 2002 - $275,331 2003 - $293,067 2004 – $314,661 2005 - $335,907 2006- $351,941 2007 - $376,236 2008- $379,347 2009-$395,460 2010-$431,436 1992 - $214,971 1993 - $206,496 1994 - $208,921 1995 - $203,028 1996 - $198,150 1997 - $211,307 1998 - $216,815 Average Price of Single Family Dwellings in the GTA 1980-2011 500% increase May 2011 $485,520

Toronto Real Estate Board Historical Stats 1980 $75,694 2005 $335,907 1986 $138,925 1996 $198,150 1976 $61,389 May 2011 $485,520

Benefits Of Home Ownership It is a hedge against inflation. It can provide excellent collateral. It is easy to liquidate. It provides an avenue for forced savings. It’s value increases over time. Your principal residence is a tax free gain.

Historically Real Estate Has Proven To Be An Excellent Investment     1986 - $139,900 2011 - $624,000 tax free gain of $484,100

Renting vs. Owning With rents increasing Mortgage rates decreasing Property values increasing  There is absolutely NO benefit to renting. At a rental rate of $1,200.00 per month it will cost you $60,000.00 in rental payments over a 5 year term!!

Most existing two-unit houses (built before Nov. 16, 1995) will be "grandfathered“. Two unit houses should have met Fire Code requirements by July 14, 1996. In general, new apartments must comply with the Building Code, and existing apartments must comply with the Fire Code. Both new and existing apartments must comply with certain property and municipal zoning (planning) standards. Should obtain a certificate of compliance from the local fire department for any property that might fall under the jurisdiction of the Fire Code, Section 9.8 Should obtain a building permit before starting any new construction. If you don’t obtain a permit, or a certificate of compliance, the dwelling unit could possibly be non-conforming, and therefore considered illegal. Units installed after November 16, 1995 without a permit are unprotected (even if they meet fire, safety & electrical standards) and the municipality could require removal of the unit. Retrofit

TREB District Map

Housing Types and Styles – Condo Apartments Low Rise Mid Rise High Rise 2 Storey Loft Loft Conversion Each owner receives a deed for their unit. Property owned in common with others - recreation areas, lawns, basement, garage. Maintenance fees usually include common elements, building insurances & sometimes utilities.

Housing Types and Styles - Townhouses 2-Storey Townhouse Freehold Townhouse 3-Storey Townhouse Freehold Condo Garden Townhouse Detached Condo Condominium Townhouses Monthly maintenance fees often includes exterior maintenance & building insurance. Freehold Condo Townhouse Monthly maintenance fee usually includes general landscaping & road maintenance. Freehold Townhouse No Maintenance fee. You own the land. Detached Condo: Usually includes a small fee for road maintenance.

Housing Types and Styles - Semi-Detached Attached by Common Wall or Garage Typical Semi-Detached Bungalow Multi-Level 5 Level Backsplit 4 Level Backsplit 2-Storey 3 Level Backsplit Raised Bungalow 3-Storey

Housing Types and Styles - Link Attached by footings or garage Typical Link Link by Garage Link by Footing Link by Garage Link by Garage Link by Garage Link by Footing Link by Footing Link by Footing

Housing Types and Styles – Detached 3 Level Sidesplit Raised Bungalow 2-Storey 2 ½ Storey 4 Level Sidesplit 4 Level Backsplit 5 Level Backsplit Bungalow 1 ½ Storey Typical Detached

The Home Buying Process   10 Steps Pre-approval Agency 3. Price determination 4. Buying profile 5. Product availability 6. Viewing & Feedback 7. Offer 8. Negotiations 9. Waivers 10. Closing

Mortgage Pre-Approval Before we even begin to investigate the marketplace you must have a pre-approved mortgage in place. We can arrange for you to meet with our mortgage consultant at a mutually agreed upon time. Most of the preliminary information can be done over the phone. Our mortgage consultant will shop for the absolute best rate and terms possible to suit your needs.

What You Need To Apply For A Mortgage Credit Check (done with your initial pre-qualifier)   Salary letter from employer (and/or T4 slips for the past two years)   If self-employed, financial statements & income tax returns/assessments for the past two years   List of assets and liabilities (including account numbers)   Verification that the down payment came from your own resources (ie. Bank account, gift letter)   Copy of agreement of purchase and sale   Copy of the listing   Survey

Mortgage Financing CMHC/Genworth Less than 20% down payment Under Canadian Law all high ratio mortgages (less than 20%) down must be insured through CMHC. This fee ranges anywhere from 0.5% to 2.75% of the mortgage amount which varies according to your down-payment. This mortgage insurance is only for the protection of the lender should there be a default in the loan. Two Types of Loans Conventional Mortgage 20% or more down payment Under Canadian Law lending institutions cannot provide first mortgages in excess of 80% of the value of the property. karen.hewitt@migroup.ca Karen Hewitt Mortgage Intelligence 905-466-6582 Fisco #MO800I380 FSCO Lic# M08001380 FSCO Lic# M08001380 FSCO Lic# M08001380 FSCO Lic# M08001380

CMHC and Genworth have a variety of duties, including insuring mortgages for properties. In most cases the premium is added onto the mortgage amount & paid monthly with the mortgage. A mortgage loan insurance is insurance that is put on a mortgage where there is less than 20% down payment - this only applies to owner occupied properties. For rental purchases or refinancing on a rental property, CMHC or Genworth would have to insure the mortgage if there is less than 25% down payment/equity. It is a Federal Law in Canada that the lender must protect themselves when there is less than 20% down payment (the financial institution lending money) from mortgage default, which is when the borrower stops making timely and sufficient. payments to their mortgage. CMHC / GENWORTH

Insurance Premiums CMHC WEBSITE CMHC for Consumers Insurance premiums are subject to PST

CMHC Insured Mortgage Purchase Price $250,000.00 Down-Payment $ 12,500.00 Mortgage Amount $237,500.00 Insurance Fee (2.75%) $ 6,531.25 Actual Mortgage $244,031.25   The insured portion of the mortgage is subject to PST In the above example the PST would be: $6531.25 X 8% =$522.50 Example BASED ON A 25 YEAR AMORTIZATION

FIRST TIME HOMEBUYERS

First-Time Home Buyers Tax Credit Must buy a qualifying home. Neither you nor your spouse or common-law partner owned and lived in another home in the year of purchase or any of the four preceding years. Maximum rebate = $750.00 For 2009 and subsequent years, the budget introduced a new non-refundable tax credit to help first-time home buyers with some of their closing costs. This Home Buyer Tax Credit (HBTC)will provide up to $750 in tax relief on the purchase of a first home. The HBTC is calculated by multiplying the lowest personal income tax rate for the year (15% in 2009) by $5,000. For 2009,the credit will be $750. If the total of your non-refundable tax credits is more than your federal income tax, you will not receive a refund.

The Home Buyers' Plan (HBP) Can withdraw up to $25,000 from your registered retirement savings plan (RRSP’s.) Couples, including common law will be able to withdrawal up to $50,000. You or your spouse have not owned and occupied a home as your principal residence in the preceding 4 years. RRSP contributions must remain in the RRSP for at least 90 days before you can withdraw them. Must repay all withdrawals to your RRSPs within a period of no more than 15 years. For each year of your repayment period, you have to repay 1/15 of the total amount you withdrew, until the full amount is repaid to your RRSPs. Repayment period starts the 2nd year following the year you made your withdrawals. If you do not repay the amount you have to repay for the year, you have to include it as income on line 129 of your tax return.

Land Transfer Tax Rebate The buyer cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time. If the buyer has a spouse, the spouse cannot have owned a home, or had any ownership interest in a home, anywhere in the world, while he or she was the buyer's spouse. If this is the case, no refund is available to either spouse. The buyer must be at least 18 years of age. The application for a refund must be made within 18 months after the date on which the conveyance or disposition occurred. The buyer must occupy the home as his or her principal residence no later than nine months after the date of the conveyance or disposition. The buyer cannot have previously received an Ontario Home Ownership Savings Plan (OHOSP) based refund of land transfer tax.

Land transfer tax is a provincial tax payable on the purchase of a residential home. This tax is paid by the Buyer and is calculated as follows: Land Transfer Tax Table TORONTO LAND TRANSFER TAX (applies only to properties purchased in the City of Toronto) Up to & Including $55,000….price x 0.005% Exceeding $55,000 & up to $400,000….price x 0.001 MINUS $275.00 Exceeding $400,000…price x 2% MINUS $4275.00 Maximum Toronto LLT rebate for first time homebuyers is $3725.00 $55,000 - $250,000 … price x 1 % MINUS $ 275 $250,001 - $400,000 …price x 1.5% MINUS $1,525 Over $400,000 ……… price x 2 % MINUS $3,525 Maximum Provincial LTT rebate for first time homebuyers is $2,000.00 ONTARIO LAND TRANSFER TAX

There are several items that need to be attended to prior to closing a  real estate transaction. These include certain items imposed by the government, certain items that lending institution require as well as certain items that should be attended to in order to ensure clear title to the home or condo that you buy. In general, you should budget up to 2% of the purchase price of the Ontario home or condo to cover these various items. While these vary depending on the situation, typical costs include: CLOSING COSTS Service Fees are Subject to HST

  Survey: In most cases, the agreement of purchase and sale will have a clause asking for the seller to provide a survey to the buyer at their cost within a certain period of time. If the seller does not provide you with an acceptable survey, you may need to obtain a new survey. Approximate cost: : $650 -$950   Title Insurance:  A title insurance policy can eliminate the requirement for a new survey. Title insurance is an insured statement of the condition of title or ownership of real property, at the time the policy is issued. Approximate cost: $250-400 (residential).   Land Transfer Tax: See previous table   Legal Fees: Legal fees will vary according to the lawyer. Approximate cost: $600 to $800 Disbursements.   Disbursements : Costs that you lawyer will have to pay on your behalf, such as registration fees, photocopies, etc. Approximate cost: $400 to $600.  

  Home Insurance :Home insurance premiums will vary from one insurance company to another and according to your insurance needs. In a condominium, the building insurance is included in your maintenance fees and does not form part of the closing costs, unlike a house purchase. Approximate cost: Varies   Mortgage Application: Your lending institution may charge a fee for processing your mortgage application. Approximate cost: Varies   Mortgage Appraisal :Approximate cost: $200. This may be waived depending on how you negotiate. CMHC Insurance Premium :This premium is only applicable if you are putting less than 20% of the purchase price as a downpayment. Additionally, you have the option of adding the premium to your mortgage and amortizing it over the term of your mortgage. In the latter case, it does not form part of your closing costs as you will pay it over the term of the mortgage.

  Home Inspection : Approximate cost: $250 - $500 + tax.   Status Certificate : Prior to buying a condo, you should request a Status Certificate which provides detail son the Condo Bylaws, Rules and Regulations, as well as Finances. Any Insuite restrictions or common element restrictions are also detailed in the Status Certificate. Most importantly, it includes information on the condo's Reserve Fund, which is the amount the condo corporation has set aside to cover unexpected expenses. The Status Certificate is usually paid for by the seller. Approximate cost: $100. Moving Expenses: Movers, possible storage, postal (change of address) Statement of Adjustments: The purchaser and the vendor are each responsible for their share of taxes, fuel, and utilities. These costs will be reflected in the statement of adjustments which the lawyer puts together. Approximate cost: Varies depending on type of property (condo vs. freehold) and time of year.

Price Determination Price range will be established based on the results of your meeting the mortgage consultant.   Although you may qualify for a loan amount higher than what you anticipated, you may choose not to purchase up to your maximum qualification level.   Staying within your comfort zone may be more suitable to you.

Product Availability Our main frame database will source available listings in the price range, area and with the features you have requested.   Our data is updated frequently throughout the day.   We will keep you fully updated on all new properties as they become available.  

Selections Our job is to assist you in selecting those properties that suit your needs.   Through the process of elimination, we will choose those homes that represent the best value.   At any give time there will be only a handful of homes that you will even consider.

Power of Sales Owner defaults on loan Lender takes property back   Scenarios There is more mortgage owing on the property than what the property is worth. There is equity in the property that must be returned to the Seller.   The lender must try to obtain the best price for the home.

Viewing & Feedback Appointments will be made to view the most appropriate homes. Asking questions and taking notes will prove to be very beneficial. Feedback is critical in order to ensure that we are on the right track. Express your thoughts!

Usually an owner will ask between 2 – 4% above market value for the home, therefore there is usually some flexibility in the asking price. Sometimes an owner will price his home very close to or even slightly under what comparable homes have sold for, therefore there is usually very little if any flexibility. Usually these properties attract all the attention and in many cases generate more than one offer. Depending on condition, location, upgrades, etc. some homes will sell for more or less than comparable homes.   A CMA will be prepared for you advising you of recent market activity in the area. How Much Do We Offer?

Negotiations Who is representing you?   Under Buyer-Agency it is our duty and obligation to represent you – OUR CLIENT.   Our Goals and Objectives are to get you the best possible home at the best possible price with the least amount of hassle.  

What is an Agency Relationship? *It is the relationship an agent has with his/her client/customer. *Sub-Agent works with the Buyer but for the Seller. * Buyer-Agent works with the Buyer and for the Buyer.  *Dual-Agent works for neither the Seller nor the Buyer. This situation would arise when the Buyer and Seller Agent are the same real estate firm.  *All prospective Buyers have the right to representation.   Under Buyer Agency , a Buyer Representation Contract is signed by the Buyer authorizing the Buyer Agent to act exclusively on behalf of the Buyer for a specified period of time.

Waivers & Follow-Up Once your conditions have been fulfilled they are waived in writing and the deal becomes firm and binding. Typical conditions include, financing, home inspection and if the property is a condominium the status certificate. We look after forwarding all of the paper work to your solicitor and mortgage consultant.

Meet with mortgage consultant Choose a lawyer Arrange for moving company Arrange for utility transfer/hookup + house insurance Arrange for keys Arrange for school enrollment Change of address at post office Checklist

Cooperative (co-op) A type of multiple ownership in which the residents of a multi-unit housing complex own shares in the cooperative corporation that owns the property, giving each resident the right to occupy a specific apartment or unit. Condominium A type of ownership in real property where all of the owners own the property, common areas and buildings together, with the exception of the interior of the unit to which they have title. Often mistakenly referred to as a type of construction or development, it actually refers to the type of ownership. Buying a Condominium

When you buy a Condominium you are actually buying two things: your individual unit. 2. a share in the condominium corporation that owns and maintains the land and all of the common elements such as elevators, outside grounds, security, parking etc. It is just as important that your condominium corporation is in good condition as your individual unit. When looking at condominiums, you must also consider the building itself. The choice of the building has a big impact on your 'lifestyle'. The 'building lifestyle' is determined by three factors: Amenities Location Mix of Owners

Status Certificate When purchasing a resale condominium unit, you should ensure that your offer is conditional on receiving and reviewing a Status Certificate and the accompanying documents, as required by the Act. There is usually a 2 business day condition in your offer upon your solicitor reviewing the documents. This certificate, for which there is a fee of $100 inclusive of HST (usually paid by the Seller unless it is a bank sale) must be delivered within 10 days of the request for it. It discloses whether the owner of the unit you are buying is current in the payment of common expenses as well as a picture of the condominium corporation's financial affairs.

A property management firm usually manages the corporation under the direction of the Board of Directors, runs the day-to-day affairs of a condominium corporation. Some condominium corporations are self-managed. The board is responsible for carrying out the obligations of the Corporation as set out in the Act, the condominium documents (declaration, by-law and rules) and any agreements to which the corporation is a party. You have the right to participate in the affairs of the condominium corporation. An owner who leases his or her unit must give the corporation the name of his or her tenant(s) and a summary of the lease or a copy of the lease. The owner and the tenant are both responsible to the corporation. The tenant is bound by all the same documents as the owners

Common Expenses (maintenance fees) Monthly fee charged to each condo owner for the management, insurance, upkeep, maintenance and future repairs (reserve funds) needed for the given complex.  Sometimes utilities are included as sometimes they are not. A portion of the common expenses paid by the owners is transferred monthly to a reserve fund account. The reserve fund is the unit owners' savings for the major repair and replacement costs of the common elements which occur as a building gets older. The larger the unit the greater the amount of payable towards common expenses.

Helpful Resources Government of Canada Home Buyers Plan Government of Canada Home Buyer Tax Credit Ontario Government Land Transfer Tax Rebate Canada Mortgage and Housing Corporation MORTGAGE CALCULATOR Title Insurance LAND TRANSFER TAX CALCULATOR MLS

Thank You Joanne Lozinski Sales Representative The Realty Connection Inc. Brokerage 905-567-1411 416-562-8334 jlozinski7751@rogers.com www.joannelozinski.com Serving My Clients Since 1980