Renovate Your Basement into a Profitable Income Suite

Real Estate Mark Goode 14 Jan

Turning Your Basement into a Legal Income Suite: What You Need to Know

With current interest rates and economic uncertainty, many Canadians are looking for ways to bring in extra income. One great option is putting your home equity to work by renovating your basement into a legal income suite. Using a secured credit line, such as a home equity line of credit (HELOC), can help you fund the upfront costs of transforming your space into a money-making asset.

If you’re considering this investment, here’s everything you need to know to get started:

1. Check Zoning Laws

Before diving into renovations, confirm whether your property is zoned to allow for a secondary suite. If it’s not, look into the possibility of rezoning. This step ensures your renovation can proceed without complications.

2. Understand Local Regulations

Income suite regulations vary depending on your city or province. Be sure to consult your municipality’s building department or website to learn about rules specific to your area. For example:

  • In Coquitlam: Suites cannot exceed 40% of the main house’s floor plan, and you must provide a designated parking spot.
  • In Toronto: Proposed reforms aim to make it easier to add secondary suites.
  • In Calgary: Recent zoning changes have made it simpler to add income suites.
  • In Montréal: Large renovation projects may require agreements with the city to contribute to affordable housing.

Research these regulations thoroughly to avoid setbacks and ensure compliance.

3. Address Insurance & Legal Needs

Adding a secondary suite means revisiting your homeowner’s insurance policy. Ensure your property will be fully covered, including the new income suite. It’s also important to create a formal tenant agreement if you’re renting out the space. In Ontario, landlords must use the standard lease agreement for all rental arrangements.

4. Plan the Suite Layout

Your income suite must meet specific requirements to be functional and code-compliant. Key considerations include:

  • Separate entrance, kitchen, bathroom, and living/sleeping areas.
  • Proper ventilation, soundproofing, and natural light.
  • Interlinked smoke detectors for the main home and suite.
  • Separate heating and ventilation systems.
  • Proper utility connections, drainage, and electrical setup.

Hiring professional builders, electricians, and plumbers ensures the suite meets building codes and avoids costly issues down the road. Check out construction-related businesses from the Orillia and District Construction Association.

5. Secure Necessary Permits

Before starting construction, draft blueprints and apply for the required building permits in your area. Even if your region doesn’t require a permit, obtaining one is crucial for ensuring your investment is protected and your suite is considered legal.
You’ll also need permits for plumbing, electrical, and gas work. Failing to secure these can result in delays or fines. Orillia’s building division includes a list of required permits and zoning which can be found here.

6. Schedule Inspections

As construction progresses, ensure you schedule required inspections to confirm the work complies with building codes, fire safety standards, and health regulations. Once the suite passes inspection, it will be officially approved for use.

7. Verify Licensing Requirements

In some cities, you may need a business license to rent out your suite. For instance, Vancouver requires a license for long-term rentals. However, if a family member will live in the suite, a license may not be necessary. Double-check with local authorities to confirm.

8. Take Advantage of Incentives

Renovating for a secondary suite comes with financial perks! Some programs include:

  • Multigenerational Home Renovation Tax Credit: Offers 15% of qualifying expenses (up to $50,000) for creating a secondary unit for family members.
  • First Nations Programs: Federal funding of up to $60,000 for adding affordable secondary suites, with increased amounts for remote or northern areas.
  • Ontario Regional Programs: Forgivable loans of $25,000–$50,000 are available, provided homeowners maintain ownership for 15 years.

Contact your local government or research online for details about programs in your area. The County of Simcoe covers frequently asked questions regarding secondary suites, learn more here.

Why Add an Income Suite?

Creating a legal income suite not only boosts your monthly cash flow but also increases your property’s value. Whether you use the additional income to pay down your mortgage or cover rising costs, this investment can provide long-term financial stability.

Before you begin, visit your local municipal office and consult professionals to ensure you have a full understanding of zoning, permits, and regulations. By following these steps, you’ll set yourself up for a smooth and successful renovation process—and a profitable new stream of income!

Ready to learn more about funding your renovation? Contact us today 705.326.8523 to discuss how to make your home equity work for you!

 

Understanding Home Appraisals: Key Insights and Tips to Enhance Your Home’s Appeal

Real Estate Mark Goode 14 Jan

Home appraisals are a crucial element of the real estate process, providing an unbiased estimate of a property’s value. Whether buying, selling, or refinancing, a well-prepared home can make a strong impression and potentially increase its appraised value. Here’s everything you need to know about home appraisals, along with expert tips to enhance your home’s appearance for a higher appraisal.

1. Purpose of a Home Appraisal

A home appraisal is conducted to determine the fair market value of a property. This is essential for:

  • Buyers and sellers: Ensures the property’s worth aligns with the purchase price.
  • Lenders: Confirms the home’s value to secure their investment by lending based on an accurate assessment.

For financed home purchases or refinances, lenders need an appraisal to confirm that the property’s value supports the loan amount. This process safeguards all parties by offering an objective assessment of the home’s market value. At Mortgage Man DLC, once we receive the lender’s request for an appraisal, we handle all arrangements on behalf of our clients.

2. How an Appraisal Is Conducted

Appraisers assess various factors to estimate a home’s value, including:

  • Property size and layout: Square footage, number of bedrooms and bathrooms, and overall flow of the space.
  • Condition: State of maintenance, age of major systems (like HVAC, roof, and plumbing), and the quality of materials used.
  • Upgrades and renovations: Recently updated kitchens, bathrooms, or other remodeled areas can positively impact the valuation.
  • Comparable Properties (Comps): Appraisers look at recent sales of similar homes in the neighborhood to gauge market value.

Enhancement Tips:

  • Highlight Recent Upgrades: If you’ve done any major renovations or upgrades, make a list and share it with the appraiser to ensure nothing is overlooked.
  • Boost Curb Appeal: First impressions matter, so invest time in landscaping, repainting the front door, and clearing any clutter. A neat exterior can improve the appraiser’s perception before they even step inside.

3. Impact of the Appraisal on the Transaction

The appraisal directly influences the transaction outcome:

  • At or above the purchase price: The transaction can proceed smoothly with financing in place.
  • Below the purchase price: This may complicate financing, as lenders will usually only finance up to the appraised value. This can lead to renegotiations or additional funds needed from the buyer. Our team will work for you to obtain the best possible outcome.

Enhancement Tips:

  • Declutter and Depersonalize: Create a welcoming atmosphere by tidying up and removing personal items, which helps the appraiser focus on the home itself rather than distractions.
  • Complete Minor Repairs: Fix leaky faucets, touch up paint, and ensure all lights are working. Small, inexpensive improvements signal to the appraiser that the home is well-maintained.
  • Clean Thoroughly: A spotless home feels well-cared-for, which can positively influence the appraiser’s assessment of your property’s condition.

Additional Tips to Maximize Your Home’s Appraisal Value

  • Organize Documentation: Have a record of all improvements, repairs, and relevant warranties for major appliances or systems.
  • Point Out Energy-Efficient Features: Features like new windows, a smart thermostat, or upgraded insulation can add value, so make sure these enhancements are noticed.

By understanding how appraisals work and investing in these small enhancements, you can feel confident about presenting your home at its best and potentially increasing its appraised value. These proactive steps not only make a great first impression but also demonstrate a high level of care and maintenance, ultimately benefiting the appraisal outcome.

Should you have an additional questions about the appraisal process as it affects your mortgage refinancing, please reach out to our expert mortgage agents at Mortgage Man DLC 705.326.8523.

Market Beware: The Risks of Subject-Free Offers

Real Estate Mark Goode 8 Oct

When purchasing a home, most offers typically include conditions (or “subjects”)—specific requirements that must be met before the sale is finalized and the property is transferred. Common subjects include:

  • Financing approval
  • Home inspection
  • Fire/home insurance
  • Review of strata documents (if applicable)

These conditions help protect buyers from potential issues related to financing, the property’s condition, or securing insurance. Once all conditions are met by the agreed date, the sale can proceed. If not, the buyer can walk away without penalty.

However, in today’s competitive housing markets, subject-free (or condition-free) offers have become more common. These are offers made without any conditions, essentially saying “what you see is what you get.”

Let’s break down the pros and cons of subject-free offers for both buyers and sellers.

Pros of Subject-Free Offers

For Buyers:
In a competitive market, a subject-free offer can make your bid more attractive to the seller. It shows you’re serious, and the deal is less likely to fall through, which might help you beat out other potential buyers.

For Sellers:
Sellers benefit from subject-free offers because they speed up the process. The buyer is willing to proceed without any conditions, which means there’s less waiting and uncertainty. A subject-free offer often includes a competitive price and aligns with the seller’s preferred closing date.

Cons of Subject-Free Offers

For Buyers:
Subject-free offers are extremely risky. Here’s why:

  • Financing Uncertainty:
    A pre-approval is not a guarantee of financing. Lenders still need to approve the property and its value. Without a subject to financing, the buyer risks losing their deposit if the financing falls through, which could be thousands of dollars.
  • Skipping Inspections:
    Without a home inspection, you could be buying a property with hidden issues like structural damage or code violations. Insurance companies might also require an inspection, so skipping this could leave you without coverage.
  • No Due Diligence:
    With no time to review important documents, check title issues, or secure insurance, you could face legal or financial problems after the sale.

For Sellers:
While sellers face less risk, financing could still fall through, leaving the sale in limbo. Even if the offer is accepted, the deal isn’t guaranteed until the buyer secures funding.

Financing Around Subject-Free Offers

If you’re considering making a subject-free offer, you’ll need to do as much research and preparation as possible beforehand. Securing financing, though never guaranteed, is crucial. Pre-approval helps, but you’ll want to ensure the lender approves the specific property. Our team at Mortgage Man DLC will assist you with every step of this preparation, be sure to reach out to us markgoode.ca

Contractual Obligations

Be aware that once your offer is accepted, it becomes a legally binding agreement. If you can’t secure financing or decide to back out, you could lose your deposit or even face legal consequences. Sellers might sue for damages if they’re forced to sell to another buyer at a lower price.

Mitigating Risks of Subject-Free Offers

If you decide to go ahead with a subject-free offer, here’s how you can reduce the risks:

  • Get Pre-Approved:
    This gives you a clearer picture of your financing options, even though it’s not a guarantee. You can simply download Mortgage Man’s My Mortgage Toolbox free.
  • Do Your Homework:
    Research the property’s history, any major renovations, and potential issues through a Property Disclosure Statement.
  • Review the Title and Strata Documents (if applicable):
    Ensure there are no outstanding legal issues with the property title or hidden concerns in the strata documents.
  • Secure Insurance:
    Confirm that you can obtain insurance for the property, and if possible, conduct an inspection beforehand.
  • Consult Experts:
    Speak with your real estate agent and mortgage broker (mark@markgoode.ca / 705.326.8523) to assess the risks and explore alternative strategies like a short closing period, which might make your offer competitive without going subject-free.

Conclusion

Subject-free offers can help you win in a competitive market, but they come with significant risks. Always weigh your options carefully, do your due diligence, and consult with your real estate and mortgage professionals to make an informed decision. If you’re considering a subject-free offer, talk to Mortgage Man’s mortgage experts to discuss financing and ensure you’re fully prepared.

Boost Your Yard’s Allure with Top ROI Ideas

Real Estate Mark Goode 14 May

Summer beckons for outdoor enjoyment in your yard. To maximize your space, I’ve outlined key yard enhancement concepts offering significant ROI, ensuring you get the best value and enhance both your home’s equity and curb appeal simultaneously!

  • Embrace Sustainable Landscaping: Incorporating native plants, drought-resistant foliage, and xeriscaping techniques not only reduces water consumption but also creates an eco-friendly landscape. Consider installing a rain garden or a drip irrigation system to conserve water and enhance the natural beauty of your yard.
  • Install Outdoor Structures: Adding functional outdoor structures like pergolas, arbors, or gazebos can provide shade, define spaces, and add architectural interest to your yard. These structures can serve as focal points and create inviting outdoor living areas for entertaining or relaxation.
  • Upgrade Your Lawn: A lush, well-maintained lawn instantly elevates the appearance of your yard. Invest in professional lawn care services, aerate and overseed to fill in bare patches, and regularly fertilize and water your lawn to keep it healthy and green. Consider alternatives like artificial turf for low-maintenance options.
  • Incorporate Water Features: Incorporating a water feature such as a fountain, pond, or waterfall adds visual interest, tranquility, and a sense of luxury to your yard. The soothing sound of running water can create a serene ambiance and attract wildlife, enhancing the overall appeal of your outdoor space.
  • Enhance Privacy: Increase the comfort and enjoyment of your yard by enhancing privacy with strategic landscaping, fencing, or screening options. Planting tall hedges, installing lattice panels, or adding trellises with climbing plants can create secluded areas and block unsightly views while adding beauty and greenery to your yard.

Incorporating these supplementary concepts alongside your existing plans can turn your yard into a welcoming oasis, elevating both your pleasure and providing a substantial return on investment.

Source: DLC Marketing Team

What to Expect for the 2024 Spring Housing Market

Real Estate Mark Goode 2 Apr

The spring housing market is just around the corner! Whether you’re looking to sell, buy, or want to ensure your mortgage is in order, knowing what to expect can help.

Here is the low down on what we are anticipating for various factors affecting the housing market this season:

  • Interest Rates: While the Bank of Canada held the overnight rate steady at 5% for the past five meetings, it is expected that they will make the first interest rate cut in June or July this year, followed by additional reductions in the overnight rate to a more manageable level as the year continues. Experts are predicting that The Bank of Canada rate could drop to 3.75% by the end of 2024.
  • Housing Prices: With interest rates expected to start coming down mid-year, that means more affordability and buyers in the market. As a result, it is expected that home prices will increase this year.
  • Market Inventory: According to the Canadian Real Estate Association, the number of new properties listed has edged up 1.5% month-over-month in January, with this expected to rise as the interest rates drop.?

Looking to buy? For those of you who may be looking to purchase a home this Spring, here are some things that can help you be prepared:

  • Get your finances ready by paying off as much of your debt as possible to improve your debt-to-income ratio and ensure you qualify for the best rate possible.
  • Obtain a mortgage pre-approval before starting your search. This helps you understand your budget and makes your offer more appealing to sellers.
  • Clearly define your priorities and preferences for a home. This will help streamline your search and make decisions more efficiently, especially as the market becomes more competitive.

First-time homeowner? Take advantage of first-time home buyer assistance if you have not been a homeowner in the past. You can find out more on the Government of Canada website here.

Looking to sell? If you want to sell your home this Spring, you will want to be ready to take advantage of the market! Some things you can do include:

  • The first step is to find a reliable real estate agent who can help you with pricing and listing your home for sale. Not sure who to call? I can provide some references!
  • Allow for open houses during evenings and weekends whenever possible to ensure you’re maximizing potential buyer foot traffic.
  • I have even more tips on decluttering and getting your home ready to sell below!

Want to renew or refinance? If you’re not looking to sell or buy this Spring, you may still be looking for mortgage advice or assistance with your home and finances. Now is a great time to make sure your mortgage is working for YOU! With so many renewals coming up this year, keep in mind there are several benefits to taking time to review your renewal before you sign:

  • Get a Better Rate: With interest rates expected to come down, taking time to reach out to me and shopping the market could help save you money!
  • Consolidate Debt: Renewal is a great time to take a look at your existing debt and determine whether or not you want to consolidate it onto your mortgage. In most cases, the interest rate on your mortgage is less than you would be charged with credit card companies or other forms of financing you may have.
  • Start on that Reno: Do you have projects around the house you’ve been dying to get started on? Renewal time is a great opportunity for you to look at utilizing some of your home equity to help with home renovations so you can finally have that dream kitchen and updated bathroom, or even utilize it to purchase a vacation property!
  • Change Your Mortgage Product: Are you not happy with your existing mortgage product? Perhaps you’re finding that your variable-rate or adjustable-rate mortgages are fluctuating too much and you want to lock in! Alternatively, you may want to switch to a variable as interest rates level out. You can also utilize your renewal time to take advantage of a different payment or amortization schedule to help pay off your mortgage faster!

No matter your plans for this month or the coming season, don’t hesitate to reach out to our team for expert mortgage advice, 705326.8523 or you can apply today here !

Source: Dominion Lending Centres Marketing