Wednesday, June 25, 2014

Lawyers giving Condo Advice

When you purchase a resale condo suite you receive a Status Certificate that explains the Financial position of the Condominium Corporation.
a) What are they expected to spend Capital Projects (Forward Plan)
b) Are they being sued?
c) Are their Finances stable IE Borrowings vs Special Assessment
d) Percentage of Rentals vs Owners
e) Rules and Regulations you will need to adopt.
f) Is the Owner up to date with their fees and what do they pay
g) Confirmation of Locker and Parking descriptions.

They will provide you all Insurance Documents, Rules and Regulations, and most recent AUDITED Financial Statements.  You now have these on a CD and in Print; You take them to your lawyer....

Lawyer today told a Buyer;  "That condo isn't a good deal because their Annual budget is in deficit."    UMMMmmm Really....  My response?   "Yer stupid".

Building Budget Held Meetings (the Board of Directors and Management Company) for what they expect to spend; planning Diligently. This creates the amount to calculate your maintenance fees.

If we spend $100 more than anticipated on anything ( legal fees, repairs, a few snapped parking control gates)  WE WILL BE IN DEFICIT. 

If a condo is adhering to their Reserve Fund Study, {depositing the correct amount quarterly each year and earning interest}  and the audits have been done.... [by accountants who manage and accounting firms who audit PLUS the engineers who calculate the remaining economic life of system components] there is generally not a lot to discuss.

WTF  [who legal term] are you to decide an annual operational deficit means its a poorly run building and you recommend your buyer skip it.

A financial statement takes a snapshot at a particular calendar date. (Usually Dec 31st year end) Are you overdrawn during TAX time?   Uhhuh   Now pick up that book on accounting practices are review Financial Statements paying careful attention to the Source and Application of Funds.  ( what we collected, what we spent / did with it) 

If the building is deficit or surplus it is carried forward (and paid) into the next year. It is not a VISA card.  Its a running balance.

In this case, the Buyer is changing Lawyers. or the Building could have a sale that show DFT [Deal Fell Through]  when asked the agents would say Financial Statements of the Condo Corp.  Depending on their KLOUT their voices might carry, damaging the financial resale and viability of the building.

Please work with people who understand...  Your road will be so much smoother.

Tuesday, June 10, 2014

When the Average Sale at $1.0MM What do you get?

The average sale of a detached home within the City of Toronto is now at One Million Dollars. Market Watch for June 2014 shows average sale at $943k.
Average selling prices varied across the Greater Toronto Area, depending on geography and home type. A detached home in the City of Toronto sold, on average, for $943,055. In the surrounding GTA regions, the average detached price was $648,439. The average price for condominium apartments was $401,809 in the City of Toronto and $307,307 in the surrounding regions.
That means that the home you bought for $500k only 10 or 12 years ago has doubled and you are able to sell to fill your family needs going forward.

You are also in your power earning years.
You are prepared to pay the Toronto Land Transfer Tax on this purchase.
Interest Rates at 3% Fixed for 5 years make this very comfortable 

We are all waiting for the retirees to finally sell!  BUT, they are making their homes more comfortable [especially when compared to retirement home costs.]  Housing Inventory (the number available for sale) has declined about 10% per year since 2005 forcing more competition among shoppers.

So let's have a quick look at what was sold in the last 45 days in west Toronto detached and semi detached houses. What was actually PAID in the last few weeks.

You do need to sign in to get this PDF  but we do have a No Stalking Rule. 
Millionaire Monday   What sold in the last 60 days WEST Toronto   Better Still...  Let's update #MillionaireMondays on Twitter. 

Now that you have decided to sell....  What will be buy?