Dartmouth, NS - Blog

Deck Staining Recommendations

sandi.lee@century21.ca — Tue, 14 May 2013 00:00:00 GMT

Q: What should I do to prepare an existing deck for a new finish? The current finish is Cabot decking stain that was applied after the wood was sanded. It has lasted well, but needs to be redone.

A: There are two ways to make an old wooden deck look new again. You can strip the surface back to bare wood chemically, followed by power washing and sanding. This is a ton of work, but remains the best option for decks that are peeling like crazy or show a lot of grey wood.

Is the current finish just a little worn? A simple option is to scrub off all dirt with a brush and water, then lightly sand the wood with a 100- to 120-grit abrasive in a random orbit sander. This removes small areas of loose finish, and roughens the remaining stain so new coats stick better.

If a single coat is enough to make your deck look good, then leave it at that. Apply a second coat only if needed. Too many layers of deck stain can cause premature peeling, even if you’re using a good product.

Warming a cold floor

Q: How can I warm the cold floor of my upstairs bedroom? There’s a garage underneath and the bedroom floor was really cold this past winter, even with carpet under foot.

A: Cold floors are common in Canada because so many home designs have rooms located over an unheated space — usually a garage. You need to add more insulation to the floor, and possibly add more heat to the bedroom.

Exactly how you do this is the big question. If the ceiling of your garage is open and uncovered with drywall or wood, then you’re in luck. Apply 3- or 4-inches of spray foam to the underside of the subfloor and you’re done. This both insulates the floor above, and seals out drafts perfectly. You can buy tanks of foam to do this work yourself.

If you can’t conveniently add insulation to the garage ceiling, then you’ll need to add it to the top of the bedroom floor. A couple of inches of extruded polystyrene foam on top, with sheets of 1/2-inch plywood over that, all secured with screws driven down into the underlying floor joists does an excellent job.

On the downside, this approach does raise the height of the floor significantly, and only makes sense if you’re replacing the finished floor anyway.

If you choose to insulate on top, live with the foam and plywood for a while during cold weather, without a new finished floor installed. If your toes aren’t quite toasty enough, consider adding electric radiant infloor heating mats before the new finished floor goes down.

Dry basement quest

Q: What can we do about a very leaky finished basement in the home we just bought? This is our first place, and the previous owners (who’ve lived here for many years) assured our real estate agent that the basement was dry. Estimates for fixing the problem is $10,000. What should we do?

A: Depending on where you live, start by lodging a formal action with the real estate council in your province. Google “real estate council” plus the name of the province where you live.

Among other things, organizations like these enforce codes of conduct for all registered agents and brokers. If the issue of basement leaks had been mentioned during negotiations, but your agent didn’t include any written assurances in the contract, then there may be something that can be done in your favour.

That said, it’s a sad situation when people like the previous owners so easily turn their back on basic honesty, all to make a quicker sale at a higher price. Laws, courts and arbitration boards are a poor substitute for integrity.

Up to 100% rerurn on Kitchen Renos

annette.vaters@century21.ca — Mon, 13 May 2013 00:00:00 GMT

ROI Statistics on Home Renovations

Did you know you can get up to 100% return on a Kitchen Reno?

According to The Appraisal Institute of Canada, kitchens and bathrooms continue to number one followed closely by a coat of paint. Here are the stats for ROI on various home reno projects:

Kitchen upgrade: 75% to 100%
Bathroom upgrade: 75% to 100%
Interior painting: 50% to 100%
Roof replacement: 50% to 80%
Expansion (addition of family room): 50% to 75%
Doors and windows: 50% to 75%
Deck: 50% to 75%
Installation of hardwood floor: 50% to 75%
Construction of a garage: 50% to 75%
Finished basement: 50% to 75%
Wood fence: 25% to 50%
Interlocking paving stones on driveway: 25% to 50%
Landscaping: 25% to 50%ROI Statistics on Home Renovations
May 8, 2013 under Uncategorized

Did you know you can get up to 100% return on a Kitchen Reno?

How mortgage rates are set!!

annette.vaters@century21.ca — Mon, 13 May 2013 00:00:00 GMT

How mortgage rates are set

AdviceMay 7, 2013

By Idriss Bouhmouch

It’s easy to say that mortgage rates are “affected by economic factors,” or more specifically “bond yields” or “the Bank of Canada”, but are you really getting an understanding with those answers? If so, you may understand economics better than most Canadians. But if the responses above present more questions than answers, we will try our best to break it down for you here.

First off, there are two types of mortgage rates: variable and fixed. Both are indeed driven by similar economic factors, but they are affected by different factors too.

Variable mortgage rates, as they sound, vary and fluctuate with what is known as the prime lending rate. This rate is set by the Bank of Canada based on its interpretation of the state of the economy and inflation targets. When the prime rate goes up, variable mortgage rates go up, and vice versa. This is why variable mortgage holders take on a bit more risk over the term of their mortgage and should watch the Bank of Canada announcements.

Fixed mortgage rates, where the interest rate is fixed over the course of the mortgage term, are a little more complicated – they shadow Government of Canada bond yields of the same term. In fact, there is a very positive correlation between the two.

Bond yields are determined by the price of bonds and have an inverse relationship with them. For example, if a five-year bond falls in price, this means the yield (return for investors) goes up. Similarly, if the price increases, the yield falls.

Bonds are like safe havens for investors: they offer guaranteed repayment on funds the investor loans to the issuer (in this case, the government) after the term of the bond has passed (plus a set rate of interest known as the coupon). When the economy is booming and the market is good, big returns can be had by investing in alternatives, and bond prices tend to fall so bond yields rise. When the market is bad, demand for safe money increases, so bond prices rise and yields fall.

Meanwhile, mortgages are funded through capital issues and often the bond market. The interest rate on a mortgage depends on the yield (return) the bank provides bond investors. When investors demand a higher yield, mortgages must also be issued at a higher fixed interest rate that is in line with the cost to the bank. The cost of borrowing for the bank to fund mortgages is essentially the percentage yield paid to investors of the bond.

The second factor influencing fixed mortgage rates will be the spread required by financial institutions, on top of the bond yields. Three main components influence this spread: the cost of trades and transactions of the loan, a risk premium (in the case of default payment) and finally the profit margin that the financial institution desires.

We could summarize that for the duration of a loan, fixed mortgage rates are determined on the following basis: cost of capital + administration costs and/or mortgage negotiations + risk premium (in the risk of the borrower defaulting on the mortgage) + the bank’s desired profit = cost of the mortgage for the borrower.

In short, if you are trying to predict where fixed mortgage rates are headed, look to the bond market.

Overwhelmed?

This is a lot to take in, and it may not all make sense right away. But the introduction of these concepts hopefully provides a little more insight and trust in the mortgage process. As with all financial transactions, mortgages are driven by supply and demand, and underlying economic factors.

Idriss Bouhmouch is director of operations in Quebec for Ratehub.ca, a mortgage rate comparison website. The company says mortgage information should be presented in a transparent, easy-to-understand, and complete manner.

Positive Canadian economic growth

annette.vaters@century21.ca — Mon, 13 May 2013 00:00:00 GMT

Positive Canadian economic growth
in second half of 2013

Canadian home sales likely to stabilize
Existing home sales are likely to stabilize in the coming months. Most of the weakness seen over the last eight months can be seen as a result of the change in mortgage insurance rules that were implemented in July 2012 (which had the same impact on housing prices as a 1% increase in interest rates). Changes to mortgage insurance rules usually tend to drag down on growth in home sales for up to 3 quarters - therefore this impact is expected to vanish in the coming months. Sales are now at levels that are greatly supported by underlying employment and population growth. As demand for Canadian housing continues to be modest, prices are expected to continue to weaken. The impacts vary for different regions - Vancouver home prices have fallen 10% and sales have fallen 36%. Current home sales in Toronto have weakened, however increasing inventory (because of the amount of overbuilding in that market) will likely force downward pressure on prices.

U.S. strong retail sales growth
U.S. retail sales rose 1.1% in February. Sales growth in January was also shown at an increase at 0.2%. As a result, positive sales point to a great outlook for consumer spending in the first quarter of 2013. With this support, U.S. economic growth is likely to increase to approximately 2.5% in Q1. However, there are still challenges facing households and the economy - the impact of the limit on the federal budget and the impact of higher taxes and high prices at gas pumps, is likely to lead to a slowdown in growth in Q2. The unemployment rate declined to 7.7% from 7.9% in January. If this pace of job creation is maintained, U.S. employment would increase by approximately 2.3 million this year.

Job growth in Canada to remain positive
While debt growth is expected to continue to move more in line with income, the level of Canadian household debt is currently a concern. The federal government and households are continuing to benefit from lower debt servicing costs (due to the low interest rate environment). The Bank of Canada's current position on low interest rates and low inflation is also expected to continue. While there are still headwinds and downside risks present, these should fade away allowing economic growth in Canada to pick up in the second half of the year. The Canadian economy is anticipating the corporate sector to be the stronghold in 2013 by increasing spending on investment and hiring. Canadian job growth in 2013 year-to-date is seeing positive numbers. Businesses are expressing hiring intentions which looks like the job growth number will remain positive looking ahead. The jobless rate is expected to average 7.1% in 2013.

This article is for information purposes only. It is recommended that individuals consult with their Wealth Advisor before acting on any information contained in this article. We accept no liability whatsoever of any kind for any damages or losses incurred by you as a result of reliance upon or use of this publication in contravention of this notice.