2/Keep your hands off the temperature. Decide to live in a slightly warmer space say 24%, then stick to it. Resisting changing the temperature will keep your bills down and help the environment.

3/ Buy a new air conditioner. If your system has been around for a decade or more it won’t be very energy efficient. A new system with a SEER rating (Seasonal Energy Efficiency Ratio) of 14-20 will cut your energy bills up to 30% and cool your home more quickly.

4/ Location is important. Install your new system on the north side of your home or in a shaded area. A unit in direct sunlight can use up to 10% more energy. Don’t plant shrubs around the unit, this can block intake and exhaust of air.

5/ Use Ceiling Fans. If you can use ceiling fans instead of air conditioning your electricity bill for cooling will reduce to about .15 cents per day.

6/ Turn off the A/C when your on vacation… you could save up to $70.00 on this one.

7/ Seals Cracks around your windows and doors. This can stop the loss of up to 30% of cool dry air. Caulking windows and weather stripping doors can save you several $ per window and door over the year.

8/ Keep it Shady. On hot days close your blinds. Depending how your home sits this could save you as much as

another 10% in cooling costs.

 1/ Bugs – this is my #1, I don’t know about you but I hate them.  So being honoured with an invitation to fight them off all weekend doesn’t really appeal.  This year Ontario’s

North Country has a record amount of black flies to eat you… a word for the wise.. Stay away. A chance to be eaten by black flies have your blood sucked by mosquitoes, have ants walking across your food, stung by wasps   oh my gosh.

2/ Sand. Charming and romantic in the moment but when you get home it is still there even a week later… it pours out of your shoe, grates between your toes, it’s everywhere, and it’s everywhere.

3/ Unsightly Views and Loud Noises. So tell me what do loud jet skis, and other water contraptions plus ugly blow up toys have to do with communing with nature. Compare this to staying in the city and taking a long walk on one of our city park systems where you may view a rabbit or a fox in the distance, then having din dins at a nice local tratoria and attending a little theatre afterwards. No long drive home just a 5 -10 min car ride and plop into your own comfy bed with no sand in it.

4/ Traffic, Traffic, Traffic

5/ Gas Price, Gas Price, Gas Price

6/ Cottage Politics. Cottage living is like living in a small town, it has it’s good points but some definite negatives.  If your neighbour decides to build an offensive addition and there is an argument the whole community talks…. Same if young Sally gets caught making out with the neighbours son and the two young ones have to be taken to task, somehow it gets around.

7/ Expectations. Once you own a cottage you feel pressure to invite up your relatives and friends. Then of course you have to entertain them.  This means extra food expense, changing beds, extra laundry and having someone drink your good bottle of Chablis while you were out shopping to feed this lot. Need I say more.

8/ There is nothing to do out there.  You may go into town at night to see a 3 year old movie or to a local corn roast.  But really what fun is that.

9/ Guilt.  Now you’ve bought the place you have to use it.  You can’t just go somewhere else, you can’t just forget it… and there is still maintenance, maintenance, maintenance. After a hard snow fall you may have to go out there and make sure the roof didn’t collapse.  All this and you could have been in  Florida enjoying the sun.

10/  Boring Games.Because there is nothing to do out there you end up playing boring games at night.  Your chance to know every bit of boring trivia about everyone that you never really wanted to know.

11/ Who’s got the supplies.  There is always someone who brings everything and then there are those who don’t bring enough and expect everyone else to supply them with stuff.  They constantly interrupting asking if they can have some of yours and you comply trying to be nice. Before you know it your stuff is gone to and there is no where to go to buy more. 

12/Reciprocity. You can get an invitation to a cottage if you already have a cottage.  The rest must suffer in silence hoping for invitations and they have nowhere to invite you.  This system doesn’t really work.  Try an online house swap  this would be much more reliable and can work really well if you have a home in a desirable downtown location.

Well that’s my list and I am staying home this season.

There are five  major changes to the mortgage rules.

1/ No more Zero down. You will need a minimum of 5% downpayment to purchase a home. If you need to buy Zero Down you can still do so and must close the property by Oct. 15^th.

2/ 40 years amortizations have been pared back to a maximum of 35 years amortization.  Ammortization is the period of time over which you retire your complete mortgage debt and own your home outright.

3/ You will require a credit score minimum of 620 to obtain a gov’t backed mortgage. Your credit score must be consistent and documentation will be required to prove that the valuation of the property is a reasonable one.

4/  No more government backed interest only mortgages.

 Meaning no mortgages where there is no principal paid in the first few years.

5/ A maximum of 45% of a borrower’s income can be used to retire debt.  This means a combination of mortgage payments, car, credit card, student loan and other essential or fixed payments

These were the five major changes that affect First time home buyers primarily.

The Gov’t is prudently trying to avoid a mortgage meltdown similar to that of the U.S. markets.

At the moment in Canada mortgages in arrears are stable at 0.27% the lowest levels experienced since 1990 and well below the highs of 0.65% in 1992 and 1997.

If your mortgage is coming due or you would like to have a mortgage review or mortgage debt consolidation please let me know. I will set up a time to meet with you and review your situation.  You can reach me at mytorontohome@gmail.com.

I am now affiliated with Dominion Lending as a Mortgage Broker.  We can now offer both Real Estate and Mortgage Brokerage services to all of our clients.

Thank you for your help and I look forward to your reply.

Paola Z.

No, there is no such thing Paola. Lofts come under the category of condominiums which means there are common areas with shared hallways, heating systems, roofing systems, plumbing, underground parking spots etc etc. you get the picture. Common expenses pay for the maintenance of these many items. Plus each common expense has a portion called Reserve Fund. The reserve fund is a percentage that is designated by Law which must be put aside for long term repairs. If you are in the price range you may consider free hold townhomes instead

Monday night I went on an offer on a property in Riverdale overlooking Withrow Park.  Priced seemingly right at $779,900.  The home sold at $929,000.  All this in a crashing market according to the media.  Although most home sales are not so spectacular… this one had 13 offers, it is most common to see a couple of offers on a property and sale prices still over asking.  When will this let up?  Too hard to tell. 

 The suburbs are another story.  The late winter and late spring are seeing people just getting out to fix up their homes now for a spring sale.  Also I  believe that gas prices may be a definite factor.  I am told the South Barrie market ( the market that travels to Toronto to work) always takes a downturn every time the gas prices hit a new high.

Buying a New Condo In Toronto

If you would like representation with builders please contact us and we can explain how our service works. Our service costs you nothing. Aeriol Nicols at (416)-445-8855

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Buying a New Condo In Toronto

If you would like representation with builders please contact us and we can explain how our service works. Our service costs you nothing. Aeriol Nicols at (416)-445-8855

It’s RRSP season and that means you can’t turn on the TV without some talking head trying to bully you into making a fat contribution. But if you’re younger and still paying off your first house, you shouldn’t be saving a cent for retirement this year. That’s right – it would be more prudent to forget contributing to your RRSP altogether and pay down your mortgage instead.

The debate as to whether you should focus on your RRSP or your mortgage has raged on too long. Part of the problem is that the banks win twice if your RRSP takes precedence: they get fees from selling you mutual funds in your RRSP, and they keep you in your mortgage for longer. That’s why their traditional advice is to put as much money in your RRSP as possible and then use your tax refund to pay down your mortgage. This approach certainly won’t land you in the poorhouse, but it’s not the optimum way to go.Both shelter you from tax

The biggest misunderstanding in this debate surrounds the tax implications of the two approaches, says Malcolm Hamilton, actuary extraordinaire at Mercer Human Resource Consulting in Toronto. Many people think that your RRSP payments are tax sheltered and your mortgage payments are not. No wonder: when you put money in your RRSP the tax man sends you a juicy tax refund, but when you make an extra mortgage payment, you get nada.

But Hamilton says that RRSP payments have no significant tax advantage over mortgage payments. That’s because every time you make an extra mortgage payment you reduce the principal amount that you’ve borrowed, which means that you will pay less interest in total over the life of your mortgage. All of those future interest payments that you no longer have to make would have been made with after-tax dollars, so in effect, you not only save the interest, but the tax on that interest too.

It’s hard to get your head around, but the net effect is that you get a tax-free return on the money you use to pay down your mortgage, just like the tax-free return you get inside an RRSP.

It comes down to risk

If neither approach has a tax advantage over the other, then the next logical thing to look at is the return. Do you get a better return on your money by paying down your mortgage, or by investing it in your RRSP?

Most comparisons will tell you that you get a better return from your RRSP, but those comparisons don’t play fair. Usually they’ll compare, say, a 6% mortgage rate to something like an 8% return on your RRSP. Paying down a 6% mortgage is like getting a 6% return on an investment, so they conclude that the 8% return you get on an RRSP is the better deal.

That seems reasonable, but it’s not a fair comparison at all. That’s because the 6% return you get on your mortgage is a sure thing, and the 8% return on your RRSP is not. The truth is, a guaranteed tax-free 6% return is almost unheard of right now. An investment product offering such a return would devastate the market for GICs, T-bills and bonds as investors stampeded to the higher guaranteed rate.

Not only that, but the comparisons usually forget that the average mutual fund in Canada charges over 2% in fees, so the actual return you could expect from an RRSP after fees is more like 6%. “And in order to get that 6%, you’re going to have to take on the full risk of being in the stock market,” says Hamilton. “I think that most investors will appreciate that if you’ve got a choice between a high-risk 6% return and a no-risk 6% return, you’re well-advised to take the latter.”

The dangers of success

Since paying down your mortgage offers you the best risk-adjusted return, anyone who’s buying their first house should concentrate on that task, even if it means neglecting your RRSP contributions for a while. However, there are some dangers.

The biggest pitfall is that you’ll be so successful at paying down your mortgage that you’ll think you can afford a bigger house than you really can. You also have to keep in mind that once your first house is paid off, you really do have to get going on those RRSP contributions. If instead you decide to turn around and buy a bigger house, you could run into trouble.

The most important thing to remember is that paying down your mortgage and building your RRSP are both worthy causes. In the end, if your biggest financial concern is which one you should put your money in, you’re probably going to be just fine either way.

Duncan Hood