New Homes
New Homes
Good arguments for buying a new home
WITH all the financial issues in the U.S and Europe, there has been unfounded fear regarding the situation in Canada.
The European situation is definitely a crisis, but the impact on Canada is different than in the U.S. The Americans have a much deeper hole to climb out of, and every one of their trading partners makes that climb steeper. Given that Europe represents 12 per cent of the U.S. economy, the EU crisis hurts the U.S. recovery.
As we know, the U.S. housing crisis was caused by reckless lending practices. This hasn't happened in Canada and it won't. The Canadian banking system is still rated the best in the world.
The U.S. has entered into numerous spending and incentive programs and, although these may provide some stimulus for the economy, they will do nothing to help balance the budget. In Canada, we appear to have those factors under control. Although we bemoan the fact the government has halted the Home Renovation Tax Credit and the Eco Energy grants, what these may really mean is the government doesn't feel we need them anymore to bolster our economy.
Four out of 10 homeowners in Canada have more than 30-per-cent equity in their homes. That makes for a tremendous downpayment towards a new home. There is concern about rising interest rates, but many look at this increase incorrectly. We look at where interest rates were at their absolute lowest, at a time when the government was artificially keeping rates down to stimulate a weak economy.
This increase is simply a return to normalcy. Most Canadians lock into a five-year mortgage. So, don't look at interest rates from last year; look at them five years ago. That's the figure by which you will be comparing future mortgage payments to past payments. Using that logic, we see that even with projected hikes, interest rates will only be about .3 per cent higher than what you were previously paying. All in all, mortgage rates are and will continue to be extremely new-housing friendly.
All signs of the Canadian economy and, in particular, the Manitoba economy, point towards a perfect time to purchase a new home. Our hesitation in 2009 may have been based on sound cautionary measures, but now it's time to take the step we've been considering for the past few years.
New Homes
Little homework helps you choose right renovator
DECIDING who to hire for your home renovation is an important part of planning for the success of your project. You want to work with a professional contractor, someone who is reputable and in business for the long term.
You need to find someone who is right for your particular project and someone you can feel comfortable with and can develop a good working relationship with.
Not everyone who offers renovation services is in business legitimately.
Some are 'fly-by-nighters' --who are here today and gone tomorrow. Some are 'moonlighters -- they do renovation on the side but it's not their 'real job.' Others are 'low-ballers' who ask for cash payment and fly 'under the radar' by avoiding registration, taxes and other normal costs of doing business properly.
Any home renovation, no matter the size, is an investment in your home and your life. Look for a contractor who:
-- Offers proof of being in business: GST/business registration, workers compensation, insurance, and so on.
-- Works with a written contract.
-- Offers a warranty on their work.
-- Provides referrals to previous work and clients.
-- Is happy to talk about their company, their experience and their plans for the future
Companies that belong to RenoMark, a program for professional renovators in some areas of Canada, commit to a renovation-specific code of conduct.
Check www.homebuilders.mb.ca for more information and a listing of members in Manitoba.
You want to find someone who has experience with the kind of renovation you are planning and can add value to your project through their expertise.
As you search for renovators, ask friends, family and co-workers for recommendations for companies with proven experience; do a little independent research for companies that may be a good match for your project; and ask renovators directly about their experience and possible fit with your project.
Reputable, experienced renovators are often booked well in advance.
Start your search early on in your planning process and be prepared to wait, if possible. When you find the right renovator, a small delay is a reasonable price to pay for a renovation done right.
This backgrounder has been prepared by the Canadian Renovators' Council of the Canadian Home Builders' Association.
New Homes
Strengthening consumer protection properly
THE province recently announced it is introducing changes that will benefit consumers. Gord Mackintosh, minister responsible for consumer and corporate affairs, said the government is committed to strengthening consumer protection in 42 different areas.
Proposed changes include a variety of items of interest to current and potential home buyers and those wanting to upgrade their existing home. For example, legislation will be introduced to protect against real estate fraud occurring when properties are sold without proper authorization. The government will also provide assurances for home buyers regarding the condition of their intended home purchase. This may come in the form of inspections, although Manitoba does not currently license home inspectors, so this may be difficult to qualify. The provision of a statement of current property condition may be the first step in this discussion.
The Manitoba Home Builders' Association and the province have been engaging in discussions regarding new home warranties. The MHBA has long been in favour of mandatory warranties for new homes. The MHBA will not even accept members who have not offered third party warranties for at least two years.
The laborious part of these discussions has been the determination of what should and shouldn't be part of the mandatory new home warranty. After all, for every item included the cost to the consumer increases and neither the province nor the MHBA want to make housing affordability more difficult.
It will be important to find the right balance of necessary protection for the consumer without burdening them with unnecessary expenses for coverage they don't require.
The proposed new legislation also aims to ensure that consumers are dealt with fairly in home renovations. The initial intent is to develop legislation regarding contracts, estimates and final costs. Again, the MHBA is fully supportive of legislation that will force all persons doing renovations for consumers to adhere to the high standards set by the RenoMark renovator members of the MHBA.
The province and the consumer affairs branch have proposed some very ambitious goals for the future. However, by working closely with industry to ensure a win/win scenario for business and consumers, the odds of success are greatly enhanced.
Mike Moore is president of the Manitoba Home Builders' Association.
New Homes
MHBA plays key role in workers' safety
The Manitoba Home Builders' Association supports a culture of occupational safety and health to make the province's residential construction sector safer for its workers.
The MHBA Workplace Safety and Health Committee, established in 2002, plays a key role in promoting safety and health for its members. This committee works with the province's Workplace Safety and Health Division and the Construction Safety Association of Manitoba to develop training and education, highlighting safety on work sites.
In addition to participating in Manitoba's annual construction safety conference, the MHBA co-ordinates a two-day housing forum each year. Last year, members heard presentations on topics such as safety audits, loss prevention, fire safety and H1N1 awareness.
The MHBA also offers a subcontractor safety course that outlines the importance of safety on site, educates building sub-contractors and trades on their responsibilities as employers and explains how to conduct a hazard assessment, inspection and toolbox talk.
Fall protection is one of the association's most important training programs. To that end, the Fall Protection Training Centre was established. This facility reflects real-life working conditions and provides practical training to workers in the trades on using fall-protection systems.
Because residential construction in Manitoba continues to experience active growth, effective measures for safety and health must be created and used on every job site. In 2008, following a key focus of its workplace safety and health committee, the MHBA board of directors mandated that all builder members must have a certified safety program, such as the Certificate of Recognition (COR). Now, more than 70 per cent of all new homes built in Manitoba are constructed by companies that are safety certified.
The Manitoba Home Builders' Association and its member builders continue to promote safety on the work site for the betterment of the industry, the client and the worker. Safety is good business.
Mike Moore is president of the Manitoba Home Builders' Association.
New Homes
Imagine; legislation that is actually a deal
POSSIBLY the best piece of legislation to come from the federal government in decades has been the Home Renovation Tax Credit.
Introduced in the 2009-10 budget, the HRTC was designed to stimulate the economy in a time of recession. The basic premise was that the consumer would receive a rebate on their taxes if they renovated some aspect of their home. The rebate was 15 per cent of moneys spent between $1,000 and $10,000. Therefore, for renovations of $10,000 and above, one would receive a tax credit of $1,350.
Imagine -- the government was giving us money back if we spent money on something we needed to purchase in the first place. This was a deal!
The timing couldn't have been better. The entire world was mired in a recession and Canada was no exception. Manitoba was not impacted to the same degree as Ontario, Alberta and B.C., but our manufacturing sector, especially those dependant on U.S. trade, was definitely hit hard.
Consumers stepped back from their customary purchasing habits, further impacting the economy. The HRTC not only encouraged people to upgrade their houses by way of renovation, it also helped many other sectors. In the case of manufacturers who produced goods for the home such as windows, floors, cabinets and counter tops, the HRTC provided an economic incentive that encouraged the consumer to keep buying through tougher times. This meant that they could continue to operate their production plants, thereby keeping their employees working. Sales staff were also busy.
Professional renovators, handymen and do-it-yourselfers were kept busy all year with various projects. The beauty of the HRTC was that both labour and materials were eligible for the rebate. All benefited from it.
So, the consumer wins, the manufacturer wins, the sales staff and retail outlets win. We're still not out of the woods yet, so why discontinue the HRTC before the final numbers were even assessed? Perhaps there is an opportunity here for the Manitoba government to implement some updated version of the Home Renovation Tax Credit, maybe one tied to energy or water savings. It's worth a thought.
Mike Moore is president of the Manitoba Home Builders' Association.
