Date Posted: July 2, 2019
When working with a listing agent to sell your home, ensure the photos are representative of your home and professional looking without being deceiving on size and condition. Like appraisals, good photos will help the lender reviews the report and assess the value of the home as well. Appraisals will be required on country homes (often driven by postal codes), private sales, but many have an auto appraisal program which is cheaper for the clients. A big risk of going into a multiple offer scenario is if the home will auto appraise if needed, if not a full report will be required, and the lender will finance the lower of the purchase price or the appraised value. The risk lies in that if the appraised value is the lower of the two, the buyers will need to come up with the additional funds to cover the difference between the appraised value ad the purchase price.
Two of the sister companies under the Advanced Group of Companies, which also holds Mortgage Brokers Ottawa, is the Advanced Mortgage Investment Corporation (AMIC) and Advanced Capital Corporation. A mortgage investment corporation (MIC) is a private lender that accepts investment dollars and invests in a pool of mortgages so that each investor’s dollars are invested in a proportionate way to all of the mortgage held in the pool; as opposed to one individual investing in one individual mortgage which shares the risk amongst all the investors equally. Since inception nearly 5 years ago, the annual rate of return for investors is 7.837% when dividends are re-invested monthly. The goal of AMIC is to create a short-term “band-aid” lending solution and every mortgage has an exit strategy likely in 12-15 months from the time of funding.
On the investing side, the average investor is someone looking to diversify their portfolio and perhaps looking to get some yield in their registered accounts including RRSP, TFSA, RESP, RRIF accounts. These investments are not exchange traded and all mortgages are based in the Ottawa market.
In terms of the Ottawa real estate market, there 4535 total listings. Of those listing, there are only 611 condos leaving the residential market to make up the additional 3924 homes. The condo market has really changed and rebounded over the last few years in that there are only 611 listings currently as opposed to 2300 listing 3 years ago. The average sale price has increased 6.1% overall and condos have helped increase that figure with an increase of around 8%.