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Talk of rising interest rates no reason for homeowners to panic – Consult with Bruce Coleman, Vancouver Mortgage Broker

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ROMINA MAURINO-  The Canadian Press

Per cent blocks.
(Golkin Oleg/Getty Images/iStockphoto)

Talk of rising interest rates tend to make homeowners jittery and, if you have a big mortgage, you may be feeling extra nervous.

But while Bank of Canada Governor Stephen Poloz may have made some people uneasy when he spoke in a televised interview last week about the likelihood of rising long-term fixed rates, experts say not to panic.

Peter Veselinovich, vice-president of banking and mortgage operations with Investors’ Group in Winnipeg, says that while rate increases are expected, any change will not be “as dramatic as the sound bite that comes out of an interview with Mr. Poloz.”

“People immediately assume that means (rates) continually rising over a short period of time and that it’s a cause for concern,” Veselinovich said.

“It’s certainly not a ‘sky is falling’ type of message. It will be modest increases.”

Poloz said last week he expected long-term interest rates to rise in response to tapering by the U.S. Federal Reserve, which has already decided to reduce its monthly $85-billion bond purchases by $10-billion.

A change in interest rates would translate to higher mortgage payments, although that would only apply to people with variable ones, since fixed-rate mortgages don’t change for the duration of their term.

Most home owners currently have fixed-rate, five-year mortgages. The mortgages come with the peace of mind of knowing what your payment will be, but with an interest of about 3.5 per cent.

Variable mortgage rates usually hover around 2.5 per cent, since they are based on a floating rate based on prime and are adjusted with each change in prime. Rates have been low since the financial crisis of 2008.

Variable rates appeal to home owners who want to minimize the size of their payment or pay the debt off sooner, but require a financial cushion to account for any changes, should interest rates increase. They also provide more flexibility than fixed mortgages, since most variable mortgages will let you convert to a fixed rate at any time during the term, for a fee.

Robert Stammers, director of investor education for the CFA Institute, said that when it comes to picking a mortgage, it’s important to consider why you purchased the home and how long you plan to live in it.

“You really have to understand — Am I buying this asset to hold it for three (years) and then go up into something else or relocate? Because that will really drive the kind of debt decision you’ll make,” he said.

“If you’re going to be in your home for a short period of time and that’s the reason that you have floating rate debt, then you may be OK because you were expecting some rise in rates over the time period,” he said.

Home Series: Interior Design Mistakes to Avoid- Consult with Bruce Coleman, Vancouver Mortgage Broker

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Interior Design Mistakes to Avoid

When it comes to designing how you want your home to look, and you plan to live there awhile, you want to give the home a look which reflects your tastes and the style of the home.

However, if you don’t do it right or make some of the following common interior design mistakes, then it just means that you’re going to have re-do it which means additional time and expense.

So, to help you avoid some of the most common interior mistakes, this guide will hopefully help save you some expense and aggravation.

Choosing Paint and Fabrics in the Right Order

One of the most common mistakes is that people go ahead and choose a colour scheme and paint the walls before they go shopping for fabrics. The colour effect of the fabrics and paint often don’t match as well as you like. When considering the interior design of your home, it’s a lot easier to first choose the fabric colour scheme first and then select the colours to paint the walls because fabrics are limited in their colours and hues while paint is much more selective and adaptable.

Don’t Jump too Quickly on Going with White Walls

Most experts suggest you should avoid plain white walls unless it’s suitable for the type of architecture you have. The reason is that white walls often don’t work is because they give the impression that things which are resting against the walls that they are floating.

If you do go with white it is best to ensure that you have a lot of contrast and colour. Interior design experts recommend that a neutral colour or a colour with a mid tone will unify the pieces in a more cohesive effect.

Ask for Help and Opinions

Before you head out shopping, it can be advantageous to seek out the advice or get some critique from style conscious friends or even to seek out the services of a professional interior designer to assist you. Getting a second opinion can help avoid unnecessary expense and help you avoid any potential flaws in your design scheme.

Always Work Out a Budget Design Conception Beforehand 

Another huge rookie mistake that many people make is not having a clear cut budget in mind when considering the design scheme of their home. The second is not having a focused idea of what you want to achieve. When it comes to buying your sofas, chairs, wall units etc. you might buy it because it looks great in the store, but that does not mean that it will work in that particular room.

The biggest problem here is that many people do not consider the furnishings relative to the shape and size of the scale of the room which means the furnishings could end being too dominate or disappear, so always consider the size and scale of the furnishings relative to the size and scale of the room because otherwise they simply won’t jibe.

Another thing to consider is to avoid impulse buying because that is another major culprit that can completely offset a room’s design scheme.

Add Some Warmth or Character

Don’t be too rigid in your selection of colour and a furnishing so you end up with a space that appears too cold and lacks personalization. Often, all it takes to make a room more inviting is to add a focal point such as a piece of artwork or an antique or heirloom. And if your room contains something that you don’t like – simply get rid of it. The appearance of the décor of a room can be dramatically changed by doing something as simple as altering the location of the artwork such as at different heights.

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What soft landing? Bullish realtors see no slowdown at all for ‘strong’ housing market – Ask Bruce Coleman, Vancouver Mortgage Broker

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What soft landing? Bullish realtors see no slowdown at all for ‘strong’ housing market

Not only does Royal Lepage not expect a correction in Canada’s housing market, they say conditions are right for a rebound not seen since after the recession.

TORONTO — The latest Royal LePage housing survey shows average price of a home in Canada increased between 1.2% and 3.8% in the fourth quarter of 2013.

It says the average cost of a standard two-storey home rose 3.6% year-over-year to $418,282, while detached bungalows went up 3.8% to $380,710.

Royal LePage says the price of a standard condominium rose 1.2% during the quarter to an average of $246,530.

The real estate company says prices are expected to maintain a “healthy momentum“ this year and rise a projected 3.7% over 2013.

CEO Phil Soper says late 2013 saw the housing market transition to “buoyant sales volumes“ and above-average growth.

He says that in the absence of “some calamitous event or material increase in mortgage financing costs,“ he expects positive momentum to characterize 2014.

“We predict continued upward pressure on home prices as we move towards the all-important spring market.“ he said.

“Talk of a ’soft landing’ for Canada’s real estate market in the new year is misguided,“ continued Soper.

“We expect no landing, no slowdown, and no correction in the near-term. Conditions are ripe for as strong a market as we saw in the post-recessionary rebound of the last decade.”

We expect no landing, no slowdown, and no correction in the near-term

Separate data out Thursday was not so optimistic however. Three separate reports released on Thursday showed a cooling trend, with weaker-than-expected readings for November’s new housing price index and building permits, and December’s housing starts.

Building permits fell by a sharper-than-expected 6.7% in November, more than double the 3.0% pullback expected by analysts, while housing starts dropped to 189,672 units in December, shy of economists’ forecasts for 190,000.

“The decline (in building permits) is in line with our expectation that residential construction will soften in the coming year in the face of affordability challenges to a pace more in line with underlying demographics,” CIBC World Markets economist Peter Buchanan said in a research note.

Statistics Canada said Canada’s new housing price index did not change in November, after a 0.1% rise in October, with prices rising in eight metropolitan areas, unchanged in eight and declining in five.

Canada’s housing market avoided the crash experienced in the United States five years ago due in part to more conservative lending standards and a stronger economy. While economists have long predicted an eventual correction in Canada, they are divided over whether prices will drop sharply or simply stagnate in a so-called soft landing scenario.

Prices in the closely watched Toronto-Oshawa region were up 0.1% on the month and a tame 1.4% on the year. Vancouver, to which authorities also pay attention, fell 0.2% on the month and 1.3% on the year. The oil town of Calgary was up 0.4% since October.

With prices stabilizing, economists expect new construction to cool further in 2014. Starts for all of 2013 slowed to 188,200 units, down sharply from 215,000 in 2012 and the lowest full-year tally since 2009, according to Robert Kavcic, senior economist at BMO Capital Markets.

“In fact, outside of that recession year, it was the slowest year for starts in more than a decade. We expect further cooling to about 180,000 units this year, which would reflect balanced overall building activity,” Kavcic said in a research note.

Notably, starts for both houses and multi-units – typically condos – fell in December. Condominium construction fuelled building in Canada’s biggest cities, including Toronto and Vancouver, during the height of the boom, but has since slowed dramatically. Many observers fear a glut of condos coming to market in 2014 and 2015 may drive prices lower, but are divided over whether a correction would spread to the broader residential housing market.

The outsized drop in November building permits was offset slightly by an upward revision to October data to show an 8.0% gain in the month, according to Statistics Canada.

Residential construction intentions sank by 7.6% with both single- and multi-family dwellings declining, while the nonresidential sector dropped by 5.2% as institutional and industrial building plans decreased.

Commercial building intentions, however, were once again robust, with the value of permits hitting a record level over the past 12 months, according to Kavcic.

With files from Canadian Press, Reuters

Canada’s house prices still rising but sales stall for third straight month – Consult with Bruce Coleman, Vancouver Mortgage Broker

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TORONTO — The latest real estate results look impressive for seven-figure homes but the story is not as dramatic once you factor out Canada’s two most expensive cities and look at three months of falling sales.

Garry Marr | January 15, 2014 9:50 AM ET

Prices across the country rose 10.4% in December from a year ago to an average of $389,119, according to the Ottawa-based Canadian Real Estate Association. Once you hack out Toronto and Vancouver, the increase drops  to 4.6%.

“The 10% number, unless you are millionaire living in Vancouver, this is not your number,” said Benjamin Tal, deputy chief economist with CIBC  World Markets.

Mr. Tal says prices are up nationally only 6.5% from a year ago if you create a weighted average that limits the impact of Vancouver and Toronto by factoring out a massive surge in the sale of high end homes. A year ago, sales were way down, making activity today look that much stronger and allowing expensive markets to skew the national results even more.

But he acknowledges even the 6.5% increase is more than most people had predicted for the market at this point in the housing cycle.

“We are running out of excuses and the housing market might be a bit stronger than expected,” said Mr. Tal.

There is cause for concern in the market. Seasonally adjusted December sales were down 1.8% from November and are now off 5.2% from the peak that was reached in September. Historically, price declines have followed sales declines.

“It’s very reasonable for prices to ease or even fall,” said Mr. Tal, who rules out doomsday scenarios that would see prices drop 25%.

He says it’s “way too premature” for the government to do anything to curtail the housing market, even though the market is stronger than anyone expected.

The concern is Jim Flaherty, the finance minister, will step into the market again to cool things down — something he’s done on multiple occasions during the this housing boom by among other things limiting amortization lengths. Mr. Flaherty has, so far, ruled out further intervention in the market.

We are running out of excuses and the housing market might be a bit stronger than expected

“I think January will look tepid because the first two weeks were so bad due to weather. But when we look at the first quarter of 2014, it will be quite starkly larger,” says Phil Soper, chief executive of Royal LePage, referring to sales.

He says economic conditions in North America are improving and that’s going to put pressure on housing.

“There’s going to be upward pressure on prices and by the end of the first quarter we will be talking about ‘Oh, my God how do people afford these homes’ as opposed to a falling number,” says Mr. Soper. He said more regulation could be in the cards as policy makers face a Catch-22. They need to keep the cost of money low but that encourages more debt and puts more pressure on housing prices.

CLICK TO ENLARGE

CREA has emphasized that results in the coming months might give people the wrong impression of the strength in the market. “We’ll likely continue getting mixed signals in the months ahead with positive year-over-year comparisons for sales masking the recent moderation in the monthly sales trend,” said Laura Leyser, president of the group.

Toronto-Dominion Bank issued a note yesterday with a continued call for a soft landing in the housing market.

“For the year as a whole, existing home sales rose 0.8%, a pace that is neither too hot, nor too cold but largely in line with our view of a soft landing in the Canadian housing market,” said Diana Petramala, an economist with the bank.

However, a report from Capital Economics, one of the well-known bears on this housing market, sees the downturn picking up steam.

“The downward pressure on house price inflation will intensify, translating into outright price declines in due course,” said economist Amna Asaf, citing declining sales and increasing number of unsold new homes.

Home Series: Guide to Buying New Windows- Consult with Bruce Coleman, Vancouver Mortgage Broker

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Home Series: Guide to Buying New Windows- Consult with Bruce Coleman, Vancouver Mortgage Broker

If you just bought or live in an older home, you might consider replacing your old windows to make your home more energy efficient.

Many older homes have wood frames made which tend to deteriorate and often only support single paned windows which can cause loss of energy.

Here is a brief guide on selecting new windows. Keep in mind that you can also get your windows custom made and in styles that reflect your style of home.

How Windows Are Rated

The energy efficiency of windows is reflected in the following terminology:

U Factor – Describes the glazing efficiency alone how it conducts non-solar heat flow. A more comprehensive rating is called the NFRC U- Factor rating describing the efficiency of both the glass/glazing. A lower rating means the window/frame has greater energy efficiency.

Solar Heat Gain Coefficient (SHGC) – Refers to the amount of solar energy and the amount of solar heat passing into the home. A lower rating means less solar heat.

Air Leakage – describes how much moves about the window frame. A lower rating means a tighter more efficient fit.

Sunlight Transmission

Windows are rated by the amount of sunlight so you can adjust to suit certain rooms.

Visible Transmittance (VT) – Represented as a fraction. The term refers to the spectrum of light which you see. A higher VT rating means more visible light.

Light to Solar Gain (SHGE) – This is the ratio of the Solar Heat Gain Coefficient (SHGE) to the Visible Transmittance (VT) and refers to the efficiency of the window glass or glazing.

Choosing Window Frames

Here are the types of window frames to choose from including:

Wood Window Frames – Many older homes have wood frames which are not energy efficient and subject to the elements.  You can buy wood frames, but keep in mind they need be regularly maintained

Metal Window Frames

Metal frames require minimal maintenance because they are light and durable, but they tend to be a poor conductor of heat and have negligible insulation. They have to be installed correctly to adjust these issues.

Vinyl and Fibreglass Window Frames

Most vinyl frames incorporate Polyvinyl Chloride and should preferably have ultraviolet light stabilizers to prevent erosion. They resist moisture and do not require painting.

Composite Window Frames

These use composite wood products such as strand lumber or particle board but can resist moisture and less decay than standard wood frames.

Window Glazing

There are many types of window glazing and glass so you select the ones you need for different rooms and for different effects. Your choices include:

Gas Filled – Uses inert gas such as Krypton or Argon between the window panes to provide greater resistance to both heat and air flow.

Tinting – Tints absorb heat and limit the amount of solar radiation and heat transfer. You have a variety of options

Coatings – Coatings are also varied so can opt for the following:

• Low-emissivity coating which regulates heat transfer for windows that have insulated glazing.

• Reflective coating which blocks light but will admit more heat.

• Spectrally selective coatings that filter out between 40 – 70% of heat but permit a full range of light to enter.

Insulated Windows – Have two or more panes of glass. They are hermetically sealed and can be very energy efficient.

When buying new windows, just remember that you don’t have to select one uniform type so give some thought about what you want to achieve when you go shopping for new windows.

Finance 101 Series: 10 things you should know about TFSAs – Consult with Bruce Coleman, Vancouver Mortgage Broker

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While many Canadians are focused on the looming RRSP deadline and maximizing contributions, it’s important that they don’t lose sight of an important alternative investment, a tax-free savings account.

A major benefit of TFSAs is that money invested in them can grow tax free-for life, says Ahmad Dajani, vice-president of investments, guaranteed investment certificates and sales tools for Scotiabank in Toronto. “They provide great flexibility because you can pay as little as you like up to $5,500 a year and withdraw funds without penalty or tax consequences.”

TFSAs are a useful special purpose savings vehicle for anyone wanting to save for a major expense, such as a renovation, car purchase or other outlay. Alternatively, investors – including retirees — can use TFSAs to generate dividend, interest or capital gains income tax-free.

Here are some things you should know about TFSAs:

1. The starting age for contributions is 18.
2. There’s no age limit to contributing to TFSAs; you can continue to invest even after the age of 71, the limit for RRSPs.
3. Investors can contribute a maximum of $5,500 per year in 2014.
4. If you have not contributed in the past, or did not meet maximum contributions in any given year, you can catch up on unused contributions (Up to the $31,000 limit as of this calendar year).  The best way to keep track of your unused contribution room is to check out your notice of assessment from the CRA.
5. Be careful not to over-contribute or you will incur tax penalties equal to 1% of the highest excess amount in the month and for each month you are over.
6. You can withdraw money at any time without penalty or tax consequences. However, you can’t re-contribute that amount in the same calendar year. (If you only need the funds for a short time and plan to replace them quickly, the best strategy is to make the withdrawal late in the calendar year so you can re-contribute Jan. 1 of the following year.)
7. TFSA withdrawals do not impact any government benefits or assistance programs such as child tax benefits, old age security or other guaranteed income supplements. This means low-income earners can generate tax-free income without it affecting their support.
8. A TFSA is not just a cash account. It can be structured so you can invest in various vehicles, such as GICs, bonds, mutual funds, stocks and exchange-traded funds, among other options.
9. Unlike RRSPs, deductions are not tax deductible. However, you can double up on tax-free income generation by opening a second TFSA in your spouse’s name.
10. For those on a limited budget, the best way to keep up with contributions is to set up an automatic monthly withdrawal plan.

Bank of Canada chief Poloz says rates on hold until economic data improve – Consult with Bruce Coleman, Vancouver Mortage Broker

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OTTAWA • The Bank of Canada should keep its key interest rate on hold until economic data persuades it otherwise, central bank chief Stephen Poloz said on Tuesday, adding that he was not worried about calls from

“For us, minimizing the risks of making a big mistake here is what we’re trying to do, and that tells us that we should be holding rates where they are until the data flow changes our mind,” Poloz said in an interview with CBC television.

some international players to tighten policy.

His comments follow controversial remarks by Canada’s finance minister on Sunday suggesting there would be pressure to raise interest rates in 2014.

“For us, minimizing the risks of making a big mistake here is what we’re trying to do, and that tells us that we should be holding rates where they are until the data flow changes our mind,” Poloz said in an interview with CBC television.

Asked about the potential for higher rates in 2014, Finance Minister Jim Flaherty told CTV television on Sunday there would be some pressure to tighten because of the U.S. Federal Reserve scaling back its bond-purchasing program.

He also cited reports by the Organization for Economic Co-operation and Development and the International Monetary Fund recommending rate increases.

“I think the pressure will be there because the Fed in the U.S. should stop printing money, and taper off as they say … And the OECD and the IMF have both said to Canada, we ought to let our interest rates go up a bit, so there will be some pressure there for that to happen,” Flaherty said.

Flaherty’s remarks spurred some criticism that he appeared to be meddling in the day-to-day implementation of monetary policy, which is the domain of the Bank of Canada and supposed to be off limits to the government.

His comments on the outlook also appeared to contradict the central bank chief, who has been signaling rates are on hold for the foreseeable future.

Poloz, who took the helm at the central bank in June, oversaw a sharp policy shift in October when he abandoned any talk of rate hikes after 18 months of signaling that a tightening of policy was on the horizon, pointing to inflation that has been below the bank’s 2% target for a year and a half.

Analysts in a Reuters poll have forecast the Bank of Canada will begin raising its main policy rate in the second quarter of 2015.

LONG-TERM RATES UNDER PRESSURE

The CBC cited Poloz as saying he was not worried by international calls for rate hikes and that his decisions would be based on Canadian economic factors. In November, he disagreed with the OECD’s assessment that rate hikes could start in 2014.

Poloz did say on Tuesday there would be upward pressure on rates this year, but he referred specifically to long-term market rates, not the rate set by the central bank, as the U.S. and global economies strengthen and stimulus is curbed.

“So as a tapering occurs we might expect to see, as we saw in the summer, some increases in long-term rates, (although) most of it seems to be priced in,” Poloz said.

Adjusting the central bank’s target for the overnight rate, on the other hand, is a tool that is available “but we have to consider in the broader context what impact would it have,” he said.

Higher rates would have a negative impact on highly indebted Canadian consumers, he suggested.

“Would it be the same size impact we normally would expect? Probably not, given the situation,” he said, referring to the record high household debt-to-income ratio and a situation that he called “fragile from a consumer point of view.”

© Thomson Reuters 2014

Beware of Big Bank Mortgage Penalties – Ask Bruce Coleman, Vancouver Mortgage Broker

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Beware of Big Bank Mortgage Penalties

The majority of Canadians still prefer to use the large banks when it comes to taking out a mortgage on their home. And, generally they often stick with the bank that they have their accounts, credit cards and some form of lending history.

For many mortgage borrowers, the reason you choose the large banks is because you simply do not have enough information on alternative mortgage lenders. Large banks tend to appear financially stable and many mortgage investors are still skittish about the recent economic turmoil.

The other side of the coin is that many of these mortgage borrowers will want or need to refinance your mortgage at some point. Breaking your mortgage before it comes to the end of the term means you will have to pay a “mortgage penalty.”

It turns out that close to 7 out of 10 mortgage borrowers will make some form of adjustment before their mortgage term ends and are doing so to either refinance their existing mortgage or moving to purchase a larger home.

Even though you might have obtained a mortgage rate which was lower than the rate posted by the bank, you might not be aware exactly how the bank will calculate the penalty. This can cost you thousands of dollars more than you might have been expecting.

Although you got a rate which was lower than the rate posted by the bank, most of these guys use the posted rate when it comes to calculating your mortgage penalty. These penalties are actually quite expensive and almost punitive in nature.

Mortgage Penalties for Variable Mortgages Versus Fixed Rate Mortgages

If you have a variable mortgage, the penalty is generally what you would pay for the comparable amount of three month’s interest.

If you have a fixed rate mortgage, it is based on the calculation of the IRD which is short for “Interest Rate Differential” or alternatively uses the higher of three month’s of interest. Many, but not all banks may simply use the posted rate when factoring this in to calculate the penalty.

It’s vital that you clearly find out whether the bank will be using the posted rate or the actual rate to calculate the mortgage penalty. Given the cost of homes in Vancouver and the mortgages people have to carry this can be significant difference in terms of how much you will have to pay in penalties when it comes to breaking the mortgage.

The reason why some experts say the banks do this is to ensure they keep you in the fold and so you won’t go with a competitor.

Who Has Cheaper Mortgage Penalties?

Yes, there are alternatives but that means you have to go with non-traditional lenders. Most alternative lenders asides from banks are more flexible when it comes to mortgage penalties and the savings can be in the thousands of dollars when it comes to what you will have to pay as a penalty. They also often have better rates.

Before you jump on the “Big Bank” band wagon to get your mortgage, consider the idea of getting not only better rates but less restrictive mortgage penalties by using an alternative lender instead.

The easiest way to learn more about the security of an alternative lender is to speak with a knowledgeable mortgage broker such as myself as we can help you compare the savings when it comes to deciding whether to get your mortgage with the banks and what other sources of alterative lenders are available so you don’t get stuck in the “Big Bank” trap.

Home Series: Should You Buy A Fixer-Upper? – Consult with Bruce Coleman, Vancouver Mortgage Broker

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Should You Buy A Fixer-Upper?

A home that has become rundown and poorly maintained can be either a great opportunity or a dreaded money pit if you aren’t careful.

Some people love older homes and you are very likely to snap them up at below market price, and spend time and money on renovations which can greatly enhance the value when you are finished.

This sounds good in principal and can often be very advantageous, but there is the other side of the coin that can bleed you financially dry if you don’t choose wisely

Figure Out the Costs Beforehand

It all boils down to dollars and cents. You need to do the following before you take the plunge when buying a fixer-upper. The offer you should make depends on the comparable real estate value of reasonably well maintained similar homes in that particular neighbourhood minus the costs of renovating the home.

The key is to be somewhat more liberal than conservative when making these estimates and you might add as much as another 5-10% on top to account for additional costs resulting from unexpected problems.

Always Use a Home Inspector

Although you might be fairly knowledgeable about home construction, there can be many issues you might easily overlook which can really hit your bottom line. A qualified licensed home inspector can help you more readily pick out the faults of the home and pinpoint what requires maintenance and expensive major renovations. You can also use the results of the home inspection when it comes to making a more equitable offer.

Which Fixer-Uppers should you Avoid?

Many renovation projects have a good ROI but some do not because the problems encountered are not visible and add little to increasing the overall market value of the home.

You should avoid any fixer-upper which has foundation problems. These are very expensive renovations and do not markedly add to the market value. Other problems which center on old electrical and plumbing problems should also be a red flag because these are also expensive renovations that do not significantly increase the market value. Another type of fixer-upper is one which might require a major addition such as an additional bedroom or family room because they also do not have a spectacular ROI.

Which Fixer-Uppers Pay Best?

The best fixer-uppers are ones that largely need cosmetic improvements, because these types of renovations do have a good to excellent ROI. This could include both minor and some major cosmetic renovations depending on your budget and the condition of the home.

You can include some cosmetic and some minor structural renovations such as including a skylight if you have to replace the roof. The key is not to over-improve the home above and beyond how it fits into the neighbourhood and how it affects the market value of the home.

Both major and minor cosmetic improvements could projects such as a partial or complete kitchen and/or bathroom renovation. Other improvements can include replacing old or tacky fixtures, redoing the floors, adding newer and more energy efficient doors and windows, outdoor siding, a deck.

Homes seem to add more value when they are visually renovated because they have more appeal to buyers.

You can save a lot of money if you are skilled at DIY projects, but remember that you should do the project right.