Improve your indoor air quality with plants

 According to a number of studies, plants in your house not only add a bit of life and decoration, but can also improve your indoor air quality depending on your selections.  Most plants have some air filtering capacity, removing toxins from the air as they 'breathe' from day to day.

Doing some reading online, lists of best plants differ according to research and writer, but there are a few "usual suspects" that show up on many, if not all, lists.

1. Spathiphyllum (Peace Lily, pictured)
This plant shows up on most lists I have seen, as a tough and hardy plant with numerous air filtering qualities, credited with removing alcohols, acetone, industrial solvent trichloroethylene, benzene (an ingredient used to make dyes, lubricants, rubbers, and detergents), and formaldehyde.

2. Dracaena
Another low maintenance plant and regular on the lists, the Dracaena is said to be very efficient at removing formaldehyde from the air in your home, as well as other VOCs, including benzene, trichloroethylene, and xylene. One important note is that you should keep it out of reach of any pets, as it can be toxic to animals when ingested.

3. Bamboo Palm
The bamboo palm is another plant said to have a high ability to remove formaldehyde from the air, as well as benzene and trichloroethylene.

4. Snake Plant
According to NASA, the snake plant is one of the best houseplants for absorbing airborne toxins, including formaldehyde, nitrogen oxide, benzene, xylene and trichloroethylene. (You'll notice there are some regulars on the list of household toxins, too)  The snake plant is also said to be one of the higher producers of oxygen during the night.

5. Hedera helix (English Ivy)
English Ivy is another popular plant that helps filter toxins in your home's air.  It is said to be effective for benzene, formaldehyde, xylene and toluene, and other studies have indicated that English Ivy may help reduce mould in your home.

If you'd like to read more about plants that can help with indoor air quality, here are a few links to get you started:

[Healthy houseplants]

[The Top 10 Plants for Removing Indoor Toxins]

[9 Air-Cleaning Houseplants That Are Almost Impossible to Kill]

When you need a miracle to sell your house...

Hopefully you don't literally need a miracle to sell your house, but maybe just a bit of saintly help?  Well, then I've got good news for you: there's a long standing tradition of invoking St Joseph to help sell a property (yes, that St. Joseph).

The tradition seems to have began with communities of nuns burying a St Joseph medallion on a property they hoped to buy for a convent.  Over time the medal was replaced with little statues, and then at some point transferred to the sale side of a property transaction rather than the purchase. 

The tradition's specifics vary a bit depending on who you ask, but essentially you take a small statue of St. Joseph and bury it on the property until it sells and then dig it up and take it with you.  Some say it should be in the backyard or that the location doesn't matter, others say beside the real estate sign.  Likewise, some say upside down and others say horizontally with the head - and thus the praying hands of St Joseph - pointing toward the house.  The only thing that is consistent is that it should be buried.

If you want to try this next time you're selling a property,  you should be able to easily find a statue or even a "St Joseph Home Selling Kit" in a gift shop or online at someplace like Amazon.

Not surprisingly, there are also lots of [other superstitions related to the house], including some that people lean on when it's time to sell or buy - things like numbers in the address, days of the week to close, and so on.

Have you ever used the St Joseph statue when selling?  Are there any other traditions that you have used?  Or is it all just hokey nonsense? I'd love to hear from you in the comments below.

Preventing water problems in your basement

No one wants to find water in their basement.  This can mean expensive foundation repairs are needed, or at least basement waterproofing by professionals (also expensive).

But there are a couple of things homeowners can do to help prevent water in the basement.

Downspouts

The first thing to do is to make sure all your downspouts are working properly and taking the water away from the house.  If you're missing the bottom piece on any downspouts and dropping water directly beside the foundation, you're dramatically increasing your chances of water getting into the basement. Even a new foundation wall on a brand new house runs the risk of water penetration if you put enough water down beside it.  Downspouts should have the curved piece at the end and enough extension to take the water out and away from the house.

This includes if you have an older house that has downspouts going into the ground.  These downspouts will be tied into the weeping tile, which is a drain system around the base of the foundation.  The idea is that the water will go out to the storm drain.  The biggest problem with this is that old weeping tiles were made of clay and are prone to break-down over time.  This means a weak spot in the system that could allow water into the basement rather than taking it away.  This is why home inspectors will always note downspouts going below ground and recommend disconnecting them and extending them away from the house.  (and of course plugging the pipe going down)

Grading 

The second thing to look at is grading.  The ground around the home should have a gentle slope away from the house.  If there are any spots where the ground runs down toward the wall or there's a hole or dip in the ground, these are places where water could easily pool and overwhelm the foundation's drainage system, regardless of the age of the home.  I've been in a brand new multi-million dollar home where they had left a huge hole in the ground beside the foundation and there was a rather significant leak when I showed it the day after a rainstorm.

The fix is relatively simple - get dirt and make sure the ground slopes down away from the house, without any dips that would allow water to collect beside the house.  It doesn't have to be a noticeably sharp 'ramp', just a gentle and consistent slope down and away.  There are varying guides, but it should be about 6 inches for the first 10 feet where possible or roughly an inch per foot.  A good home inspector should also be able to identify these potentially problematic areas and give some guidance.

Taking care of downspouts and grading may not prevent all chances of a wet basement, but many cases of basement dampness or leaks will be prevented by taking care of these two areas.

Can a real estate professional help you find a place to rent?

You might be surprised, but yes.  A real estate professional can show you any rental property or unit listed in the local MLS® system and help to write an offer to lease it and typically get paid by the landlord via the listing brokerage, just like when someone is buying a home.  I actually helped a family member with one of these recently.

The main limitation is that the majority of MLS® listings are for sale, not for rent.  So our selection might be somewhat limited, compared to properties advertised directly by landlords. 

And landlords who are leasing the property themselves are also significantly less inclined to pay any commission than someone selling, so if you want a professional's help on one of these, you might have to pay your agent's commission yourself.  A typical commission is half a month's rent.

Many real estate agents don't actively pursue rental business, and some simply refuse it, because the work involved is the same as a property sale (if not more sometimes) for significantly less money.  It sounds cold, but it's true. 

Personally, I'm willing to work with rental clients, so if you know someone who's looking to rent, I'd be happy to have a conversation with them and show them anything that might be suitable within the MLS® listing inventory as a starting point. 

There might not be anything available that fits, but you never know... there just might be something there for them.

What happens when a real estate sale doesn't close?

When a real estate deal doesn't close, it can create a far-reaching mess pretty quickly, depending on the circumstances.

If you're buying a house and counting on the proceeds of the sale of your old house and your buyer doesn't close, then you may not be able to close your purchase.  This may in turn cause your seller to not be able to close their next purchase, and so on down the line.  Every real estate agent involved experiences a great deal of stress too, with the uncertainty about whether they are going to get paid. The lawyers are working in the middle to untangle the mess. The whole thing can be a headache for a lot of people. 

So what happens next?  Well, once you're finished laughing, crying, and/or tearing your hair out - as the case may be - it comes down to what your lawyer advises based on the situation.

Sometimes there is just a paperwork issue in the deal that the lawyers expect to be able to get sorted out and close it the next day.  Maybe it's something extreme like the buyer ending up in the emergency room.  The possibilities as to why are endless.  You just hope it is something that can be corrected and not an unexpected termination of the sale. 

If the situation can't be sorted out and your sale doesn't close, then you may need to re-list the house (but only when and if your lawyer advises it).  If you are forced to sell for less than the original sale price, you might consider launching a lawsuit against the former buyer for the loss.  If you're the buyer and the seller didn't close, then whether it is worth a lawsuit would depend on a number of things.  Real estate lawyer and columnist Mark Weisleder wrote [a good overview] a while back.

As a real estate agent, it's certainly something I do everything in my power to prevent happening to my clients. I've only ever had one deal even close late, and that was entirely beyond our control.  It can be a stressful uncertain situation and I hope you never have to deal with it.  But if you do, my advice to to keep breathing and trust your legal counsel to guide you through it. 

#TerminologyTuesday: What is a final walk-through?

 

A final walk-through is exactly what it sounds like: a final walk through the property so the buyer can take a last look before closing.

It's pretty common practice, but there is a standard clause that should be in the offer to ensure the buyer will have an opportunity to take this final walk-through:

The Buyer shall have the right to inspect the property one further time prior to completion, at a mutually agreed upon time, provided that written notice is given to the Seller. The Seller agrees to provide access to the property for the purpose of this inspection.

Although the standard wording refers to it as "inspecting" the property, it is important to note that this is NOT a condition, like a home inspection condition, so there is no automatic right to cancel the deal.  But it does provide an opportunity to make sure there have been no significant changes to the property. If there was some major new damage or issues revealed, the buyer would want to immediately discuss the situation with their lawyer.

This opportunity to revisit the property is also often used by buyers to make some measurements for new furniture or renovations they have decided to do in between when they made the offer and closing.  Unless it is a short closing time frame, I usually write the clause in to include "two further times" so that buyers can take an opportunity to measure if they need to make orders sooner, and still be guaranteed a final walk-through closer to actual closing.

Why you need a financing condition

Whether it is in the heat of competition or just confidence in your financing, you might be tempted to remove or not include a condition on financing.  You're pre-approved by the bank, so you should be fine right?

Maybe, but not necessarily.

Unless you're buying the house all cash and don't need a mortgage at all, you might want to re-consider your decision not to include a financing condition, and here are a few reasons why.

1. Are you properly pre-approved?
Most independent mortgage brokers will get all the information they need and do a proper credit report when pre-approving you.  Big banks, however, will often not thoroughly discuss income and debt not reported on credit reports, and sometimes base your pre-approval on your history with them without even doing a full credit report up front. Obviously, this can lead to some troubling reversals after an offer is made and submitted for financing and they see something they don't like on your full credit report or financial information.  And even if you're the poster child for fiscal responsibility, no system is perfect and there could be errors on your credit report which will need to be address and fixed - a process that can take time.  I've seen this happen.  Fortunately, a mortgage broker caught it while doing a pre-approval, and the client was able to first get it resolved before proceeding to shop for a house.  That would have been a very stressful time if they had already bought a house and couldn't close.

2.  Discrepancies between credit reports
Similar to the surprise of errors, there can also be discrepancies between one report and another.  I have seen a full and proper pre-approval done on a client.  Then when the offer was submitted, a credit issue still came up.  Why?  The broker pulled a report from one of the major Canadian credit reporting companies and it showed clean.  The lender, however, pulled a report from the OTHER major credit reporting company, and there was an old credit issue that had fallen off of the first report but was still reported there.  It was enough to disqualify them from financing and they didn't have a lot of options for lenders at the time.  It could be differences in the time the company keeps an item on your history, or it could be an error on one not showing on the other.  But either way, there could be a discrepancy between one report and another that leads to problems.

3.  Sometimes "appraisals go bad"
Even if everything is okay for the qualification and the bank wants to lend you a million dollars, the mortgage appraisal may come in lower than expected.  If the mortgage company feels the property is worth less than you have offered, they will only give you a mortgage based on that amount.  So as an example, you have offered $700,000 but the lender's appraiser thinks it is worth $550,000, they will give you a mortgage based on $550,000 and you will have to cover the shortfall out-of-pocket.  If you're in a conditional sale, you have options such as trying to negotiate a price reduction or walking away.  But if you don't have the financing condition, you are in a binding contract to close at that price and failure to do so could result in a lawsuit and at the least, the loss of your deposit.  For a bit more on this, visit previous article [ "When appraisals go bad" ].

4.  The property also needs approval

Besides your financial qualification and the appraisal, the lender is going to look at the property itself. They could take issue with any number of things about it from property condition to location. I've seen one lender refuse to approve a purchase in the country because of railroad tracks they felt were too close, and that buyer didn't have a lot of lenders to choose from based on their personal situation.  I've also heard of problems with mortgage insurance cropping up unexpectedly because of a house being a former grow-op - something the buyer couldn't have known but was on record with the insurer!  You never know what might come up.

So, unless they are in a very strong cash position, I always advise my clients to keep some kind of financing conditions if possible, even if they have been pre-approved.  Removing them can be a real risk with some factors beyond your control.

"When appraisals go bad"

 You've got your offer in on a property and it was accepted.  Yay!  Now you get to work on fulfilling your conditions, including financing.

Whether through you or your real estate agent, the bank or mortgage broker will want a copy of the Agreement of Purchase and Sale (formal name for the contract often referred to simply as "the offer").  They will enter the transaction into their system and it will go through a number of approval steps behind the scenes.

One of these steps may be a formal value appraisal.  Banks do this to protect themselves from over-financing properties, whether by innocent buyer enthusiasm or by fraudsters looking to make easy cash.  An appraiser has specialized education in real estate value assessment, should have a proper certification, and often is on a list of approved qualified appraisers that the specific lender will accept.

The appraiser's job, in a nutshell, is to look at sale history for the marketplace and determine whether the offered price is reasonable based on that evidence. Appraisers do not "set" the value of a property - it's more like they "uncover" the value, by making adjustments to real sales to account for differences and determine a proper value range.

Of course, you generally don't care how the appraiser comes to the value they come to, as long as it is at least what you have offered.  If it isn't, then you have a problem.

It can be very difficult (if not impossible) to challenge an appraisal value, and the bank will only lend based on what they think a property is worth, so if you have offered $700,000 on a house and they feel it is only worth $550,000, then they will only give you a mortgage based on $550,000.  If you want to continue with the purchase, you will have to come up with the down payment for the $550,000 plus the full $150,000 shortfall.

Where this can really be a problem is if you have made a higher offer to win the purchase in a bidding war and perhaps allowed yourself to also (unwisely?) remove the financing condition to make your offer more attractive, because you are now legally obliged to buy without any easy way to back out.  And that could hurt, with an expensive purchase or a lawsuit if you fail to close.

Some appraisers will deny it but there is sometimes room for judgement calls on adjustments, so you might be able to arrange a mortgage through a different lender who will do their own appraisal, and that new appraisal might come back acceptable. But you'll be stressed out and scrambling, and there is no guarantee another appraisal will make a difference.

Bottom line advice: always try to include a mortgage condition unless you are buying all cash or you are ready to make up any large shortfalls to the financing.

Life transitions and real estate

Do you know someone who needs a good real estate agent right now? Chances are you're either shaking or scratching your head.  But maybe you do and don't even know it.

Sometimes I know folks would like to refer me to people they know, but many times the first indication that you get from friends or family that they are thinking of moving is their house being listed for sale (too late for me) or an announcement that they have bought a house.

It helps to understand what drives real estate transactions - what makes people move.  Sometimes it is just a simple desire for change: a different size of house or property, or maybe to a better neighbourhood.  In those situations, they may not have talked about their thoughts and you can't really predict the decision.

But quite often, it's more apparent "life transition" periods that brings someone into the real estate market as a buyer or seller. Marriage, divorce, births, deaths and parental estates, job losses or transfers.. all of these life events can cause someone to move and that means they may need a trustworthy real estate agent who will guide them through that side of their situation.

If you see someone going through one of these transition periods, maybe ask them gently what they are going to do about their property needs and whether they need a good real estate agent.  If they do, I hope you'll keep me in mind to refer them to.

What does "as is" mean in a listing?

If you're looking at properties long enough, there's a a chance you're eventually going to come across one that says "property sold as is" or something along those lines.

Basically, this is a way of emphasizing "buyer beware" and the seller saying they are not taking responsibility for the condition of the property or making any promises about it.  Sometimes it can be an indication that the property will be in rough condition, with deferred maintenance or other issues.  As such, some lenders treat this as a potential 'red flag' when looking at the property for a mortgage.

However, it is also quite common on estates and power-of-sale/foreclosures because the seller is not the person who was actively living in the property (although with an estate you might be a bit more familiar with the property than a bank is for a property they are selling).  When looking with buyer clients, I'm less concerned to see this statement in one of these situations.

And it's important to understand as a seller, that it doesn't really excuse you from disclosing known latent defects.  A latent defect is any problem that may not be visible on inspection.  This can include things like knob & tube hidden in the walls (if you know), occasional problems with flooding in the basement (sometimes hard to see unless it's presently wet), foundation problems hidden behind a finished basement, and so on.  It does emphasize that the buyer should be doing their own due diligence, but does not entirely remove the sellers' legal obligations.

Clauses can be included in an Agreement of Purchase and Sale that help to emphasize that the buyer is making an informed decision and accepts the property "as is". Even this probably would not really excuse the seller from disclosing known latent defects if it came to a court battle, but it can be quite difficult for a buyer to prove a seller knew something. As such, buyers should always use reasonable caution when buying a property that includes this statement.

The nose knows and the nose 'noes'

First, let me apologize to the strict lovers of grammar for using the word 'no' as a present tense verb like 'goes' to 'go'.  I plead poetic license. 

The point is that unpleasant scents can very quickly lead to negative feelings, and a desire to say no to something based on olfactory offense.

For example, if someone walks into the room and strongly exudes a bad body odor, your opinion sinks pretty quickly.

Or if you catch a whiff of food cooking and it turns your stomach, you're not likely to be interested in the finished dish.

The same goes for home buyers entering a property for the first time.  The house might be clean and everything in proper order visually, but if they get hit was a nasty smell at the front door, it subtly changes that first impression.  Sometimes it's not even subtle - it evokes outright dislike.

Because every sense can impact a buyer's impression of your home, don't neglect to eliminate day-to-day smells that may turn buyers off - pets, cooking, hobbies and other things you might not think about.  Wash or change your pet's beds and put toys away.  Try to avoid cooking foods with strong scents, particularly before showings.  And consider the impact a strong chemical scent might have on someone walking into the home before you start staining your latest wood project in the basement.

Besides emotional response to smells, some people also have scent sensitivity.  There's debate about whether this is becoming a more common problem, an imagined problem, or if awareness and acceptance is just growing in recent years.  Regardless, I have personally had clients who developed migraines if confronted with strong scents, so it's also good to avoid air fresheners, scented candles, and especially something like incense.

The best bet is a nice clean and odorless environment, as much as possible.  If you're not sure, get someone from outside the home to take a walk through and let you know if they smell anything.

One word of caution here:  if there are permanent or more serious smells, make sure you're dealing with the source.  For example, simply covering up a musty smell with air freshener without finding its source could lead to lawsuits later if the buyers discover a leaky roof and mould in the attic.  Reduce and eliminate day-to-day odors, but if there may be a more serious problem behind it, try to find it and fix it.  Or at least disclose it to reduce exposure to lawsuits later on.