Money123: What 1st-time home sellers should know

How to sell your home for the first time

If you thought buying your first home was overwhelming, wait until you want to sell it.

The typically busy spring housing market will likely have a number of homeowners listing their properties for the first time, so this month’s Home School instalment is all about now to navigate selling a home.

There are a number of costs that come with selling a home, from paying lawyers to paying movers. But how do you know whether or not to take on a big renovation to boost the selling price of your home?

Realtors who spoke to Global News said the return on major investments like property can be mixed. Ottawa real estate agent Nick Kyte noted especially that if you’re not handy, don’t take on a big project alone – it’s more likely to turn a buyer off than something done professionally.

Instead, Kyte says the best places to focus your budget are on fixing anything broken and the little things in a home like hardware or a fresh coat of paint.

“Just having a little change of certain handles and whatnot can make a drastic difference and not break the bank,” he says.

Read on to find out what experts suggest for how to set your home apart and cater to prospective buyers.

Ready to retire? What about your pocketbook?

New research on the finances of Canadians aged 50 and older paints a worrying picture for those gearing up for retirement.

A survey from the Toronto Metropolitan University’s National Institute on Ageing on retirement readiness suggests only about a third of those over 50 (35 per cent) who plan to retire indicated that they were financially prepared to do so.

That rises to 50 per cent for workers aged 80 and older, but the NIA points out that means almost half of this oldest cohort is likely working out of necessity rather than choice.

The pain of higher interest rates and stubborn inflation is hailed as a major factor keeping retirement out of reach for respondents. But experts also flagged the rising costs of care as one ages as a strain on finances in retirement.

Lianne Di Rocco, portfolio manager at BMO Nesbitt Burns, says that many Canadians have the first 10 years of their retirement pretty accurately accounted for, but it’s the unknowns of aging that can quickly see a financial plan unravel.

“It’s that uncertainty as we get older, as our health starts to fail. What does that look like? What is the cost and can I afford it? And if I can’t afford it, what are my options?”

Read more about how to adjust your savings and spending plans in retirement, and how to account for the unknowns of aging.

A ‘window of opportunity’ for first-time buyers

It’s been a hard couple of years for would-be homebuyers, who have either been boxed out by exorbitant price hikes or rising interest rates keeping home ownership out of reach.

But a Royal Bank of Canada forecast released this week sees a chance for first-time buyers to get into the market later this year.

While RBC expects muted sales activity in the first half of 2024, a pivot to rate cuts around mid-year could bring more buyers and sellers back into the market.

Home prices may not surge rapidly after rate cuts if supply continues to improve in the housing market, giving prospective buyers a chance to qualify for an affordable mortgage with home values holding at relatively lower levels after the past years’ correction.

“The larger window of opportunity for buyers is likely to open only after interest rates have dropped materially — something we foresee in the latter stages of 2024 or into 2025,” the report read. “That’s especially the case for first-time buyers who may be more financially constrained.”

Read more on which provinces could continue to see prices drop in the year to come.

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– THE QUESTION –

“I have about eight different credit cards, some of which I no longer use. I would like to cancel the ones I no longer use, but I’ve been told that doing so would harm my credit rating. On the other hand, keeping them increases my risk of a thief somehow accessing my cards and charging purchases to them at my expense, and then it’s very time consuming and tedious to deal with the bank to get the charges cancelled. This in fact is exactly what happened recently, and I had to wait hours trying to get the bank’s transaction dispute department on the phone. I would appreciate your advice on what to do.”

— A Money123 reader 

“Closing down credit cards can indeed impact your score, but if you are otherwise managing credit responsibly, any drop in your credit score is likely going to be small and short-lived.

For example, closing a card might increase your credit utilization ratio (how much credit you are using compared to how much you have access to). If you are carrying little or no balances then your utilization ratio will likely stay well within the ideal range but if you are carrying large balances, closing paid off cards will increase your utilization ratio and potentially lead to a noticeable drop in your credit score. Closing your oldest card might shorten the length of your credit history and cause a score decrease as well. But if you aren’t using your oldest card, call the provider and see if they have a card that makes more sense for you that you can switch to. You might be able to preserve the amount of time that account has been open. If you can’t switch your oldest card, but it has no fee, it might be worth keeping that one open, even if you opened it a long time before the next oldest card.

But otherwise, I’d take a look at annual fees, interest rates if you carry balances, and reward/benefits you are utilizing (or not) and figure out what the smallest portfolio of cards is you can manage. Less to think about and fewer access points for theft.”

— Preet Banerjee, personal finance commentator, preetbanerjee.com

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