Chris Grimes

With less than two weeks till the official “First day of spring” there are many maintenance activities that you can do to your home that will help protect your investment and may even save you money. Here are some Spring Maintenance tips that CMHC (Canadian Mortgage and Housing Corporation) offers……

Spring

1. After consulting your hot water tank owner’s manual, carefully test the temperature and pressure relief valve to ensure it is not stuck. Caution: This test may release hot water that can cause burns.

2. Check and clean or replace furnace air filters each month during the heating season. Ventilation system, for example heat recovery ventilator, filters should be checked every two months.

3. Have fireplace or woodstove and chimney cleaned and serviced as needed.

4. Shut down and clean furnace humidifier, and close the furnace humidifier damper on units with central air conditioning.

5. Check air conditioning system and have serviced every two or three years.

6. Clean or replace air conditioning filter (if applicable).

7. Check dehumidifier and clean if necessary.

8. Turn OFF gas furnace and fireplace pilot lights where possible.

9. Have well water tested for quality. It is recommended that you test for bacteria every six months.

10. Check smoke, carbon monoxide and security alarms and replace batteries.

11. Clean windows, screens and hardware, and replace storm windows with screens. Check screens first and repair or replace if needed.

12. Open valve to outside hose connection after all danger of frost has passed.

13. Examine the foundation walls for cracks, leaks or signs of moisture, and repair as required. Repair and paint fences as necessary.

14. Ensure sump pump is operating properly before the spring thaw sets in. Ensure discharge pipe is connected and allows water to drain away from the foundation.

15. Re-level any exterior steps or decks which moved due to frost or settling.

16. Check eaves troughs and downspouts for loose joints and secure attachment to your home, clear any obstructions, and ensure water flows away from your foundation.

17. Clear all drainage ditches and culverts of debris.

18. Undertake spring landscape maintenance and, if necessary, fertilize young trees.

Patrick Langston reported in a recent Ottawa Citizen column that “interest in (granny suites) will continue to grow as the population ages and the recession forces families to look for new revenue sources.” According to Stan Wilder, Policy Planner for the City of Ottawa, the concept of the “granny flats” is embraced by the city as it promotes one of the city’s goals of “aging in place” for our senior residents. In the same “Homes” Section of the paper, the Citizen’s Homes Editor, Sheila Brady, featured a young family who invited the woman’s younger sister to share separate living quarters in their large home. According to the article, “They count themselves lucky because there is no way they could have afforded to buy two separate homes…”

Help with financing the mortgage is the way to go for many extended families. In fact, if you’re adding a secondary suite to accommodate a low-income senior or an adult with a disability, CMHC has a Residential Rehabilitation Assistance Program (RRAP) that offers up to $24,000 in a forgivable loan for construction of the suite. Some units may be eligible for the GST rebate as well.

Adding the secondary living suite AFTER you’ve bought is the cheaper way to go. Development charges can double with new construction but there’s no fee to add the suite to an existing home. Prices generally start around $20,000 and you MUST make sure you have all the necessary permits. Garden suites are also becoming popular, but mostly in the country where there’s land available to put the suite in the backyard. Townhomes and row houses are not allowed secondary units in the city of Ottawa nor are homes in the old Village of Rockcliffe (don’t panic if you have an illegal unit; get your permits under the municipality’s grandfather clause).

Speak to your mortgage agent about financing options for construction to an existing dwelling. Refinancing is becoming very popular right now in this time of historically low interest rates; it may be a good idea to add the cost at renewal or even use a home equity line of credit.

If you’re thinking this may be the way to go, check out the City of Ottawa’s “Home within a home” downloadable brochure. There is loads of other information out there; give me a shout if you would like more and I’d be happy to get it for you!

Under the RRSP Home Buyers Plan a first-time home buyer can now withdraw tax free from a Registered Retirement Savings plan to purchase or build a new home up to $25,000 ($50,000 per couple); this is up from $20,000. Under this plan participants must begin repayment two years after withdrawing the funds. The withdrawal amount is completely repaid over a period of 15 years interest free. You may also participate in the Home Buyers Plan more than once as long as you repaid your previous withdrawal in full and within the prescribed time period. As the March 1^st RRSP deadline is approaching one point to remember is your RRSP contributions must remain in the RRSP for at least 90 days before you can withdraw them under the HBP.

For more information you can go to www.cra-arc.gc.ca

In one of the most anticipated budgets in Canadian history the Harper Government made good on its promise. Finance Minister Jim Flaherty toned down on their first attempt at a budget, and followed the guidelines set out by the G20 to spend heavily and provide tax cuts to help spur on the economy. Did they do enough? We’ll see over the next 12 months.

However, one thing is for sure - their commitment to improve the housing market is at the forefront of this budget. Here are some highlights

· Home Renovation Credit – Up to $1350 tax credit for renovation spending from $1,000 to $10,000 (This is a temporary credit until February 1^st, 2010)

o This credit can be doubled if the renovation qualifies under the ECOEnergy Retrofit Program or the Medical Expense Tax Credit

· First Time Home Buyer Credit – 15% non refundable tax credit for up to $750

· Home Buyer’s Plan Increase – An increase of $5000 to the Home Buyer’s Plan now allows for a withdrawal of $25000

· Mortgage Buybacks – Government will purchase an additional $50 Billion in insured mortgages

These measures should help the growing housing market in Canada. Now the test will be whether or not the Ignatieff led Liberals will accept and pass the budget next week. The Bloc Quebecois and NDP have already said they plan to oppose the budget.

TD announced this past week that they will be introducing a $35 inactivity fee on all their unused lines of credit. This fee will be introduced in April. But it doesn’t stop there, for those who do use their credit lines, TD will raise the borrowing rate by an additional 0.5%, moving the rate to 4.4% above prime. Currently with prime at 3.00%, the new borrowing rate will be 7.4%. Still a decent rate when compared to many auto loans and credit cards however, if compared to a secured line of credit, ie. Home Equity Line of Credit (HELOC) the rate is Prime + 1% (4%). On an average $25,000 balance on a credit line compared to a HELOC the savings would be $70 per month.

TD isn’t the only bank to be increasing their unsecured credit lines. BMO has planned to increase their rates by one full percent on March 4 on all of their credit lines. As of now the other major banks have not decided whether they will increase their lending rates.

This increase was just days after all the major banks decided to pass on the 50 basis point drop from the Bank of Canada rate drop announcement on January 20^th. The drop has decreased all posted mortgage rates and HELOC rates. But for those without the equity in a home, it would appear the banks have pushed their declining profit on to you, even though they believe they are still within fair lending rates. Paul Gammal from BMO stated ” From our survey of the market, our personal-line-of-credit offering is competitive and, in fact, favourable, compared to some of our major competitors.”

With these new charges and increases in rates it may be time to access some of the equity in your home. With a HELOC you can have the same flexibility and benefits of an unsecured line of credit but with a lower rate and no additional charges.