Mortgage 101 – Love your Home

Todd Veinotte and Clinton Wilkins discuss the concept of loving your home, the importance of viewing a home as a financial asset and the potential benefits of renovations, particularly those that enhance the home’s structural integrity.

Todd Veinotte
All right, welcome to Mortgage 101. Your guide to home ownership with Clinton Wilkins and myself, Todd Veinotte – and it is this the season of love isn’t it Clinton?

Clinton Wilkins
It is a season of love. You know what – we’re just really kicking it off. This is the first weekend of February and it’s the month of love. This month we’re talking about, Love Your Home, and what that looks like. You know, 2025 started off busy, at least for us, busier than a normal January was. Getting into February certainly still a lot of purchases happening, which might surprise some of our listeners. We’re going to talk about do you love your existing home. Not everybody does, so maybe you’re looking to buy a new home in 2025 or maybe you want to improve your existing home in 2025 so certainly, lots to talk about.

Economic and Sentimental Aspects of Homeownership

Todd Veinotte
Loving your home on a sentimental level is different than loving your home on a business level as well, right? Because they’re two different things on an economic level.

Clinton Wilkins
Some people love their home, but the operating expenses are just so high, from property taxes to mortgage payments and maybe a smaller home works out better and vice versa. So many buyers that I see, for some home buyers, they’re buying starter homes, but maybe that doesn’t work for them forever and maybe they’re working at home, or maybe their family has grown or changed, and they need a different style of home. Maybe they need more square footage, or maybe it’s a location that needs to change. Everybody’s needs shift from time to time, and that’s why it’s so important to make sure that your house is good and secure and meets your needs.

Todd Veinotte
Also, talk about sentimental needs, it’s part of purchasing a home. But I think that it can have a double-edged sword in that it can be great because it can draw somebody to a home, but it can sometimes keep somebody in a home which perhaps they should get rid of or make changes.

Clinton Wilkins
I see so many of our clients that sometimes own homes for 20, 30, 40, years… they renovate it, and then they sell it. I was talking to some of my longtime clients this week, and they’re at a crossroads there. They said, either I need to renovate this home and make it the way we want it, or we’re going to buy another home that’s going to better meet our needs and their mortgages coming up for renewal. They’re thinking about it from kind of an economic situation. They love their location and they’re okay with the house, but there are a lot of things in the house that would need to change for it to work in the long run. And I said to them, if you’re going to do it, it’s always better to do it now and then you get to enjoy this. If you’ve been in this home for 5, 10, plus years, then maybe doing some renovations and then selling is the way. The other thing I’ll say about renovations is if you’re planning on renovating to sell, I just wouldn’t do it personally. And I hear these from Realtors all the time, so many times people do work and then someone buys it, and they come and rip out brand new work that they’ve done. Maybe someone doesn’t like the floor and they don’t like the kitchen, and they’re going to redo it anyway. I think there is something to be said for something turnkey, but if you’re kind of updating one thing, but you know more of the house needs to be done, maybe just leave it all and let the next person do it the way that they want to do it.

Renovations and Market Trends

Todd Veinotte
Often you watch some of these shows in which people are upset. They almost insist that whoever buys the house doesn’t do certain renovations. I mean, my attitude… and again, I’m not necessarily the most sentimental person in the world, although I do have some of that, but be logical. Who cares? Once you sell that house and that asset no longer belongs to you and you get money for that house, who cares? What happens to it?

Clinton Wilkins
I agree. I think that’s where it’s really hard sometimes for people to divide the love for their home and the business for their home, and I think it’s detrimental in some cases. I may be callous because I’m looking at this all day, every day, but for me, it’s transactional, and it’s a business, and the home is often the biggest asset of faith. But some people don’t look at the home that it’s an asset, but it, really, truly is. And there are so many Canadians that are living mortgage to mortgage or paycheck to paycheck, and that’s their retirement plan is selling this house and using that money to then invest or live off in retirement, and it can be a great asset, typically, real estate, at least here in Halifax in Atlantic Canada, has increased. We’ve never had the boom that they might have had in Ontario and BC, but we’re also not suffering right now with their values have decreased. Honestly, the values have gone down. Our prices are continuing to increase, maybe not as fast as they were the last couple of years, but that’s also healthy. Real estate here, typically is a very safe investment overall and has been for many years. I think going forward, just based on the amount of demand we have in our market, it will be a good investment.

Todd Veinotte
But again, you deal with people with different mindsets, but I view a home as an asset. I do love my home, and that’s important that you do love your home. But I think that at the end of the day, if you view it as an asset and a business, a part of your business, and your retirement plan and the whole thing, I think that’s smart and prudent. What do you think?

Market Demand and Future Projections

Clinton Wilkins
I agree. And you know, where the home is the biggest asset. I see so many people who are just so focused on getting mortgage-free, mortgage-free, mortgage-free, but yet, sometimes they have a whack at consumer debt, or they’re sitting in this asset that needs some improvement. You need to protect the asset. You know, if there are some renovations that you want to do, and you’re not that worried about the cosmetic, at least, make sure the envelope of the house is good and secure. When we’re talking about roofs, we’re talking about windows, we’re talking about exterior siding, making sure that is safe and secure. It will protect the asset and also will help improve the value as well. I think that’s something certainly to take into consideration. I think it would be remiss for us not to mention not everybody loves their home. I think some people are renting, that want to get into home ownership. I think some people own homes, that are looking for a different style of home, and I think we need to be cognizant of that. I think there’s going to be a lot of transactions here in 2025 you know, the realtors have been coming out and saying that there’s going to be at least 5% more transactions this year than there were last year. And I can tell you, January has started very, very strong. Why do you think that I think there’s pent-up demand? I think we were in a higher rate environment last year from a mortgage lending perspective, and the rates have started to come down. We’re going to talk in our next segment about some of the uncertainties. We don’t want to be doom and gloom. We’re going to talk about what we know right now, but I think there’s going to be more people coming into the marketplace. One thing that you know, and the one thing that we need to remember, is, as the rates continue to go down, I think there’s going to be more and more buyers and borrowers entering the marketplace, which will drive up the demand, which means that I think the prices are going to go up this.

Todd Veinotte
How about inventory? You only create inventory by two houses, right? We need new construction.

Clinton Wilkins
Way, way, way more. The one positive thing is, we have a lot of apartments coming online, and you’re like how does that impact? Do people want to buy a home? Well, homeowners oftentimes think about that little old lady and a little old man, they then have a place to go and move into that home or into that apartment, and that puts that home up for sale. Some of these homes that maybe these older people have lived in for 40-plus years are great homes for first-time homebuyers. When I first started doing this 20 years ago, first-time homebuyers bought starter homes. But something happened over the last 10 years or so, and so many first-time homebuyers have been buying new construction and these beautiful, 3000-square-foot homes. The culture shifted, but now the culture is shifting back, I think, primarily because of price and affordability. But first time, homebuyers are buying starter homes more and more so now. But again, we need all levels of inventory to start rebalancing, you know, the demand that we have in the market.

Demographics of First-Time Home Buyers

Todd Veinotte
When we’re talking new homeowners, what are we talking what type of demographics are we talking across?

Clinton Wilkins
Honestly, it can be anywhere from 20 to 60. I see a lot of first-time homebuyers in their 40s and their 50s, which would surprise you. But for whatever reason, a lot of people have it and the one thing that I will say is that you know some of these first-time homebuyers that are entering the real estate market at a more mature age. Typically they have a more extensive credit background, hopefully, they have more money saved. And typically their incomes are higher, so they’re more easily able to be qualified. And typically they can qualify for potentially a bigger budget than a younger person can. But believe it or not, we’re seeing a lot of people that are 21 years old and buying their first home sometimes, obviously, that takes the help of a mother, father, brother, sister, or it takes some help from a spouse. The average house price in Halifax is still over $500,000 and really, we need over $100,000 of household income to kind of get into an average home.

Todd Veinotte
Okay, so we’ve got a guest coming up later in our third segment, third and fourth.

Clinton Wilkins
We do have a special guest, so we’ll leave that for later. And this next segment, we’re going to be talking really about what’s going on in the economy, the Bank of Canada, and a lot of chatter about tariffs. So we’ll dig into that.

Todd Veinotte
Indeed. Mortgage 101 your guide to home ownership. We will be right back.