Wednesday, July 07, 2010

Electricity Rates & Bedbugs

Would you buy a house with bedbugs?

According to veterans in Toronto's real estate industry its something that to many homebuyers is a deal breaker. If the house has bedbugs it can lead to lawsuits over the cost of spraying and removing the annoying insects. Especially if the previous owners failed to mention them.

According to real estate appraiser Barry Lebow he now sprays his jeans with bug spray before entering houses. Its an occupational hazard. “I promised myself that I wouldn't bring home bedbugs again — that stuff is murder,” says Lebow, admitting he accidentally brought bedbugs home with him after inspected a Toronto home. “We didn't sleep for three weeks.”

Blame new laws against pesticide use in Canada. Only farmers with permits are allowed to use pesticides now and getting the permits cost several hundred dollars.

Bedbugs are not life threatening, but they're MORE annoying than an army of mosquitoes. If you've ever been attacked by mosquitoes you know how horrible they are.

In 2009 Toronto city hall formed a committee to look at the problem as bedbugs are becoming a growing nuisance in Toronto, hurting the well-being of many Torontonians. And the fact we can't use pesticides to kill them makes removal very difficult.

Some homebuyers are even putting bedbug clauses into their contracts, along with other clauses covering standard problems such as leaks, moulds, termites and whether the home has ever been a marijuana grow-op.

In 2009 apartment residents in two Des Moines, Iowa, apartment buildings filed a $7.4 million USD class action suit against management for ignoring the bedbug problems in their building. The suit also demands that the buildings not be allowed to rent to new tenants until all the bedbugs have been removed first.

There is even a website,, which tracks tenant and buyer issues.

Its now being recommended that people check for bedbugs both in person and online before they buy a house or condo... even if its just in a neighbourhood building, because the critters are known to spread to neighbouring homes quickly... as easily as hitching a ride on the pant leg of the local postman.

Worse... people living with bedbugs often get fed up with them and try and find a different place to sleep. This migration often results in the bedbugs migrating too.

In June, Ontario MPP Mike Colle started promoting a private member's bill to protect tenants against bedbugs. If passed in the Autumn the bill would amend the 2006 Residential Tenancies Act to require landlords to disclose information with respect to bedbugs and other pests... because otherwise many landlords would prefer to lie about it so people don't know about the extra critters who will be biting them at night.

Some landlords are so paranoid about their reputation they are demanding bedbug removal services send their invoices and bills to a corporation number... and not to their company name.

Such services are booming anyway, up approx. 20% from 2009. Prices vary but expect to pay $400 for a two-bedroom house or $500 for a three bedroom home. Try if you're looking for a local Toronto company.

This is a big shift from 2003 when bedbugs were practically non-existent in Toronto. There were only 46 reported cases in 2003. By 2008 there was over 2,500 during the year. Its believed there will be over 3,000 reported cases in 2010.

While you're checking for bedbugs there is several other things you should ask about:

Electricity Rates

Ask to see the sellers electricity bills (and their heating bills too, if applicable).

Then determine the average they pay for month. Assume an increase if you have more people in your family, especially if you have teenagers who consume more electricity.

Then calculate how much do you like to run the AC full blast in the summer... I run it all the time myself.

Once you have an idea of what it will cost, then you need to calculate how much money would you save if you signed a contract instead (buying your electricity either at a bulk rate over a period of several years, or buying it at a constant rate regardless of the time of day).

Most electricity companies (Ontario Hydro, etc) are moving to time-of-use prices, forcing customers to shift consumption to off-peak periods... however if you want to avoid this you could sign a fixed-price electricity contract.

But to do this its recommended you compare prices first before signing. The following website from the Ontario Energy Board will be helpful: You can also compare natural gas prices on the website too. This website is good too:

Lets say you use 960 KWh per month, above the so-called Ontario average of 800 KWh.

If so your bill is likely $127.41 if you are currently with Toronto Hydro, of which $68.95 was the cost of electricity.

You are also paying $44.62 for delivery, $7.12 for regulatory charges and a $6.72 debt retirement charge. (Feel ripped off? Me too.)

Don't forget the 13% HST on top of all that.

Now when comparing companies you have to realize that some companies are a complete ripoff... Direct Energy for example would be charging $179.86 for the same thing and you'd be stuck in a 5-year-contract... I worked for Direct Energy years ago and I admit they are high-sales-pitch, lots of fluff and gain customers by scaring them with rumours that electricity rates are going to rise. Its a scare tactic and it works.

But if you shop around you MIGHT be able to find a deal. Or you might not. It really depends what you're currentl being charged and whether you're being ripped off.

Its entirely possible you could get stuck with a fixed-rate contract where you are actually paying extra... and what happens if you move later on? Weigh your options carefully. Signing a fixed rate contract also includes an extra $21.12 fee... a provincial benefit which gives more money back to the grid.

To learn more about the provincial benefit check the Independent Electricity System Operator’s website.

If it was up to me I'd calculate how much it would cost to install solar panels and windmills (enough to provide the needed 960 KWh or whatever you happen to us), a geothermal heating system to save on heating and electricity costs... and then calculate how many years it would take to pay off.

And while I was at it I'd make a point to purchase household items which use less electricity and retrofitting the home so it has better insulation (saves on both heating and air conditioning).

I think its best to know such things before you buy a house... the last thing you want is a surprise when the electricity bill comes... or when you're bitten by bedbugs.

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