Why I LOVE polished concrete

Whether you are building your dream home or looking to flip a house for a handsome profit, polished concrete is the way to go.

I first saw polished concrete and realized its potential when going to York University here in Toronto, Canada. One of the buildings had polished concrete walls and floors and it was smooth and shiny like marble, but without the expensiveness of marble.

I immediately envisioned whole buildings and even sidewalks with polished concrete. Everything shiny and smooth.

I think it really comes down to the fact that people like smooth and shiny things. Consider the following:

Marble
Silk
Satin
Glass
Stainless Steel
Chrome

They all just scream luxury.

Lets say for example you want to purchase a table. Do you want a rough-hewn table that has never been polished or even sanded? Or a polished wood table which looks so clean you could eat off of it.

Check out the website http://forrestconcrete.com for example. It has polished concrete floors, concrete countertops and they do a variety of residential and commercial work. So as a company they obviously know what they are doing.

If you browse their website and similar websites (or if you do a Google image search) you can see lots of images of the amazing things companies can now do with polished concrete.

For example, you can use pieces of other rock to polish into the surface and make the concrete look even shinier than a normal polish. By using quartz dust for example you can make the surface sparkle, by using marble dust you can make it literally look marble (or as I like to call it, "faux marble").

Another thing they can do, instead of dust, is use tiny chips of colourful rocks. Thus whether you use dust or rocks you can make different colours, shades or even a rainbow of different colours by overlapping various colours and grinding/polishing them into the surface of the concrete.

You can make designs, shapes, patterns and even mosaic-like artwork. It will be more costly for sure, but there is a lot of amazing things that can be done with building materials these days.

You could even, from a distance, make the floors look like polished wood and only up close would you realize its just the same colour.

And that is just the architectural playfulness. You can also make tabletops, coffee tables, kitchen counters, chairs, decks, balconies, columns...

Knowing me, I would probably make artwork and sculptures if I had an ample supply of concrete and a grinder to polish it with. Or even better, artwork that doubled as exercise equipment for parks so adults could do chin ups on it. :)

Oh I forgot pools! Yes, you could also make a pool. You just wouldn't want to dive in and bang your head on it. That is painful whether its concrete or not.

The example I've been using of Forrest Concrete is in South Carolina, but there are certainly lots of companies locally you might wish to check out.

In Toronto for example there is:

floorlab.ca

concreteartfx.com

torontopolishedconcrete.ca

uniquetouchconcretedesign.com

concrete-polishing.ca

ttmfinishes.com

concreteyourway.com

marblerenewal.ca

and a dozen or more other vendors. So yeah, no shortage of concrete polishing companies in Toronto.

So whether your home is a house or a condo you can certainly shop around and get something special for your home.

Or office! Doh, I forgot offices. Polishes countertops in reception or a desk with a polished concrete surface. Or a boardroom table. OOOOOOOOoooo!

Anyway, I think my point has been made. So many possibilities to create shiny surfaces that amaze friends, guests and clients.

Mortgage Life Insurance

I think the title of this post is pretty self explanatory.

Basically what Mortgage Life Insurance is life insurance so that if you die, and thus cannot pay your mortgage payments, your family members can collect the insurance and the lump sum will be enough to pay off the remaining mortgage on your home.

Although in theory, you could just get a standard life insurance policy, with a big payout, enough to cover the mortgage and a little left over.

Except that the actual value of the mortgage goes down over time. Which means that in theory the cost of the insurance should also go down over time. Except that isn't how it actually works. Instead the premiums keep going up as the person gets older, even if they are in perfect health.

Thus Mortgage Life Insurance ends up being very profitable for insurance companies because the premiums keep going up and the payouts decrease over time. It is so profitable that many banks now sell Mortgage Life Insurance too whenever someone asks for a mortgage and the bank employee gets a commission every time they sell someone a policy. Some of it even verges on "Tied Selling", meaning they give you the mortgage and pressure you into the insurance to the point that you don't have any other choice.

1st Note: Tied Selling is illegal in many countries, including Canada.

2nd Note: Buying Mortgage Life Insurance is not mandatory when buying a mortgage. There is no laws requiring it. (In some countries bicycle stores are required by law to make sure you have a bell and helmet if a child wants to buy a bicycle. Because if the kid gets killed on the bicycle and they weren't wearing a helmet, the bicycle store can be liable for not asking if they owned a helmet. In theory they are supposed to sell you a bell and helmet if you don't have one.)

3rd Note: This should not be confused with Private Mortgage Insurance, which is meant to protect the lender against the risk of default on the part of the borrower.

When the Mortgage Life Insurance commences, the value of the insurance coverage starts off being equal to the capital outstanding on the repayment mortgage and the policy’s termination date will be the same as the date scheduled for the final payment on the repayment mortgage. Thus when the mortgage is paid off the insurance is likewise terminated. The insurance company providing the Mortgage Life Insurance calculates the annual rate at which the insurance coverage should decrease in order to mirror the value of the capital outstanding on the repayment mortgage. Even if the client is behind on mortgage repayments, the insurance will adhere to its original schedule and will not keep up with the outstanding debt if the person falls behind on payments.

Some mortgage life insurance policies will also pay out if the policyholder is diagnosed with a terminal illness from which the policyholder is expected to die within 12 months of diagnosis, but many will refuse to pay and declare the policy void. Insurance companies sometimes add other features to a Mortgage Life Insurance policy to reflect economic conditions, problems in the domestic insurance market and various domestic tax regulations.

The thing is that when it comes to actually buying Mortgage Life Insurance there are a lot of companies out there, and you don't know which ones actually will payout if there is ever a problem such as the policy holder being diagnosed with cancer and then their family being left out to dry with the insurance company refuses to pay.

Thus lets pretend for a moment you are considering getting Mortgage Life Insurance... Which company should you hire? How much should the premiums be? What are the guarantees they will actually pay out?

Well, the wisest answer is to shop around and ask. Compare prices. Don't be pressured with a big sales pitch or shiny one-time discounts (those are tricks to get you to sign up today).

Why? Because I honestly can't tell you which companies are the best. Although in theory you could research various companies online and try to determine which ones have a good reputation. Proceed cautiously and don't assume that just because its a bank trying to sell you the mortgage that they are any more reputable. Banks are in the insurance business to make MONEY. And that person trying to be all friendly and selling you the policy just wants their commission for kissing your behind.

Now you might think, oh what the heck, just get the first policy you come across. No. Proceed cautiously and wisely. Especially if you already have health problems and the insurance company may try to refuse to pay out to your relatives after you are gone.

Note: Car dealerships do the same thing, selling you insurance car loans. Buyer beware.

Amazing Dream Kitchens to Die For

Okay, maybe not worth dying for. After all if you're dead, you can't enjoy the beauty of these interesting and inspired kitchen designs. As kitchens go they're pretty amazing.

Of course, what is the point of having your dream kitchen if you don't know how to cook or bake?

Yes, you could host really amazing dinner parties... again, assuming you know how. Or hire a caterer. But what you really need is private cooking lessons in a topic of your choice. Let's pretend for a moment you really like Italian food, so you could get yourself Italian cooking lessons in Toronto. Makes perfect sense, right? Or if Italian isn't your thing you could get cooking lessons in Toronto on the topic of your choice.

What the heck is a FHA loan and why are Americans defaulting on them?

As a Canadian I have to stand in ABSOLUTE AWE of the American mortgage system.

There are a "ridiculous" number of mortgage options out there. There are many options here in Canada too, but its much more regulated by the Canadian government to prevent booms and busts of the housing industry.

In the USA however it seems to me like its a bit of 'Wild West Free-for-All'. Mortgage lenders are like hired guns, bankers and thieves all at once. They're offering many different options and they're all looking to make a fast buck, often by targeting a percentage of people which are higher risk but can be charged higher interest rates.

In recent year the American mortgage market appears to finally be stabilizing, but just so long as you ignore loans backed by the Federal Housing Administration. FHA loans are federally insured loans which, you guessed it, are covered by Washington in the event of foreclosure or serious delinquency.

While other mortgage loans are either bank held loans by financial institutions or insured by Fannie Mae/Freddie Mac, the FHA loans are operated separately and have very different rules governing who can get a FHA loan.

Lets start with some numbers:

Bank held mortgage delinquency is down 39% in the last year (from the 1st quarter of 2011 to the 1st quarter of 2012).

Fannie Mae and Freddie Mac delinquency is also down 14.7%.

Sounds great, right? Wait til you see the FHA numbers: 26.6% MORE delinquencies.

Furthermore FHA loans are growing in popularity. The reason is because they are much easier to get. All you need is apply for a loan of "less than $729,750" and qualify to have a debt-to-income ratio below 43%*. There are a couple other minor things you have to jump through hoops for, but otherwise its one of the easiest mortgage loans to qualify for in the USA even if you have had past debt problems.

* Actual number varies.

In one way FHA-insured loans are a good thing. They are keeping the American housing market stable for the moment by allowing people to buy or refinance their homes with less fuss.

But on the other hand FHA-insured loans are increasingly falling into foreclosure or serious delinquency, moving in the opposite direction of loans guaranteed by Fannie Mae and Freddie Mac or those held by banks, which are all showing signs of improvement.

The scary bit is that American taxpayers could ultimately be on the hook for FHA's growing number of troubled mortgages. The agency's finances are already on shaky ground, and additional losses from loans going sour could prompt the need for a federal bailout.

"We can't escape this one," said Joseph Gyourko, a real estate professor at the University of Pennsylvania's Wharton School. "This is an arm of the U.S. government." If a large enough share of the government-guaranteed loans, are delinquent for 90 days or more then we will see a jump in foreclosures which could prompt a federal bailout.

Note: The FHA itself doesn't provide the money for loans. It just insures them in the event that people fall into delinquency. Its a bit like having a co-signer on your mortgage. If you stop paying your mortgage, the co-signer is the one who ends up paying for it and eventually the home is foreclosed if the homeowners don't catch up on their payments.

Part of this problem isn't just the people applying for the mortgages. Its a few unscrupulous companies which are selling FHA-insured loans and are taking advantage of the less strict rules for approving mortgages.

Which begs the question, will be having another real estate bust in America in a few years from now when and if the FHA-insured loans cause a federal bailout? Or will such a bailout just be a band-aid measure which keeps everything afloat?

As to why Americans are defaulting more often on FHA loans my guess is its because they were given to people who probably weren't ready to be purchasing a house.

How is it possible that Miami condos are cheaper than Toronto's?

Seriously.

How is it possible that Miami condos are cheaper than Toronto's?

When browsing condo websites (a hobby of mine) its always fun to check out what is available. Some of the condos in Miami are dirt cheap compared to the prices in Toronto.

The median sales price of a condo in Miami is $160,000 (stats from Trulia.com).

That is pretty dirt cheap if you know anything about the ridiculous prices in Toronto which have been inflated by foreign investors.

The average sales price of a new condo in Toronto was $432,256 in June 2012. Existing condo sales averaged $364,597 in June 2012. So... basically you could buy 2 condos in Miami for the cost of 1 in Toronto and still have money left over.

But it is also fun to explore the websites that specialize in LUXURY condos. eg. Condo Sunny Isles is a good example.

Now with respect to luxury condos the prices can be pretty ridiculous. Think between $500,000 and $40 million. Yes, that is correct, $40 million for a luxury condo in Miami. For that kind of prices you have to imagine a place that comes with its own private indoor pool, tennis courts, etc...

The example I am looking at is:

100 S POINTE DR PH-2
Miami Beach, FL 33139
$39,000,000
6 BEDS, 8 BATHS
10 PARKING
11,031 square feet + 6,31 in extra lot size (parking, etc).

The place apparently comes fully furnished, marble floors, private pool on the balcony, access to the condo's various facilities (tennis courts, etc, but they're not private)...

But the funny thing is I don't think its worth "$39 million". For that kind of money a person could buy 13 smaller condos worth $3 million each, basically the whole floor of a condo building... but why would ANYONE need that many extra beds and kitchens?

Or alternatively you could buy 13 different condos in 13 different cities (Paris, London, New York, Tokyo, etc) and rent out half of the condos and then move from one condo to the next every 2 months. Just because you can. Sheer silliness.

I think you would have to REALLY love marble floors to want to spend that much extra on a single property, because lets be honest, its all the marble that has made that property so dang expensive.

And its completely unnecessary. I can see spending extra on a house that has beautiful ivy on the exterior of the building, but spending a obscene amount extra just so every room can have marble floors? Pfff!

I can only just imagine the kind of ridiculously rich person who would buy such a place. Probably the kind of person who bilked the American government out of millions during the bank bailouts and then got an annual bonus in the 10s of millions.