BUYING YOUR HOME FOR

THE BEST PRICE

By Maggie Chandler
Chandler Realty Ltd.

All Rights Reserved
(604) 328-0077

SOME COMMONLY ASKED
QUESTIONS AND ANSWERS

What are the advantages of using a Real Estate Consultant (or agent) to help me buy a home?

Buying a home is certainly one of the most rewarding experiences most of us ever have; it’s also one of the most challenging. If you are buying for the first time, the process may be overwhelming. Even if you have been through it several times, every move is different and presents new challenges.

One clear advantage of enlisting the help of a realtor is simply that you don’t have to “go it alone”. A good realtor has the training, the knowledge and the experience to help you every step of the way. This makes the process of finding, buying, and moving into your new home as smooth, quick, and enjoyable as it can be.

Another advantage is that a realtor represents a valuable source of information about market trends, legalities, neighbourhoods, and especially access to information about homes for sale throughout the areas in which you are interested. Remember, not every home seller runs an ad in the local paper or puts up a sign in the yard. You could be driving by some outstanding properties that may be just what you’re looking for in a home. An realtor, on the other hand, offers you access to complete, regularly updated information about every home listed by area agents through the Multiple Listing Service (MLS).

Real estate agents involved in a given transaction are usually paid a commission by the Seller on the sale of the home; there is minimal cost to the buyer. An agent’s professional expertise and effort can be of considerable help throughout the buying process.

Where do I begin the process of looking for a home?

The first thing you should do is to begin focusing on what you are looking for in a home. You can start by establishing priorities in the following 3 areas:

Z Location

Are you relocating to a new town because of a new job or to be closer to your current job? How will the location of schools, shops, and transportation affect your choice of neighbourhood?

Z Personal Taste

How large a home do you need? If you’re buying a condominium, do you have a pet? Do you have a rental requirement? Do you prefer a hi-rise or low-rise?

Z Budget

What’s a comfortable monthly payment for you? Don’t forget annual property taxes and monthly condominium fees (if applicable).

As you consider these things, do a little research of your own. Drive through neighbourhoods that appeal to you to see what is available. Talk to friends about the features that you would like to have in your home. The more knowledgeable you become, the better your final decision is likely to be.

Finally, sit down and create a “Home Buyer’s Priority List” and rank them!

How do I find the right agent?

The key word is ‘right’. While there is certainly no shortage of agents to choose from, it is important that you find one who can fully understand your wants and whose personal and professional judgment you respect. They should also consider your needs and individual tastes. Above all, look for someone who makes you feel comfortable and whose word you trust.

Here are some important points to consider….

Z Choose an agent who is knowledgeable and familiar with the neighborhood! They will be able to point out the features and the best place to buy.

Z You want an agent who can provide all the services you need! They must have the knowledge and the expertise you need for the latest technology (where to find listings), financing, appraisal of property values and negotiation of your Offer.

Z You want an agent who listens to your needs; someone who is looking at your home purchase as the first step in a long and happy relationship

How do you know for sure how much home you can afford?

Affordability is probably the single biggest concern of today’s homebuyer.

My advice….there are many financing options available today. If you haven’t already, sit down with a Mortgage Consultant. Securing a pre-approved mortgage will let you know exactly how much you can afford. More details on mortgages and mortgage options are featured in the Mortgage section of this manual and is also available on my website.

How can I find out what the market price for homes is in a given neighbourhood?

Home sales are a matter of public record. Maggie will give you information on recent, comparable sales including sale price and days on the market. This will allow Buyers to be objective.

How can I find out how much I will have to pay for property taxes?

The total amount of the previous year’s property taxes is included on the MLS listing information sheet for every home. Taxes are quoted as Gross. For properties under $450,000, deduct $450.00 per year if the property is your principal resident. City Hall offers a monthly payment plan option.

If I’m moving a considerable distance, is there any way I can screen homes before I go to the new city?

Yes. Today’s MLS service, which includes up to 98% or more of the homes listed in any given community, has made it relatively easy for buyers to access detailed information on homes for sale practically anywhere in the country. And now with the internet available to most people, you can also get a full visual of many of the properties listed today.

My association with realtors across Canada gives me the advantage of being able to refer you to a qualified realtor in your destination community. They will provide you with all the information you need before you leave your home here!

When I start visiting homes, what should i be looking for the first time through?

The house you ultimately choose to call home will play a major role in your life.

As you look at each home, play close attention to these important considerations:

Z Is there enough room for you now and in the near future?

Z Will you have to replace the appliances?

Z How much maintenance and/or decorating will you need to do right away? Within the first 2 – 3 years?

Z Will your present furniture work in this house?

What do I need to bring along when I’m looking at homes?

Ask questions; don’t worry about being nosy – you have a right to know! Use a note pad to record features, colours, space etc and grade it on a scale of 1 to 10. Certainly if you are looking at several homes, this will help keep them straight in your mind. You may need to go back to give the home another look. Just ask Maggie and she’ll be happy to set up an appointment.

What should I tell my realtor about the homes I view?

Open communication is critical. Tell me everything you liked and didn’t like about each home that you see. Don’t be shy about talking about a home’s shortcomings. The more open and descriptive you are, the easier it is to “zero in” and find the home you’ll love!

How many homes should I look at before I buy?

There is no set number of homes you should see before making a decision. That’s why providing your realtor with as many details as possible up front, and having a pre-approved mortgage, is so helpful. The perfect home may be waiting for you on your first visit or you may have to look at several; most people view less than 10.

I’d like to have a professional look at the home before I buy it. What does a Home Inspector do?

Usually you call an inspector immediately after you have made an Offer on a home. However, before you sign any written Offer, make sure that it includes an inspection clause or other language that says that your Offer is conditional upon having a satisfactory home inspection.

Your home cannot “pass” or “fail” an inspection and your inspector will not tell you whether he/she thinks the home is worth the money you are offering. The inspector’s job is to make you aware of recommended or necessary repairs. A Seller may be willing to renegotiate a price to accommodate repairs, or you may decide that the home will take too much work and money. A professional inspection will help you make a clear-headed and informed decision.

In choosing a Home Inspector, look for one who is a member of the Canadian Association of Home Inspectors and who has errors and omissions insurance! Ask me for a brochure about one of the most professional inspectors in your neighbourhood!

Should I be present for the inspection?

Absolutely! It’s not required, but it is very much to your advantage. You’ll be able to clearly understand the Inspection Report and know exactly which areas need attention. In addition, you can get answers to many questions and tips for maintenance plus a lot of general information that will help you when you move into your new home. Most importantly, you’ll see the home through the eyes of an objective third party.

Do I need a lawyer to buy a home?

Due to the complex and confusing nature of the legal contracts and other paperwork involved in buying a home, people do hire lawyers to handle the closing details.

A lawyer will review contracts, clear Title, make you aware of special considerations and potential problems, and will go to the closing to help everything go as smoothly as possible.

If you do not know a Real Estate Lawyer, ask me for help. Real Estate Consultants work with many legal professionals and can provide you with the names of several competent and trustworthy lawyers in the community.

Do I need to talk to an Insurance Agent?

Yes…the sooner, the better! Most insurance professionals have a lot of experience in working with homeowners, and can offer useful tips about home ownership, particularly with regard to home safety and maintaining low premiums.

Once you have found a home, work together with your insurance agent to develop a homeowner’s policy that meets your individual insurance needs. You will need to bring your paid-up policy for your mortgage lender when you go to your lawyer’s office to sign all the closing documents.

If you don’t already have an insurance agent, I would be happy to recommend one to you.

When I’ve found the home I like, how do I make an Offer?

When you’ve found your special house, you’ll probably feel excited and a bit nervous. I am ready to help you through this important time. With me, you’ll write an “Offer of Purchase and Sale”. This is a written document that declares how much you will pay for the home provided that certain conditions are met.

This is a legally binding contract that you will sign and date. Your Offer will have a time limit for the Seller to accept, reject, or make a counter-offer. IF a counter-offer is made, you have time to respond. Often, Offers go back and forth until accepted or one party decides to end negotiations.

Most Offers are typically conditional upon several “subject clauses” including financing. Your lender, on review of your application, will have a professional Real Estate Appraiser perform an appraisal of the property. This is a safeguard that ensure you won’t pay more than the property’s true market value.

Ideally, property listings are within 2% to 4% of current market value!

Be prepared to encounter a phenomenon called “buyer’s remorse”. This occurs after you make a large purchase of anything, let alone a house. You will ask yourself..”Did I make the right decision?” The answer is YES…consider this self-analysis to be entirely normal!

How do I determine the amount of my initial Offer?

There is really no rule to use in calculating a realistic Offer. Naturally, the Buyer wants the best price, but many factors influence negotiations. After you’ve looked at the home’s features, asked questions, checked comparable sales in the neighbourhood, and talked about it with your realtor, you should have a good idea of what the home’s value is in the current market.

Most Buyers and Sellers negotiate on price. Both sides “give” a little until they agree. When the price is agreed upon, both parties will initial the paperwork. My skills are in negotiating a fair price for you – so use those skills to the fullest!!

Now, you typically begin the process of arranging an inspection, processing your mortgage and reading strata documents.

What is a “deposit” and how much do I need?

When you sign an Offer of Purchase, I will ask for a deposit; that is, money that shows your are serious about wanting to buy.

Usually, you will be asked to write a cheque for a specified amount, typically $1,000.00. When the subject clauses are met, the deposit increases to 5% to 10% of the purchase price. We hold this cheque until you have an accepted Offer at which time the money is deposited into the listing broker’s Trust Account. Therefore, your deposit funds must be made readily available before your consider signing an Offer.

When your Offer becomes firm, your deposit is included as part of your down payment. If your Offer is not accepted you will get back all of your deposit, usually without interest or any deductions depending on the wording in your Offer.

Keep in mind that, if you back out of an Offer once it has been accepted and all conditions have been removed, you forfeit the full amount of the deposit. Also, you may be liable for other costs incurred by the vendor.

There’s so much to remember…what do I have to do?

As your realtor, I can help you with many of these things and I will keep in close contact with you right through the closing period and throughout your move. Here a partial closing checklist.

Z Are all the necessary inspections complete?

Z Are all the required repairs complete?

Z Is your lawyer satisfied that title to the property is clear (no one else has a claim on it)?

Z Is your home insurance ready to go into effect on the day you close?

Z Has your lawyer told you the closing dollar amount required?

Z What form of cheque should you use to pay for the closing costs? To whom should it be made payable?

Z Do you have receipts for the items you have already paid for, including deposit and inspection fees?

Z Bring your cheque book to the lawyer’s office to cover any last minute extras that might have been overlooked.

What will happen in your lawyer’s office on the day BEFORE the closing date?

Z The lender will want a copy of your paid-up home insurance.

Z The lawyer will list the closing adjustments. These include the money you owe the Seller (which includes the remainder of the down payment, any prepaid taxes and other adjustments) and what the Seller owes you (including unpaid taxes, prepaid rent).

Z You will sign the Mortgage document. This gives the lender the legal right to the property if you don’t make your payments. You also promise to repay the loan in regular monthly payments.

Z Your lawyer will collect the closing costs from you and give you a statement of all the items for which you have paid.

On Closing Day….

Z You will get title from the Seller in the form of a signed Deed.

Z The Deed and Mortgage will be recorded in the Land Titles Office.

Z You will get your property keys from your Real Estate Consultant directly.

Is there anything I should do immediately after closing?

The first thing you should do is have the locks changed. You should also make sure all your utilities have been switched on and are now in your name (electricity, gas, telephone, cable etc.).

And Remember..Call me with any questions. I’m always happy to help!