Tips for Home Buyers

Remember some time ago, I spent a lot of time writing about indecision and how I just couldn’t come to any conclusion about what I should do?

Well, one of the items on the table during that period was whether or not to move and where to move.

One of the factors affecting our decision (although, good or bad, it was never a strong enough factor to actually push us in the direction of a decision) was how much the price of houses had climbed in a relatively short period of time in our neighbourhood.

In the end, we didn’t move. At least, we haven’t yet. Home selling and buying is a bit daunting and fairly expensive in Toronto, what with the double land transfer tax and all.

So we are staying put for now, but this article below, provided by Brenda Chmelyk, has renewed my interest in house hunting.

Tips for Home Buyers in Canada

 

The real estate market in Canada has been hot – too hot in some cities. Houses now cost an average $733,000 in Vancouver; in Toronto, they’re going for $517,000.

To avoid a U.S.-style bubble burst and the personal disasters that befell so many Americans, Canada threw some cold water on home sales in July.

“By cutting the maximum mortgage loan from 30 years to 25 the government makes buying a home a little more expensive,” says Brenda Chmelyk, a former top British Columbia real estate agent and creator of www.MyVirtualAgent.com, a site where buyers and sellers can safely transact without a middleman.

Noting the rule only applies to loans involving less than a 20 percent down payment, Chmelyk said it will affect mostly just first-time home buyers.

“In the long run, it will save them thousands in interest, but they’ll have higher monthly payments and they’ll need higher incomes to qualify.”

But there are ways to save, Chmelyk says.

“Canadians pay an average $12,900 commission to real estate agents. If buyers and sellers cut out the middleman, both can come out ahead.”

She offers these tips for any buyers interested in taking matters into their own hands:

• Do your homework on the community. Get familiar with the community and the neighborhood you’re interested in. Find out the crime rate, bus routes, average pricing inclines and declines, and check the zoning on any undeveloped land around your neighborhood. This is all easy-to-do research via the internet and email.  There are some convenient calculators at www.freevls.ca where you can enter some of the data you have gathered and get an unbiased opinion on whether it makes sense to purchase in that area. 

• Get a pre-approval letter from your lender. With everything happening in Canada’s markets, including the new mortgage rule, sellers are nervous about buyers being able to pull through at the final hour. Nothing will motivate a seller to drop his price like you doing the legwork before you’ve ever made an offer. Don’t be afraid to offend the seller! If you’re well prepared and the seller has not done his homework (pre-inspection, third-party appraisals) then you are going to have to learn more before you can decide if this is the right place. Making an offer subject to financing, appraisal and inspection is extremely common nowadays.

• Create a team that plays well. As a buyer, it’s important to have some close allies throughout a real estate transaction. Start with your bank. Get to know the representative you’re working with because he or she will be the key to a smooth transition from the time the offer is written to ensuring the money arrives upon closing. Make it personal; it does not have to be all business.  Shopping for the right deal is important, but a 0.1 percent savings isn’t as important as trust and having someone who’s extremely capable working hard for you. Second is a home inspector. Don’t just randomly select one. Get references, do some online research into the company the inspector is affiliated with and ask friends for recommendations. Finally, your conveyance lawyer is an integral part of the team. This is the person who ensures all the i’s are dotted and t’s are crossed. Your meeting will be quick and fairly painless — possibly some minor hand cramping by the time you sign all the documents.

“Buying a home may be the biggest investment you ever make,” Chmelyk says. “Don’t skimp on your homework!”

About Brenda Chmelyk

During both economic booms and slowdowns, Brenda Chmelyk was a top-producing British Columbia Realtor specializing in residential markets. She expanded to helping people not only with their real estate needs, but financial and personal goals as well, through motivational coaching, training and speaking.  She created My Virtual Agent and Free Virtual Listing Service, a first-of-its-kind website, to offer all the benefits of a traditional agency with all the savings of a for sale by owner.

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