Is it necessary to buy a house through a Realtor? Although you are not legally required to, why would you undertake such an important purchase without the help of an expert? My expert knowledge of the neighbourhood, future development plans, taxes, zoning, transportation, schools and community services will help you select the property that meets your needs. I will also advise you on financing options and recommend other professionals needed to complete the sale. You will be dealing with sellers and their agents, so you want to make sure you have someone who will represent and promote your interests. Read the RealtyLink article on How Realtors Earn Their Commission
Before you begin shopping for a home, make a detailed "wish list" of what you need and want in a home. I will help you prioritize this list and suggest features that you may have overlooked. First, you need to decide upon a location. Think about factors such as school quality, crime rate and proximity to public transportation, shopping areas, work, parks, etc. You can research different communities in the Greater Vancouver area by following the links found in my Community Info section.
Second, you need to choose the type of housing you want (i.e. condominium or house; new or resale) and the amount of space you need.
Print the Home Requirements Checklist, fill it out, and contact me for a free consultation.
For more information, read the following RealtyLink articles:
Before you start looking for a home, I can assist in determining how much you can afford. The main home buying expenses are the down payment, the mortgage and the completion costs. Current interest rates will effect the amount you can afford. Contact me about the various homebuyer incentive programs that can assist you with your purchase.
For a conventional mortgage, you will need to pay at least 25% of the purchase price as a down payment. However, if you qualify for the Canada Mortgage and Housing Corporation (CMHC) 5% down payment program you can get a high-ratio mortgage where you receive up to 95% financing.
Although your down payment can't be borrowed, gifts from friends or relatives are fine. You can borrow up to $20,000 from your RRSP if you are eligible.
Most people buying a home need to borrow a portion of the money from a bank or other lending institution. I can assist you in calculating how much you are eligible to borrow based on your income and level of debt. You can also use RealtyLinks' mortgage affordability calculator to determine how much you can afford.
There are additional costs involved in buying a home. These include mortgage insurance, taxes, legal fees, house insurance, inspection reports, appraisal and survey fees. If you are a first time homebuyer, you may be exempt from the Property Transfer Tax.
For more information on borrowing your down payment from your RRSP, please read the following article on the Home Buyers Plan.
Before approaching lenders you should familiarize yourself with some basic mortgage concepts. You can start by reading my Glossary.
Pre-approval of a mortgage is when your lender has reviewed all your financial information and has determined the maximum amount of money you can borrow. The advantages to pre-approval include:
Many banks and financial institutions are competing for your business so it makes sense to shop around for a mortgage. Most lenders will reduce their posted interest rate so don't be shy about bargaining. Your ability to bargain for a low rate and a flexible mortgage will often depend on how much business you have with the institution. You can contact banks and credit unions directly, or work with a mortgage broker. I will help you find a lender and the best mortgage package.
Once you have selected your lender, you will need to provide your financial information. Your lender will want the following:
Once your application is complete, you will know how much you can borrow and you will be ready to start searching for a home. For more information, contact me or your financial institution, or log onto the Canadian Mortgage and Housing Corporation and the Canadian Bankers Association web sites.
When you begin your search, remember to compare each property according to your standards and your priorities as determined in your wish list. By investing time and thought in choosing your property, you can find a home with the most functional fit for your lifestyle.
I will give you a list of properties for sale that fit your requirements and I will set-up appointments to view houses. You can also use MLS' All Listings search to find properties or the newspaper version, RealtyLink, for properties. Let me know about any properties you find in your search and I will gather additional information to provide you with greater detail on a property for sale.
While you are visiting various homes for sale it's a good idea to make notes about each house you're seriously considering so you can remember the details about a property. Use my Home Hunting Checklist to help you keep track of your impressions.
When looking at a house you need to consider several factors:
For additional considerations for condominium buyers, read the RealtyLink article Finding a Sound and Solid Strata Property.
You've finally found the perfect home and are ready to make an offer. You and I will need to determine what price to offer and fill out a standard form called the Contract of Purchase and Sale. I will present your offer to the seller, who will accept, reject or make a counter-offer.
If your offer is accepted, you will still need to remove the subject clauses before the sale is finalized. If your offer is rejected, there is no deal and that is the end of the transaction. If the seller presents a counter-offer in which some of the terms are changed, you are then free to accept the counter-offer, reject it or make a counter-offer.
Once your offer is accepted you will need to carry out a number of steps and fulfill certain legal requirements before the completion of the transaction.
The Completion Day is the day you legally get ownership of the house. There are several things that will take place.
GST - If you buy a newly constructed home, you must pay the 7% GST. However, if your house is less than $450,000 you may be eligible for a rebate. There is no GST on resale housing unless there have been substantial renovations to the property.
Property Transfer Tax - This tax is 1% on the first $200,000 of the sale price and 2% on the remainder. First-time buyers may be exempt from paying this tax.
Prepaid property taxes or utility bills - You will have to reimburse the sellers for any prepaid property taxes or utilities.
Mortgage loan insurance and application fee - If you get a high-ratio mortgage (a mortgage where you pay less than a 25% down payment) you will have to buy mortgage loan insurance from CMHC or a private company. If you qualify for a 5% down payment, CMHC charges an insurance fee that equals 3.75% of the mortgage. If you put 10% or 15% down, your insurance fees will decrease to 2.5% and 2% respectively. The insurance premium usually gets added to your mortgage.
You will also have to pay an application fee. CMHC's standard fee is $235. CMHC also offers a basic service for a $75 fee but it must be accompanied by an appraisal.
Appraisal - Before your lender approves your mortgage, you may be required to have an appraisal done. Sometimes your lender covers this cost otherwise you are responsible for covering this cost. The fee ranges from $150 to $350.
Survey fee - Your lender may require an up-to-date survey of the property. If the seller did not provide you with one, you will have to pay to have one done. The fee ranges from $150 to $350.
Home Inspection fee - Most Realtors recommend that you get a home inspection by a certified home inspector. It will cost you from $150 to $350 for a smaller house. Large houses may cost more.
Legal fees - Lawyers/Notaries fees for closing the sale range according to the complexity of the deal but they will probably be at least $400.
Disbursements to Land Titles Office - These fees are approximately $300. Your lawyer/notary will arrange this payment.
A full glossary of real estate terminology can be found here.