Advice for Buyers
10 tips to follow when buying a home
Are you about to embark on a property search? It can be an exciting and stressful process! To help you make sure everything goes smoothly, follow these tips.
Apply for a mortgage pre-approval
Before you start dreaming on sales websites, it's best to be realistic. Based on your financial picture, what budget range should your future home fall into? It is not up to you to determine this, unless you can pay for the property in full (without financing).
Instead, you should go to your financial institution and have an advisor take stock of your finances and prepare a mortgage pre-approval. This will indicate how much you can borrow.
Then look for properties that are worth that much (or less)!
Putting a good down payment to avoid fees
Ideally, you should put 20% of the value of the property as a down payment. This way, you avoid paying mortgage default insurance. However, this is not mandatory: many buyers choose to put a lower down payment and pay the insurance premiums.
Making a realistic budget
The price of the mortgage to be paid is one of the costs to be calculated. But there are many others! It is wiser to make a budget to ensure that you have the financial means to acquire the property. Think about everything:
- Municipal and school taxes
- Home insurance
- Condo fees, if applicable
- Electricity and natural gas bills
Don't forget the costs related to the purchase of a property that are not recurring, but that can make a big difference in a budget:
- Inspection fees
- Notary fees
- Welcome tax
Establish your essential needs
What are the must-haves? Do you need a garage? To live close to all services? To have 3 bedrooms on the same floor? A finished basement?
It is important to determine everything that is non-negotiable for you.
Establish your non-essential desires
As you determine your priority needs, you'll see the non-essential desires accumulate. So, if these items are in the house in sight, great. If not, too bad!
It is important to keep your essential needs in mind during visits, and not let yourself be influenced by a crush that, in the end, does not correspond to your real expectations.
Choose a neighborhood
If you're going to buy a house, you're going to buy a neighbourhood! The neighbourhood can greatly influence your happiness index in your new home. Its characteristics should not be taken lightly. Take a walk in the neighbourhoods that interest you and notice the atmosphere, the sounds, the areas nearby, etc.
Use a broker who knows your area
To help you find both the right neighborhood and the right home, a real estate broker is the best choice. It's best to choose a broker who knows the area like the back of his hand. This way, he or she will be able to name the strengths and weaknesses of the neighbourhoods and the property to guide you in your decision making.
Read the Seller's Declaration carefully
This document, which is essential in a real estate transaction, must be read carefully from beginning to end. You will find the history of the property. For example, renovations, water damage, structural problems, etc.
This history will help you have a clear picture of the property in order to make an informed purchase.
Do an inspection before you buy
The Seller's Declaration is important, but it is not a substitute for an inspection. It can certainly help you! For example :
- The inspector can identify work that needs to be completed. You can then negotiate to have it completed before you buy.
- Depending on the number of problems found, you can negotiate the price
- If a problem arises a few years after the purchase, the fact that you had an inspection will add to your credibility.
Negotiate a fair price
Since real estate prices vary, there may be a few thousand dollars at stake in the transaction. Negotiating through offers and counter-offers is the time to go after a price that you feel is fair. In this process, a real estate broker has your best interests at heart.
Happy searching!