Buyers

Thinking

How do I prepare to buy a home?

This section offers detailed information to help you as you prepare to buy a home. You’ll find helpful tips and details on everything from talking to your potential REALTOR® to getting your finances organized.

The more prepared you are as you start looking for a new home, the easier and more enjoyable the process will be. Thanks to the wide variety of services offered by theDepass Group, we’ve got you covered every step of the way.

Looking for a quick way to figure out how much you can afford to spend on your home? Try our Mortgage Affordability Calculator.

Needs vs. Wants

What features do I want in a home? What features do I need in a home?

Looking for a new home can seem overwhelming at first. There are so many things to think about, so many choices, and often not enough time.

A small investment of time and effort right at the start can pay tremendous dividends. Take the time to organize your thoughts and think seriously about what sort of home you want before you start looking. It will simplify the process, save you time, and help lead you to the right home for you.

Make sure that you talk to a REALTOR® before you start your search to help you get organized, answer your questions, and also to raise important questions to ask yourself, such as:

• Where do I want to live? (community/general area)
• How much should I expect to spend on purchasing a home?
• Are schools a factor?
• Do I want an older home or a new one?
• What style of home do I prefer? (ranch, colonial, split-level, multi-level, town home, condominium, multi-family, bungalow, other)
• How much renovation and remodeling am I willing to do?
• Is being close to public transportation important?
• Do I have special physical requirements, such as wheel chair access?
• Do I have pets to consider?
• What sort of lot would I like? (small yard, large yard, fenced, garage, patio/deck, other buildings)
• How many bedrooms do I need? How many would I like to have?
• How many bathrooms do I need? How many would I like to have?
• How big a house do I want? How many rooms? How many square feet?
• What features are important? (air conditioning, carpeting, ceramic tile floors, hardwood floors, eat-in kitchen, separate dining room, formal living room, family room, den, library, basement, separate laundry room, fireplace, workshop, other)

Depass Real Estate Can Help

How can Depass Real Estate help?

Depass Real Estate can save you time and money. We know your community, we know what is important when buying and selling a home, and we know all the intricacies of the process, from finding a home, to negotiating a price, to closing a deal.

Depass Real Estate will:

• Screen the available homes in your neighbourhood to make sure that the houses you look at fit your budget and your requirements
• Give you important information on local real estate values, taxes, utility costs, services, and amenities
• Guide you through the viewing process showing you features you may not have noticed and problems you may not have spotted
• Advise you about your legal and financial options
• Recommend expert help when needed, such as home appraisal, home inspection, and contracting services
• Manage your offers and counter-offers, and use his or her skills and experience as a negotiator to make sure you get the best deal possible

Questions to Ask Your REALTOR®

How do I know if I have found the right REALTOR® for me?

You are going to be working very closely with your REALTOR®. You need to be confident that you are working with someone who understands what you want, knows the real estate market, and can give you the advice and guidance you need. We encourage you to interview several REALTORS® before choosing the one you want to work with.

To help you choose a REALTOR®, here are some questions to consider:

How can you help me find the right home?

Good REALTORS® will impress you with their knowledge of the local market and their ability to appreciate what you are looking for in a home. They should be able to show you what is available in your price range, and how the features and benefits of specific homes and neighbourhoods fit your requirements.

 

Given our particular circumstances, what advice would you offer?

Every family is different and a good REALTOR® appreciates this. He or she should be able to advise you on how to meet your unique circumstances and lifestyle.

Why should I work with just one REALTOR®?

If you don’t have an exclusive agency agreement with your REALTOR®, you’re not legally obligated to work only with him or her to find your next home. It may, however, greatly benefit you to do so. Talk to your prospective REALTOR® to find out his or her position and then determine what’s best for you.

What happens when you are not available?

REALTORS® work extremely long hours and try to be available whenever and wherever you need them. However accommodating they try to be, they are not always available.

Ask your prospective REALTORS® what arrangements they have in place when they are not available.

What makes your real estate service special?

Every REALTOR® tries hard to give top-notch service, but what distinguishes really good REALTOR® from the rest? Ask them. You may be surprised at what they have to say and, just as importantly, how they say it.

When the interviews are over it’s time to make a choice. Think about what the REALTOR® told you, and ask yourself:

• Did they seem trustworthy and honest?
• Were they realistic when discussing your home purchase?
• Did they communicate well? Were you on “the same page”?
• Were they committed, motivated, and experienced?

We think you’ll agree that Royal LePage and The Depass Group are the REALTOR® of choice – motivated, experienced, and dedicated to the highest level of service in the real estate industry.

Your Mortgage

• Find out about your mortgage options before you start looking. There’s nothing more frustrating that falling in love with a home, only to find out you can’t afford it.
• Pre-qualifying for a mortgage is the best way to find out how much you can afford. Your financial institution will look at your income, expenses and debt to determine how much they will lend you. Combine that amount with the money you have for a down payment, and that’s your budget.
• Once you have pre-qualified, consider applying for a pre-approved loan. Then, when you find the home you want to buy, it will speed up the purchasing process. For more information about planning your mortgage, see Organizing Finances.
• Want to get an idea of how much you can afford? Try our Mortgage Affordability Calculator for a quick estimate.
• Mortgage options Mortgages are available through a number of financial institutions; your bank is only one option. Shop around for competitive rates and options.

 

First Time Buyers

Why Buy?

Two out of three Canadian families own a home – that’s one of the highest rates of home ownership in the world. And for good reason.

It’s a great investment. And with with increasing house prices, it’s all the more important for first-time buyers to get a foot on the first rung of the property ladder.

Did you know that…

• Homeownership is the single largest source of savings for Canadian households.
• Unlike other investments, which can be quite volatile, the increase in the value of homes is relatively steady. The average house price in Canada has increased every year since 1998.
• The return on your investment in your home can be substantial. In 2004, the average house price in Canada rose to a record $227,210 – a 9% increase in just one year and a 27% increase over four years.
• Homeowners can use the equity in their homes as security for other loans.
• Building equity in your first home is the first step on the property ladder. It gets you into the market, keeps you in touch with increasing house prices, and puts you in a good position to trade up to bigger and better houses as your circumstances allow.

Looking

There are a lot of homes out there. How do you figure out which one is right for you? Start by getting familiar with the market. Drive around the areas you’re interested in and get an idea of what’s available. Talk to friends, use the Internet, check out community newspapers and catalogs from local real estate companies – and don’t forget your REALTOR®. That’s why you have one.

The Depass Group will work with you to expand your choices, making you fully aware of what your home-buying dollar will buy in various communities. Then we will help you separate good options from those that are less-than-optimal, educating you on the features and benefits of specific homes and their neighbourhoods.

Viewing Homes

What should I look for when viewing a home?

You pull up to the curb and there it is – the home of your dreams.

Calm down. Take a deep breath and start again. The hardest thing to do when looking for a home is to remain objective. It is easy to fall in love with a home’s appearance, but it’s very important to look beyond the window dressing.

Here are some things to consider when looking at a home:

General Upkeep

First appearances do count. Is the home dirty and cluttered? Are the lawns uncut? Are the walls chipped and in need of paint? If the owner hasn’t bothered to keep the house looking clean and attractive, what problems are lurking below the surface?

Water leaks

Water can do a lot of damage to a home. It rots wood, undermines foundations, and leads to mould and mildew. Reshingling a house, or repairing a cracked foundation to stop water leaks, can be extremely expensive.

It takes an expert eye to find most water leaks (which is why we recommend you have a house inspected before you buy). If you spot stains, bulges and other signs of water damage on ceilings or walls, make special note that there could be a problem.

Appliances and fixtures

Test the lights, faucets, toilets, furnace, air conditioning, and all major appliances that are to be included with the home. Make sure everything is working as it should.

Floors

Floors should be smooth, even, and solid. Soft springy sections, excessive squeaking, and unevenness are all indications that expensive repairs may be needed.

Doors and windows

Check that doors and windows fit snugly and operate smoothly. Look for flaked paint and loose caulking. Check for drafts.

Drainage

Walk around the yard looking for areas where water might collect. Soggy areas near the foundation indicate poor drainage.

Grout and caulking

If the grout and caulking around bathroom and kitchen tiles are loose and crumbling, there is a good chance water is finding its way into the wall or under the floor.

Structural

Look for deep cracks in the foundations or loose mortar and bricks.

Furnishings

If you are not planning to replace all of your furniture (and not many people are), make sure it will fit into the rooms of the new house. Be sure to bring a measuring tape. Rooms can be deceptive.

Storage space

Make sure your new house has enough storage space for all your belongings. And that means more than just your clothes. Think of all the things that need to find a home – tools, gardening equipment, old toys, sports equipment, and all those wedding presents that are still in their original boxes. Check the size of the closets, the attic, the basement, and the garage. Rule of thumb: there’s never enough storage space.

Inspection

You should take a long hard look at a house before you put in an offer to protect yourself from disappointment down the road. But, nothing can replace the expert opinion of a qualified home inspector. Inspectors can spot problems that the average person would never find and they can usually advise you on how much it will cost to make the repairs. A home inspection can help you determine whether or not you are going to make an offer on a house, and if you decide to go ahead, just how much that offer is going to be.

Market Conditions

Pay attention to market conditions – they will have a definite impact on your position as a buyer. The table below lists the influences that different conditions may have on you. Impact and expenses may vary, depending on your area.

Market Conditions	Characteristics	Implications
Buyer’s Market The supply of homes on the market exceeds the demand.	High inventory of homes. Few buyers compared to availability. Homes are on the market longer. Prices tend to drop.	More time to look for a home. More negotiating leverage.
Seller’s Market There are more buyers looking to buy a home than there are homes on the market.	Smaller inventory of homes. Many buyers. Homes sell quickly. Prices usually increase.	May have to pay more and make decisions quickly. Conditional offers may be rejected.
Balanced Market The number of homes on the market is equal to the number of buyers.	Sellers accept reasonable offers. Homes sell within an acceptable time period. Prices are generally stable.	More relaxed atmosphere. Reasonable number of homes to choose from..

 

Types of Home Ownership

What type of home ownership is right for me?

There are three broad categories of home ownership:

1. Freehold

The owner owns the house and the grounds.

Freehold homes offer the most privacy and freedom of choice of any type of home. Homeowners are free to decorate and renovate as they please. They are also responsible for all the maintenance both indoors and out.

Freehold is the most common type of home ownership.

2. Condominium

The homeowner owns the unit and shares in ownership of common elements. Condominiums are usually apartment buildings, but also include townhouse developments and developments of detached buildings on private roads.

The homeowner is responsible for the interior area of the unit (everything from the plaster in). The condominium association is responsible for the up-keep of the exterior of the building, common interior elements (halls, elevators and parking garages, for example) and the grounds. All condominium owners pay a monthly fee to the condominium association to cover maintenance costs and common utility fees and taxes.

Condominiums often have strict rules regarding noise, use of common areas, and renovations to units. Condominium residents often enjoy less privacy than residents of detached homes.

Condominiums are usually less expensive than freehold houses.

3. Co-operative

Co-operatives (or co-ops) are similar to condominiums but instead of owning your unit, you own a share in the entire building or complex.

Co-op residents pay for maintenance and repairs through monthly fees and are subject to the rules and regulations of the co-op board.

If you decide to sell your shares and move out, the co-op board has the right to reject your prospective buyer.

Purchasing

Once you’ve found the home you’re interested in, it’s time to make an offer. Deciding what to offer is one of the most difficult decisions to make. Offer too little and you stand a chance of losing the house (particularly in a seller’s market). On the other hand, nobody wants to pay more for something than it’s worth.

Depass Real Estate can help you enormously by showing you what comparable houses are selling for, helping you assess the condition of the house, and judging the type of competition you may face. Once you have decided on the price you are prepared to offer, we will draft the offer and explain the details to you.

Depass Real Estate will communicate the offer, sometimes known as an Offer to Purchase (a legal document specifying the offers terms and conditions) to the seller, or the seller’s representative, on your behalf.

The offer can be firm or conditional.

Firm Offer to Purchase: usually preferable to the seller, because it means that you are prepared to purchase the home without any conditions. If the offer is accepted, the home is yours.

Conditional Offer to Purchase: means that you have placed one or more conditions on the purchase, such as subject to home inspection, subject to financing, or subject to the sale of the buyer’s existing home. The home is not sold until all the conditions have been met.

Making An Offer

 

When you’re making an offer to buy a home, there are six main elements to consider:

1. Price

The price you offer reflects your opinion of the value of the house and is determined by the condition of the property and local market factors. You can make any offer you like. It does not have to be the same as the seller’s asking price.

2.  Deposit

The deposit shows your good faith and will be applied against the purchase of the home when the sale closes. Your Realtor can advise you on an appropriate amount.

 3. Terms

Include the total price offered and the financing details. You may arrange your own financing or ask to assume the seller’s mortgage, especially if it has an attractive interest rate.

 4. Conditions

Conditions are items that must be completed or fulfilled prior to an offer being concluded. These can include subject to home inspection, subject to you obtaining financing, or subject to you selling your existing property.

5. Inclusions and exclusions

Your offer may be contingent on certain items being either included or excluded in the sale. These might include appliances, fixtures, and decorative items, such as window coverings or mirrors.

6. Closing or possession date

The closing date is generally the day the title of the property is legally transferred and the transaction of funds finalized, unless otherwise specified (except in Manitoba and Quebec). In British Columbia the possession date is legally one to three days after closing.

Negotiating

Once your offer to purchase has been drafted, it will be presented to the seller as soon as possible. The seller can accept your offer, reject it, or make a counter offer.

Acceptance

An accepted offer means the seller has agreed to all the terms and conditions exactly as set forth in your offer to purchase.

Rejection

A rejected offer means the seller did not agree with any of the terms and conditions set forth in your offer to purchase.

Counter offer

A counter offer means the seller agrees with some of the terms and conditions of your offer, but not all of them.

The seller then makes a counter offer. The counter offer may change the price, the closing date, or add or delete conditions.

Once you have received a counter offer you have two choices. You can accept the new terms and conditions or reject them. If you reject them, you can choose to start the whole process over again.

Inspections & Appraisals

Buying a home is probably the biggest single investment you will make. A home inspection prior to making an offer will protect you and your investment.

A qualified home inspector will give your house a thorough examination, checking the heating and cooling system, plumbing and electrical systems, the roof, attic, walls, ceilings, floors, windows, doors, foundation, basement, and visible structures of the home.

The inspector will point out the need for major repairs, identify areas that may need attention in the near future, and explain what maintenance will be necessary to keep the house in good shape. But, it is not all negative. Most inspectors are more than happy to tell you about the home’s good qualities as well.

Home inspections are relatively inexpensive considering the size of the investment that you are about to make. Many people consider this a small price to pay for peace of mind.

Depass Real Estate can provide you with a list of reputable, qualified home inspectors in your area.

Appraisals

An appraisal is a report containing an estimate of the value of the property. Appraisals are conducted for the purpose of mortgage lending by certified appraisers. The appraisal should not be confused with the home inspection or the market analysis.

Closing

What does the term closing mean?

Closing refers to the preparation for the transfer of ownership of a property from the seller to the buyer.

There is no standard method for closing. In some places, “round table” closings bring all parties together at the closing table. In other areas, buyers and sellers complete the process through separate, individual appointments with their lawyer.

Closing Day

What happens on closing day? Closing day is the day you become the official owner of your home.

Typically, you visit your lawyer’s office to review and sign documents relating to the mortgage, the property you are buying, the ownership of the property, and the conditions of the purchase. Your lawyer will also ask you to bring a certified cheque to cover the closing costs and any other outstanding costs.

Once the mortgage and the deed for the property are officially recorded, you become the official owner of the property and your lawyer will call you to pick up the keys to your new home.

Congratulations! You’ve just bought a home!

Costs

When you buy a home, you will be asked for a down payment, usually between 5 and 25% of the total price of the property. You might also have a number of other fees and expenses to pay.

Some of the most common expenses are listed below. These expenses may vary, depending on your area:

Expense	Paid
Mortage application and appraisal fee	At time of application
House inspection (optional)	At time of application
Legal fees	Closing
Legal disbursements	Closing
Deed and/or mortgage registration	Closing
Property survey (sometimes provided by seller)	Closing
Land Transfer Taxes by province	Closing
Property tax adjustments	Closing
Fuel adjustments	Closing
Mortgage insurance	Closing
Title Insurance	Closing

Estimate the full cost of your home with the Closing Cost Estimator.

Land Transfer Tax

Purchasers in most large Canadian centres can add Land Transfer Taxes to their list of closing costs. Unless you live in Alberta, Saskatchewan, or rural Nova Scotia, Land Transfer Taxes (or property purchase taxes) are a basic fact of life.

Land Transfer Taxes, levied on properties changing hands, are the responsibility of the purchaser. Depending on where you live, the taxes can range from 0.5% to 2% of the total value of the property.

Many provinces have multi-tiered taxation systems and these can be complicated. If you purchase a property for $260,000 in Ontario, for example, 0.5% is charged on the first $55,000; 1% is charged on $55,000 to $250,000, and 1.5% is charged on $250,000 to $400,000.

Use the Land Transfer Tax Calculator to estimate the land transfer tax for your new property.

Land Transfer Taxes by province:

British Columbia Property Purchase Tax Up to $200,000 X 1% of total property value From $200,000 up X 2% of total property value

Manitoba Land Transfer Tax Up to $30,000 N/A From $30,000 to $90,000 X 0.5% of total property value From $90,000 to $150,000 X 1% of total property value From $150,000 up X 2% of total property value

Ontario Land Transfer Tax Up to $55,000 X 0.5% of total property value From $55,000 to $250,000 X 1% of total property value From $250,000 to $400,000 X 1.5% of total property value From $400,000 up X 2% of total property value

Quebec Transfer Tax Up to $50,000 X 0.5% of total property value From $50,000 to $250,000 X 1% of total property value From $250,000 up X 1.5% of total property value

Nova Scotia Land Transfer Tax Halifax Metro: 0% to 1.5% on total property value Outside Halifax County: Check with local municipality.