Buying Real Estate

SO IT’S TIME TO SELL

Are you thinking about selling your home but wondering if the right time is now? To help you determine if it is I have used my years of real estate experience, plus that of the brokerage team, to put together a guide to walk you through the steps of selling your property and give you the tools you need to make this important decision.

First of all, you need to know that local market conditions will have the most impact on the amount of money you can get for your property and how quickly you can sell it. You may put a price on your home, but the market is what really prices your home.

Under any circumstances, selling a home can be a stressful process, emotionally, financially and physically. To help ease this stress, I am here to counsel you through the sale with the wisdom I have gained from experience, saving you incalculable aggravation and money. I know your neighbourhood, what Buyers want in a home, how to negotiate the best price and how to close the deal for you. Together, we can make the sale of your property easy and worry-free – and it all begins with you.

HERE YOU GO!

To guide you safely and comfortably through the closing period, which usually ranges from 30 to 90 days. I will:

• Arrange Buyer Access visits to your new home for you, typically 2 viewings or as outlined in the Agreement of Purchase and Sale, so you can see your new home and take measurements, plan interior decorating, renovations etc.
• Advise you on any inspections that might be needed, such as home inspections or mortgage appraisals.
• Recommend trusted tradespeople to you so you can start receiving quotes for any renovations you may wish to carry out once the home is legally yours, this can cut down the wait time.
• Provide you with valuable contacts to trusted professionals such as expert real estate lawyers, mortgage brokers, and movers.
• Explain the costs and fees to you, such as helping you calculate your Land Transfer Tax.
• Recommend moving tips and remind you of important things to do, such as switching your utilities over to the new home in time. Remember, there may be a pre-payment cost on taxes, hydro, gas, and fuel etc…
• Help you answer questions about your new property for your insurance company that you might not know the answers to.
• Check in with you on a regular basis to make sure everything is going well and you are prepared for the big move to the area.

Below is some detailed information on the role of an real estate lawyer and on what you need to do when working with your lawyer and securing a mortgage. Your lawyer should advise you what expenses you are likely to incur with respect to the closing procedures, including:

• Legal Fees + HST and Disbursements
• Land Transfer Tax: Ontario Land Transfer Taxes are payable by the Buyer through their lawyer upon closing of the transaction.

The formula for calculating Ontario Land Transfer Tax is:
0.5% on the first $55,000
Plus 1% of the amount from $55,001 to $250,000
Plus 1.5% of the amount in excess of $250,001 to $400,000
Plus 2% of the amount in excess of $400,000

If you have bought a new home from a builder, the lawyer can give you an educated estimate as to how much you should budget for “hidden charges” such as:

• Ontario New Home Warranty Enrolment Fee
• Hydro and Water meter installation charges
• Fencing charges
• Grading Deposit charges
• OTHERS

If all the conditions in the Agreement have been met and the Offer is firm, the lawyer proceeds to investigate the title to the property. Initial searches include:

• utility searches
• property tax searches
• building, zoning and planning searches
• registered title searches

A Tax Certificate is requested by your solicitor to verify the amount of the current year’s taxes and to ask about any arrears and outstanding charges for taxes. Your lawyer will also write to the Building and Zoning Department to get the full particulars of zoning by-laws and restrictions and permitted uses for the area

A Search of Title to the property is begun in the Land Registry Office to make sure the Seller is the true owner of the property, has the right to sell you the property, and that the property is not subject to any encumbrances, encroachments, easements, liens, agreements or mortgages that were not disclosed in the Agreement or Purchase and Sale. This search has to be completed prior to the Requisition Date (title search date) shown on your Agreement of Purchase and Sale.

If you are getting a mortgage, you MUST have fire insurance to cover the property from the day of closing. Let your insurance broker know the name, address, phone number and fax number of both your lawyer and of the financial institution providing your mortgage. Your lawyer needs a letter confirming that insurance coverage is in place effective on closing in order to advance the money to close your purchase.

HERE YOU GO!

When I draft the legal purchase documents, there are five main elements to keep in mind:

• Price – this does not have to be the same as the Seller’s asking price. There are many factors to consider, Is the home priced at fair market value? Is there work that needs to be done immediately, Has the home been on the market long? Are homes moving quickly in the area? I will help you determine all of these factors and help you decide on a good price.
• Deposit – shows your good faith and will be applied against the purchase of the home when the sale closes. A deposit should be at least 5% of the home’s purchase price.
• Conditions – standard conditions can include the following clauses: subject to home inspection, subject to you obtaining financing, or subject to you selling your existing property. However, a condition can specify almost anything. Sellers obviously do not like to have their homes effectively off the market while they wait for conditionals to firm up, so the shorter the conditional period (i.e. 3-5 business days) the better chance the Seller will accept your offer.
• Inclusions/Exclusions – your offer may be contingent on including certain home items in the sale, such as appliances, fixtures, and finishing items, if you like it then it can be included.

The Closing Date – the Seller will often specify the date or date range they would like to close on the property and your offer should closely match this. The closing date is the day the title of the property is legally transferred to you and all funds go to the Seller.

THINGS TO LOOK FOR WHILE VIEWING

One of the hardest things to do when looking for a home is to remain objective because it’s easy to fall in love with a home’s appearance, but it is also important to look beyond the outer layer, because sometimes appearances can be deceiving.

Here are some things to look for when viewing a home:

• General upkeep – is the home dirty or cluttered and are the lawns uncut? If the owner has not bothered to keep the house looking clean and attractive, what problems could be lurking below the surface?
• Water leaks – water rots wood, destroys foundations and leads to mold and mildew just to start. Re-shingling a house or repairing a cracked foundation can be very expensive. Look for stains, bulges and other signs of damage on ceilings and walls, loose crumbling grout around bathroom & kitchen tiles could mean leaking water. It takes an expert eye to find many water leaks so please feel free to bring a professional with you on our showing, or I can also arrange to commission a home inspection if the seller has not already provided one from a reputable company.
• Do things work? – where possible, test the lights, faucets, toilets, furnace, air conditioning, and all major appliances that will be included with the home sale and make sure everything is working as it should
• Floors – should be smooth, even and solid, otherwise, repairs may be needed
• Doors and windows – should fit snugly and operate smoothly. Look for flaked paint and loose caulking. Checking for drafts is always important
• Outside – walk around the yard looking for areas where water might collect. Soggy areas near the foundation indicate poor drainage
• Look for deep cracks in the foundations or loose mortar and bricks
• Be sure to bring a measuring tape if there are any large items that you want to ensure fit in your new home as doorways may not allow

Home is the nicest word there is. It’s not a place, it’s a feeling.
Ray Brown

Sellers are contractually obligated to disclose all problems in their homes that they know about, HOWEVER, nothing can replace the expert opinion of a qualified home inspector. A qualified home inspector can give the home a thorough examination, checking heating and cooling systems, plumbing and electrical systems, the roof, attic, walls, ceilings, floors, windows, doors, foundation, basement, basically all visible structures of the home. They will point out the need for major repairs if necessary and identify areas that might need attention in the near future. What level of maintenance will be needed to keep the house in good shape, most home inspectors in the area are more than happy to tell you about the home’s good qualities as well, so you can decide if it is a good fit.

BEGINNING YOUR SEARCH FOR A HOME

Before we look at homes we will sit down for a complete consultation so that I may get a better picture of what your ideal scenario is. During our consultation, we will discuss your home ownership goals, wish list and desires including your preferred neighbourhoods, price range, timeframe, and of course to answer all of your questions.

Here are some things to consider when compiling your list of needs vs. wants:

• Where do I want to live? or anywhere in between (community/general area)
• Are schools a factor?
• Do I want an older home or a new one? What style of home do I prefer? (detached, townhome/condominium, multi-family, bungalow, farm, acreage) There is every choice available in the area.
• How much renovation and remodeling am I willing to do? Can I see past a coat of paint?
• Is being close to public transportation important for me?
• Do I have physical requirements such as wheelchair access or others?
• Do I have pets to consider?
• What sort of lot am I looking for? (small yard, large yard, acreage, fenced, garage, workshop, barn or other buildings)
• How many bedrooms do I need and how many would I like to have?
• How many bathrooms do I need and how many would I like to have?
• How big of a house do I want with how many rooms and how many square feet?
• What features are important to me? air conditioning, carpeting, ceramic tile floors, hardwood floors, eat-in kitchen, separate dining room, formal living room, family room, den, library, finished basement, separate laundry room, fireplace, workshop etc…

Another key factor we will consider is whether you already have a property to sell. The question of whether to buy first or sell first has a different answer for everyone and depends on the individual. It is always a risk to buy before you sell, but it is also a big inconvenience not to find a home and have to move into a rental for a couple of months while still looking for a house to buy. I have helped many buyers choose which option is best for them while negotiating closing dates and conditions that work best for the planned move(s). If you have a home to sell, I can help you improve its ability to sell so you will receive the highest market value for it and put yourself in a great situation.

Throughout the home search, I am here to help you navigate the ups and downs and you can count on me to:

• Pre-screen the online properties you see, keeping your ultimate goals in mind so you are not wasting your time sifting through hundreds of property listings that don’t match all of your criteria
• Recommend the best homes and nieghbourhood for viewing based on my area expertise in the area.
• Make you completely aware of what your dollar will get you by finding opportunities, great homes near your main search areas
• My office will arrange all of your viewings and I will personally guide you through the viewing process, showing you feature and or problems you may not have spotted
• Advise you about your legal and financial options available to you
• I can recommend expert help when needed, such as home inspection and contracting services.

My goal is to have all the information you need to make well-educated, stress-free choices when purchasing your new home.

LOCAL REALTORS, WHAT TO LOOK FOR

Once you have decided that the time is right for you to buy a property, you will want to choose a real estate agent to work with. More so in recent years, the question comes up: why should I use a real estate agent at all? With the surge in for sale by owner (FSBO) websites and the explosion of websites geared to helping buyers find the properties and research neighbourhoods, some people consider doing the job themselves. The fact remains that you might find your ideal home on the internet but it is still essential to have an advocate who will help you with every step, from screening potential properties to negotiating the best possible deal for you and handling the dozens of complicated transactional details. The great news is that Buyer Representatives are compensated by the seller, so using a Realtor does not require the Buyer to pay any out of pocket fees. I will put all of my time and effort into helping you reach your real estate goals and I do not get paid until you are happily moved into your new home!

BENEFITS OF HAVING A TRUSTED PROFESSIONAL GUIDE YOU THROUGH THE PROCESS

• Real estate agents have access to the Broker’s version of the Multiple Listing Service (realtor.ca) which receives immediate updates and contains more detailed information, while the public version has a delay in updates and contains less information for the area.
• The BUYERS agent is looking out for you, they will not negotiate diligently on your behalf to obtain the best possible purchase price for your new home.
• Having a relevant consult on the current market value in the area means you will not overpay for the purchase of a home without knowing you’re doing so, also you might not lose out on your dream home by a few thousand dollars in multiple offer situations.
• A realtor’s trained eye and expertise can assist you in detecting serious problems with the home, including structural damage that may not be visible to the untrained eye. A Home Inspection is always recommended to be an included clause in the Offer to Purchase.
• Complex clauses in the Offer to Purchase (drafted by the Seller’s advocate, not yours) may put you at a disadvantage in terms of payment arrangements and conditions. Your realtor will be working for you to obtain the best terms in every circumstance for you!
• Once the deal is done, your Realtor will take care of all the closing arrangements.

A realtor is not a salesperson, they’re more of a matchmaker.
JENNIFER MORTON

Buying a home is a big step, both financially and emotionally. My clients are all happy to have had an experienced real estate agent on their side. I have helped many people buy their homes, and experience pays off.

BUYING REAL ESTATE

People tend to invest their money in real estate and the stock market, both of which have their peaks and valleys. Of these two popular investments, real estate tends to dip for less time than it peaks; there are long periods of sustained growth, shorter valleys, and over time, the trend is always upward.

Here are some things you should know about investing in real estate:

If you plan to live on your property for more than five years, you are in a great position. You will have the benefit of being able to ‘time the market’ and sell when it is to your advantage. In this case, your home is also a lot more than a tangible investment in your future, also it is a place for you and your family to put down stable roots in the community while enjoying and personalizing your living space.

If you have bought your property mainly to generate rental income and do not “have” to sell it at any specified time you are similarly in a great position to gauge when housing prices have hit their peak so that you can sell at the height of the seller’s market. In the meantime, all that rental income is paying for the mortgage, repairs, and upkeep on the property.

The best time to buy a house is always five years ago.
Ray Brown

The majority of homes are purchased with the intention of being owner-occupied. However, some buyers do purchase an investment property, often pre-completion condos, vacant land or homes in disrepair with the intention of making improvements and then selling. “Flipping” properties require a skill an experienced business acumen and a great deal of planning because the intention is usually to re-sell the property within a short period of time, you have to time it right.

Remember, there are other serious financial benefits to owning property that a realtor can assist you with:

• Tax benefits for improvements made to the property
• Government rebate programs for eco-friendly renovations
• Homeowners can use the equity in their homes as security for other loans
• Building equity in your first home puts you in a good position to upgrade to bigger and better houses as your circumstances allow
• Mortgages on investment properties are tax-deductible

Of course, before you begin your search it is crucial to examine your own personal and financial circumstances to determine whether now is the right time for you.

Here are some key points to consider:

• How much can I afford for a down payment?
• Do I have additional funds allocated for closing costs?
• Is my current job stable?
• Is my situation (job change, starting family, etc.) likely to change in the next 12-24 months?
• Do I have the time and energy for this process? (looking for homes, notice given to the landlord, baby on board etc…)
• Do I have a home that I want and need to sell first?

Ideally, find out about your mortgage options before you start looking. Pre-qualifying for a mortgage is the best way to discover how much you can afford. Your personal banker or financial planner will look at your current income, expenses, and debt to determine how much a lender will lend. All of this information should be given to you from any of the local real estate agents you choose from.