Buyers Be Aware, It's Confusing Out There...

...Preparation is key to your success.

Buying a home can be stressful at the best of times but with tight budgets, competition for properties and relatively high interest rates, buying in today's market can ratchet that stress to new levels. This blog shares some pointers on how to increase the likelihood of a successful search while keeping stress levels manageable through research and planning. A little upfront research and planning can make a world of difference in your ability to deal with the ups and downs of the home buying process and to your satisfaction with the end result.

Most people, once they have decided that they would like to purchase a house or condo, immediately begin looking at properties online. Wrong starting point. If you decide that you would like to or have to move, the best starting point is to look at your financial situation - what can you afford to purchase and carry on a monthly basis. Getting pre-approved for a mortgage provides you, and any owner of a property that you make an offer on, with a better sense of whether or not the deal will actually come to fruition or not. Neither side wants a deal to collapse because your financial institution will not approve the financing. Even with pre-approval, a financial institution will want to appraise the property before committing to a mortgage. 

A common misconception of new buyers is that they only need to concern themselves with the price of the property. The following link provides a good summary of other costs that can affect what level of funds will be needed to close on a purchase. 

When making an offer to purchase, a deposit will be needed, usually within 24 hours of the offer being accepted by the seller. It's important to have reasonably quick access to the required percentage of the offer price (5% is common) as it will need to be transferred to the listing brokerage's trust account once the offer is accepted. If your agent doesn't provide it, you might need to cover the cost for a home inspection. When you close on your new home, once again, if your agent doesn't provide it, you might also want to have the home cleaned professionally and carpets cleaned. You'll need to move your furniture and may have to purchase items as rudimentary as snow shovels and gardening tools. Depending on the state of the property, you could find yourself wanting to paint over that lovely shade of mauve in the family room!

When thinking about carrying costs, there are the usual elements; mortgage payment, mortgage insurance (CMHC), life & disability insurance, taxes, utilities, any property management fees but an amount should also be budgeted for repairs in the first year of ownership. Appliances fail, HVAC systems choose not to function at the worst possible time and roofs, doors, windows and fences are other common areas requiring unforeseen investment.

With financing sources & commitments secured and limits defined, you are now ready to create your shopping list of property features and start looking at specific properties. Inevitably there will be concessions to be made in terms of property features and location based on what you can afford.

There are a number of government programs that provide various levels of aid to buyers. Check out the following links for more information: