7 Questions Every Home Buyer Should Ask

What is my primary use for the home – what key features and benefits do I require from my new home and neighbourhood?

Ask yourself, “What do I want to do with my home?”

Generally, home buyers use a home as a primary or secondary residence or as an investment property.

Do you work from home? Will clients and associates visit you at your home office? Maybe you will only use the home on weekends and in the summer. Perhaps your primary use for the property to earn income.

A fully fenced backyard may be important for dog owners and families with young children. Walkability is a big benefit especially in urban areas where walking to work and school are lifestyle choices. Retirees often consider the distance to health care and shopping. Privacy, access to waterfront and recreation are other considerations.

When you ask yourself these questions the type of home and property you want to purchase becomes clear to both yourself and your REALTOR®.

How and why should I prepare for a mortgage?

Getting pre-approved for a mortgage is a process that home buyers who need financial help buying a home have to go through with a mortgage broker, credit union or bank.

Be proactive and get the ball rolling before you start looking for a home. This shows your lender, REALTOR® and home sellers that you are serious about buying a home and you have a solid idea of what you can afford and that you are looking at homes within your budget.

To get pre-approved for a mortgage you will need:

• proof of income like income tax statements or financial statements if you are self-employed,
• list of assets (RRSP, vehicles or boats, other investments, other real estate holdings) and
• liabilities (credit card debt, student loans, car loans, child support) and photo identification.

From there your mortgage broker will look for the best deal that fits your budget taking into account monthly expenses things like property tax, home improvements, heat and hydro and of course your mortgage payment and mortgage insurance, if applicable.

Get pre-approved for a mortgage and stand out from the crowd as a home buyer.

Are the municipal zoning and strata by-laws in-line with my primary purpose for buying the home?

it is your responsibility, along with your REALTOR®®’s help, to check the municipal and provincial zoning and in some cases strata by-laws for the home you want to buy.

Let’s say for example you want to run a B&B from you home. You go ahead with the purchase and then find out after closing that the zoning or the strata doesn’t allow for short-term rentals. You end up without the income you thought you could get from the property and now you are short on the monthly mortgage payments.

Easily avoid disappointment by asking the right questions at the local municipal hall.

Or, here’s another scenario… You purchase an acreage property with a home in the Agricultural Land Reserve (ALR). Your idea is to build another home to use a long-term rental income but you later find out that because the home is in the ALR you are restricted to one home.

Again, you are short on your monthly mortgage payment because of the loss of expected income from the second home.

More commonly, homeowners who work from home, in most cases, fit perfectly into municipal zoning as home occupation.

Always ask questions at every level of government to confirm your ideas for the use of the property fit into zoning and bylaws of the area.

What are the current local values of homes in the area I want to buy?

It always a good idea to be aware of what other homes in your desired neighbourhood have recently sold for as an indicator of current market value.

Your REALTOR® should be able to give you a well-rounded representation of sale price, Housing Price Index (HPI), sales volume, days on market and sales success ratio to provide a holistic view of market activity at any one time.

What should I include in my offer to buy the home?

Your desired price is the first thing you want to negotiate. Keep in mind your other monthly and bi-weekly expenses.

Next, you want your desired move in and closing dates that ideally line up with moving out of your current home.

Then, conditions of the sale, things like home inspection, financing approval, review and approval of strata documents, etc.

Inclusions and exclusions – items of importance to you that are part of the home and property such as washer and dryer, light fixtures and affixed mirrors.

BONUS!

In a busy real estate market where multiple offers are the norm a personal letter or video saying telling your story about why this is the home for you may go a long way to win over a home seller and touch their heart. We’ve seen this happen where a young family won out with a lower price and many conditions because the buyer reminded the seller of when they were first starting out with their young family. Stories are powerful and persuasive.

What costs, other than the purchase price of the home, should I prepare for?

When it comes to buying a home nobody wants any costly surprises!

The following are costs that one can generally expect to pay as part of the process of buying a home. Service and price can vary, be sure to ask about what you’re paying for and how much.

• Home, septic and pest inspection,
• conveyancing including adjustments – performed by your lawyer or notary,
• title insurance, fire and home insurance,
• home appraisal (usually paid by the mortgage lender – be sure to ask),
• mortgage fees,
• renovations, short- and long-term home repairs and improvements,
• property transfer tax, foreign home buyers tax, Goods and Services Tax (GST) on brand new construction, newly subdivided land and services and moving costs.

Keep these costs in mind when crunching your numbers and avoid any unpleasant surprises.

How and when should I start preparing for the move?

Mental preparation is half the battle of preparing for a big move.

With a positive mindset and a support of friends and family you’re on your way to a smooth move.

One to two months before your desired move-in date is an excellent time to start packing. Start with seasonal items like clothing and recreational gear moving onto wall hangings, books and knick-knacks. Leave must have items like clothing and personal items to the last day.

Moving is an excellent occasion to go through your “stuff” and get rid of unwanted or rarely used items.