Buyer and Seller Tips
Buying Tips
Buying real estate can be both exciting and daunting. This section was designed as a jumping off point in your decision making and I will be happy to answer any questions you may have.
Costs for the Buyer
These costs are the responsibility of the buyer.
- Mortgage Costs including
- Mortgage company’s lawyer/notary
- Land Title Registration fees
- Appraisal if required
- Taxes
- Goods & Service Tax ( if applicable)
- Property Tax Adjustment
- Property Purchase Tax (1% on first $200,000 and 2% on the balance)
- Sales Tax ( if applicable)
- Strata Maintenance Fees ( if property is part of a strata corporation)
- Fire Insurance
- Survey Certificate ( if required)
- Lawyer or Notary fees and expenses
Financing
It is always an excellent idea to obtain pre-qualification from a mortgage lender regarding the maximum loan amount available. This allows the buyer a clear understanding of what they can afford, saving time and energy. With pre-approval obtained there is the freedom to act on any appropriate property in a timely fashion. Buyers can also lock in an interest rate for a period of 60 - 90 days, even if those rates increase. The lender will take into account gross income, monthly expenses, debt and credit rating along with down payment amount to determine the loan. The following figures are guidelines only, as personal situations vary and different lenders have slightly different policies and procedures.
Down Payment
Residents of Canada Generally, most lenders require a down payment of 25% of the purchase price or appraised value. However, it is possible to borrow as much as 90-100% of the purchase price in what is known as a high ratio mortgage. There are additional costs to insure that mortgage through CMHC, which can be added to the amount borrowed or paid immediately.
Non-Residents For non-residents of Canada the required amounts are slightly different. Requirements vary between lenders but usually a down payment of 35-40% of the purchase price or appraisal value is needed. CMHC financing is not available to non-residents.
GST
The GST is a 6% value added tax charged at the point of sale. With respect to real estate, GST is charged on new construction and resale property that has been used for short term or nightly rentals. A resale property used solely as a residence is not GST liable. Should the situation arise, consultation with a lawyer or accountant is strongly advised.
Other Considerations
- Building inspection
- Every buyer should have a building inspection done on their prospective purchase. This will tell you the condition of the property as it is now and provide a guideline of what maintenance will be required in the future. An inspection costs approximately $300 but can potentially save thousands.
- Understand Buyer’s Agency
- A legal relationship exists between you (the principal), the Agent (the office your realtor works for) and your realtor. Agents and their salespeople are legally obligated to promote and protect the interests of their principals as they would their own.
- Identify your needs and goals
- One of the satisfying things for me about being a realtor is helping people clarify what they are looking for and then helping them find it. If you sit down and honestly evaluate what you want, the chances of finding it go up immensely and you will end up much happier with your final decision.
Seller Tips
Selling your home for it’s maximum amount requires some planning and usually a little elbow grease. It can be both emotional and inconvenient to have a house listed so I have included a few basic points to help make things go smoothly and profitably. Most buyers will have questions, concerns or issues with any property, so identifying and addressing them right away will always work to a sellers benefit. I am always available to view your property, make suggestions and help you identify what buyers are looking for.
Costs for Sellers
These costs are the responsibility of the seller.
- Costs of clearing title including
- Discharge fees charged by encumberance holders
- Mortgage prepayment penalties.
- Lawyer or Notary fees and expenses
- Real Estate Commission
- GST on Commission and other services
- Capital Gains ( if applicable)
- Adjustment for Ownership
- Taxes
- Strata fees ( if applicable)
Home Selling Tips
The key to a quick, hassle-free sale of your property is to present it in a way that prospective buyers can picture themselves living there. The following are simple, low cost ways to help paint that picture.
- Eliminate clutter
- Nothing shrinks a house like clutter and you can expand your home and it’s rooms by clearing it away. Clean out overflowing closets, kids toys and if possible, store excess furniture somewhere else. Less is more.
- Garage Sale
- Most people have a garage sale after they sell. Once you have un-cluttered, consider having a garage sale before people view the house and that way everything is definetly out of the way.
- Clean Up
- You would be amazed at the number of people who don’t, and then wonder why their house doesn’t sell! First impressions are everything and if people see a clean home they will feel the house has been well looked after and can picture themselves living there. If you do nothing else, do this.
- Fix up and repair
- Look around. Fix the things that buyers will notice and be concerned about. Cracks, peeling paint, hanging wires, rotten fence boards, squeaking hinges etc. can all be dealt with quickly and inexpensively. Buyers not only think of cost but of hassle as well and eliminating them means money in your pocket.
- Paint
- A proven winner, a fresh coat of neutral, tasteful paint will work wonders.
- Exterior
- Tidying up the exterior is important because the moment that a potential buyer walks up they are evaluating your property. Mow the lawn, shovel the snow and get rid of any exterior clutter.
- Aromas
- People feel the same way about offensive aromas as they do about dirt. Cooking, smoking and pets are the most frequent causes and dealing with them beforehand will help your property sell. Cleaning the carpets, smoking outside, cleaning and using air fresheners or candles will all help.
- Clean and tidy the garage/workshop
- A good garage or workshop is a strong selling feature so maximize it’s appeal.
- Lighting
- Make sure the house is well lit and all the bulbs work.
- Walk through
- Have a friend, neighbour, relative and your realtor walk through the house and get an honest opinion of the appearance of your home both before and after your efforts. Have them look at everything as potential buyers would and don’t get mad!
- Survey and Home Inspection
- While these items are the responsibility of the buyer, some sellers get one or both done in advance to demonstrate good faith and seriousness, address issues beforehand and help speed up the selling process.