Buying a home is the largest investment most of us ever become involved in. Yet people sometimes take less time over it than they do when buying a new car. That’s because it’s unfamiliar territory to many of us. We don’t know what questions to ask. We may take things for granted, rely on others when we shouldn’t, and sometimes we later wish we had known more about the process involved.
The Real Estate Council of British Columbia feels it is important for you to understand the procedures normally involved in the purchase of a home, to recognize the significance of the documents you will encounter, and to understand the role of other people who may be involved in the transaction. Buying a home is a major event. This information will help you better understand the entire process.
TEAM SM WILL HELP YOU MAKING: The Decision to Purchase
The obligation to Disclose DefectsPurchasing a home can be both exciting and frightening!! It is probably one of the biggest financial investments you’ll ever make. You’ll not only have to live with your decision but also live in it, so you don’t want to make any costly mistakes. Before you start looking for your “dream” home, organize yourself by considering a few basic questions:
2. WHAT ARE THE DIFFERENT Types of Housing OPTIONS :
To meet the many kinds of needs that people have, a number of different housing styles and types of ownership have developed over the years. Your individual requirements and your income level will govern the housing type which is most suitable for you at the present time.
Single Family, Detached Home
A detached home is one which has no common walls with any other residential structure, resting on its own land with front, rear, and side yards. It may be any size from a small, one-storey bungalow to a huge mansion.
A semi-detached home is two single family dwellings joined together by a common middle wall. It is sometimes called a “side-by-side” duplex.
A duplex is two separate dwellings which are attached either side-by-side (a semi-detached home) or one unit above the other. It is important to note that this type of structure may be strata titled property and therefore subject to the Strata Property Act.
In British Columbia, the term “townhouse” is usually used to describe one of a group of dwellings (most often two-storey) joined together by common walls, each with its own entrance from the outside.
An apartment is one of several dwellings (most often single storey dwellings built one above the other) joined together by common walls, each having its entrance from a common hall. The overall building containing the apartments may be from three to 33 or more storeys.
Mobile or Manufactured Home
A manufactured home is a factory-built residential structure designed to be moved from one place to another, although wheels are not necessary. It is often placed on a rented space (called a “pad”) in a manufactured home park
What are my housing needs?
What are the choices?
What can I afford to spend?
Time spent answering these questions in advance may save you from frustration and disappointment during your search. Syed and Manisha Can help you guide through this process
What Can You Afford?: WE HAVE QUALIFIED SPECIALISTS TO HELP YOU
Before you start looking for a new home, it is important that you become aware of how much you can afford to pay. This knowledge will allow you to spend your valuable time looking productively at homes which are within your predetermined price range. You can calculate a relatively accurate figure for yourself if you assemble the following information:
$ _____ The cash you have saved to be used for this home purchase is called the down-payment.
$ _____ Plus: The amount of borrowed money you are able to arrange.
$ _____ Less: Closing costs and other “last minute” costs associated with the real estate purchase.
$ _____ Equals: Maximum Price
The Down-payment: WE HAVE MORTGAGE SPECIALISTS WHO WILL HELP YOU THRU THE PROCESS
Lending institutions will usually require you to make a down-payment of at least 5% to 10% of the purchase price of the home. Lending institution policies may vary from time to time. However, as a general rule, you should make your cash down-payment as large as possible. Your deposit for the real estate transaction may form part of your down-payment.
The Borrowed Money
Almost everyone who purchases a home borrows some of the money needed to pay for it. The easiest way to determine how much money you will be able to borrow as a mortgage loan is to consult with one or more lending institutions. These lenders will apply standard tests, based on your family’s current income and debts, in order to decide the amount of money they will lend to you. They will ask for information about your finances and make a thorough credit check, in order to be sure you are able to repay a loan.
What is a Mortgage?
Obtaining a loan to finance the purchase of your new home will probably require you to sign a document called a mortgage. This document will set out the terms and conditions for the loan and its repayment. If you fail to meet your debt obligations, the lender may have the right to claim your home to pay off what you still owe.
Where Should You Purchase? TEAM SM WILL HELP YOU MAKE BEST SELECTIONS WITH VAST EXPERIENCE
Where Should You Purchase Before you begin looking for your new home, it is important that you consider the needs of all the people it must shelter and what effect their daily activities will have on your desire for a certain size or location, both now and in the future. Thinking about some of the following factors will help you determine where and what you should purchase.
Rural? Small town? Suburban? City?
What facilities are available: shopping centres? places of worship? recreational facilities? hospitals? schools?
Are property taxes comparable to those in other communities?
Are there any future developments planned which you may not like?
Are the sewage and water systems adequate?
What is the availability and cost of utilities: electricity? gas? water?
What public services are provided: the police? fire protection? ambulance? garbage collection? mail delivery? snow removal?
Is there nearby public transportation available?
Do you mind a long commute to work or to visit friends?
Can you afford to drive to and park at your workplace?
Will another car be needed for your partner to drive to work, to shop, or take children to school or other activities?
Are major roads easily accessible?
Is public and private property maintained to your satisfaction?
What is the composition of families living nearby: quiet, mature people? teenagers? potential playmates for children?
Are their incomes and lifestyles compatible with yours?
Have home values risen, fallen, or remained stable in the recent past?
Are there any known projects on the horizon which could substantially change the quality of the lifestyle or the home prices in the area? Do you feel comfortable with the current zoning regulations? Will they protect home values yet still allow you to use a dwelling in the way you envision: outdoor basketball hoops and barbecues? storing your boat? a home-based business? keeping chickens/rabbits/horses? cutting trees? high fences? a basement suite? etc. When you walk up and down the streets of the neighbourhood, can you picture yourself living there for several years into the future? Do you understand the effect of the registered bylaws of a strata corporation? For example, do the bylaws restrict your right to rent the property or prohibit pets? Could the bylaws affect your quality of lifestyle and/or impact or protect the property’s value in the future?
Are you interested in brand new only? a historic, character home? an already renovated resale? a solid, older home that just needs redecorating? or can you purchase a “fixer-upper” and do major renovations yourself?
What combination of space do you require? Think not only about bedrooms, bathrooms and garages but also about areas for hobby activities and children’s play; and storage for clothes, skis, bicycles, windsurfers, tools, garden equipment, etc.
Is a large, well-equipped kitchen important to you? How about a fireplace? A large entrance hall? A sun deck? A pool?
Would you prefer a small lawn and low-maintenance garden, or do you enjoy cutting grass and making things grow?
Do you need a dwelling with room to eventually accommodate more children? Elderly parents? Inlaws? Do you require wheelchair accessibility either for you or your visitors?
Are there any restrictions which could prohibit pets or rentals?
What schooling is available: primary? high school? adult evening programs? college?
How close are the schools and how do the students get there?
Are the schools crowded?
Is the sports program satisfactory?
Do the students have a high achievement record?
If your family has special educational needs, are these available?
Services a Buyer Can Expect From a Real Estate Licensees: SYED AND MANISHA WILL GUIDE YOU TO…
You can expect licensees to provide you with such services as:
Helping you to clarify the type of home you need and can afford
Providing information about available properties and sources of financing
Arranging appointments to view available properties
Providing accurate answers to any questions you may have about a specific home you are considering
Explaining the forms used in a real estate transaction and assisting you in making a written offer to purchase
Presenting your written offer to the seller
Familiarizing you with the steps you must take to complete the purchase after the seller accepts your offer.
FREQUENTLY ASKED QUESTIONS IN BUYING PROCESS WHAT SHOULD YOU ASK YOUR LICENSEES – TEAM SM IS YOUR PRIME SOURCE CALL US TODAY :
Buying a home is a psychological game of poker, with very high stakes, and huge incentives to bluff and avoid inconvenient facts. However estate agents are legally bound to tell the truth, so you need to make sure you ask the right questions to find out what the real situation is.
YOU COULD ASK ANY QUESTIONS INCLUDING SOME OF THESE THAT WILL HELP YOU THROUGH THE PROCESS
Why is the owner selling?
The estate agent doesn’t have to answer, but if you’re lucky they might hint at the circumstances. You might find out the owner is desperate to sell, perhaps because work is taking them overseas, and so would accept a lower price
Is there anything that you would want to know about the house if you were buying?
The big fear, if you are buying, is that you are missing out some big negative factor that others know about. Is the local train station is about to close, a nearby sewerage plant opening up, or the next door neighbours the family from hell? People have been known to move into the homes of convicted mass-murderers without knowing – but you can bet they wish they had known. If you have any doubts about a house, ask next door neighbours or local shopkeepers what they think.
Exactly what is included in the sale?
Is the garden shed or greenhouse included? Are the fixtures and fittings? Exactly where does the boundary lie? Make sure you see all of what you are getting. It is not unknown for most of the contents to be included in the sale
How long has the property been on the market?
If the house has been on the market a long time (more than three months), ask the agent why they think it isn’t selling. Are there problems that other people have realised that you haven’t? Is it just overpriced? A long time on the market might mean that the seller would accept a lower price
How long have the owners lived there?
If they are moving out after a short period, it is important to find out why. Do they have noisy neighbours?
Has the property repeatedly changed hands?
You should be alert to serious problems if the property has frequently changed hands. Find out why previous owners moved out. Perhaps even try to contact them to ask why they did
How did the agent decide on an asking price?
A good agent will provide you with their justifications for the asking price, which you can then judge. Or, if you get lucky the agent might tell you that they think the seller is overvaluing the house. You should, in any case, visit other homes for sale nearby so you get a good idea what properties in the area sell for. See How do I know I’m not paying too much?
What is the minimum price the seller will accept?
It sounds silly, but asking if their bottom line is actually negotiable can save you thousands. Estate agents will often give you an indication – it is in their interest to make a sale, even at a lower price, because if they don’t sell, they don’t get paid
What offers have they had so far?
The agent will most likely tell you if there have been other offers, but not how much they were. But again, they have a big incentive to get a price agreed, so might drop some pretty heavy hints in whispered tones. If you can find out about the other offers, it obviously makes it easier to know what you should offer. See Making an offer and haggling over the price
When do the sellers have to move out?
Have the sellers already found another home? If they have, they may be keen to sell as fast as possible. Otherwise, if you have to wait until they find somewhere else, it adds to the uncertainty, with all the risks associated with being in a chain
Can you speak directly to the sellers?
Agents generally hate this – it is their job to negotiate – but they can’t stop you speaking to the sellers, which can be the best thing you do. Most sellers are like you – not industry professionals – and this means they often give answers that agents would find shockingly honest. Unlike the agent, they can’t pretend ignorance if you ask why they are moving. It can also give you a much better feel for the house – ask them the best and worst points.
Which way does the property face?
Evening drinks on that beautiful terrace will not be so pleasant if the house faces north and the sun disappeared hours ago. Or maybe you love the sun waking you up in the morning – in which case ensure you face south-east. Which rooms will you be using most; and which way do they face?
Have any major works been conducted?
If so, are you able to have a look at the relevant planning and building control consents? In most cases you can search online for planning applications (granted and refused) on the local planning authority website. It would be awful if you bought your dream home only to find out you would have to knock half of it down
Have any of the rooms been redecorated recently? If so, why?
Often people will repaint a room in order to cover damp or cracks. See other useful checks in our DIY Survey for House Hunters
Can you move the furniture and have a peek under the rugs?
It is not unknown to hide cracks in the wall with furniture or cover up floor problems with rugs. So ensure you look thoroughly.
Have there been any problems with the boiler recently?
And if so, what? And when was it last replaced?
How new or how sturdy are the drains and guttering?
Replacing drainage is a very expensive pain. And it might be a shame to have to replace those beautiful lead gutters. If it is raining seize the opportunity to check nothing is leaking
Do you have noisy neighbours?
If the seller has lodged any complaints against their neighbours they legally have to tell you if you ask
What can they tell you about the local neighbourhood?
What are the schools like? What is the crime rate like? How good are transport links? Where is the nearest petrol station? While it is a good idea to see what the estate agent has to say, make sure you do some independent research as well. See How do I choose a new area to live in? it must be a shame to have to replace those beautiful lead gutters. If it is raining seize the opportunity to check nothing is leaking
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