GUIDE TO BUYING A HOME
“Guide to Buying a Home” has been prepared by Royal LePage Real Estate Professionals to offer you practical information about the buying process. It outlines steps that you and your Real Estate Professional will follow during your search for the ideal home


Determine What you can Afford
• Purchasing a home involves one-time costs and monthly expenses.
• The largest one-time cost is the down payment. It usually represents between 5-25% of the total price of the property.
• In addition to the actual purchase price, there are a number of other expenses that you might be expected to pay for. These are listed below.

Typical One-Time Expenses
• Expense Paid
• Mortgage Application and Appraisal Fee at time of application
• Property Inspection (optional) At Inspection
• Legal Fees Closing
• Legal Disbursements Closing
• Property Survey (sometimes provided by seller) Closing
• Land Transfer Tax Closing
• Mortgage Interest Adjustment Closing
• Closing Adjustments - Fuel, Taxes etc. Closing
• Home and Property Insurance Closing and On-going
• Moving Expenses Date of move

Typical monthly costs incurred with home ownership are mortgage payments, maintenance, insurance, condo fees, property taxes and utilities.

Understanding Market Conditions
• The real estate market is always changing. It helps to understand how market conditions can affect your position as a buyer.
• I can provide you with current real estate market conditions and explain their impact.

Market Conditions
1. Buyers Market: The supply of homes on the market exceeds demand.
2. Sellers Market: The number of buyers wanting homes exceeds the supply or number of homes on the market.
3. Balanced Market: The number of homes on the market is equal to the demand or number of buyers

Characteristics
1. High inventory of homes. Few buyers compared to availability. Homes on the market longer. Prices tend to drop.
2. Smaller inventory of homes. Many buyers. Homes sell quickly. Prices usually increase.
3. Demand equals supply. Sellers accept reasonable offers. Homes sell within an acceptable time period. Prices generally stable.

Implications
1. More time to look for a home. More negotiating leverage.
2. May have to pay more. Make decisions quickly. Conditional offers may be rejected.
3. More relaxed atmosphere. Reasonable number of homes to choose from.


Obtain a Pre-Approved Mortgage
• Having a pre-approved mortgage will give you the confidence of knowing exactly what you can spend on a home before you start looking. You will also be protected against interest rate increases while you look for your new home.
• Your Mortgage Specialist will answer your questions and help you determine which financing terms and options are right for you. Your mortgage specialist and real estate agent professional should work as a team to help you find the right home and select the best financing.

Finalizing Your Mortgage
• Once you’ve found the home you want to purchase, there are some documents you’ll probably be asked for in order to finalize your financing. They will include:

1. A copy of the real estate listing of the property. If the home is still to be built, the mortgage lender will need to see the architects or builder’s plans and details on the lot size and location.
2. A copy of the offer to purchase or the building contract, if this document has been prepared.
3. Documents to confirm employment, income and source of pre-approval.
If you have a Pre-Approved Mortgage, it’s a simple matter of finalizing a few details which your mortgage specialist will explain to you.


The Major Elements of an Offer
1. PRICE
Depending on local market conditions, your opinion of value and market information provided by me, the price you offer may be different from the seller’s asking price.

2. DEPOSIT
The deposit shows your good faith and will be applied against the purchase of the home when the sale closes. I can advise you on an appropriate amount.

3. TERMS
Includes the total price offered and the financing details. You may arrange your own financing or ask to assume the seller’s mortgage, especially if it has an attractive interest rate.

4. CONDITIONS
These might include ‘subject to home inspection’, ‘subject to obtaining financing’ or ‘subject to you selling your property’.

5. INCLUSIONS & EXCLUSIONS
These might include appliances and certain fixtures or decorative items, such as window coverings or mirrors.

6. CLOSING OR POSSESSION DATE
Generally, the day the title of the property is legally transferred and the transaction of funds finalized unless otherwise specified.


How to Make an Offer
• When it comes time to make an offer, I can provide current market information and will assist you in drafting your offer.
• I will then communicate your offer, sometimes known as an Offer to Purchase, to the seller, or the seller’s representative, on your behalf. Sometimes there may be more then one offer on a property coming in at the same time. I can guide you through this process.
• The offer can be FIRM or CONDITIONAL:

Firm Offer to Purchase:
Usually preferable to the seller, because it means that you are prepared to purchase the home without conditions. If the offer is accepted, the home is yours.

Conditional Offer to Purchase:
Means that you have placed one or more conditions on the purchase, such as ‘subject to home inspection’, ‘subject to financing’ or ‘subject to sale of buyer’s existing home’. The home is not sold until all the conditions have been met.


Acceptance of the Offer
• Your Offer to purchase will be presented as soon as possible. The seller may accept the offer, reject it, or submit a counter-offer.
• The counter-offer may be in reference to the price, the closing date, or any number of variables.
• The offer can go back and forth until both parties have agreed or one of you ends the negotiations.


Hire a Legal Professional
• A legal professional is there to represent your interests and to process the legal documentation required.
• I can provide you with names of legal professionals who specialize in real estate.


Have the Home Inspected (Optional)
• Having the property inspected by a qualified home inspector will give you the added confidence that you’ve made the right decision.
• When the procedure is complete, you may wish to ask for a full written report plus estimated costs for any necessary repairs.


Moving Tips
1. Book the movers:
• You can choose to have your movers pack everything, or just the breakables, or you can pack yourself. It is a good idea to obtain estimates from several different companies.

2. If you own your present home:
• Arrange to have your gas, water, and electric meters read on the day you leave and have the bills forwarded to your new address.
• Have the oil tank read and filled before your sale closes, and provide a receipt to your legal professional if required.
• If the water heater or furnace is rented, arrange for a transfer of the rental agreement to the purchaser.
• Disconnect your telephone, cable TV, and water softener.

3. If you rent your present home:
• Give the necessary written notice to your landlord and make arrangements for the return of any money you have on deposit.

4. At your “NEW” home:
• Make arrangements for the gas and electric utilities, water softener, telephone, and cable TV to be connected on the day the sale closes.

5. General:
• Get “change of address” cards from the post office and send out well before moving day.
• Have the post office forward your mail to your new address.
• Cancel any contracted services and pre-authorized cheques.
• Change the address on your drivers license(s) effective the day you move.
• Make special arrangements for the moving of perishables, such as plants.
• Make special arrangements for the moving of any pets.
• Safely dispose of all flammable liquids as it is illegal for movers to carry them.