• You’ll save time. An agent can pinpoint homes that fit your needs and dismiss those that don’t.
• You benefit from an experienced negotiator. Your agent will manage your offers and counter-offers, ensuring that you get the best possible price for your home
• You’ll get the right information. Your agent knows the neighbourhood and can give you accurate information on local real estate values, taxes, utility costs, services and amenities.
• You can always count on great advice. Because your agent is familiar with the entire home purchasing process, he or she can advise you of your legal and financial options, and recommend appraisal, home inspection and contracting services.

Here are a few questions to ask to help you determine if an agent is right for you:

• Will you be representing my interests?
• Do you have access to MLS information?
• Will you provide market evidence to support the price?
• Will you look after closing and possession details?
• Can you be contacted at any time?

Let your real estate agent do the searching for you. The best buys aren’t in the newspaper ads; most great opportunities are on “hot sheets” that are available every morning to salespeople with access to MLS information.

An agent’s job is to:

• Provide information on the property and the area
• Negotiate a price and terms that are agreeable to both buyer and seller
• Help arrange a source of financing

As a homebuyer, you must work with your agent to find the home that’s right for you. Communication is key – tell your agent what you want, and be specific.

• Offer a detailed description of your property needs and wants. If you will absolutely not consider a house without a hardwood floor, say so. And if air conditioning is a “nice to have” rather than a “must have,” communicate that, too.
• Be specific about where you want to live. If you refuse to live outside a certain area, it might take longer to find you a home, but your agent will know not to waste your time with anything not in your chosen neighbourhood.
• Tell your agent what you can afford. He or she can help you get a pre-approved mortgage so you know for sure what your price range will be.
• Communicate your likes and dislikes for each property you see. It will help your agent narrow down the possibilities.
• Commit to one salesperson.
• Respect and perform the terms of the purchase agreement.
• Keep an open mind. Agents know about those charming little areas that you’ve never even heard of. You might find your dream home in a completely unexpected place.

Here’s a quick reference to everything you need to know about making an on offer on a property.

1. Price

Depends on the market and the buyers, but generally, the price offered is different from the asking price.

2. Deposit

Shows the buyer’s good faith and will be applied against the purchase price of the home when the sale closes. Your agent can advise you on a suitable amount to offer.

3. Terms

Includes the total price the buyer is offering as well as the financing details. The buyer may be arranging his/her own financing or may ask to assume your existing mortgage if you have an attractive rate.

4. Conditions

These might include “subject to home inspection,” “subject to the buyer obtaining financing,” or “subject to the sale of the purchaser’s property.”

5. Inclusions and exclusions

These may include appliances and certain fixtures or decorative items, such as window coverings or light fixtures.

6. Closing or possession date

Generally, the day the title of the property is transferred to the buyer and funds are received by the seller, unless otherwise specified (except in Manitoba and Quebec).

Your Royal LePage agent can arrange to have you pre-qualified for a mortgage before you start shopping for a home. It’s easy, and you’ll avoid possible disappointments down the road if you fall in love with a place, then find out you can’t afford it. Plus, once you do find the perfect home, it will mean you can make an offer immediately.

Here’s how mortgage approval works: the amount of money you qualify for, plus the amount of cash you can put down equals the amount you can afford to spend on a home. Most lending institutions won’t allow more than about 30% of your income to support a mortgage. If you have other debts, they usually won’t allow your debts and your mortgage to exceed 40% of your income.

Finalizing your mortgage

Once you’ve found the home you want to buy, you’ll need to finalize your financing. You’ll need to provide your lender with the following documents:

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 architect’s or builder’s plans and details on 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.
4. If you have a pre-approved mortgage, it’s a simple matter of finalizing a few details with your mortgage specialist.

You’re not just buying a home – you’re buying a location. And even the most perfect house won’t feel right if you’re in the wrong neighbourhood. Educate yourself about the area so you’ll choose wisely – and end up being happy with your decision.

• Are you close to shopping and recreation?
  Being close to stores, parks, recreational facilities, a post office and dry cleaners will save you time.
• Do people in the area take care of their homes?
  Explore the neighbourhood, keeping an eye out for signs of neglect (overgrown lawns, houses in need of paint, trash and junked appliances littering yards). A run-down neighbourhood can drive down your property value.
• Are there schools nearby?
  If you have children, the proximity and quality of schools is key. Some schools will provide data (i.e. average test scores) that can determine quality. Talking to neighbours with children can be helpful, too.
• Is there good access to transportation?
  Living near public transport and/or major highways can mean an easier commute to work.
• Is it safe?
  Check with the local police department – they may be able to provide statistics about break-ins or other crimes.
• Will the home increase in value over time?
  Homes in some neighbourhoods appreciate faster than others. Research the selling prices of homes in over the past decade or so to predict future trends. Your agent may be able to provide helpful data.
• Is it quiet?
  Listen for traffic noise, barking dogs, airplanes and any other noises that might bother you. Return to the neighbourhood at different times of the day to get an accurate impression.

That gorgeous house on the corner lot may look great, but it could be hiding all sorts of expensive, annoying problems, from a leaky roof to faulty wiring to a mouldy basement.

Make sure your home is solid and secure inside and out before you buy it. A home inspector will determine structural and mechanical soundness, identify problem areas, provide cost estimates for any work required, and generate a report. It’s a great way to avoid headaches and costly problems that can turn a dream home into a money pit.

If you decide to go ahead and buy a home with issues that have been flagged by your inspector, you can base your offer on how much potential repairs and upgrades may cost.

Home inspection costs range according to size, age and location of the home. Your Royal LePage sales representative can recommend a reputable home inspection service or arrange for an inspector to visit your property.

When you fall in love with a home, the things you like about it can blind you to its problems. Next time you go to an open house or tour a property with an agent, keep your eyes open with these top tips:

1. Take a look at general upkeep. Is it clean? Are lawns left uncut? Do walls need paint? If the small stuff hasn’t been taken care of, there’s a good chance that bigger issues have been ignored as well.
2. Test it. Try out lights, faucets, toilets, air conditioning and major appliances.
3. Check for water damage. Look at ceilings and drywall for stains and bulges. Water that works its way in through a leaky roof or a cracked foundation can rot wood, create mildew and destroy possessions.
4. Watch for “spongy” floors. Take note of soft, springy sections, squeaky or uneven areas – these can be a sign that costly floor repairs are needed.
5. Check doors and windows. Make sure they fit snugly in their jambs and operate smoothly. Feel for drafts. Look for flaked paint and loose caulking – if wood isn’t protected from moisture, it will rot.
6. Look at the foundation. If you see deep cracks or loose mortar and bricks, there may be a significant structural problem. Soggy areas near the foundation are also a warning sign.
7. Make sure there’s enough storage space. If you are moving from a home with large closets and a shed, make sure your new house is able to store an equivalent amount of belongings.
8. Measure. Make sure your furniture will fit into your new house.

These tips are for your own first (or second) look at a home. For true peace of mind, you should always hire a certified home inspector before you buy.

Closing day is the day you become the official owner of your home. However, the entire closing process usually takes a few days.

Typically, you visit your lawyer’s office to review and sign documents relating to the mortgage, the property you are buying, the ownership of the property and the conditions of the purchase. Your lawyer will also ask you to bring a certified cheque to cover the closing costs and any other outstanding costs.

Once your mortgage and the deed for the property are officially recorded, you become the official owner of the property and your lawyer will call you to pick up the keys to your new home.

Buying a home involves both one-time costs and more regular monthly expenses. It’s important that you take both into account when you’re figuring out how much you can spend on a home.

The largest one-time cost is the down payment, which usually represents upto 25% of the total price of the property. Then, in addition to the actual purchase price, there are a number of other expenses that you may be expected to pay for.

Typical One-Time Expenses

• Mortgage application and appraisal fee (paid at time of application)
• Appraisal fee (paid at inspection)
• Property inspection (optional) (paid at closing)
• Legal fees (paid at closing)
• Legal disbursements (paid at closing)
• Deed and/or mortgage registration (paid at closing)
• Property survey (sometimes provided by seller) (paid at closing)
• Land Transfer, Deed Tax or PropertyPurchase Tax (in Quebec within 3 months following signing) (paid at closing)
• Mortgage interest adjustment and take over fee (if applicable) (paid at closing)
• Adjustments for fuel, taxes, etc. (paid at closing)
• Mortgage insurance (and application fee if applicable) (paid at closing)
• Home and property insurance (paid at closing and on-going)
• Connection charges for utilities such as gas, water and electricity (paid on date of move)
• Moving expenses (paid on date of move)

Other costs may include landscaping, decorating, furnishings, appliances and repairs. Typical monthly costs include mortgage payments, maintenance, insurance, condo fees, property taxes and utilities.

When you purchase a home, you have several insurance options that will protect your investment in different ways.

Homeowners’ Insurance

Most mortgage lenders insist on fire insurance coverage that is at least equal to the loan amount or the building value, whichever is less. You should also consider a homeowner’s policy that combines fire insurance on the building and its contents with personal liability coverage. Consult your general insurance agent for professional advice.

Mortgage Life Insurance

When lenders refer to mortgage insurance, they’re referring to coverage that’s provided by CHMC or MICC for a high ratio mortgage. Mortgage Life Insurance (MLI) is optional, inexpensive coverage on your life, which protects your beneficiaries by paying off your outstanding mortgage in the event of your death. MLI premiums are based on your age and mortgage amount. The premium is added to your mortgage payment so there’s no extra paperwork, and it remains the same until your mortgage is paid off.

Disability Insurance

Disability Insurance provides replacement income if an accident or illness prevents you from working.

Job Loss Mortgage Insurance

Job Loss Mortgage insurance covers the mortgage payments in the event that you involuntarily lose your job.

When it comes time to make an offer, your Royal LePage Real Estate Professional will provide current market information and help you draft a suitable offer. He or she will then communicate the offer to the seller (or the seller’s representative) on your behalf. Sometimes there may be more than one offer on a property coming in at the same time. Your agent will guide you through this process.

An Offer to Purchase

An Offer to Purchase is a legal document which specifies the terms and conditions of your offer to purchase the home. The offer can be firm or conditional.

Firm Offer to Purchase: preferable to the seller because it means you are prepared to purchase the home without any 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.

*In the province of Quebec, this is referred to as a “Promise to Purchase.”

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 offers can go back and forth until both parties have agreed or one of you ends the negotiations.

If you’re buying a home in a large Canadian centre, you’ll need to add land transfer taxes to your list of closing costs.

Unless you live in Alberta, Saskatchewan, or rural Nova Scotia, land transfer taxes (or property purchase tax) are a part of the home buying process. These taxes, levied on properties that are changing hands, are the responsibility of the purchaser. Depending on where you live, taxes can range from 0.5% to 2% of the total value of the property.

Many provinces have multi-tiered taxation systems that can seem complicated. If you purchase a property for $260,000 in Ontario, for example, 0.5% is charged on the first $55,000, 1% is charged on $55,000 to $250,000, while the $250,000 – $400,000 range is taxed at 1.5%. Your total tax bill? $2,375.00.

Land transfer taxes by province

British Columbia

Up to $200,000 X 1% of total property value
From $200,000 up X 2% of total property value

Manitoba

Up to $30,000 N/A
From $30,000 to $90,000 X 0.5% of total property value
From $90,000 to $150,000 X 1% of total property value
From $150,000 up X 1.5% of total property value

Ontario

Up to $55,000 X 0.5% of total property value
From $55,000 to $250,000 X 1% of total property value
From $250,000 to $400,000 X 1.5% of total property value
From $400,000 up X 2% of total property value

Quebec

Up to $50,000 X 0.5% of total property value
From $50,000 to $250,000 X 1% of total property value
From $250,000 up X 1.5% of total property value

Noval Scotia

Halifax Metro: 1.5% on total property value

Outside Halifax County: Check with local municipality

What is title insurance? Do you need it? Here’s some information that can help you make an informed decision.

What does “title to property” mean?

Title is the legal term for ownership of property. Buyers want “good and marketable” title to a property. “Good title” means title appropriate for the buyer’s purposes; “marketable title” means title the buyer can convey to someone else.

Why do I need title insurance?

Prior to closing, public records are searched to determine the previous ownership of the property, as well as prior dealings related to it. The search might reveal existing mortgages, liens for outstanding taxes, utility charges, etc., registered against the property. At closing, the buyer expects property that is free of such claims.

Sometimes problems regarding title are not discovered before closing. They can make the property less marketable when the buyer subsequently sells, and can cost money to fix. For example, the survey might have failed to show that a dock and boathouse built on a river adjoining a vacation property was built without permission. The buyer of the property could be out-of-pocket if he is later forced to remove the dock and boathouse. Or, the property might have been conveyed to a previous owner fraudulently, in which case there is the risk that the real owner may come forward at some point and demand their rights with respect to the property.

Who is protected with title insurance?

Title insurance policies can be issued in favour of a purchaser, a lender, or both. Lenders will sometimes require title insurance as a condition of making the loan. Title insurance protects purchasers and/or lenders against loss or damage sustained if a claim that is covered under the terms of the policy is made.

Types of risks that are usually covered include:

• survey irregularities
• forced removal of existing structures
• claims due to fraud, forgery or duress
• unregistered easements and rights-of-way
• lack of pedestrian or vehicular access to the property
• work orders
• zoning
• set back non-compliance or deficiencies, etc.

For a risk to be covered, it has to have existed as of the date of the policy. As with any type of insurance policy, certain types of risks might not be covered. For example, native land claims and environmental hazards are normally excluded. Be sure to talk to your lawyer about the types of risks that may not be included in your policy.

The insured purchaser is protected against actual loss or damage sustained up to the amount of the policy, which is based on the purchase price. As well, some policies have inflation coverage, which means that if the fair market value of the property increases, the policy amount will also increase.

How long will I be covered?

Title insurance remains in effect as long as the insured purchaser has title to the land. Some policies also protect those who received title as a result of the purchaser’s death, or certain family members (e.g., a spouse or children) to whom the property may have been transferred for a nominal amount.

The premium for title insurance is paid once, at the time of purchase. In Canada, the purchaser generally pays for the title insurance, though there can be situations where the seller pays for it.

Protection and peace of mind

Title insurance can help ensure that a closing is not delayed due to defects in title. And if an issue arises, the title insurance covers the legal fees and expenses associated with defending the title and pays in the event of loss.

<ul > <li >He/she knows real estate values in your neighbourhood and will help price your home competitively by preparing a market analysis of homes that have sold, competing homes that are still on the market and homes that were on the market but didn’t sell.<li >He/she will establish a marketing strategy for your home, ensuring that it’s exposed to as many potential buyers as possible.<li >He/she takes care of the tasks involved in selling a house, ensuring that the transaction is simple and low-stress for you.<li >He/she is an expert in the home selling process and will advise you of your rights, options and obligations.<li >He/she is an experienced negotiator and will work for you to get you the best possible price.

An agent can help you market your home by exposing it to as many potential buyers as possible. The first step is putting it on the MLS. But listing your property is only the beginning; your agent will prepare a personalized plan that includes everything he/she plans to do to sell your property. At Royal LePage, your property will be aggressively promoted through:<ul > <li >A posting on the Multiple Listing Service (MLS) <li >Royal LePage property advertising publications <li >The Royal LePage web site <li >Other Royal LePage offices and real estate professionals<li >Mailings to potential buyers in your area

If you price your property too low, it may sell quickly, but you’ll lose out on money. If you price it too high, it may not sell at all. Your agent can help you figure out the best asking price for your home.

The benefits of the right price

A well-priced property may generate competing offers, which will drive up the final price. Other real estate professionals will be enthusiastic about presenting your property to their buyers. Your home will sell faster because it is exposed to more qualified buyers.

Listen to the market

As part of your pricing strategy, your agent will put together a comparative market analysis, which is a good indicator of what today’s buyers are willing to pay. It compares the market activity of homes similar to yours in your neighbourhood:

<ul > <li >Homes that have recently sold represent what buyers are willing to pay. <li >Homes currently listed for sale represent the price sellers hope to obtain.<li >Listings that have expired are generally overpriced or have been poorly marketed.

Don’t overprice your home

Some sellers believe that if they price their home high initially, they can lower it later. Instead of making you more money, this strategy could end up hurting you.

<ul > <li > <b >Early activity is key. As soon as a home comes on the market, agents and potential buyers sit up and take notice. If it’s overpriced, interested parties will quickly lose interest. By the time the price drops, the majority of buyers are lost. When a home has been for sale too long, buyers will be wary and may reject the property.
<li > <b >You’ll miss the right buyer. You may think that interested buyers can always make an offer, but if your home is overpriced, potential buyers looking in a lower price range will never see it. And those who can afford a home at your asking price will soon recognize that they can get a better value elsewhere.
<li > <b >You could run out of time.You may end up having to drop your price below market value if your home doesn’t sell initially. Price it right the first time, and you won’t end up having to sell it for less than it’s worth.

Here’s a quick reference to everything you need to know about accepting on offer on your home.

1. PriceDepends on the market and the buyers, but generally, the price offered is different from the asking price.
2. DepositShows the buyer’s good faith and will be applied against the purchase price of the home when the sale closes.
3. TermsIncludes the total price the buyer is offering as well as the financing details. The buyer may be arranging his/her own financing or may ask to assume your existing mortgage if you have an attractive rate.
4. <b >ConditionsThese might include “subject to home inspection,” “subject to the buyer obtaining financing,” or “subject to the sale of the purchaser’s property.”
5. Inclusions and exclusionsThese may include appliances and certain fixtures or decorative items, such as window coverings or light fixtures.
6. Closing or possession dateGenerally, the day the title of the property is transferred to the buyer and funds are received by the seller, unless otherwise specified (except in Manitoba and Quebec).

Renovations don’t have to be expensive or extensive to offer you a good rate of return. In fact, a quick coat of paint can go a long way to boosting your selling price. Just make sure your new décor is tasteful, with shades of white and tame versions of popular colours.

The kitchen and bathroom are your best bets for renovation with the highest payback. Take a look at these average rates of return for home upgrades:

<li >Interior painting and décor – 73%<li >Kitchen renovation – 72%<li >Bathroom renovation – 68%<li >Exterior paint – 65%<li >Flooring upgrades – 62%<li >Window/door replacement – 57%<li >Main floor family room addition – 51%<li >Fireplace addition – 50%<li >Basement renovation – 49%<li >Furnace/heating system replacement – 48%<li >New lighting – 84%

As an expert on home sales trends in your neighbourhood, your Royal LePage Sales Professional can suggest which areas of your home could benefit from renovation and increase its value.

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If you’re selling your home, be prepared for a visit from a home inspector, who will be checking out the property on behalf of possible purchasers. Take a look through your home using these steps, and repair any problems to ensure that your inspection is a success.

1. <b >Make sure the structure is sound.Check to see if any renovations have damaged the structure. Look for termite damage. Ensure that “settling” hasn’t caused damage to the foundation or support beams and joists.
2. Check if electrical and wiring systems are safe. Loose wires or incorrectly installed or wired receptacles, switches or electrical box problems are hazardous and should be fixed. All homes should have a minimum of 100 amp service.
3. Look for leaks. Water can leak into unexpected places, causing extensive damage over time. Examine the underside of sinks and dishwashers, along ceilings, on floors or along basement walls. Plumbing fixtures, water-using appliances, drain pipes, water supply inlets and outlets, basements and roofs can all be causes and sources of water damage.
4. Resolve safety issues. Make sure windows open easily and lock securely, and entrances/exits can be securely locked. Correct hazards such as hidden curbs, loose railings and stairs, uncapped wells, etc.
5. Check plumbing. Faucets should run easily and shut off completely, bathtubs should be properly caulked and grouted, toilets should be bolted down securely, drains should be clog free, and the water heater should be in good working order.
6. Make sure your heating and cooling systems work. Make sure they are up to date, clean, in good working condition and have clean filters. Check refrigerant in air conditioning units.
7. Have a friend take a look. A general, unbiased overview of your home by a neighbour or friend may reveal issues you might have overlooked.

If you’re planning an open house, or are expecting buyers to be looking at your home, make sure their first impression is a good one. Here are few hints for making your house look great to potential buyers:

Exterior

<ul > <li >House in good repair <li >House number easy to read <li >Eavestroughs, down spouts and soffits in good repair <li >Garage/car port clean and tidy <li >Litter picked up <li >Cracked or broken window panes replaced <li >Lawns and hedges cut and trimmed, garden weeded and edged <li >Walks shovelled and salted <li >Boot tray inside front door <li >Doorbell and door hardware in good repair<li >Porch and foyer clean and tidy

Interior

<ul > <li >Chipped plaster and paint touched up or replaced <li >Doors and cupboards properly closed <li >Leaky taps and toilets repaired <li >Burned out light bulbs replaced <li >Squeaky doors oiled <li >Mirrors, fixtures and taps cleaned and polished <li >Seals around tubs and basins in good repair <li >Floors cleaned, garbage containers empty <li >Inside of closets and cupboards neat and tidy <li >Appliances cleaned <li >Countertops neat and polished <li >All lights turned on <li >Air conditioner turned on in warm weather <li >Fresh air in house <li >Fireplace lit in cooler weather <li >Halls and stairs cleaned <li >Drapes opened during daylight <li >Carpets freshly vacuumed <li >Fresh flowers in various rooms <li >Jewelry and valuables locked safely away or taken with you <li >Valuable property, such as art, vases and figurines out of reach, out of sight or locked away<li >Pets absent, where possible, or contained during the showing, and litter boxes clean

The first formal step in selling your property is entering into a Listing Agreement with your Royal LePage agent. The Listing Agreement is a contract in which Royal LePage commits to actively market your home for a specified period of time. It also commits you to a pre-established marketing fee that is to be paid upon the successful closing of the sale.

As part of the Agreement, your agent may require the following documents:

<b >Plan of Survey or Location Certificate.A survey of your property which outlines the lot size and location of buildings as well as details of encroachments from neighbouring properties. This may be required in certain areas to complete the sale of your home. Your legal professional may recommend a survey, especially if significant changes have been made to your property.

<b >Property tax receipts.Most Listing Agreements require that current annual property tax assessments be shown.

<b >Mortgage verification.Few homeowners know the exact balance of their mortgage as it is paid down. You will be asked to authorize your mortgage lender to provide the figures required.

<b >Deed or title search.This document is a legal description of your property and the proof that you own it.

<b >Other documentation.In some instances, it may help the sale of your property if you can provide prospective buyers with information on such items as annual heating, electrical, and water expenses, as well as any recent home improvement costs. Some provinces require that you sign a property condition disclosure statement.

The real estate market is always changing, and it helps to understand how market conditions can affect your position as a seller. Your agent can provide you with info on current conditions and explain their impact on you.

Buyers’ market

The supply of homes on the market exceeds demand.

<u >Characteristics

<ul > <li >High inventory of homes <li >Few buyers compared to availability <li >Homes on the market longer<li >Prices tend to drop

<u >Implications

<ul > <li >More time to look for a home<li >More negotiating leverage for buyers

Sellers’ market

The number of buyers wanting homes exceeds the supply of homes on the market.

<u >Characteristics

<ul > <li >Smaller inventory of homes <li >Many buyers <li >Homes sell quickly<li >Prices usually increase<u >Implications

<ul > <li > Buyers may have to pay more <li >Buyers must make decisions quickly<li >Conditional offers may be rejected

Balanced market

The number of homes on the market is equal to the number of buyers.

<u >Characteristics

<ul > <li >Sellers accept reasonable offers <li >Homes sell within an acceptable time period<li >Prices generally stable<u >Implications

<ul > <li >More relaxed atmosphere<li >Reasonable number of homes to choose from