Real Estate FAQ
FREQUENTLY ASKED QUESTIONS ABOUT REAL ESTATE
Q1. How long will it take to buy a home?
A: the time it takes to purchase a home can vary, depending on how many homes you view and how quickly you find what you're looking for. You could find a house within the first week of searching, or it may take you 2 years. + 30-90 days for closing.
Q2. How much do I pay my agent to find me a home?
A: As a buyer, you rarely pay any real etsate fees. Your Realtor gets paid by the seller - a percentage of the total commission when the sale closes. In some cases, when a home is sold by the owner, the buyer may have to agree to cover some of the commission.
Q3. When have I officially purchased my home?
A: The purchase of your home is 'firm' once you have fulfilled the conditions in your offer. At this point, the contract is legally binding. You do not recieve the keys until the closing date agreed upon.
Q4. Should I get a home inspection?
A: It is always recommended that a buyer do their due diligence when buying a home, which includes having a professional inspector look at all of the major systems and components on the property.
Q5. How do multiple offers work?
A: Multiple offers occur when more than one buyer is offering on a property at a given time. Currently in our market, this is a common occurance with many properties being listed with specific offer dates requested. In this circumstance, your Realtor would submit your offer to the listing agent by the requested time and the listing agent would then review all offers with the seller and select the favoured offer. In most cases you will have a chance to make adjustments to your offer and resubmit after you have been notified of the number of competing offers. In some cases, you may get a call saying that you offer is very close to another at which point you can make changes to your offer. Keep in mind in this situation that all offers are confidential and you will have no idea what the competing offers are. You Realtor will do their best to offer advice but your best offer is all you can do.
Q6. Should I call the listing agent directly?
A: Your Realtor is working for you so you should trust them to do the legwork for you. Let them make the calls and set up the appointments and ask the questions. This is what we're paid to do! If you get involved with the listing agent, your agent may be faced with a reduced commission.
Q7. What is the first step to buying a home?
A: The first step should be getting pre-qualified for a mortgage. You can do this either through a mortgage broker or your bank. A mortgage broker can often find more options than your bank and can offer their expert advice. Being pre-approved shows you are a serious buyer and most agents will not want to work with buyers until they have their financials in order.
Q8. What is a buyer's market?
A: A buyer's market is characterized by lower home prices and reduced demand (not as many competing buyers looking for homes).
Q9. How much do I need for a down payment?
A: Your down payment will be a minimum of 5% of the purchase price with conventional mortgages requiring 20% down. There are other factors involved and you should also note the incentives offered for first time buyers.
Q10. Should I sell my current home before I buy a new one?
A: If you are unable to carry two mortgages or do not plan to lease your current home to earn income, you will need to sell your current home in order to purchase a new one. In this market, you will find it difficult to have an offer accepted which includes a condition that you sell your house before you firm up the offer to purchase. Most sellers are reluctant to risk accepting this type of offer in such a hot market - they don't want to miss out on other offers by taking their home off the market while waiting for your home to sell. It is best to list your current property while you search for your new home and ask for a long closing on your current house.
Q11. How many homes should I view before deciding?
A: This is entirely dependent on how picky you are. It is best not to choose the first home you see as there will always be others and it is a good idea to compare features of multiple homes to decide what you really want. That being said, don't wait too long or your first love will be the one that got away! Some buyers do find love at first site and pull the trigger having only seen one property. When you know, you know.
Q12. Can the seller reject my offer?
A: Sadly it's true that yes, a seller can flat out reject your offer. This does happen. If you low-ball them, they may become offended and not want to work with you. They may also have a number in mind and will not accept anything until you meet them there. An offer can be accepted, rejected or countered with adjustments. If they make a counter offer, the ball is now in your court. This is the negotiation process.
For more answers to your questions, here is a great source of information: CMHC