realtylinkonline

February 23, 2001

Tips for first-time homebuyers

Buying your first home is one of life’s most exciting experiences, but it can also be one of the most stressful if you’re unprepared. Invest some time in learning about the home-buying process before taking the plunge – review the tips here, do some research at the library or online, and talk with friends who’ve recently bought  homes. The more you understand about the process, the less intimidating the experience will be.

1. Work with an experienced REALTOR®. A good REALTOR® will make the home-buying process easier, helping you avoid common pitfalls and making sure you get the best value for your budget. Ask people you trust for referrals, and then interview several candidates – don’t hesitate to check references. Choose a REALTOR® who’s knowledgeable about the market and the neighbourhoods that interest you, someone who communicates effectively and listens well.

2. Know what you can afford: prequalify for a mortgage. Review your finances and visit your bank to determine how much you’re eligible to borrow. Being pre-approved for a mortgage gives you many advantages – you can lock in at today’s interest rates (and still get a lower rate if they change), and you’ll have more clout when negotiating for a home. Most banks also offer online mortgage qualification, or you can visit a central mortgage site like www.canadamortgage.com. Ask your REALTOR® for a budget worksheet to review the other costs involved (including taxes, closing costs, and moving costs) so you know exactly how much cash you need on hand.

3. Consider a variety of housing types and neighbourhoods. New home or resale home? Condo, townhouse, or detached? Established neighborhood or up-and-coming neighbourhood? Every choice has unique advantages and disadvantages. Your REALTOR® will help you review the options, and you can do research online at sites like www.realtylink.org, www.cmhc-schl.gc.ca, and www.homeadvisor.msn.com. If you’re considering an unfamiliar neighbourhood, make sure to explore it on foot, during the day and after dark, and investigate schools and crime statistics.

4. Make a “need and concede” list. Your wish list should include both "must-haves" and "nice-to-have but can do without,” in terms of features, style, size, and location.  This list will help your REALTOR® pinpoint your ideal home. You’ll probably alter the list as you start looking at homes and getting a better feel for the market.

5. Keep notes on the houses you view.

Make notes on the positives and negatives of each home you view, write down your overall impressions and any concerns you have. Once you’ve seen five or more homes, you’ll start to forget unless you keep good notes.

6. Don’t rush into a decision. Take time to get to know the market and look at a variety of properties. The biggest mistake many first-time buyers make is panicking about ‘missing out’ on a deal and jumping into a decision without enough thought.

7.  Hire a good home inspector.  No matter how good a home looks, there can be hidden problems that only a qualified home inspector will find. Writing your offer ‘subject to inspection’ is the best way to protect yourself, and can save you thousands of dollars.