Things are turning around for those looking to buy a home in Metro Vancouver. We are now into a buyer’s market, and real estate agents are gearing up for a busy spring season.
You need to be prepared before heading out to look for a new home. CTV News sat down with the Phil Moore, the president of the Real Estate Board of Greater Vancouver, for some valuable advice.
Here are some things to consider:
1. Secure financing
You need to take care of your credit score. Typically, those with lower scores turn to the secondary mortgage market for financing where they’ll likely pay a higher interest rate.
Get preapproved for a loan so you know exactly how much money you can spend but don’t be tempted to borrow the maximum amount available to you.
“What’s your mortgage payment that you’re comfortable with? And take into the fact the taxes you’re going to have to pay, if it’s a strata - what the maintenance fees are, if it’s a home what type of maintenance are you going to have to pay in the future?” Moore pointed out.
Be aware of the type of loan you secure and make sure it’s one that you can afford over the long term.
2. Remove emotion
When buying a home you should concentrate on the hard numbers and the facts. Does the property really make sense for you? It may be appealing and offer all kinds of features, like a built in sauna or hot tub. Those things need maintenance. Do you really need the space? What if you had to turn around and sell it quickly, is it the type of property that would appeal to a lot of buyers?
3. Get an inspection
In this current market, you now have time to get an inspection. There may be major maintenance or repair issues that could surprise you. Make your offer contingent on the inspection with stipulations about getting your damage deposit back if things don’t measure up.
If renovations have been done you need to ensure it was permitted work and done correctly, otherwise it could cost you a lot down the road to get it done properly or hang up an offer when you go to sell. A good real estate agent will look for those things.
4. A real estate agent
You should make sure you have a qualified real estate agent to represent you. A family friend may not be your best bet. Interview a few agents and choose one that’s knows the markets and has a good reputation.
“They’re there to protect you. They’re there to walk you through each step of the process,” Moore said.
5. Back-up plan
Everything may not go as smoothly as you like. The inspection could fail, the property may not appraise as expected or you can’t come to terms on a closing date that meets with your needs. A good real estate agent will help you navigate these things. If you’re selling a house as you buy, you can make that part of the deal.
“You’ve got an option, especially in a buyer’s market: you can put in an offer subject to selling your place. So maybe you want to have a place lined up,” Moore added.
It’s also advisable to build contingencies into your buying plan. Don’t forget about closing costs, moving costs, unexpected delays in closing the deal that could lead to added living expenses if you’ve got nowhere to live.
6. Buyer frenzy
The buying frenzy that drove up prices a couple years ago is over. Don’t get caught into bidding wars with properties that have been deliberately underpriced with the hope of creating multiple offers.
“Some of the sellers have been on the market for over a year and they’re eager to sell. So what I’m saying to consumers is: you have a lot of choice, you’re in the driver’s seat, let’s go out and take a look at what’s available,” said Moore.
