Purchasing

Once you’ve found the home you’re interested in, it's time to make an offer. Deciding what to offer is one of the most difficult decisions to make. Offer too little and you stand a chance of losing the house (particularly in a seller's market). On the other hand, nobody wants to pay more for something than it's worth.

Your REALTOR can help you enormously by showing you what comparable houses are selling for, helping you assess the condition of the house, and judging the type of competition you may face. Once you have decided on the price you are prepared to offer, the REALTOR will draft the offer and explain the details to you.

Your Royal LePage REALTOR will communicate the offer, sometimes known as an Offer to Purchase (a legal document specifying the offers terms and conditions) to the seller, or the seller's representative, on your behalf.

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 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 the sale of the buyer's existing home. The home is not sold until all the conditions have been met.

Purchasing A Condominium

Canada Mortgage and Housing  Corporation is an excellent source of information on all aspects of buying and selling property. Their section on condominiums is particularly useful and I highly recommend that my clients visit the site. Extract below...

Who Do You Need On Your Team?

Buying a home can be a long and complex process. For first time, or even repeat buyers, purchasing a condominium is usually just as lengthy and complex an experience. When you buy a condo, you’re not just buying a place to live. You’re becoming part of a community.

Before you make an offer on your dream condo, Canada Mortgage and Housing Corporation (CMHC) recommends that you get some expert advice to help you navigate through the process. To help walk you through your purchase, CMHC has identified many industry professionals who are available to provide you with information. They are the following:

• Real estate agent: A real estate agent who specializes in condominiums can save you time, energy and help you make an offer once you’ve found the condo that’s right for you. While you can deal with the vendor’s realtor, it may be wiser to enlist an agent who will act solely on your behalf. Make sure you're clear about who's paying their commission and what your obligations will be once you’ve signed any agreement. Be specific about the type, features, location and price range you’re looking for in a condo. This will allow your agent to pre-screen properties that are within your budget, in the neighbourhoods where you want to live and with the features and amenities that are important to you.
• Real estate lawyer: A lawyer who is knowledgeable about condominiums can protect your legal interests, explain all the documentation and review the purchase and sale agreements. Your lawyer will determine whether or not there are any legal actions pending against the condominium. If your offer is accepted, he or she will also be responsible for many of the closing arrangements.
• Home inspector: A qualified home inspector can determine whether there are any construction-related defects in your condo that could put a significant dent in your pocketbook. All too often, people make purchase decisions too quickly in anticipation of competing offers. This can leave you vulnerable to substantial additional repair and renovation costs that a pre-purchase inspection might have detected.
• Financial Institution: Your bank manager or financial advisor can help customize your mortgage to suit your financial goals and needs, and ensure you can afford your monthly mortgage payments. CMHC’s on-line interactive guide Homebuying Step-by-Step, available at www.cmhc.ca, can help you determine what price range you should be looking at and how much you can really afford.
• To avoid any unpleasant surprises, you should also investigate the financial well being of the condominium corporation you'll be buying into. For resale condominiums, check documents such as the estoppel or status certificate as well as annual operating budgets and end-of-year financial statements. Technical audits and reserve fund studies can also offer insight on the condition of the building and the adequacy of the reserve fund to meet future major repairs and building renewal work. For new buildings, also review the full disclosure statement.

For more information or a free copy of the Condominium Buyer's Guide Download Here or other fact sheets on owning, maintaining or renovating your home, call CMHC at 1-800-668-2642 or visit our Web site at www.cmhc.ca. For more than 60 years, Canada Mortgage and Housing Corporation (CMHC) has been Canada’s national housing agency and a source of objective, reliable housing expertise.

For story ideas or to access CMHC experts or expertise, contact CMHC Media Relations — National Office at: 613-748-4632 or by e-mail: media@cmhc.ca.

Published: March 4, 2008