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What are the steps to buying a home? You’re starting to think about becoming a homeowner, or maybe you’ve even started to look at listings. Either way, you likely have lots of questions, from the general “how tos” to specific queries around financing, different home types and locations, to how to make an offer. To help simplify what can be a complicated process, we’ve outlined the steps to buying a house in Canada.

What Are the Steps to Buying a Home?

There’s a lot to do, but we’ve narrowed it down. Here’s our 10-step home buying process checklist to get you started!

1. Choose a real estate agent that’s right for you.

A home is a huge investment, so work with a realtor that’s knowledgeable, professional and responsive. Treat your search for the right agent like a job interview. Meet with a few different agents, ask lots of questions and check references. Here is a list of 7 questions to ask an agent before you commit.

2. Know your budget.

As you already know, buying a home is going to be expensive. Knowing exactly how much it will cost and how much you can spend is a crucial step in making a wise investment. Consider your lifestyle, your income and any current debts you’re carrying. Are you secure in your employment? Are you planning any major life changes in the near future, such as a job change or growing your family? Be mindful of the financial impacts this could have.

3. Explore mortgage options and get pre-approved.

A mortgage pre-approval informs you of how much your lender is willing to lend you based on a number of factors, such as your credit rating, income and debts. The lender also guarantees the current interest rate for up to 120 days (time may vary depending on the lender), giving you the freedom to house hunt, knowing that you’re safe from interest rate increases. If rates drop, so too should your guaranteed rate. In addition to the interest rate, be sure to also take into account the terms of the mortgage.

4. Start home hunting.

Admittedly, this step that has many sub-steps, but let’s narrow it down a bit. While the old adage of “location, location, location” still stands when it comes to good real estate investments, the recent trend of remote workplaces has given people greater flexibility when it comes to answering that all-important question of “where?” Then comes the what: what type of home do you need to accommodate how you and your family live? Condominiums, townhomes and freehold homes each offer distinct benefits, so ensure you’re choosing something that will work for you for the next rive years. Create a remax.ca account and register to receive listings that meet your criteria when they hit the market.

5. Schedule showings.

Did you know your agent can show homes in-person or virtually? Virtual showings have been around for some time, often used for purchases by buyers from overseas, however it has picked-up speed with local buyers too, due to the Coronavirus pandemic. Regardless of how you choose to view the listings, keep your eyes on the prize. Remember your budget and the must-haves outlined in step #4 above.

6. Make an offer.

You’ve found the home you want, in a location you like. Now, to make an offer to purchase for a price and terms that are agreeable to both you and the seller. Here’s where working with an experienced realtor can give you the upper hand. Different market conditions require a different approach – a seller’s market might mean lots of competition, requiring you to come in at or over asking price with few to no conditions, while a buyer’s market means you have choice and time is on your side. Lean on your agent on how to best handle the situation.

7. Get a home inspection.

Regardless of the market, this is one condition that we recommend you keep as part of your offer. The home inspection is intended to identify any existing or potential underlying problems in a home, alerting the buyer of risks and giving them leverage in negotiating a reduced selling price. Your home inspector will examine systems that are visible without opening walls or floors, including heating, plumbing, electrical, roofing and foundation. The inspection should take approximately three hours and will cost a few hundred dollars, depending on the size of the home.

8. Close the deal.

The closing period for your transaction is typically 90 days, however it can range depending on the agreed upon terms in the Agreement of Purchase and Sale. The homebuyer has some important obligations during this waiting period. Once the offer has been accepted, there’s a window during which you must take all the necessary steps with regard to your offer conditions, such as financing, home inspection and anything else that needs to happen before you officially seal the deal. Your mortgage lender will need a copy of the offer to ensure it’s in-line with your pre-approved level of financing. After any adjustments or repairs have been done to your satisfaction, your Realtor will finalize the deal and your lawyer will process the paperwork, including the mortgage documents with your lender. All of this will point to a final date of actual legal possession: the real closing day.

9. Update utilities, transfer services and change-of-address.

During your closing period, keep track of utility and credit card bills, magazine subscriptions and any other regular mail or standing orders that you receive at your current address. Alert them of the address change in advance of your closing date. Also be sure to contact your doctor and dentist. For family and friends, you can easily send a change of address card via mail or email, but there are a few more steps when it comes to informing government agencies.

• Click here to change your address with the Canada Revenue Agency
• Contact your local Ministry of Health and Ministry of Transportation to find out how to change your address on your health card and driver’s license.
• Forward mail to your new address by visiting the Canada Post website or at your local post office.
• If applicable, it is important to change your address for the Employment Insurance program that you can easily do here.

10. Move into your new home!

If you’re moving during the busy season (typically summer) ensure you’ve booked a moving company well in advance. If you’re doing it yourself, book the truck, enlist some help and ensure you have ample packing materials. Here are some packing tips:

• Pack the items you will need first in a clear plastic bin
• Pack your plates vertically so they are less likely to break
• Take a photo of how you electronics are connected so you can know where the wires go
• Wrap your breakables in clothing to save on bubble wrap
• Keep your glassware safe by packing it with clean socks

Have More Questions?

Real estate can be confusing. RE/MAX Canada hit the streets to find out just how much (or how little) the average person knows about the Canadian housing market, and to offer some answers. For More Information Call Our Office Today 780-962-8580.

Purchasing a home can be confusing with all the different terms and requirements. Two steps involved in the mortgage process are pre-qualification and pre-approval. But what’s the difference between being pre-qualified and pre-approved?

The difference between being pre-qualified and pre-approved for a mortgage comes down to the details.

Prospective homebuyers should consider getting pre-qualification at the onset of their home-buying process. It allows them to consider their budget and gain insight into their mortgage options. Then, homebuyers should consider getting pre-approval when they are more involved in the home-buying process, ideally within three months of the expected purchase date of their new home. It allows them to understand their financial position better and narrow their options.

Being Pre-Qualified

Getting pre-qualified is generally a faster, less thorough process, where some of your personal information will be reviewed to give you a general idea of how much money you may be eligible to borrow toward the purchase of a home.

Getting pre-qualified is the first step in the process, and is a more casual version of being pre-approved. In the pre-qualification process, an aspiring homeowner would provide a general overview of their finances to the lender, including income, assets, and debt. It does not require a credit check. The lender would then review and assess the financial information and give an estimate of the mortgage amount the borrower could be eligible to receive. Still, this amount is subject to change upon pre-approval.

Pre-qualification can often be done with the lender online or over the phone at no cost. It only takes about one to three days to get a pre-qualification letter. Pre-qualification is a prime opportunity to talk with your lender about your specific mortgage needs and gain insights into the most suitable options available from your lender. Most importantly, it gives you a general idea of the size of the mortgage that you will be eligible for and be able to afford.

Being Pre-Approved

Getting pre-approved for a mortgage is the next step in the process and is much more thorough than being pre-qualified, taking into consideration all of your personal financial information, including your tax statements, credit score and income, to provide you a more detailed, specific idea of your home-purchasing power.

While pre-qualification indicates a potential borrower’s ability to obtain a mortgage, pre-approval gives a more definitive picture. In the pre-approval process, the aspiring homeowner completes an official mortgage application and supplies the lender with all the necessary documentation to perform an extensive credit and financial background check. This could include:

Assets

Debt

Income

Identification

Proof of employment

Proof of capital to pay closing costs

Expenses and financial obligations, including:

– Child or spousal support

– Student loans

– Lines of credit

– Car loans

– Credit card balances

Note that the credit check is a soft credit check and will not affect your credit score.

The lender may require additional documents to verify your employment, such as recent pay stubs, a Record of Employment (ROE), or a Notice of Assessment from the CRA if you are self-employed. Once they have reviewed and assessed the documentation, the lender will offer mortgage pre-approval for up to a specified amount. It is possible to get more than one pre-approval by exploring various lenders.

Pre-approval also offers a better idea of the interest rate you can expect to be charged on your mortgage.  Lenders will provide a conditional commitment in writing for an exact mortgage amount, allowing borrowers to look for homes at or below that price level. Some lenders also allow borrowers to lock in a fixed interest rate, valid for 60, 90, or 120 days. However, a rate hold does not guarantee mortgage approval, and you can still be refused if there are changes in your financial situation.

A Breakdown of the Differences Between Pre-Qualified and Pre-Approved

While pre-qualification and pre-approval both provide mortgage amounts that a borrower can reasonably expect to receive, there are several differences between them:

Pre-approval requires filling out a mortgage application and a credit check. It may also require paying an application fee. Pre-qualification does not have these requirements.

Pre-qualification takes about one to three days, while pre-approval can take up to two weeks.

Pre-approval requires much more extensive documentation on finances, credit, debt, and employment. Pre-qualification only requires general answers without documentation.

Pre-qualification provides a rough estimate of the mortgage amount you can expect to be approved. Pre-approval provides a calculated estimate of your mortgage amount, complete with a written commitment from the lender.

Pre-approval includes interest information with the potential option to lock in your interest rate for up to 120 days. Pre-qualification does provide information on interest rates.

While pre-qualification and pre-approval are sometimes used interchangeably, they are different from each other, and both should be completed in the mortgage application process. By getting pre-qualified and then pre-approved, you will be provided with reliable information on the size of the mortgage you can receive and the interest rate.

Is Edmonton real estate the last affordable market in Canada?

Like much of Alberta, the Edmonton real estate market had been hit hard by COVID-19 and the crash in crude oil and natural gas prices in a slumping economy. While the broader Canadian housing market rebounded quickly after the initial first wave, Edmonton and the rest of the province were slow to respond.

Over the last year, with historically low interest rates and lower prices compared to the rest of the country, prospective homeowners dipped their toes in the Edmonton real estate market. Fast forward to the present, and the Edmonton housing market is booming without any sign of slowing down.

“People began to see the interest rate dropping and their purchasing power increase,” Tom Shearer, the past chair of the Realtors Association of Edmonton, told Global News. “They saw some of those higher-end properties start to come down to a range where they felt comfortable moving into them.”

Although prices are skyrocketing in the major urban centre, conditions are still relatively affordable compared to other large areas in Canada, such as Toronto or Halifax.

But this level of affordability could be fading fast, with the western municipality experiencing a record-breaking real estate market to kick off 2022. Is this the new normal in Edmonton for the rest of the year?

Edmonton Real Estate Market Breaking Records in March

Is this a sneak peek into Edmonton’s spring and summer seasons? If winter, which is historically quiet in Edmonton, led to a spark in home sales and price growth, then the coming months should be impressive for the area.

According to the REALTORS Association of Edmonton, residential sales advanced at an annualized rate of 45.4 per cent in March. All property categories witnessed robust sales activity in March:

• Single-Family +21.2%
• Duplex / Row: +54.2%
• Condominiums: +67.1%

In addition to swelling transactions, price growth was notable, especially for detached homes. The MLS® Home Price Index (HPI) composite benchmark price climbed 9.4 per cent year-over-year to $369,700. Here is how the different properties performed in March:

• Single-Family: +9.9% to $503,711
• Duplex / Row: +11.8% to $389,321
• Condominiums: +6.7% to $245,070

“The Greater Edmonton and Area market continues to surprise us as we enter into what is normally the start of the busy season of real estate,” said REALTORS® Association of Edmonton Chair Paul Gravelle. “Although we are seeing slightly lower increases for average sale prices across all categories, there has been a huge increase in the number of listings hitting the market as well the number of sales in the month of March.”

Indeed, new residential listings increased 7.6 per cent year-over-year and a stunning 47.7 per cent month-over-month. Meanwhile, days on market declined in March, with single-family homes typically listed for only 27 days, down from 42 days the month prior.

On a positive note, new housing construction activity has remained strong so far this year. According to Canada Mortgage and Housing Corporation (CMHC), housing starts totalled 2,641 in the first three months of 2022, up slightly from 2,511 unit starts in the first quarter of 2021.

Overall, the benchmark price trend is going up for Edmonton, which has been the case since the end of last year. But can this notable growth keep going for the rest of 2022? This is the question for Edmonton and many other housing markets that have experienced exceptional growth and activity.

According to the RE/MAX 2022 Canadian Housing Market Outlook, the Edmonton real estate market is expected to see the average sale price advance seven per cent by the end of 2022, while the number of sales is estimated to increase five per cent.

Other Noticeable Trends in Edmonton

Throughout much of the coronavirus pandemic, many homebuyers from across the country purchased houses in Atlantic Canada without even seeing them in person. The same type of development is unfolding in Edmonton as out-of-province buyers and investors scoop up tightening supplies, which is in turn driving up the price.

Public policy could also play a factor in the Edmonton real estate market. The city is reportedly homing in on property taxes and basing them on density with potential cuts for rental property owners and hikes for single-family homes. Many property developers and officials contend that the city’s present tax structure limits housing growth.

As more people continue working from home, space will still be a high priority for prospective homebuyers. A recent survey from the Realtors Association of Edmonton found that 61 per cent of homebuyers said a home office is an essential feature when choosing a residential property.

Due to heightened demand, Edmonton is seeing a myriad of factors come to the surface in the housing sector: buyers are bidding over the asking price, and offers with no conditions are winning. This is further impacting housing inventory, and Edmonton’s pendulum is swinging in favour of sellers.

Purchasing a home is likely going to be one of the largest purchases you will make in your lifetime, which is why it is so important to follow the right steps when starting on your home-buying journey to ensure that the entire process goes smoothly from start to finish!

We’ve put together a step-by-step guide to buying a home, to help you get off on the right foot when it comes to buying a home.

1. Decide to buy a home
Make sure you are ready both financially and emotionally!

2. Get Pre-Approved
Work with a mortgage broker or your bank. They will work with you on what you require to submit an application. Once approved, this will determine how much you can afford to spend on a home.

3. REALTOR® Consultation
Work with a RE/MAX agent to help guide you through the process. The right agent will discuss your price range, ideal locations, current market conditions and much more!

4. Start Your Search
Your REALTOR® will get you information on new homes that meet your criteria as soon as they’re listed. They’ll work with you and for you to ensure you find your dream home.

5. Current Market Conditions
Your experienced RE/MAX agent is a valuable resource as you consider different properties. They will be there when you have questions regarding the homes you’re interested in – they can tell you what is a good deal, and when to walk away.

6. Make an Offer
Your REALTOR® will help create your offer tailored to your needs including the right subject clauses down to the closing date that works best for you.

7. Negotiate
You may receive a counter offer but don’t be worried! RE/MAX agents will negotiate for you to ensure you get the best possible price for the house you love!

8. Accepted Offer
It’s crunch time! The next few weeks are busy as you need to schedule and remove every one of your subject clauses by the specified date. You’ll likely need to schedule an inspection, appraisal, financing approval, and several others. You will also need to provide a deposit to put down on the home. The deposit will be a pre-determined amount given in-trust to your REALTOR® to show the sellers you are committed to this home. Don’t worry, that money goes towards the purchase of said home if all goes well! This is a busy time but be sure to reach out to your RE/MAX agent if you have any questions or are unsure about next steps.

9. Subject Removal
Once you have completed all your subject clauses, and everything went smooth, it is time for you to sign on the dotted line and consider your new home to be yours (almost!).

10. Official Documents
You will need to provide your RE/MAX agent with your preferred lawyer or notary to have the official title transferred into your name. You will meet with the lawyer or notary in person to sign all the legal documents before you move in. This typically happens a few days before you take possession of your new home.

11. Move In!
Congratulations, you are officially a homeowner! The date pre-determined by you is your move-in day! You can now move into your new home. Your RE/MAX agent will be there ready and waiting to hand you the keys. Enjoy!

If you’re ready to begin the buying process, call 780-962-8580 one of our RE/MAX agents would be more than happy to assist you!

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