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BUYER'S
GUIDE

A house is not a dream home because of its size or location, it’s about how you feel when you walk through the front door. 

 

Buying a home can be both exciting and stressful; working with the right Realtor® can make all the difference. Whether you’re in the market for your first home, your forever home, or an investment property, Sarah Stewart makes the buying process easy.  She does the HOME work so you don’t have to.

 

 

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Finding the perfect property takes time and careful planning. Being educated about the buying process will help ensure you find your dream home and not a money pit.

 

With Sarah’s Buying with Confidence Guide, the home buying experience is organized into simple, easy-to-understand steps so that you can take an informed approach to buying a home.

Welcome Home

BUYING WITH CONFIDENCE

STEP #1: NEEDS ANALYSIS

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When preparing to buy a property, the first step is to define your needs and wants. What are your must-haves, your nice-to-haves, and your no-way-absolutely-nots?

 

How many bedrooms do you need? What kind of outdoor space do you want? How far are you willing to commute to work?  What neighbourhood amenities are important to you? And most importantly, what is your budget?

 

Before beginning your property search, think about the following:

 

BUDGET

 

Every need and want comes with a price tag. Determining how much you want to spend, and how much you will need to spend, is essential. Purchasing a home in a competitive Seller’s Market like Toronto requires careful financial planning and decision making. Do you have adequate funds for the down payment and closing costs? Will you be able to manage your mortgage payments each month?

 

Meeting with a mortgage lender who can advise you how much you can comfortably afford to spend, and provide a mortgage pre-approval, is imperative to the home buying process. Pre-approval of a mortgage allows you to focus your house-hunting efforts and reduces the risk of financing, once you find the perfect home. However, a mortgage pre-approval does not guarantee mortgage financing and should never replace the need for a financing condition in an Agreement of Purchase and Sale.

 

In addition to your down payment and mortgage commitment,

Buyers need to budget for a variety of closing costs disbursed

before taking procession. Costing costs typically range between

1.5% to 4% of the home’s purchase price. If you’re a First-Time

Home Buyer, the government has created some valuable incentive

programs to help reduce your closing costs.

 

Buyer Closing Costs:

 

  • Legal Fees: $500 - $1,500

  • Appraisal Fee: $300 - $500

  • Title Insurance: $250 - $450

  • Ontario Land Transfer Tax 

  • Toronto Land Transfer Tax (if purchasing in Toronto)

  • CMHC Insurance Premium (if down payment is less than 20%)

  • Property Tax and Utility Pre-Payment Adjustments (reimbursement to the Seller for prepaid taxes, utilities, condo maintenance fees, etc.)

  • Mortgage Adjustment Fee

  • HST (applicable on new construction and commercial properties)

  • Tarion Warranty Fee (new construction warranty, not applicable to resale)

  • Property Insurance: $500 - $2,000

  • Home Inspection: $300 - $700 (if applicable)

  • Repairs and Upgrades (if applicable)

  • Moving Costs and Utility Installation Fees: $1,000 - $3,000

 

Establish what you can afford before you fall in love with a property, check out our Affordability Calculator, Mortgage Calculator, Land Transfer Tax Calculator, and CMHC Insurance Calculator.

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PROPERTY TYPE

 

Single-family detached; semi-detached; townhouse; condominium; loft; or maybe a multi-residential unit as an investment? Five bedrooms; two bathrooms; a backyard; a basement; a two-car garage – what are your non-negotiables?

 

Is having a backyard important to you or is the low maintenance living of a condo more appealing? Will the accessibility of a townhouse be an issue?  Can the kids share a bedroom? Could the basement be used as an income property? Determine what type of property best suits your needs, lifestyle, and budget.

 

LOCATION

 

When buying a home, you’re not just investing in a house, you’re investing in a community. Where you live not only has a significant impact on your lifestyle but the value of your home. While affordability will play a deciding role in the neighbourhood you choose, other factors such as work commute, crime rate, the quality of schools, proximity to family and friends, access to healthcare facilities, and the availability of entertainment and recreational amenities, are important considerations. Drive the neighbourhoods that interest you and get to know the available amenities and housing types.

 

FEATURES

 

This is the wish list; the wants but maybe not the needs. An ensuite bathroom, an updated kitchen, hardwood floors, a walk-in closet, a fireplace, and a pool, all the amenities that make a house a dream home. Creating a list of the features you want in your prefect home is a good thing, but prioritize them. What are the deal breakers? Do your expectations meet the realities of your budget and lifestyle? It’s also not uncommon for your needs and wants to change during your property search. Amenities that you thought were essential may become negotiable, and features that seemed like a luxury may turn out to be necessities. Be willing to be flexible.

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STEP #2: SELECTING A REALTOR®

 

For most of us, buying a home is the most complex financial transaction we will undertake. To guide you safely through the process, it helps to have an expert in your corner. Partnering with a licensed real estate professional ensures that your interests are promoted and protected. Realtors have a fiduciary duty to exercise skill and care; provide sound, educated advice; perform comprehensive due diligence; and negotiate on behalf of their clients to secure the best deal. 

 

Your Realtor® is someone you’ll be spending a lot of time with so you’ll want to choose a person that you have a good rapport with, that you can trust, and communicate openly. They should be someone who understands your specific needs and is knowledgeable about your preferred neighbourhood and the type of property you’re looking to buy.

 

When working with a Realtor®, you also benefit from our extensive client networks, and relationships with established third-party service providers including lenders, mortgage brokers, home inspectors, lawyers, contactors and other home service professionals. 

 

At Sarah Stewart Homes clients receive:

 

  • Professional Real Estate Advice and Guidance

  • Comparative Market Analysis and Evaluation

  • Property Preparation and Staging Consultation

  • Personalized Marketing Plan

    • Professional Photography and Home Tour Video

    • Customized Feature Sheets and Brochures

    • MLS® Listing

    • Comprehensive Email, Digital and Social Media Marketing

    • Open House and Agent Tour

    • Professional Copywriting

    • For Sale Signage

  • FREE Pre-list Home Inspection *subject to terms and conditions

  • Expert Negotiation

  • Appointment Scheduling

  • Flawless Paperwork

  • Electronic Signing

  • Concierge Services

MORTGAGE PRE-APPROVAL

 

When you pre-qualify for a mortgage, your lender will look at your:

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  • Income and Assets

  • Debt

  • Credit History

  • Employment History

  • Down Payment

 

Mortgage pre-approvals should be in writing and include a guaranteed interest rate valid for 60-120 days.

REAL ESTATE COMMISSION 

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Realtors in Ontario receive a commission for service, paid by the Seller upon the successful completion of a sale.  If the property doesn’t sell, the Realtor® doesn’t get paid. 

 

The commission amount is typically a percentage of the sale price or a set fee, + HST, that is split between the Listing Brokerage who represents the Seller and the Cooperating Brokerage who represents the Buyer. There is no standard real estate commission amount in Ontario.

Home Search

STEP #3: PROPERTY SEARCH

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Now that you’ve determined your needs, pre-qualified for a mortgage, and selected a great Toronto Realtor®, it’s time to go shopping!

 

Your Real Estate Sales Representative will search for properties that match your criteria using a variety of tools including Toronto’s Multiple Listing Service® (MLS®); exclusive agent listings; local advertisements; and other real estate search portals. Buyers can also conduct their own property search by using the MLS® consumer website Realtor.ca.

 

Once you’ve selected a property or properties you’d like to visit, your Realtor® will arrange a private showing. When viewing homes, it’s important to keep in mind your Needs Analysis.  Does the property meet your Budget, is it the preferred Property Type and Location, and does it have the Features required? 

 

Your Realtor® will investigate any questions you have about a property and the surrounding neighbourhood. They will advise you on an appropriate offer price and can evaluate the property’s potential long-term value given current market trends.

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Finding a dream home can take time, and some flexibility. Be open to the process. Don’t eliminate categories of housing without investigating them first. Maybe a townhouse or a semi-detached would meet your needs? Or could buying a pre-construction home or an existing multiplex unit be a better investment?  You may also need to consider expanding your search area. Some city neighbourhoods may not have the available housing inventory to be affordable.

PROPERTY VIEWING ETIQUETTE

 

  • Property showings must be booked in advance and should be no more than 30 minutes.

  • Remove your footwear upon entrance to the home, regardless of the weather conditions.

  • Keep the inspection to the property’s features and fixtures. Handling the seller’s personal items is off limits.

  • Leave the kids and pets at home. Children and animals pose potential health and safety concerns and can cause damage and liability.

  • No smoking in or around the property.

  • No personal food or beverages.

  • No photographs or video of the interior or exterior of the property unless express constant is given by the Seller or their Realtor®.

  • Do not disclose any opinions regarding the property while viewing. Provide your feedback to your Realtor® after leaving the premise.

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STEP #4: MAKING AN OFFER

 

You found it, the perfect home for your family and you’re ready to make an offer. This is when the negotiating skills and experience of a real estate professional really pay off. Your Realtor® will begin by drafting your offer, the Agreement of Purchase and Sale (APS). 

 

The Agreement of Purchase and Sale outlines:

 

  • the price you’re prepared to pay for the property;

  • the amount of your deposit - usually 5% of the purchase price;

  • your preferred closing date - the date you take possession of the property;

  • the irrevocability date and time – the deadline you give to the Seller to respond to your offer;

  • any chattels and fixtures you want to remain in the home - appliances, light fixtures, mirrors, wardrobe unit, etc.;

  • and the conditions that must be met for the deal to close - financing, home inspection, sale of current property, status certificate review, etc.

 

In a busy Seller’s Market where multiple offers are common, your Realtor® will help you draft an offer that gives you an advantage. Most Sellers prefer “Firm Offers” that contain no conditions, however by removing conditions you’re assuming potential risk and financial loss. “Conditional Offers” help protect Buyers from unforeseen issues.

 

Once your Realtor® has submitted your offer, the Seller can “Accept It”, “Reject It” or “Counter It”. If the Seller accepts your offer, Congratulations! You’ve bought a home. If the seller rejects your offer, you have two options: you can submit a new offer, or you can walk away. If the Seller counters your offer, this is when the negotiations begin. Discuss with your Realtor® what aspects of your offer may be hindering the deal and what could make it more attractive to the Seller. What are you willing to negotiate to achieve a win-win solution – price, closing date, deposit, conditions?

 

Upon acceptance of the offer, you have 24 hours to deliver your deposit by certified cheque or bank draft to the Deposit Holder, typically the Listing Brokerage, to be held in trust until closing.

 

PRO TIP:

 

The Agreement of Purchase and Sale is a binding legal document. Be sure that you read and fully understand everything outlined in the paperwork before you sign it. Your Realtor® has a responsibility to ensure your acknowledge of the offer documents, and to provide you with the final accepted forms for your records. When in doubt, have your lawyer review the offer documents before signing.

STEP #5: CONDITION FULFILLMENT

 

Once the Agreement of Purchase and Sale has been agreed upon and accepted by both parties, it becomes a legally binding contract. If the Agreement was accepted with conditions, the property is considered conditionally sold until all the conditions have been fulfilled or waived by the Buyer in writing before their respective expiry dates.

 

If a condition is fulfilled, it means the condition has been satisfied. A waived condition means the condition won’t be fulfilled but is no longer of the deal. If all the conditions are fulfilled or waived by their expiry dates, the Agreement becomes firm and binding. If for whatever reason the Buyer cannot fulfill a condition before the expiry date, an extension can be requested, or the offer becomes null, and void and the deposit is returned in full.

 

COMMON CONDITIONS

 

Financing - Getting pre-approved for a mortgage doesn't automatically mean you will receive a loan for the property you have purchased. Your lender will perform a more detailed audit of your finances once the Agreement of Purchase and Sale has been accepted. An inspection and appraisal of the home may also be required before the mortgage is granted. The timeline to complete this condition is typically 3-7 business days.

 

Home Inspection

Home Inspection - If a home inspection condition is included in your accepted offer, you must work quickly to contract a licensed Home Inspector to complete the inspection within 3-7 business days. Home inspections typically take 2-3 hours to complete. If the inspection reveals any significant deficiencies with the property you have the option to ask the Seller for remediation before completely the sale; to cancel the Agreement; or to accept the property as is. The Seller must allow access to the property to complete the home inspection before the condition deadline.

 

Buyer Selling Their Current Home – Although rarely found in Toronto’s prevailing Seller’s Market, you may choose to include a condition that requires you to sell your home before the Agreement of Purchase and Sale for the new home goes firm. This condition protects you from owning two homes should your property not sell before the stated occupancy date of your new home. This condition also typically includes the Seller’s right to continue to offer their property for sale, and in the event that they receive a firm, unconditional offer from another party, you will have 24 hours to waive your condition, or the Seller can accept the new offer.

 

Status Certificate - When purchasing a condominium unit, it is recommended that Buyers include a condition to review the condo’s Status Certificate. The Status Certificate details information about the condominium corporation's management structure; the current budget; the reserve fund; any legal issues or proceedings; upcoming repairs or maintenance; special assessments; and the common expenses. The Status Certificate is usually ordered by the Seller for a fee of approximately $100. Delivery of the Status Certificate usually takes 6-10 business days. Your lawyer will review the Status Certificate as part of closing the transaction.

STEP #6: CLOSING THE SALE

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Once your deal is firm, the process of closing the real estate transaction begins. 

 

Closing the sale requires a team effort that culminates on Closing Day, the date the ownership and possession of the property are transferred. You will need to maintain close contact with your Realtor, your lender, and your lawyer while your mortgage and closing documents are finalized. The days leading up to closing date will be the most critical. During this time, you will complete your final walk-through of the property with your Realtor®; meet with your lawyer to sign all the purchase documents; provide payment for the balance of the purchase; and finally, pick up the keys to your new home.

 

Congratulations, the home is yours!

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STEP #7: MOVING DAY

 

Welcome to your new home.

 

The final step in the buying process is Moving Day. To keep your move as stress-free as

possible, plan ahead.

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MOVING CHECKLIST

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One Month Prior to Moving Day

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  • Make an inventory of everything to be moved.

  • Collect moving boxes and packing materials.

  • Start packing up rarely used items from storage areas like the basement, attic, garage and closets.

  • Donate and sell any unwanted belongings.

  • Hire a junk removal company to dispose of larger refuse items.

  • Choose a moving company or reserve a rental truck if you’re moving yourself.

  • Condominium owners, contact the building’s management to register with security and to book the elevators.

  • Schedule any renovations, painting, or cleaning needed at your current home and your new home.

  • Apply for a change-of-address and mail forwarding at the Post Office.

  • Have any rugs and drapes cleaned.

  • Book a work holiday for your moving day.

  • Arrange the transfer of school records (if applicable).

  • Lease a storage unit in your new community (if necessary).

 

3 Weeks Prior to Moving Day

 

  • Transfer or set-up your utilities: hydro; gas; water; telephone; cable; internet; and security system.

  • Contact your insurance company to arrange for the appropriate coverage.

  • Redirect any subscription services.

 

2 weeks Prior to Moving Day

 

  • Start actively packing the rest your home. Ensure boxes are well-sealed, labelled by room, and stackable.

  • Make child-care arrangements for moving day (if applicable).

  • Update your driver’s license and health card; and notify your employer and bank of your new address.

 

1 Week Prior to Moving Day

 

  • Clear out the refrigerator and freezer

  • Pack a Moving Essentials box:

    • phone charger;

    • box cutter or scissors;

    • toolkit;

    • toilet paper;

    • garbage bags;

    • all-purpose cleaner;

    • paper towels and cleaning rags;

    • dish soap and dish towels;

    • bath towels;

    • shower curtain;

    • toiletries;

    • a change of clothes;

    • bedding and pillows;

    • beverages and snacks;

    • disposals plates and cutlery;

    • medications;

    • first aid kit;

    • and pet food (if required).

 

1 Day Prior to Moving Day

 

  • Confirm the movers arrival time.

  • Dismantle the beds and any other large furniture.

  • Set aside any valuable or fragile items to be transported in your vehicle.

 

Moving Day

 

  • Pick up your rental truck if moving yourself.

  • Double check that there are no remaining items in your refrigerator, closets, basement, attic, or garage.

  • Meet the movers at your new home and supervise the unloading.

  • Order dinner in and get a good night’s sleep, tomorrow you’ll officially unpack. 

Moving Day
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