Whether you’re upgrading from a condo or moving away from renting, we know how stressful the home buying process can be. Luckily, we have provided our Top Three Considerations with resources to support you in your home buying journey in Calgary, Alberta.
Location, Location, Location!
One of the really great things about giving your REALTOR a list of amenities and features is that your agent can utilize technology to find that perfect home for you from this list. Most MLS systems that agents use to find homes contain search parameters. Some will let you exclude certain types of criteria, which might be more helpful to you than you may first think. The more closely you define parameters, the fewer homes you may find that are available to you. If you include too many parameters, you may not find any homes at all.
Location is the first rule of real estate
If you have to choose between a home with all of the amenities you want in a bad location or a home in a good location with only some of the amenities, choose the home with the good location. You can always add amenities, but you cannot change a bad location.
Consider the Neighbourhood
Next, you will want to assess the neighbourhoods you are considering to move to. Make a list to your top 3 to 5 neighborhoods you would like to live in. Then, you can define the area by street boundaries so your agent can draw a map to help you narrow down your search.
Types of Locations
View of Downtown, City or Hills
Raised Elevation or Mountains
Cul De Sac
Dead End Street
Year of Build
Rather than picking a specific age of home, try choosing a range of years. If you do not want a newer home, you can ask your agent to limit your search to homes built prior to a certain year. Bare in mind that if your cutoff is homes built before 1970, you will not receive a home listing for a home built in 1971.
Home Amenities and Features
Home buyers often desire certain features in four areas of the home: the kitchen, master, baths, and dining room. In addition, buyers may state preferences for home energy features, including disability features. Although some of these can be added after purchase as a home improvement project, sometimes the cost to do so is prohibitive.
Accounting for Affordability
When considering your first home purchase, you’ll want to take into account what you can afford before committing to a down payment that does not fit your budget or pay schedule.
In Alberta, if the purchase price is less than $500,000, the minimum down payment is 5%. Anything above $500,000 but less than $1 million typically runs a minimum 5% and an additional 10%. For homes with a purchase price of $1 million or more, the minimum down payment is 20%. A great tool to consider using to get a sense of what you can budget for is using your local banks Mortgage Calculators or even the Canadian Mortgage and Housing Associations calculator.
Next you will want to assess your mortgage rate options and see what suits your needs. First thing you will need to do is check your credit rating and get pre-approved, this will ensure a smooth process. One way to help boost your down payment is to borrow money from your RRSP. First-time buyers can pull out $25,000 tax-free and have 15 years to pay it back. If you’re buying with your partner, you can contribute $50,000 together.
First Time Buyer Guarantees
Once you are in the green to pursue your purchase and everything is approved, you want to work with a real estate agent from a trusted brokerage that can streamline the home buying process for you. A great start to finding the right REALTOR to work with comes from looking at what Buyer Benefits are available through their brokerage. For example, at Urban Realty, we offer a 1-Year Home Warranty, a 2-Year Purchase Guarantee and a 90-Days Sold Guarantee. These help give new home buyers a sense of confidence in their home buying journey to keep their appliances up to date, secure a home purchase and have peace of mind their existing home will be sold.
BUYING OLD OR NEW
Before buying a fixer-upper, consider these tips to ensure this option is right for you, and planned renovations prove profitable.
Fixer Upper Rules to Live By
Consult a real estate agent to find out more about the neighbourhood
The real estate history (recent sales, pricing) of a neighbourhood will tell you if investing in a fixer-upper is worth your time and money. An agent can advise you on community news, including property development, environmental projects and other factors that will have positive and negative effects on your homes resale value.
Schedule an extensive home inspection
Houses that need work may contain structural or cosmetic concerns, so it is important to know what elements need to be fixed in order to work those costs into your budget. Invisible upgrades (electrical, plumbing and heating) can be expensive fixes that don’t always increase a houses value because they are naked to the eye of a potential homebuyer.
Know the law
Contact your local municipality office and request information on your city’s building permit laws before undergoing any renovations. Many large structural changes (additional storeys, extensions, decks) require a building permit. Future buyers might request proof of permits on condition of sale.
Know what you’re getting yourself into both financially and personally
When buying any house, it is important to stay afloat and avoid swimming in debt. Fixer-uppers aren’t just hard on your wallet. Renovations can be disruptive, stressful and time-consuming, so it is imperative to have a solid financial plan in place and your family’s lifestyle taken into consideration prior to purchase. Did you know you can include renovation budget in your mortgage?
Don’t over-improve for the market
Once the renovations start rolling, you might not want them to stop. Designing your dream home is tempting, but only if the housing market will reimburse you for your efforts. Finishings (wood, stone, hardware) should be in line with houses in the neighbourhood.
Renovating is an excellent opportunity to try do-it-yourself projects. Simple changes like paint colour or swapping cabinet hardware are easier ways to be involved in your renovation and can also save you on labour costs. Online tools like Pinterest or Houzz can help you get started with some home DIY inspiration.
Don’t worry, we know it is a lot of information to take in. That’s why you deserve to have the facts and resources available to support your first home purchase. When you’re in doubt of where to look or how to even start, you can always start by talking to your friends or family to share their own home buying experiences or even ask for referrals of trusted REALTORS®. And if you’re still not sure where to start, you can give us a call anytime and our team will be happy to walk you through the process. Happy house hunting!