Buying a Home in Calgary – Monika Furtado Buying Process

As you prepare for the purchase of your new home in Calgary, it would be my pleasure to help you with your purchase.  I understand the nuances of detailed needs and wants, available home options, pricing and the community options.  You will receive:

  • Confidential buyer representation
  • A personal web portal providing you details on all homes that fit your criteria
  • Professional advice in assisting and reviewing potential homes
  • Effective negotiations
  • Review, follow up and an active management of the process from start to finish

Give me a call today directly at 403 850 2446 to get started or send me an email at monika@monikafurtado.com. I’m always happy to help.

Calgary Real Estate Home Buyer’s Guide:

1. Understanding Your Real Estate Needs and Wants

A home is about more than the number of bedrooms or bathrooms. It is about how you feel when you are home, how a home flows and how it suits your day to day needs.  And primarily, it is about the location, whether that means in a specific community or its orientation on a lot with a desired attribute such as a quiet street or backing onto greenspace.

  1. What makes you comfortable in your current home? Is there anything you’d like to duplicate with your new home?
  2. What is your primary reason for searching for a new home?
  3. Do you have children? Do they have any specific needs or interests that will guide your purchase?
  4. Do you entertain? Are there specific features a home requires to suit your needs?
  5. How long do you expect to reside in your new home?
  6. Do you work from home?
  7. Do you have a style preference?
  8. What are your transportation needs including transit, walkability, and road access?
  9. Are there any physical constraints that we need to consider such as minimizing stairs?
  10. How much time and effort do you want to invest in updates or renovations?

Some folks want a home that requires some TLC (tender loving care) while others absolutely do not. Be honest with yourself about how much time and money you are willing to invest and then let your me know so that I can show you only appropriate properties.

It is easy to be swayed by beautiful finishings and a gorgeous kitchen, but keeping in mind your needs and wants will ensure you find a home that suits you for many years to come.

2. Understanding Market Conditions

When you begin looking for a home, understanding the current environment will help guide you in setting realistic expectations.

Buyer’s Market

In a buyer’s market, the number of homes offered for sale is higher than the number of people looking to purchase the type of property offered.

In this environment, there is a high inventory of homes and homes remain on the market longer. Prices tend to decline. Buyers have many options and feel they have more time to review properties. Buyers feel they have more negotiating power during a sale. Well priced homes will still sell. Sellers can expect more conditions on offers, re-negotiations regarding inspection issues and higher buyer expectations.

Seller’s Market

In a seller’s market, the number of homes offered for sale is less than the number of people looking to purchase the type of property offered.

In this environment there is a small inventory of homes and houses remain on the market a short time. Many buyers may be pursuing the same property. Prices usually increase in this market and sellers feel they have more negotiating power during a sale. There may be multiple offers on properties. Overpriced homes will not get the attention that market priced homes receive. Buyers have less options in this market and may feel pressure to act quickly and to propose less conditions on offers.

Balanced Market

In a balanced market, the number of homes on the market is relatively equal to the number of people looking to purchase the property offered.

In a balanced environment houses sell within a reasonable amount of time and prices remain relatively stable. Price fluctuations between properties may have more to do with buyer/seller motivation than a market adjustment. Buyers have many options but well priced homes will always attract interest. Equal negotiating power exists between buyers and sellers.

3. Financing

When working with buyers, one of the first items to be reviewed is financing. I would hate to disappoint you by showing you a home that is beyond your means. Reviewing your personal details with a mortgage broker or loan officer will give you the confidence to look in the appropriate price point and to put forth an offer to purchase with the knowledge that you can move forward.

What is the difference between Pre-Qualification and Pre-Approval?

Getting pre-qualified is the initial step in the mortgage process. A lender may generally ask you a number of basic financial questions and based on that information provide you a general statement of qualification. This process is based on a general income to debt ratio and does not look at your specific financial history, credit score or review other personal information.

Getting pre-approval is much more detailed and provides you a realistic personal evaluation of your ability to purchase. You will be asked to fill in an application, provide income verification, funds verification, account information and your credit history will be reviewed. You will also most often be able to lock into the current interest rate or the lowest rate between today and your date of purchase within a set time frame (90 to 120 days).

It is especially important for new buyers, anyone with previous credit issues, newcomers to Canada, anyone starting a new job or people running their own business to be pre-approved.

If credit history or credit issues are impacting your ability to purchase, your mortgage broker may be able to provide you with resources to improve your credit history. You will only know if issues exist by completing a pre-approval.

Please note that a final mortgage is always dependent on the specific property to be purchased, so even with a pre-approval you should strongly consider including a financing condition in the Offer to Purchase in order to protect yourself.

What to expect during a Pre-Approval:

A mortgage broker or banking rep will request your employment records which may include paystubs, letters from an employer or recent tax filing. Your broker will review your credit report, as well as documentation regarding any savings, gifts or other sources of income such as investments or rental property. Your current debts will be reviewed.
Once an offer has been made, the bank will also perform an appraisal on the home.

Once you have a pre-approval, it is very important that you do not do anything to change your financial situation or credit score until you take possession of your home. This is especially so if you are intending to purchase close to your maximum amounts.

– Pay all of your bills on time
– Do not apply for any new credit
– Do not make large purchases on your credit card or lines of credit such as furniture or holidays
– Do not make purchases that would put a HOLD on your credit card for a large amount such as a deposit

Your finances will be re-reviewed by your lender just prior to issuing your mortgage. Depending on your purchase this may be 30 or even 90 days after your initial offer was accepted and your initial application was reviewed.

4. Working with a Buyer’s Realtor

Every Realtor works differently so the way I work may not be how other folks work. Sellers interview Realtors. Why shouldn’t buyers? Feel free to ask any questions you wish. This is a big purchase. You need the right person by your side.

When beginning to look for a home, folks take one of two approaches:

The majority of people choose a Realtor to work with and have that Realtor represent them throughout their property search and purchase. A Buyer’s Realtor prepares a buyer for the purchase process, connects to financing and other resources, reviews properties, sets up showings for all properties, negotiates an offer and works in the interest of the buyers throughout the purchase. A buyer’s Realtor doesn’t have an interest in the properties you are pursuing so their interest is in helping you find the best property for you.

Some seek to contact the Listing Realtor for each home of interest, set up their own appointments and work directly with the Seller’s Realtor in purchasing a property.

I work with clients as a Buyer’s Realtor. My buyers have the confidence that I am working solely in their interest and I have their commitment as a client. I am working for you and anything that I know or can find out for you will be shared. As a buyer it is important for your confidentiality to be maintained. You only need to share your requirements with one person so that your situation, such as a deadline for moving, specific home needs or financial status aren’t shared with the seller during negotiations.

If you are separated but not yet divorced or if you are not a resident of Canada it is important to speak to a lawyer prior to entering into a Purchase Contract so that you understand the details of selling the property.

If you are not yet ready to purchase I am happy to provide you market information or property information, and direct you to resources, open house information and anything you may need as you get ready. When you decide it is time to purchase a home, then we can move to the next step and start viewing specific properties. As of July 2014 it became mandatory for buyers to sign a buyers brokerage document with their Realtor setting expectations of representation.

5. Selecting and Viewing Properties

Once we have completed your Needs and Wants Analysis and completed your financing pre-approval, we will begin to view properties. Initially I will build a custom portal just for you that updates you on your areas or properties of interest. I will also shortlist options and highlight those for you to review.

If you have told me that your home needs to meet specific criteria I will let you know those details in regards to your selected homes. For example, if you only wish to view homes within walking distance to a bus stop, then I will check each home and shortlist the best ones from your overall view. Or if you only want a home with a large dining room, we will review all homes together, but I will highlight those that meet your requirements.

We can view lot maps or other property details before viewing multiple homes. Let’s use your time wisely to narrow down to the best options.

I will make all arrangements for you to view properties of choice and provide any additional information you may need about particular properties or neighbourhoods.

I assist many folks that are moving to Calgary from other parts of Canada or from across the world. If you are visiting us for a short time as you prepare to buy a home I will ensure you have the information to make the most of your visit.

6. Researching Property Details

Each buyer has different priorities when looking at a potential new home.

Some of these priorities are common and more obvious such as location, transportation access, views and other details. I research properties for many clients before we physically view them.

Some of the priorities are not as obvious and require a more open conversation. This includes items such as understanding condo property management, flood risk, impact from future development and other items that need additional research. As your Realtor, I will work with you to understand your concerns and ensure you have the information to make your best choices.

The detail may be as simple as a lot map to research for surrounding development applications.

7. Answer Your Questions

When most buyers start their search for a new home, they do so with enthusiasm and jump into the process at all different points.  Some decisions are made slowly and some quickly. First time home buyers are bound to have more unknowns than an investor who already holds many properties.

The buying of a new home originates from many different needs and folks have many different questions. Please ask.

Everything from understanding that you have to shovel the whole sidewalk around that corner lot to asking about the impact of the future LRT lines in the City.

When considering a specific property, there are also different questions folks may have. Some are stigma related such as if any events occurred on a property or if the property has known defects. Some are based in family needs or religion. If you have something in mind that would affect your willingness to purchase a particular property please do let me know so we can ask the right questions important to you and your family.

8. Writing an Offer to Purchase

An offer to purchase is a binding legal document. It is explained in detail when a buyer is purchasing a property as there are many details and aspects to an offer. The main elements of an offer include:

Price: The offered price to purchase.

Deposit: At the time of offer, a buyer will put forth an initial deposit that will be deposited into trust.

Conditions: A number of conditions can accompany an offer. A condition is something that must be satisfied in order for the offer to become firm and binding. The most common are financing, home inspection and review of condominium documents (in the case of a condo purchase). If an offer with conditions is accepted it becomes a conditional offer (or pending sale) and the buyer usually has a set deadline to remove the conditions to make it a firm offer. Once an offer is firm, both buyer and seller are legally bound to the contract.

Inclusions and Exclusions: The inclusions list include all of the unattached goods that will accompany the sale. The exclusions are those things that will be removed by the seller. These vary from home to home but include items such as window coverings and appliances.

Completion Day/Possession Day: This is the date that title to the property is transferred to the buyer and funds are received by the seller. Buyers generally get possession of their new home at or around noon on the Completion Day as per the standard contract wording.

9. Understanding Purchase Contract Conditions

What are some typical conditions when submitting an Offer to Purchase?

Financing

Regardless of whether or not a pre-approval has been completed, the vast majority of buyers include a financing condition as final approval is affected by the property to be purchased.

Home Inspections

A home inspection is a standard condition of sale typically requested by buyers. A home inspection is completed by a qualified home inspector who is licensed by the Province. A home inspection is typically paid for by the buyer.

When a home inspection is scheduled the seller will typically not attend. I will attend your inspection with the inspector for the duration and highly recommend that you attend to learn about the home and ask any questions you may have. An inspection typically takes 2-3 hours and the main purpose is to review major items in the home such as structural, electrical, plumbing, foundation and roof. It is not intended to review for cosmetic items.

Reviewing Condominium Documents

When purchasing a condominium, a buyer will typically have a condominium document review condition. The buyer will be provided with a long list of documents to review as part of the process. As a buyer you are purchasing into the corporation of the building as well as the unit itself. It is important to review these documents. They can be complicated and it is recommended that buyers utilize the services of condo review companies to understand the finances, by-laws and related details.

Other Conditions

Other conditions can include review of current lease details with an existing tenant, title review, pet approval from a condo board or any other requirement you may have to complete the purchase.

10. What is an RPR?

A RPR, Real Property Report, is a survey of a property that is required during the purchase of real property in Alberta.

For a detailed description of a Real Property Report visit the Alberta Land Surveyor’s Website.

You don’t need to understand everything about an RPR, but it is best to know what to expect. Your lawyer will go over the RPR with you and you will be asked to review the RPR of the property to ensure it reflects the current state of the property. The seller will provide your lawyer the current RPR. Your lawyer will review the RPR with you and ask you about the property as they would not have visited the property in person. Please take note of existing fencing and structures as you review the document. Your lawyer can answer any questions regarding the RPR that you may have.

11. Negotiations?

Negotiating your offer can take minutes, hours or days. Throughout the purchase process the buyer will have learned what market conditions they are in and how they are positioned in the negotiating process.

As your Realtor I am on your side negotiating on your behalf. We will discuss strategy, options and how best to move forward to achieve your goals. Sometimes emotions can win over, but that’s why you have someone on your side to help you separate process from property.

For some reason many offers are agreed to at odd times such as 10 or 11 pm. That is why we utilize electronic signature so that you can even accept on the dotted line in your PJs.

12. SOLD! Contacting your Lawyer and Possession Day

Contacting Your Lawyer

Once you have a firm Purchase Contract, it is time to contact your lawyer if you haven’t already done so. Sometimes for more complex purchases you may have contacted them earlier to get advice.

Your lawyer will need to meet with you in person a week or two prior to Possession Day. He or she will go over the final documents related to your purchase and your mortgage. They will provide you a list of what you need to bring and any additional requirements prior to your meeting. This may include confirmation of home insurance for the property.

If you will be outside of Alberta prior to Possession Day then you need to make specific arrangements to get the documents signed. An option is for a Calgary lawyer to prepare the documents that are then presented and reviewed by a lawyer at your location. If this is an option you are considering you need to give all folks ample notice as couriers add days to the time required to complete your purchase.

Possession Day

On the Completion Day/Possession Day you finally get keys and access to your new home. As per the contract, possession is usually at or about noon. Please do not have your moving truck ready to unload at noon as sometimes there are last minute delays.

It is best for Possession Day to be a working business day so that all lawyers, mortgage brokers and lender contacts are available.

Congratulations! You are now a homeowner!