Buying Tips

So you’re buying a property, eh? Well, congratulations in advance. Here are some tips to help make the experience as pleasant as possible and minimize any post-purchase dissonance or remorse. After all, most homes are final sale. At least until Costco or Walmart start selling homes, I guess.

Buying a house is the biggest investment…blah blah blah…who know how it goes. Despite its importance, buying a house is a straightforward process that has been made infinitely easier with ever-expanding apps, websites, and resources that help people find a suitable property. You don’t need a Realtor to buy a home, though working with one makes the business of viewing a home infinitely easier. There are some occasions in which it’s advantageous to forego a Realtor (see the next section), but it’s nigh blasphemy for a Realtor to admit that. 

The basics of buying a house:

  • Set your budget
  • Optional: get a mortgage pre-approval. Aside from the obvious benefit, a mortgage pre-approval can also lock in a rate for you, which is helpful in markets where interest rate trends are volatile or unpredictable. While a mortgage pre-approval isn’t a guarantee of financing, it can give you confidence in a bidding war to drop a financing condition.
  • Shortlist your neighbourhoods (lifestyle considerations, walk score, transit score, proximity to schools, etc)
  • Search for properties
  • View the properties you fancy
  • Prepare your offer
  • Send your offer to the seller or their agent
  • Close the deal
Easy peasy! Let’s expand on this further with a look at the process with & without a Realtor.

With a Realtor:
When you’re working with a Realtor to buy a home, they will typically require you to sign a “buyer representation agreement.” This is not mandatory, but Realtors typically insist to ensure the work they put into helping you find a home pays off in the end. It’s a reasonable ask, since people don’t generally offer their services, time, and expertise to the masses for free. A buyer rep agreement can be broadly or tightly defined, but it basically asks you to commit to working with the specific Realtor for a specific period of time to help you purchase a specific type of property in a specific geography (ie, a house in Toronto). With a buyer rep agreement in place, if a Realtor helps you find a house but you decide to do the deal with the seller without your Realtor involved, the Realtor has recourse to earn their commission from the seller regardless of whether they were involved in the transaction or not. There’s an obligation on the seller’s Realtor to ensure a buyer’s Realtor is treated reasonably. If you sign a buyer rep agreement with a Realtor with whom you grow dissatisfied, you can request a cancellation of the agreement. Regardless of whether or not you have a buyer rep agreement in place during your search, you will be required to sign on if you submit an offer on a house with a Realtor.

Most people who’ve bought a house under $2M in Toronto since 2010 have faced a multiple offers situation. And for all but the winning bidder, it can be an emotional and stressful affair. Scratch that: it’s stressful and emotional for all including the winning bidder. If you’re buying a house that is likely to have multiple bids (likely, if it’s priced under $2M and isn’t a stigmatized property, and most of these homes have a prescribed – but not guaranteed – “offers date”), there are a number of things you can do to give yourself an advantage. Some are more obvious – getting a pre-approval, inquiring about a recent home inspection, doing your due diligence on your plans for the property (renting, renovating, raze & built, etc) – and some are less obvious. In all cases, the Realtor you hire will be a big determining factor in your success and your overall experience in a Seller’s market. Foregoing a Realtor altogether can be a better option than selecting one with an ineffective approach to multiple offer situations. Above all, it’s important to be clear-headed and rationale in multiple offer situations, and ensure your Realtor is holding the listing Realtor accountable for a thoughtful, transparent, and ethical process. If you’ve found the right house that you absolutely love, don’t lose out on it for a couple percentage points, if you can afford to stretch a bit. You’ll probably kick yourself if you find out you were outbid on a $1.5M home by $5,000. With the right Realtor at your side, you’ve already improved your chances of succeeding. And like I said, sometimes, it may be better to take an altogether different approach. Contact me to find out more.

Ah, that new condo smell. There’s nothing like it, but that’s probably because it’s mildly toxic. And who wants to wait a couple years when you can buy a previously-loved unit. 

The condo resale market is slowly emerging from a COVID-induced minor “correction.” While house prices continue to climb undeterred by COVID, the condo market has been more varied in its performance. Which means now is a relatively good time to buy. Theories abound, including one that posits that since the rental market has cratered, more investors are looking to dump empty units, while others posit that the urban exodus of white collar workers prompted by work-from-home life is diminishing demand. Whatever the reason, there hasn’t been a better time to buy a resale condo in Toronto in a long time.

When buying a condo, it’s generally a good idea to include a condition that allows you and your lawyer to review the condo corporation’s status certificate. The status certificate is a package of documents issued by the property management company on behalf of the condo corp that indicates it’s standing and financial health. If there are lawsuits pending, if the condo corp is facing large unanticipated repair or maintenance expenditures, if the insurance premiums are increasing because of issues like flooding, etc – a review of the status certificate is designed to uncover issues like the examples just mentioned. 

In the heat of a multiple offer situation, adding any condition can mean your offer won’t even be considered, so some listing salespeople will provide you with a status certificate on demand. However, if the date of the status certificate is well in the past, beware, as there may have been issues that emerged since the status certificate was generated. Ideally, a status certificate will be current, within days. 

Remember, when you’re buying a condo, you’re buying the neighbours all around you, too. It’s hard to know who you’ll be living beside or beneath during a 30 minute showing, but hey, isn’t that what makes condo living so great?

If you’re in the market for a pre-construction condo, brace yourself: there are a lot of options. There are more construction cranes in Toronto than anywhere else in North America these days, and the seemingly endless emergence of new condo towers is the main reason behind that. One recent trend in new condos in the city and in transit corridors is the reduction in parking spots available, resulting in an ever-increasing cost of parking spots. An underground parking spot is an expensive thing for a builder given Toronto’s relatively high water table. Some estimate the cost to be around $60,000 for the builder. It’s no wonder that the increasingly rare parking spot can fetch as much as $180,000 in some high end developments, though the average tends closer to $80,000. Some developers will restrict the sale of a parking spot to larger units in the building, so if you’re buying a 1 bedroom and you want parking, you might be put on a waiting list.

Selling a condo without a parking spot is hard. So if you’re going to forego a parking spot when you buy a new condo, understand the long-term implications, especially if you expect to sell the place in a few years. For my money, I’ll always buy a parking spot, no matter what. And if I can’t be assured of one up front, I won’t buy the condo. Period.

Other things to note when you’re buying pre-construction: pay attention to the fees. A condo’s maintenance fees and property taxes can be significant. And condo property tax rates are higher than house rates in Toronto. Most condos will tell you to expect a tax rate of about 1% of the purchase price (so an $800,000 condo will have an annual property tax of $8,000, or $667/month). Add to that the maintenance fees (that yoga room, rooftop terrace, and lap pool comes at a cost, yo) and you can easily match your mortgage payment in monthly expenses. But renting probably isn’t that much less, if at all. 

Condos also love to upsell you on interior finishes. Don’t be afraid to negotiate add-ons, particularly when the market is a little more in balance, like it is at the moment. If you can’t negotiate for upgrades, then try to get the assignment fee waived and secure the right to market and sell your property before the condo is registered (in the period known as interim occupancy). The right to assign a condo means you can effectively transfer your obligation to purchase the unit to another buyer. The condo has to agree and may charge you upfront for that privilege. You can assign the unit at the price you paid, at a discount (if you need to dump the property for whatever reason), or at a premium if the market can bear it. 

New condos – like most goods and services in Canada – are taxable. Typically, the HST is included in the price. If you’re planning to live in the unit (as opposed to investment units), you can apply for an HST rebate when you close the deal.

Finally, know that whatever date a developer tells you your building will be completed by, it will almost certainly be delayed. Sometimes by a couple months, sometimes by a year or more. You have rights and the developer has obligations, but keep this in mind.

I’ve owned, rented, flipped, bought, and sold my share of condos, both new and resale. If you want some advice, contact me.

If you’re buying a tenanted property, you are assuming the terms of that tenancy, whether it’s in the middle of a fixed term tenancy or a month-to-month tenancy. Buying a tenanted property doesn’t cancel the pre-existing tenancy agreement, and the act of purchasing the unit does not automatically give you the right to evict your tenant. If you’re buying a tenanted property with the intention of retaining the tenant, then refer to my tips for landlords. But if you’re buying a tenanted property with the intention to live in it, to flip it, or to rent it to someone else, you need to understand your obligations under the Residential Tenancies Act. 

If you buy a property with tenants in a month-to-month tenancy and they wish to remain, then your options to end the tenancy (and evict them) are limited. If you intend to use the place for personal use or that of your immediate family, then you can apply to end the tenancy. If you’re planning to renovate the property and lease it after the reno, then you must give them the first option to re-lease the property before you can offer it to others. 

Bottom line, if you’re buying a tenanted property, beware. And do your homework: ensure the tenants are in good standing and congenial people. If they’re terrors, you’re in for a long and potentially expensive road.

Mortgage rates today are as low as they’ve ever been. While the rates were attractively low before the pandemic, they’ve reached a new bottom during the pandemic. Rates will undoubtedly go up before long, so now is a great time to purchase a home if you have the means. And if you’re planning to stay in the home for more than 5 years, then a long-term mortgage is the way to go. Most people tend to get their mortgage where they bank (one of the big 5, a credit union, etc), but savvier buyers know to shop around for rates. A quarter point difference (25 basis points, or 0.25%) can make a big difference in interest over the term of your mortgage. 

If you’re going to shop around, you have a couple options: do your own hunting or use a mortgage broker. Mortgage brokers usually charge the lender, not you, so it can be a great option for you to have someone else do the legwork to find you the best rate. Because mortgage brokers don’t typically have a relationship with you like your bank, you can expect to give them more information (bank statements, for example) than you would your own financial institution. But it’s not a lot of work for potentially a lot of reward. Your Realtor can probably refer you to a mortgage broker, or google one, or ask around – chances are, someone you know used a mortgage broker for their home.

If you decide to do your own shopping, sites like are a good resource. Honestly, there are a lot of rate aggregators. Sometimes a particular bank will give a better rate on a specific term but a less attractive rate on other terms, vs other financial institutions. The most important thing is to ensure you understand the terms of the mortgage (penalties for early discharge, renewal conditions, added fees, pay down privileges, etc). All other things being equal, go for the one with the better rate. And don’t shy away from negotiating. While most banks will treat most people the same, your main bank might be willing to match a competitor to avoid losing your business. If they lose your mortgage, they could lose the rest of your portfolio, too.

If you need help with fInancing, let me know. I can point you in the right direction.


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