Buying a Condo: What to Expect
As you are viewing potential properties with your real estate agent, you should have an idea of what to look for. Buying a condo can be an overwhelming process, but with guidance and a plan in place, it can be a fun and exciting process too! Here are a few things you can expect when buying a condo, and some tips to help make the process smoother:
Prepare yourself to purchase.
Do your homework.
The more clarity you have going in to the buying process, the easier it will be to make a decision that feels right for you.
- Where do you want to live? Drive around and spend some time in neighbourhoods that you’re considering, and make not of what draws you to those locations.
- What do you want in your next home? Make a list of your must-haves, your ideal size, style, etc.
- What are your deal breakers? What features or characteristics do you need to avoid or would make you pass on a property.
You will need to know, before you start looking, what you can realistically get approved for, and be comfortable spending on a mortgage each month. The last thing you want to do is fall in love with a property, and find out you can’t get approved to purchase it.
- Make sure your credit is in great shape. Talk to your mortgage broker or bank about your credit score ahead of time, to make sure there are no surprises.
- Avoid making large purchases. It can be tempting to shop for furniture or larger items for your new place, but wait until your purchase closes, especially if you plan to finance any of those purchases.
Start your home search.
In addition to meeting with one of our Condo Experts to discuss your options, we will set you up on an online search so you can be in-the-know immediately. To save yourself time, refer to your list of must-haves and deal-breakers to provide clarity. It’s now time to start looking at properties!
When buying a condo, focus on the things you can’t change.
When considering if a condo is a good investment, buyers often consider the following attributes:
In-suite laundry, safe area of town, remediated building, nice countertops, newer appliances, updated bathroom, corner unit
Keep in mind that tems such as countertops, appliances, bathrooms, and other cosmetic upgrades can be done at any time. Items such as corner unit, area of town, in-suite laundry and remediated building are things that you can’t change over the next few years. Chances are if you are looking at a home that has been completely renovated, it is going to sell for its full value, and there won’t be tons of room for growth in that value over the next few years.
When looking for a great investment, you need to single out condos that have great characteristics that won’t change in the near future. A corner unit in a remediated building that is located in a great area will sell much easier when the time comes than a similar condo that is in a bad area, has never had any repairs, and faces North, no matter how nice the renovations are inside.
To help with the cost of renovations when you move in, there are now mortgages that allow you to build in up to $20,000 in renovation expenses into your monthly payments. For example, if you wanted an extra $10,000 in renovation money out of your mortgage, it would cost you approximately $40 per month more (confirm with your mortgage specialist of course).
What to look for room by room when buying a condo.
Focusing on whether the entire place is large enough, or if it has enough bedrooms, and whether it’s in a good neighbourhood is important. However, it’s also important to consider the smaller perspective – room by room.
Here are some tips and things to consider when you’ve narrowed down your list, so you know what to look for room by room:
- Living room – Will your current furniture fit the space? Is there enough storage or will you need to purchase new furniture? Consider your budget and make sure you have enough to make the condo work for you once it’s yours.
- Kitchen – How are the appliances? It’s a good idea to factor into your budget whether you’ll want to replace or upgrade the appliances once you move in.
- Bathroom – Is there enough storage? This typically isn’t a deal-breaker, but it’s nice to plan ahead & measure space that you may add a cabinet to or a couple of shelves.
- Bedrooms – It’s a good idea to measure the bedroom you currently have to know when you’re viewing places how it actually compares. It’s tough to visualize and make a comparison depending on how the room is set up by the current occupant.
- Storage/Parking – Be sure to have your agent show you the parking stall & storage locker. They come in a range of shapes & sizes and you won’t want to be disappointed on moving day.
Are you dealing with Multiple Offers?
When we help clients write an offer and we know there are other offers being presented as well there are a few important things to do to help you be successful and feel at ease. Namely:
1. Establish a range for the market value of the property. Bear in mind that properties that go into multiple offers are usually listed at or under market value… you should already be getting a good deal!
2. Establish what you’re willing to pay (if it’s the ideal property for you and/or you’ve been searching for ages, it may make sense to pay more than market value)
3. Write the best possible offer you can within your comfort zone.
At the end of the day, you should feel confident that you’re putting a good offer forward that has little or no room left for negotiation, and satisfied that if someone else gets the property by offering more than you that you simply weren’t willing to go to that price point. If you are prepared before the situation even arises you are much more likely to deal with it well and be able to make good decisions. People who ‘win’ multiple offers have often been in them before and have usually seen a good number of properties and understand value well.
Are you a First-Time Home Buyer?
If you are a first-time homebuyer in the Province of British Columbia you should be aware of a few notable changes to the buyer’s exemption under the Property Transfer Tax Act. The act exempts a first-time buyer from the property transfer tax, if the buyer meets certain criteria. Find out if you qualify here. There is no limit to the amount of down payment for a first-time homebuyer. Of course, we recommend that you should always consult with a lawyer to explore all your options.
Find out when you can move-in.
If you’re buying a condo, and have now removed your subjects, there are several dates you should pay attention to.
There are actually three different dates that dictate different processes and timelines on the standard Contract of Purchase & Sale from the BCREA. When you’re buying a condo, your real estate agent should explain the significance of each of these dates, if they’re going to differ, and discuss what would work best for your timelines, and your potential move-in plans.
The completion date is often referred to as your ‘closing’ date. Simply put, this is the date that you actually take ownership of the condo, and it becomes yours! See this excerpt from the BC Financial Services Authority’s website: ‘On that day, legal ownership will transfer from the old owner to you in exchange for the purchase price of the home. You will be able to move in on the possession date stated on your contract. The completion and possession dates are not necessarily on the same date.’
It’s important to re-iterate that the possession date is not always the same date as the completion date. The possession date will typically be accompanied by a time, and this date and time is when you’re legally entitled to the receive the keys to the property and have access to your new condo. Pay close attention to this one, it seems to be the most important for buyers, especially when you’re setting up movers and making your moving plans!
The adjustments date is often overlooked, but it is still important. It is the date that the lawyers will use to determine when the seller will stop being financially responsible for paying items like the property taxes, fuel utilities, strata fees, etc. Your lawyer should explain this to you when you’re signing transfer documents prior to your completion date, however it’s good to know ahead of signing documents with your lawyer that the adjustments date is the date that they will use to determine when you become financially responsible for those items, and potentially others, depending on the property.
If you are looking to buy a property in the current market, or in the future, it’s important to have an expert real estate agent on your side. Get in touch with The Condo Group Real Estate, reimagined as Island Realm Real Estate, for more information at 250-382-6636.
-The Condo Group Real Estate, reimagined as Island Realm Real Estate, crew