QUESTIONS YOU SHOULD ASK AS A FIRST TIME HOME BUYER.
Buying your first home can be a confusing and complicated process. It’s important to know what’s involved and what questions you should ask when you are thinking about becoming a homeowner for the first time!
Questions To Ask Yourself:
What type of property am I looking for? What type of property will suit your needs? An apartment, townhouse, duplex or single family home.
Where do I want to live? What do you need in a neighbourhood? Do you have kids - do you need to know if there are good schools in the area? Do you want to live close to where you work?
What criteria do I need for my new home? How many bedrooms do you need? Is a garage necessary? Do you have pets - ie. do you need a yard or a patio space?
What is my ideal timeline to buy? This may depend on your financial situation. It is important to chat with a mortgage broker or a bank to see if you need more time to save for your down payment, pay off debt, etc. They can help you create a plan for you to achieve your goal of purchasing your first home.
How long will I live here for? It’s important to buy a home that you can see yourself living in for more than 3 years. During the first 1-3 years you mostly paying off your mortgage interest, not so much the principal. Most first time home buyers will sell their home after 3-5 years of living there.
Questions For Your Realtor About The Process:
Where should I be looking online for homes? The best website to use while looking online at listings is realtor.ca (unless you are working with a realtor already and they have set you up on a portal through the MLS to receive notifications when a new or updated listing comes up).
What is the minimum down payment? The minimum down payment in Alberta is 5% of the purchase price (ex. $20,000 for a $400,000 property). You can put as much down as you’d like. Keep in mind, if you’re putting less than 20%, you will have an extra fee known as mortgage loan insurance.
Should I be pre-approved before we go looking for homes? It is strongly recommended that you are pre-approved and know the budget you can work with before you go house hunting. It can be disappointing when you find your dream home and then realize it’s out of the budget. Talk to a mortgage broker or a bank first before looking at properties.
How much does a home inspection cost and what’s the purpose? A home inspection is important for buyers because this is your opportunity to learn about the home you are buying, home maintenance tips, and any deficiencies that may be present in the home. A home inspection typically depends on square footage but will likely cost between $400-$600.
What are legal fees? A lawyer plays an important role in the first time home buying process. They are the ones who look through the documentation to ensure it’s legally binding and been completed correctly, they register your mortgage, transfer title and register you as the new owner of your home! Legal fees will range in price as they are dependent on the location of your home and property type.
What other costs should I be aware of when buying a home? There can be some initial expenses including moving truck fees, set up fees for utilities, repairs or renovations, etc. There are also ongoing fees to consider including condo fees, utilities, homeowner association fees and home insurance.
Questions To Ask Your Realtor About Their Experience:
Is real estate your full time job or part time job? As a first time home buyer, you will likely want someone representing your best interests who does the job day in and day out. Someone who has lots of experience and can help you with any issues that may arise. There are a lot of realtors who only work the job part time.
Do you offer first time home buyer consultations? You may want your realtor to sit down with you and discuss the home buying process step by step. This will help you feel more prepared throughout the experience.
How many homes do you sell in a year? It’s fair for you to want to know who you are working with. Every realtor has their own values and does their business differently. You may also want to find out what their experience has been like with first time home buyers and how many first time buyers they have helped.
What are your fees? Typically, the commission of both the buyer’s realtor and the seller’s realtor is paid by the seller. The commission structure is usually determined when the seller lists their home. A realtor’s commission can differ depending on the level of service they are providing to the client. Always ask your realtor what their fees are.
If you, or someone you know, is looking to buy their first home, I would love to help! Working with first time home buyers is so much fun for me. I will do my best to make the process as easy and stress-free as possible.