The four steps you need to follow to buy a home in Canada.
When it comes to real estate transactions, selling can seem easier than buying. There are, however, important details to consider. Take the time to plan and prepare for each step in the selling process, and you’ll be able to list your property and close the deal without any surprises.
Step 1) Find a Real Estate Agent
Choose a local realtor who is proactive and knowledgeable about pricing and expectations in your specific neighbourhood. When friends of mine listed their home with an out-of-town realtor, they had a lot of showings but not many offers. Unfamiliar with their neighbourhood, the agent had priced their home too high. After a couple of weeks, they adjusted the price and received multiple offers. While this story illustrates the value of local knowledge, ultimately, it is the market, that determines how much a given property will fetch. Be realistic and stay attuned to the latest local real estate trends.
Step 2) Stage Your Home
Use some of your budget to stage your home. For some, staging involves a quick coat of paint in the living room and new art for the hall. Others need to rent a storage locker to contain their clutter. Prospective buyers don’t want to look at the pile of shoes in your hall closet. Again, your real estate agent can offer some tips to help present your home in its best light.
Step 3) Review and Negotiate Offers
Once you receive an offer, don’t just look at the big number on the bottom of the page. Look at all the details—especially the subject-to provision/conditions and completion date.
A subject-to provision is a condition that the buyer has placed on the offer. For example, a purchase could be subject to inspection, financing, or sale of the buyer’s current property. If you’ve received multiple offers at the same price, you can choose the best one to negotiate with. Comparing the subject-to provisions can help you decide which offer is the strongest. A cash offer is usually better than one which is subject to financing, which means the buyer needs to secure a mortgage before the deal is complete. An offer with a subject to sale is less desirable, since it stipulates that the buyer must sell their existing home before they purchase yours.
Once you negotiate and accept an offer, you have to wait for the buyer to remove these subject-to provisions. Normally this happens within two weeks. When they remove subject-to provisions, or conditions, the deal is finalized. If they don’t remove conditions, the contract is void.
Your realtor will communicate with the buyer’s agent to establish a completion (or move-in) date that suits both parties. This is negotiable, so if you have a certain date in mind, include it in the deal. Usually the completion is set between one and three months after subjects are removed.
If you are selling and buying, allow at least one day in between, so your sale proceeds can go toward your new property. Buying and selling can be stressful; don’t complicate the process by trying to complete both transactions on the same day.
Step 4) Hire a Notary or Legal Representative
Because real estate transactions must be finalized by a legal representative (either a notary or lawyer, depending on what province you are in), it’s important to choose a legal representative to send your information to as soon as subject-to provisions/conditions are removed. A good notary or lawyer will help you understand the legal implications of your real estate deal, so you can plan your move knowing that the details are in order.
Once the deal closes, your legal representative will need to get the following information:
- Mailing address of the property
- Expected completion date (Your notary/lawyer will confirm this once the paperwork is finalized)
- Information about your mortgage, if you have one. This is often your mortgage account number and remaining balance. (Again, your legal representative will confirm these details)
If you want to learn more about the legal documents necessary for selling real estate in your area, contact a local notary or legal representative. It’s worth the effort. By understanding the legal implications of accepting an offer, negotiating subjects and completion dates, and signing documents, you can list your home with more confidence—and less stress.
Zancope Notary Public – 604-260-6783 [email protected]