Frequently Asked Questions About Buying A Home
Fulfilling the dream of homeownership is a something many people aspire to, however, buying a home requires knowledge and planning. Unfortunately, once people decide to take a step towards buying a home, they may find credible sources of information hard to come by. To plug that gap and arm you with the most accurate information available, the Jordan Grosman Group has answered some of the most frequently asked questions.
1. What is the first step of the home buying process?
Mortgage pre-approval is the first and most crucial step. This will give you an idea of how much money you have to purchase with and will likely be a factor in working with a realtor. It will decide your budget.
2. How long does it take to buy a home?
It varies from market to market, region to region, but, in a “normal” market it should be between 30 to 45 days. There are many factors like the market type, the location of the house, the inventory and the time of year that decide the best time to purchase a home as well as the time it takes to purchase one.
3. What is a “Buyer’s Market”?
A Buyer’s Market is a market that favours buyers over sellers. When interest rates and cost of borrowing increase, the number of buyers decrease, this reduces the demands for houses, and as a result, the prices of homes drop to meet the demand, this creates a buyer’s market. High inventory and natural disasters also reduce property value to benefit buyers.
4. What is a “Seller’s Market”?
When the market favours sellers over buyers. Economic factors like an increase in the labour market which increases the number of residents in an area/region, a decrease in interest rates which makes it more affordable to borrow money, and low inventory all benefit sellers. These elements can drive prices higher enabling a Seller’s Market.
5. What kind of credit score do I need to buy a home?
Most lenders will require a Credit Score/FICO Score of 650 or higher. The higher your credit score, the lower is the risk to the lender. This will qualify you for a lower down payment and interest rate.
6. What are my costs as a buyer?
In most transactions, it is the seller who incurs the cost of selling their home, that is, the sellers pay the realtor’s commission. But, as a buyer, you do need to consider these possible costs: land transfer tax, property inspection, deed or mortgage registration, legal fees, closing adjustments, home and property insurance, moving expenses and connection charges for gas, electrical and water.
7. What is a land transfer tax?
Properties sold in Toronto are subject to a Municipal land transfer tax as well as a Provincial land transfer tax – you can obtain this information from your municipal and provincial government websites.
8. Do I need a home inspection?
Although not mandatory, we always encourage a home inspection. The seller is responsible for disclosing latent material defects (things not seen on the surface), But, there are often issues with the home that the seller does not know about. A home inspection is relatively inexpensive and can bring to light any discrepancies about the house before purchase.
For any further questions about real estate or buying or selling a home, get in touch with the experts at Jordan Grosman Group. When it comes to luxury real estate, we often hear from our clients that we are the best real estate agents in Toronto. To learn more about how we can help you, please click here or contact us by clicking here.