Most first-time buyers start by scrolling listings. That is the fun part, and it is also the part that creates the most frustration, because it happens before the groundwork is done. Here is the groundwork.
1. Get a real pre-approval, not an online estimate
A pre-approval from a lender or mortgage broker tells you the maximum you can borrow, the rate you can hold, and how long that rate hold lasts. It also means a seller takes your offer seriously. An online calculator does none of those things. Budget for the stress test, which qualifies you at a higher rate than you will actually pay.
2. Know the full cost of closing
Beyond the down payment, plan for:
- Property Transfer Tax (first-time buyer exemptions and reductions exist, with thresholds that change, so ask)
- Legal or notary fees
- Home inspection
- Appraisal, if your lender requires one
- Moving, and the first month of strata fees or utilities
A rough reserve of two to three percent of the purchase price covers most of it.
3. Decide what kind of home, then where
Condo, townhouse or detached is the first decision, because it shapes everything else. A three-bedroom townhouse in Cloverdale and a one-bedroom condo near a SkyTrain station can cost the same. Decide which life you want before you decide which neighbourhood.
4. Read the strata documents, all of them
For condos and townhouses the strata package matters more than the paint. Depreciation report, minutes from the last two years, bylaws, the contingency reserve fund and any special levies. A good REALTOR® reads these with you and tells you what is normal and what is a red flag.
5. Understand subjects
A "subject" is a condition in your offer, such as financing, inspection or reviewing strata documents. Subjects protect you. In a competitive situation buyers sometimes drop them, which is a decision to make with eyes open and never under pressure. Your agent's job is to get you the home while keeping as much protection as the market allows.
6. Line up your lawyer or notary early
Completion in BC runs through a lawyer or notary. Choose one before you write an offer so there is no scramble between subject removal and completion day.
7. Pick an agent who will slow you down when needed
The best thing a buyer's agent can do is tell you when not to buy. Patience in a fast market is a skill. Ask any agent you interview how many of their clients walked away from a home on their advice.
If you are starting the search in Vancouver, Surrey, Delta or the Tri-Cities, Gopal is happy to walk through all seven with you before you look at a single listing. See the buyers page or call directly.