STEPS IN A REAL ESTATE TRANSACTION
In 2009, the average price of a home in Toronto was $395,460. By 2012, the average price increased to $497,301.
The large amount of money and importance attached to real estate transactions mean that there is usually a large number of steps involved in the purchase of property. In most transactions, a host of people are needed to ensure that a deal closes smoothly. The people that are typically involved in a real estate deal include:
- Real estate agents
- Home inspectors
- Mortgage brokers
- Appraisers
- Insurers
- Lawyers
- Banks
Deciding whether to buy a home?
The first step that a prospective homeowner should take is to decide whether buying a home is suitable, given their financial position, lifestyle and medium to long-term plans.
In terms of finances, before a buyer starts to actively look for a property, he or she should get pre-approved for a mortgage. This determines whether buying is possible at all and defines the range of homes that a buyer should be looking at. Online mortgage affordability calculators can be helpful at this stage. It may also help to limit the type of home and neighbourhoods that a buyer should be considering. Shopping around for a mortgage is recommended since different financial institutions offer different rates and options.
After making a decision to buy and determining the price range for a home, it's time to decide on the type of home and start looking.
What Kind of Home and Where?
Homes can be broadly categorized as follows:
- Detached
- Semi-detached
- Condo Townhouse
- Condo Apartment
- Freehold Townhouse
- Co-op Apartment
In addition to the above, you should also consider whether it's best to buy a new or resale home, or whether it might be best to have a custom-built home.
Shopping Around
Start your search. You can find out about homes for sale online, in real estate magazines, from real estate agents, word of mouth, for-sale signs, etc. The Multiple Listing Service (MLS) is probably the most widely used system for searching for resale homes. There are also private listings on such websites as comfree and kijiji.
An important part of home-buying is getting your feet wet by browsing home listings, attending open houses and getting a feel for the market. This being said, if you know exactly what you want, shopping around may not be necessary.
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