Your Step by Step Guide to Buying a Condo
Condos are hot properties right now. If you live in an urban centre or want to live in an urban centre, they’re easily the most affordable option available to the prospective homeowner.
But how does one go about purchasing one? Is it the same as buying a house? Read on and all your questions shall be answered.
First things first, figure out what you want
Low interest rates have people happily springing for bigger mortgages, but you can’t assume you’ll be approved for whatever amount of mortgage loan that you need. The smart buyer gets pre-approved so you know how much cash you have to work with. It's also a good idea to compare mortgage offers in order to find the best possible.
Next step is to use the web to check out sale listings to get a taste of what’s out there in your price range. Write a dream list of everything you want from building amenities to neighbourhood features as well as any specific properties you have in mind and keep it in your back pocket for now.
Now find a good realtor
Give your real estate agent that list you have of all your home buying wants and they’ll start hand picking properties for you to look at.
Elan Weintraub, a real estate agent in Toronto with Century 21, puts the selection process to a funnel. “You start off broad, and then narrow it down.”
When you’re really zeroing in on a place, Weintraub recommends clients to do a “mock commute” just so they get a real feel for what it’ll be like going to and from work every day. Distance isn’t everything. A route may be short but very busy and crowded or have long wait times.
Chances are you’ll have to compromise on a few of your wants, especially if you don’t have much wiggle room with the budget, but c’est la vie.
Closing the deal
So you found a place you like? That was the easy part.
The first step to closing the deal is to make an offer. Then both parties have to negotiate and accept the offer. When that happens, It’s time for the deposit (not the down payment!). Deposits are 5% of the purchase price and must be delivered the day after it’s agreed upon.
There are usually three conditions on the deal, although the seller or you as the home buyer may choose to waive some of them.
- Get a home inspection
- Review the status certificate. This document will tell you everything about the building including repair history, engineering assessments, and accounting.
- Finalize financing (use a mortgage agent if you need to!)
Once all the conditions are satisfied, the deal becomes firm. Down payment is due on the closing date.
On the closing date, you’ll get the keys to your new place and you’re officially a condo owner! After all the loops you just had to jump through to get your new home you have to make sure you protect it.
Don’t forget to get condo insurance, because while the building itself is insured by the condo corporation, that doesn’t cover the stuff you own.
Note: Things are a very different for buying pre-construction. Most of this article doesn’t apply, so keep that in mind and stay tuned for a piece on that.