Buying Residential Property
Identifying The Right Property
Identifying the right property is not hard as you just have to understand your needs. You want a place that is close to your customers. First and foremost is the location. But you have to see the potential risk in that too. May be the location you choose is good today but is it also easily accessible to your customers? Also you have to see if there is an opportunity for expansion. Before you finalize the location, you need to do due diligence.
Commercial property is valued differently. You have to revisit your objectives and re-consider whether it is the right investment for your business. Talk to your team of advisors and get their opinion if it is the right investment.
Buying Tips
In this home buying section, I will walk you through some of the very important points to help you quickly set up the notes in your home search.
- Contact a mortgage specialist & get pre-approved
- Review Purchasing Costs
- Property Tax
- S.T (only on new property)
- Legal Fees (Lawyer fee etc.)
- Home / Condo Inspection (if applicable)
- High Ratio Mortgage Premium (only if borrowing over 80% of the purchase price)
- Deposit (minimum 5% & forms part of the purchase price)
- Review First Time Buyer Savings (Tax rebates / RRSP withdrawals / Tax Credit)
- RRSP tax free withdrawal
- Define your Search Criteria
- Needs Vs. Wants analysis
- Neighborhood analysis (likes & dislikes)
- Determine what your budget will get you in your neighborhood of choice
- View property details from listings in your neighborhood of choice
- Tour open houses of qualified homes
- Make an offer
- Draft Contract of Purchase & Sale
- Determine Price, Possession date & Completion Date
- Determine Subjects such as Inspection, Financing & Paperwork)
- Submit Offer (with Expiry time and date)
- Sellers Options (Accept, Counter or reject)
- Place deposit check into the Trust Account of your Realtors Brokerage
- Select Notary Public / Lawyer
- Prepare for the move
Buying Commercial Property
Business Purchase Transaction
Buying commercial property is often the most time consuming transaction for any business. Whether you are a veteran or buying first time, the only difference will be that as a veteran you are prepared for pros and cons whereas the first time buyers learn a lot from this complicated transaction.
Plan well ahead before making any move. A lot of departments are involved in it such as banker, accountant, real estate agent who specialize in your area of focus. Keep certain things in mind as you plan your purchase. What kind of place you need for your business. What kind of locality you want meaning should it be close to transportation so that it is easy for your staff to communicate. May be you want it close to your residential area.
Identifying The Right Property
Identifying the right property is not hard as you just have to understand your needs. You want a place that is close to your customers. First and foremost is the location. But you have to see the potential risk in that too. May be the location you choose is good today but is it also easily accessible to your customers? Also you have to see if there is an opportunity for expansion. Before you finalize the location, you need to do due diligence.
Commercial property is valued differently. You have to revisit your objectives and re-consider whether it is the right investment for your business. Talk to your team of advisors and get their opinion if it is the right investment.
Selling Residential Property
Selling your home is easy as well as tough. It all depends what strategy you apply. There can be many reasons for selling home. Your needs may have outgrown and need a large house, or you are in a situation when you want some urgent funds or you want a more affordable house.
Preparing to Sell
You need to make sure that your home is clean of clutter and all the needed repairs are done. Check your home inside out to see if there is anything you need to fix. You also want your home looking its best to sell quickly at top market value. Do your due diligence to make it look at its best and well maintained. The seller will get an inspection, but discovering problems during a pre-sale home inspection allows you to have more control over how to handle them. Knowing the value of your house and marketing right are the keys. Get your home appraised.
Consider Your Priority
Considering your priorities before selling your property makes you well prepared when time arrives. Check out the points below and get ready.
- Is it Seller’s or Buyer’s market?
- How to spread the word out?
- How quickly I want to sell my home?
- To buy or sell first?
- Do I have a right real estate agent who knows the business and can sell
- my home for top dollar?
- Do I have enough time to make efforts to sell home?
- Am I aware of the delays and complexity involved?
- Have a right real estate agent who knows the business and can sell
- your home for top dollars!!
Showing Your Home
Once you are ready with all the steps mentioned above, you need to list your home. You have to determine your home’s price. Setting a right price is also crucial but if you know the market value, it’s easy. Showings are necessary when you sell your house because
each one brings a potential buyer into your home. Be absent during showings so buyers feel less pressure and more comfortable.
When you show your home, let the buyer engage in your home emotionally and let him feel home because the decision to buy is based more on emotions. He should feel comfortable.
Once you are ready with all the steps mentioned above, you need to list your home. You have to determine your home’s price. Setting a right price is also crucial but if you know the market value, it’s easy. Showings are necessary when you sell your house because
each one brings a potential buyer into your home. Be absent during showings so buyers feel less pressure and more comfortable.
When you show your home, let the buyer engage in your home emotionally and let him feel home because the decision to buy is based more on emotions. He should feel comfortable.
Don’t burn candles or spray deodorizers because many people are allergic to scents. Just make sure the home is clean, clutter free and smells fresh.
Selling Commercial Property
Selling a commercial property is quite different than a residential property. A commercial property can be an industrial space, a vacant land, an agricultural land, office building, residential multiplex or shopping center. The transition process of commercial property brings its own challenges. Commercial real estate is a slow process with many strings attached. But with my experience and knowledge, this can be a smooth ride.
Commercial property leases are longer than single family dwellings. An investor doesn’t require 100% cash to buy commercial property. They rely on financing to purchase their properties. They mostly use cash-on-cash formula to compare the first year performance of properties in competition.
Property Location
The appraisal process for commercial property is quite subjective, which can lead to a lot of frustration. The important fact is that the location of a commercial property is the Key. Every business wants a perfect location for its business growth, where he can increase its client base. So properties with good location sell faster than others.
Commercial property deal is different than residential property; same is true for down payment. Commercial property lenders want at least 30% down payment before they approve a loan. Be adaptable when searching for great deals. Use all resources when searching like Internet, Social Media, Classifieds, walk the neighborhood, talk to local people to see what input you get!
What is the difference between a real estate agent and a real estate broker?
Most states require real estate sales professionals to be licensed by the state, so that they can control education and experience requirements and have a central authority to resolve consumer problems.
The terminology used to identify real estate professionals varies a little from state to state. Brokers are generally required to have more education and experience than real estate salespersons or agents.
The person you normally deal with is a real estate agent or salesperson. The salesperson is licensed by the state, but must work for a broker. All listings are placed in the broker’s name, not the salesperson’s.
A broker can deal directly with home buyers and sellers, or can have a staff of salespersons or agents working for him or her.
Why should I use a real estate salesperson?
A real estate salesperson is more than just a “sales person.” They act on your behalf as your agent, providing you with advice and guidance and doing a job – helping you buy or sell a home. While it is true they get paid for what they do, so do other professions that provide advice, guidance, and have a service to sell –such as Certified Public Accountants and Attorneys
The Internet has opened up a world of information that wasn’t previously available to homebuyers and seller. The data on listings available for sale is almost current – but not quite. There are times when you need the most current information about what has sold or is for sale, and the only way to get that is with an agent.
If you’re selling a home, you gain access to the most buyers by being listed in the Multiple Listing Service. Only a licensed real estate agent who is a member of your local MLS can get you listed there – which then gets you automatically listed on some of the major real estate web sites. If you’re buying or selling a home, the MLS is your agent’s best tool.
However, the role of an agent has changed in the last couple of years. In the past, agents were the only way home buyers and sellers could access information. Now agents are evolving. Because today’s home buyers and sellers are so much better informed than in the past, expertise and ability are becoming more important.
The real estate agent is becoming more of a “guide” than a “salesperson” — your personal representative in buying or selling a home.
I have a family friend who is a Realtor. I like her and she is a help but she gives me one price to sell my home for and I think it is too low. So I called another agent who suggested a price more in line with my expectations. Who do I choose?
You might want to consult a couple more Realtors on the market value of your home. Most of the estimates should be in the same ballpark.
It could be that your friend is being more honest with you about the value of your home and the other Realtor gave you a higher number because he already knew you expected it. This is called “Buying a Listing” and is the subject of an article on our web site.
Or it could simply be that your friend is a good friend, but not that great of a real estate agent.
Mixing business and friendships is always risky to the friendship. On the other hand, if your friend is truly competent and was providing wise advice, she may be offended if you ignore the advice and choose another agent.
What is the difference between a real estate agent and a real estate broker?
A real estate sales professionals to be licensed by the Authorities, so that they can control education and experience requirements and have a central authority to resolve consumer problems.
The terminology used to identify real estate professionals varies a little from state to state. Brokers are generally required to have more education and experience than real estate salespersons or agents.
The person you normally deal with is a real estate agent or salesperson. The salesperson is licensed by the state, but must work for a broker. All listings are placed in the broker’s name, not the salesperson’s.
A broker can deal directly with home buyers and sellers, or can have a staff of salespersons or agents working for him or her.
Why should I use a real estate salesperson?
A real estate salesperson is more than just a “sales person.” They act on your behalf as your agent, providing you with advice and guidance and doing a job – helping you buy or sell a home. While it is true they get paid for what they do, so do other professions that provide advice, guidance, and have a service to sell –such as Certified Public Accountants and Attorneys
The Internet has opened up a world of information that wasn’t previously available to homebuyers and seller. The data on listings available for sale is almost current – but not quite. There are times when you need the most current information about what has sold or is for sale, and the only way to get that is with an agent.
If you’re selling a home, you gain access to the most buyers by being listed in the Multiple Listing Service. Only a licensed real estate agent who is a member of your local MLS can get you listed there – which then gets you automatically listed on some of the major real estate web sites. If you’re buying or selling a home, the MLS is your agent’s best tool.
However, the role of an agent has changed in the last couple of years. In the past, agents were the only way home buyers and sellers could access information. Now agents are evolving. Because today’s home buyers and sellers are so much better informed than in the past, expertise and ability are becoming more important.
The real estate agent is becoming more of a “guide” than a “salesperson” — your personal representative in buying or selling a home.
I have a family friend who is a Realtor. I like her and she is a help but she gives me one price to sell my home for and I think it is too low. So I called another agent who suggested a price more in line with my expectations. Who do I choose?
You might want to consult a couple more Realtors on the market value of your home. Most of the estimates should be in the same ballpark.
It could be that your friend is being more honest with you about the value of your home and the other Realtor gave you a higher number because he already knew you expected it. This is called “Buying a Listing” and is the subject of an article on our web site.
Or it could simply be that your friend is a good friend, but not that great of a real estate agent.
Mixing business and friendships is always risky to the friendship. On the other hand, if your friend is truly competent and was providing wise advice, she may be offended if you ignore the advice and choose another agent.
I have to make a choice between an updated home in an older neighborhood or a newer home in a more modern neighborhood. The home in the older neighborhood has almost everything I want and is much larger, but which makes the most sense as an investment?
If your goal is to buy a home for it’s resale value and the one you are thinking of buying in the older neighborhood is at the upper end of values for that neighborhood, then it may not be the wisest choice. If it is similar or lower in price to the others, then there should be no problem, because pricing should be considered in relation to the local neighborhood and not compared to homes in other neighborhoods (for the most part)
Plus, is it a neighborhood on the decline, or are others going to be fixing things up, too, so that it is a neighborhood that is improving? It could turn out to be a very good deal as long as you don’t “overpay” because of the recent improvements.
Remember that you also buy a home for it’s value to you as a “home,” and that is something else you should consider. Which neighborhood would you AND your family feel most comfortable in?
When buying a new home, what upgrades should we go for? What holds the most value? Do we upgrade the lot? Pick more square footage in the house? Add an extra bedroom?, etc.
A lot depends on why you are buying the house. Are you buying it mostly as a home or mostly as an investment? There is a difference.
For the most part, upgrades are high-profit items for builders. They aren’t designed to enhance the value of the house, but make you happier with the house you do buy.
If you are looking at your home as an investment, then you buy from the smaller to medium size in the tract and spend only a minimal amount on upgrades. If you are looking at your purchase as a home, then you select upgrades that will enhance your quality of living.
One rule of thumb is to always upgrade the carpet and padding.