Buying a house - The Solid Foundation

Whether you are buying an investment property or buying a house for yourself, the foundation is the same. so this articles applies to all home buyers types.

To make sure I am not making any assumptions, your objective is to buy a house that you want at the lowest possible price.

To do that, first, stop DAYDREAMING. Stop listening to the scammers who claim you can buy for nothing and get the house for nothing! What kind of seller would be so stupid to sell you a house for nothing and how many of them will you actually run into. Even if you end up finding one, your Real Estate Agent would buy it before you do! In fact, with all these Real Estate Scams out there, if you bought a house at fair market value, then you have done very well.
 
This article is not about the secrets of buying a rental property for no money down and half the price of the market value of the house. I am not Tom Vu or Don Lapre and I am not in jail.

To clear the air, in Canada, the no money down home did use to exist, but not anymore. Some banks and lenders were willing to lend you the 5% down payment so that you don't have to pay a dime out of your own pockets to purchase a home. However, given the changes to the financial situation and the tighter lending restrictions, there are no bank or lenders who would do that in Canada or the United States.

The buying home for half price did use to exist as well. At one point, foreclosures (or called "Power of Sales", which is just a marketing gimmick) in Canada would allow foreclosed homes to be sold at rock bottom prices. The new law, which has been in placed for many years now require foreclosed properties be sold at the highest possible price or else the lenders will get sued. Cause of the naive belief of some buyers, sometimes foreclosed homes sell higher because Canadians have the misconception that foreclosed homes are a really good deal causing it to have a reverse affect.

Now, clearing out the quick money maker myths of buying homes, there are still many things you need to be aware of before starting.

If there exist ever an industry with more sneaky sales tactics and money motivated people, it has got to the Real Estate industry. As a buyer, you could be dishing out $350 000 and everyone wants a piece. The Real Estate Agents want a piece. The lenders want a piece. The lawyers want a piece and the sellers want piece. No wonder there are so many scams in this industry.

Your objective as a buyer is to get trustworthy people on your team. If you Real Estate Agent claims he knows everything and can get you houses at dirt cheap prices, then he is lying. If he could do that, why wouldn't he just buy it for himself. Don't bother looking for those who possess "Power of Sale" or sneaky ways of getting homes for half the market price. They don't exist in Canada! If a Real Estate Agent could do that for you, then the Real Estate wouldn't be a Real Estate Agent. He would become a buyer! Look for Real Estate agents whoe will work for less commission, not secret inside knowledge that God doesn't have.

And don't even listen to the Real Estate Agents who claim they are so rich that they are only working because they want to help new inexperience buyers. Just run when you hear that! If they really wanted to help, they can volunteer for other things and work for free.

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Etiquette when visiting a stranger's house

When you travel to visit these houses that you are interested in buying, you entering as a guest in someone else property. Treat it like you are a guest and respect the rules of the owners.

First, if the owner is around, do not critisize the house. Sometimes, people get too caught up in analyzing the house that they forget that this could be someone else's pride and joy. Some people take it personally and critisizing the house could be equivalent to critisizing the people living there. You can make your own remarks after you have left the house.

Second, do not use the washrooms. You are only there to view the house for purchasing. Unless if the owner is there and you have gotten to know the owner better, it is not a polite thing to do to strangers.

Third, don't mess the place up. Turn off lights when leaving and leave things the way they were before you step in. A home can be a private and personal concern. You should notice your agent making an effort to turn lights off and making sure your agent is polite. You should also notice your agent unlocks and locks the door after he or she leaves.

Condo or House - which one is a better investment

Simply put, the general case is a house. Done properly a larger house goes higher in value, can be rented for more and doesn't have condo fees associated. Although the condo mangement board is non-profit, they are still very expensive for what they offer.

Now, having said that, there are exceptions. It would be impossible to find a house in downtown Toronto. Yet, downtown Toronto will offer you the better rental investments for your money. Therefore, if you are going to buy a condo for investment purposes, your best bet is in downtown Toronto. If you really want to rent out your property, your best bet is also in downtown Toronto.

A condo also offers less worries because everything is taken care of. This lifestyle is actually catching on as more people are preferring this lifestyle. At least, the single, young adults do and given the trend, the percentage of singles are growing with each year.

I recenty purcahsed a house and the maintenance has become a nuisance.  Mowing the lawn, and shovelling the snow appears to be a lot easier than it really is. I made the mistake of buying a corner lot - double the sidewalk and bigger lawn!

My next house will definitely be a small lawn, small side walk house, but not a condo with those overpriced monthly condo fees.

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Buying a House - Ground Rules

First, you do not need a Real Estate Agent in buying a home. All you really need is a lawyer to perform the property transaction work. However, if the seller has a Real Estate Agent, then there is a high chance you will want one, too. Houses for sale are easier to visit when you have Real Estate Agent. The Agent has access to opening the doors and letting you in.

A Real Estate Agent is suppose to act on your behalf to buy or sell the home. Both the buyer of the home and seller of the home will have their own Real Estate Agent called a Buyer's Agent and a Seller's Agent.

In Canada, each Real Estate Agent often gets an average of 2.5% (but sometimes lower) of the sold price of the home as commission for selling the house. Some Real Estate Agents provide cash back rewards. Canadian Real Estate Agents gets higher commission than anywhere else. In United States, their Real Estate Agents only get 1% of the commission and their homes are actually much cheaper. Even though Real Estate Agents are the least educated of the parties involved in the buying home transaction, they seem to be getting the biggest piece of the pie here in Canada.

Do not listen to mls.ca and their gimmicks on Real Estate Agents are ethical. (http://www.howrealtorshelp.ca/). Where do they get the idea any Real Estate Agent off the street is ethical. Their claim is based on these tests that they pass to become a Real Estate Agent. Agents passing a test does not meant hey are ethical. It only means they can remember enough to pass the test.

One would believe it should be the Real Estate Agent's job to help the buyer ensure the home is of value. Rightly so, many buyers depend on the Real Estate Agent to protect them and provide them advice and in my opinion, the ethical Real Estate Agent should do that. However, the true reality is that Real Estate Agents do not make money unless if the home is purchased. The reality is that the Real Estate Agent's salary is not truly dependent on giving you advice. The Real Estate Agent's job is to get the buyer to buy a home through them so they can get paid!

Accept the reality of the motivation behind servicing you and listen to their verbal explanation for servicing you. If they do not match, then they are lying and you should never work with people who lie to their clients.

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