When you want to purchase a property, it is always best to be represented by a real estate professional to protect you as a buyer. There is no cost to you a s a buyer to use an agent, and the information, protection and guidance will ensure you are well informed and protected during the process.
A Real Estate Professional will protect you and advise you of different strategies depending on the circumstances and what conditions are necessary when placing your offer. They will then present and negotiate your offer on your behalf.
Firm to Offer Purchase
This is a very aggressive approach to purchasing a property and is usually done when the buyer is facing competition or is negotiating an excellent price. It is advised to make sure you have done your homework ahead of time to know the condition of the property and make sure you have the finances secured for closing.
Conditional Offer to Purchase
Your offer to purchase may be conditional on a set of terms that must be met before the sale of the property is firm. The buyer can walk away from the purchase with their deposit if the conditions are not met within the given time period. Once the conditions are met, the buyer is obligated to purchase the home for the set out terms.
Acceptance of Offer
When all the terms of the offer are satisfactory to both the buyer and seller, than the offer is accepted by both parties. Usually there are negotiations that go back and forth until both parties can agree on the the terms of the offer.
There are six key components to the elements of an offer. They are:
1. Land Transfer Tax
Ontario charges a land transfer tax that must be paid by the purchaser and the amount of tax is based on the purchase price. First time home buyers purchasing a new home may be entitled to a refund. The city of Toronto also charges a seperate land Transfer tax that also has a benefit for first time home buyers. Click here to calculate the amount of tax you have to pay.
Your deposit demonstrates your seriousness and good will as a buyer. It is the amount that will be applied against the purchase in order to secure the property. Depending on the property and listing price, I will advise of an appropriate amount as your Real Estate Representative.
3. Inclusions and Exclusions
Usually in the listing, a seller will disclose what items that are not included with the purchase of the property. A general rule of thumb is anything that is fixed to the wall is included unless otherwise indicated. However just to be clear, appliances, window coverings, light fixtures should all be clearly stated so there is no misunderstanding to either buyer or seller.
As a buyer, you indicate the price you are offering, when you wish to take possession, under what names you wish to take title and how long your offer is valid for the sellers to make their decision.
Conditions are set to protect you as a buyer and must be met before the sale is firm. This would include conditions such as financing approval to ensure you are able to mortgage the property, a home inspection if neccessary, and possibly the sale of your current property. When purchasing a condo unit, a Status Certificate condition should always be included to determine the financial stability of the building.
6. Closing or Possession Date
The day in which the property is legally transferred to your name and the funds are transfered between buyer and seller. This day may not fall on the weekend or on a holiday.