in real estate for over 65 years
Tips for buyers
Take the time to analyze your needs
Dreaming of a large lakefront home? Is it really the right property for you? Sometimes you have to know the difference between the house of your dreams and the one that really suits you. Before you start looking, take some time to think.
Every family has its own needs and priorities. How many bedrooms and bathrooms do you need? Is a dining room really necessary? Will the garage become another storage space?
Take your tastes and skills into account. If you’re not a handyman, avoid homes that need major renovations. Fancy a large plot of land? Don’t forget that you’ll have to maintain it. If you prefer urban living to be closer to services, entertainment venues and trendy restaurants, expect to live in a noisier, less green environment. In short, set your priorities!
Don’t make the mistake of buying a home you can’t afford. To find the property that’s right for you, match your needs to your budget. Once you’ve become a homeowner, your investment will increase in value, enabling you to opt for a property closer to your ideal later on. At the outset, it’s important to remember to set aside funds for purchase-related costs and contingencies. And don’t forget maintenance, insurance and repairs, whose annual costs are generally equivalent to 2% or 3% of the house price.
Your environment is also an important factor. Is there a daycare center or school nearby? Will your children be able to use public transportation, or will you have to drive them to their activities? Also consider the distance to work.
Single-family home, condominium or plex?
The most popular property. The advantages are many: you can arrange it as you wish, and you enjoy maximum privacy since no one else lives in the building. However, exterior maintenance requires time and money.
Increasingly popular, well suited to those with little time to devote to property maintenance. However, it’s important to choose a building whose co-owners have a profile similar to yours, as you’ll need to reach agreement with them on several important aspects, such as renovation work and building maintenance. You’ll also need to think about condominium fees, which you’ll have to pay like all the other co-owners in the building.
How do you choose your condominium?
There are two types of co-ownership: divided and undivided. In divided co-ownership, the buyer is the sole owner of the apartment. He has the right to sell or bequeath it as he sees fit. However, he or she shares ownership of common areas such as grounds, corridors, elevators, etc. with the other co-owners.
In rare cases, co-ownership may be undivided, in which case the buyers share their mortgages, rights and obligations.
A syndicate of co-owners (board of directors) is elected by the co-owners to manage the building. To better appreciate community life, choose a building where the occupants have similar incomes, professional status and other characteristics to your own. This will foster a better understanding.
The location of a condominium is also an important factor. Choose an apartment with a good location. An interesting view, peaceful surroundings and good light, as well as proximity to services and transport links, will ensure a good resale value.
The size of the apartment and the quality of its construction are also determining factors. Although some luxury buildings are designed so that each unit has a private or semi-private entrance, condominiums don’t always offer the privacy of a single-family home. Pay particular attention to soundproofing.
What services does the building offer? Is there a garage, swimming pool, sauna, tennis court or fitness room? An indoor garage can increase the value of a condominium, but there’s no point in having a swimming pool if you don’t like to swim. Don’t forget that condominium fees must cover the maintenance of all equipment and services, whether you use them or not.
When you sign a promise to purchase for a condominium, be sure to indicate that it’s conditional on studying the declaration of co-ownership and the inspection. Have this document checked by a lawyer or notary, and carefully read all the condominium bylaws (pets, parking, etc.). Also check the amount of money in the reserve fund, especially for older buildings.
Choosing the right second home
The second-home market has been booming in recent years. More and more households are opting for this type of property, whether for retirement or to live in a tranquil setting closer to nature.
Buying a second home requires just as much care as buying a property in an urban environment. Not only must you consider the environment, services and quality of construction, but also your needs and the impact of this purchase on your budget.
identify your needs
find your ideal location
The value of a country home is closely linked to its environment and accessibility. As a general rule, buyers are looking for a comfortable home in an area where they can enjoy nature and their favorite sports and leisure activities, both in winter and summer. Make sure you get the most out of your investment by finding an easily accessible environment that suits your lifestyle.
And of course,
do the math!
Remember that a second home entails substantial fixed costs: insurance, taxes, heating, telephone, electricity, water, not to mention the investment in money and time required for transportation and maintenance. Lawn mowing and gardening, as well as any renovations that become necessary over the years, are likely to involve substantial expenses. Make sure the amount you spend on your second home is compatible with your budget
Borrowing capacity and
pre-arranged mortgage loan
When you start looking for a property, it’s a good idea to know your borrowing capacity. That way, you’ll know which type of property to look for. A good way to do this is to get a pre-arranged mortgage before you’ve even found your property. That way, you’ll know how much you can borrow, the interest rate and the amount of each payment. That way, you can look for a property you can afford.
Buyers' Plan (HBP)
The Home Buyers’ Plan (HBP) is a government program that allows buyers to use their savings in a Registered Retirement Savings Plan (RRSP) to finance the purchase of a property, without having to pay income tax on the withdrawal. Withdrawn funds must be returned to the RRSP within the time limits set by the program.
Do you dream of buying a home, but have less than 20% of the purchase price for a down payment? Mortgage default insurance could help make your dream come true… Lenders usually require mortgage default insurance when the borrower makes a down payment of less than 20% of the purchase price of the property.
Mortgage loan insurance applies to a variety of new and existing properties. Keep in mind that the smaller the down payment, the higher the mortgage payments and the total cost of the purchase. Mortgage loan insurance is offered in Canada by Canada Mortgage and Housing Corporation (CMHC), Genworth Canada and Canada Guaranty.
Think about start-up costs
Ongoing start-up costs
- property inspection and appraisal;
- review of the file by the mortgage insurer, if applicable, as well as premium taxes;
- notary fees;
- account adjustment fees indicated by the notary (electricity, heating, municipal and school taxes, equipment leases, etc.);
- property transfer tax (“welcome tax”)*;
- moving expenses;
- connection costs (telephone, electricity, etc.);
- furnishings (paint, curtains, etc.).
In addition, plan for your future needs (renovation and extension work, purchase and installation of a swimming pool, etc.) and the means to finance these projects.
* Check with your municipality to find out if you qualify for a payment waiver.
The professionals involved in your transaction
When you buy a property, you come into contact with a number of real estate professionals who work alongside your broker. As the real estate broker is at the center of the real estate transaction, he is able to coordinate your transaction by collaborating with each of the other professionals involved in the purchase of your property. Here’s an overview of the services offered by each player.
The land surveyor is the only person authorized by law to delimit public and private property in Quebec. Owners can call on his services to determine the boundaries of their land by staking it, or to draw up a certificate of location.
The Ordre des arpenteurs-géomètres du Québec brings together all members of the profession.
The mortgage broker
Mortgage brokers strive to find the best mortgage contract for their clients. He can find the contract with the terms and conditions best suited to your needs: prepayment options, amortization period, financing an older home, granting a loan to a self-employed person, etc.
Mortgage brokers must hold a certificate from the Organisme d’autoréglementation du courtage immobilier du Québec (OACIQ).
A chartered appraiser provides an objective estimate of a property’s value. His appraisals are used for insurance, mortgage, estate settlement or property division purposes. He or she can act as an expert witness in court, and his or her report is evidence of a home’s value.
To use the title of chartered appraiser and affix the initials “É.A.” next to his or her signature, the appraiser must be a member of the Ordre des évaluateurs agréés du Québec.
Before you buy a property, we strongly recommend that you have an expert inspect it.
As the building inspection profession is not subject to government control, it is advisable to call on inspectors who are members of one of the following professional orders: technologists, engineers, chartered appraisers and architects. Inspectors who are members of one of these professional orders offer the public greater security, since they are professionally supervised by their order. Professional insurance is also a condition of membership. In Quebec, the Association des Inspecteurs en Bâtiment du Québec is responsible for enforcing standards among its members.
The services of a notary are indispensable in any real estate transaction. Along with lawyers, notaries are the only professionals authorized to draw up mortgage deeds. In addition, he or she drafts the deed of sale and carries out title searches to ensure that the property purchased is free of any obligation.
Notaries are members of the Chambre des notaires du Québec.