Fall in love again
V6
BUYERS GUIDE
Change is exciting. Families evolve, financial situations develop, needs change, and you’ve grown. The home you once loved so dearly, no longer feels the same.
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ABOUT THE GROUP AT RE/MAX FIRST ABOUT THE GROUP
We believe that consumers make better real estate decisions when they have access to the right data and smart advice. The Group at Re/max First has the systems, process and experience to deliver the results you’re looking for. We promise to be open, honest and upfront and guide you in the right direction.
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REMAX FIRST
BASED ON CLOSED TRANSACTIONS (‘19-’20)
2
“
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Read our reviews and testimonials at www.top-producers.ca/thegroup/
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REMAX OFFICE IN THE WORLD
RE/MAX FIRST - TOP GIVING OFFICE IN WESTERN CANADA FOR 7 CONSECUTIVE YEARS From 2014-2020
This booklet helps answer these 4 most common questions buyers ask...
1.
2.
3.
4.
How will you help me find the right home?
How do I ensure that I do not overpay for my new home?
How do I know that the home is not in poor condition?
How do I get a great rate and terms without costly penalties?
MOST COMMON SELLER QUESTIONS
1. 2. QUANDARY3. THE SELLER’S How much can I expect to get How long will2. it take to sell my1. What are you going to do to 2. 1. 3. SHOULD I BUY OR SELL FIRST? for my home? property? get my home sold?
MOST COMMON SELLER QUESTIONS MOST COMMON SELLER QUESTIONS
80% of
How much can I expect to get for my home?for a buyers looking
3.
How Howtomuch can I expect How longtowill it take to sell my What are you going going to to do do t How long will it take sell my What to areget you going to do for my home? property? get my home sold? sold? property? get my home sold? home need to sell their home before they can buy.
THE SELLER’S QUANDARY: SHOULD I BUY OR SELL FIRST? OR THE SELLER’S QUANDARY: THE SELLER’S QUANDARY: Y N Y N SHOULD I BUY OR SELLI BUY OR SELL FIRST? SHOULD SHOULD I BUY OR SELL FIRST?
Y N Y Y NN Is the real estate market Do you need time to prepare 6 your home for sale? really hot? Isyou the theneed real real estate market the real estate market DoIs time to prepare dream home available 1 IsIsyour 6 11 your Isreally it important to have the upper really hot? hot? really hot? home for sale? 2 right 7 now? hand in negotiations? Is Is important your your dream dream available Is your dream home available Is it tohome have the upper 2 Can 2 Do 72 younow? have cash to buy without right right now? now? right you afford to take a loss on hand in negotiations? 3 8 selling first? your current home? Do Doyou you youafford have have to cash toabuy Do you have cash to buy without Can take losswithout on 3 Are 3 Do you need to move for a new 83 you comfortable buying not selling selling first? first? selling first? your current home? 4 9 knowing your exact sale price? job or for the new school year? you comfortable buying Do Do you you need need to move for anot new 4 Are 4 Do you need to move for a new 94 Can you hold two mortgages for knowing your exact sale price? Do you need lots ofschool time to pack job job or or for for the new school year? job or for the new year? 5 10 an unspecified amount of time? and move? two mortgages Do Doyou you youhold need need lots of time tofor pack 5 Can 5 Do you need lots of time to pack 105 anand unspecified of time? and move? move? andYES move? If you answer on more questions, you should consider BUYING first. If you amount answer NO more, you should con-
1
sell first?
I M P R OV I N G YO U R H O M E L I F E
MOST COMMON BUYER QUESTIONS
6
Do you need time to prepare prepare your home for sale?
7
Is it important to have the the upper upper hand in negotiations?
8
Can you afford to take take aa loss loss on on your current home?
9
Are you comfortable buying buying not not knowing your exact sale sale price? price?
10
Can you hold two mortgages mortgages for for an unspecified amount amount of of time? time?
buy first?
Y Y
sider SELLING first. These questions may each carry different weight based on your unique needs and situation, If If you you answer answer YES YES on on answer more more questions, BUYING first. If you answer answer NO NO more, more, you you should should you answer YES on more questions, consider BUYING first. If you NO more,you you should should consider consoIfdiscuss the most important ones foryou youshould with your agent. sider sider weight SELLING SELLING first. first.on These These mayand each carry different weight based on your your unique unique needs needs and and situ situ sider SELLING first. These questions may each carry different based yourquestions unique needs situation, 3 so so discuss discuss the the most most important important ones for you with your agent. so discuss the most important ones for you with your agent. 3
?
QUESTIONS & ANSWERS
QUESTIONS & ANSWERS Q:
A
A:
SEE ALL ACTIVE & HIDDEN
Q: A:
A
FINANCING CONSIDERATIONS
Don’t miss the right home
Standard • Enhanced • Premium
B
ACTIVE ON/OFF MLS® SHADOW INVENTORY/ INACTIVE MLS® INACTIVE COLD CALLING
*Additional charges may apply
There’s more to it than just the rate
B
FOLLOW A PROCESS
The right things in the right order
C
• • • •
INITIAL DISCOVERY PRE-QUALIFICATION PICKING THE RIGHT NEIGHBOURHOODS NARROW DOWN 1,000’S TO THE 1 (+ 1 BACKUP)
SEE THE BEST OF THE BEST ...and forget about the rest
• ONLY LOOK AT APPROPRIATE & BEST VALUE • ROLLING “TOP 3” (THE BEST OF THE BEST) • HAVE A PLAN “B”
FIND THE RIGHT HOME
4
MORTGAGE CMHC, Down Payment, Variable/Fixed RATE & Penalties, Privileges, Credit Report Errors CONDO DOCS Financial Status & Well-being MAINTENANCE COST - 1%/year Rule, Condo Fees
$
COST VS VALUE The “best” home
“cheapest” home
• LARGEST PRICE REDUCTION INDICATORS MOTIVATION (3 D’s), 90+ D.O.M., Vacant, Historical NEGOTIATION PLAN - Strategic Plan
C
RIGHT HOME AT RIGHT PRICE NOT the wrong home at the right price
• ONLY LOOK AT APPROPRIATE & BEST VALUE • ROLLING “TOP 3” (THE BEST OF THE BEST) • HAVE A PLAN “B”
AT THE RIGHT PRICE
?
A
Q:
Q:
A:
A:
THE PHYSICAL ASPECTS Don’t buy a “Lemon”
B
• • • •
MATERIAL LATENT DEFECTS. #1 Cause of Lawsuits HOME INSPECTION #1 Reason Offer Collapses HOME WARRANTY PROGRAM Written in Offer REAL PROPERTY REPORT #1 Delay at Closing
MORTGAGE QUESTIONS
TALK TO THE MORTGAGE AGENT ABOUT THE FOLLOWING:
CREDIT SCORE - Find Errors, Improve Score, Lower Rate DEPOSIT - 1.5%+/- Typical Deposit (Taken at Offer) CLOSING COSTS - 1.5% Budget DOWN PAYMENT - Source - 1st Time Buyer, CMHC MORTGAGE AMOUNT - CMHC 4X Household Income (+/-) INTEREST RATE & TERMS & PRIVILEGES PENALTIES
1
2 3
4 5
6
MORTGAGE PRE-APPROVAL
THE FINANCIAL ASPECTS Buyer Beware
THE FIRST STEP - WHY GET PRE-APPROVED FIRST?
DISCUSS OPTIONS AVOID THE SCRAMBLE GUARANTEE A LOW RATE
1
C
DOCS REVIEW #1 Claim is Parking, Buying a Corp. REAL PROPERTY REPORT #1 Delay at Closing LEGAL TERMS & CLAUSES Protection/Diligence MORTGAGE TERMS Rate, Privileges, Penalties
AVOID THE WRONG HOME Don’t fall in love with a “money pit”
• ONLY LOOK AT APPROPRIATE & BEST VALUE • ROLLING “TOP 3” (THE BEST OF THE BEST) • HAVE A PLAN “B”
QUESTIONS & ANSWERS
QUESTIONS & ANSWERS
2 3
1
ASAP!
Pre-qualification (Phone consult)
2
4 MTHS
BONUS
Know How Much Home You Want/Can Afford
Pre-approval/Ratehold (In person consult)
3
Confirm Mortgage
1 MTH
4move in! 0 MTHS
break their mortgage before their term is up 50%+ ofandborrowers pay a penalty for doing so.
& KNOW THE END COST
KNOW THE CONDITION
5
5
BUYING TIMELINE
KEY STAGES IN THE BUYING PROCESS 1
PLANNING STAGE
1
DILIGENCE STAGE
3
4 - 18 MTHS BEFORE MOVE DATE (BMD)
OUR INITIAL CONSULTATION
2
SHOPPING STAGE
30 DAYS B.M.D.
ACTIVE DUE DILIGENCE
1 - 4 MONTHS (AVG 10 WEEKS) B.M.D.
In-person viewings
WE ACTIVELY WORK TOGETHER
1
1 8+
PQ Pre-qualification/Rate Hold 6
2
PQ Process of Elimination/80% Rule 4
PLANNING STAGE
“
I’m thinking of moving - We talk and make a plan -
Need to sell as well? *Your house should be listed *Refer to Seller’s Quandary
SHOPPING STAGE
“
I’m a serious home shopper - We meet and go shopping -
3
4move in!
SOLD
0
1
DILIGENCE STAGE
“
I have an offer on a home - We do our due diligence -
****Check this when printing. It looks bad. Maybe keep the same ocupancy. Trail and error test.****
PLANNING SHOPPING DILIGENCE 6
PLANNING STAGE
1
D O I T “ S T R A T E G I C A L LY ”
4 - 18 MTHS BEFORE MOVE DATE (BMD)
OUR INITIAL CONSULTATION I’M THINKING OF MOVING
1
PLANNING STAGE
4 - 18 Months before move date
6
1
“
PLANNING STAGE
TO-DO-LIST:
• • • • • •
COMMON/COSTLY MISTAKES: • Don’t: Forget down payment/closing cost budget • Don’t: Delay on consulting with mortgage broker • Don’t: Change jobs or make big purchases!
DILIGENCE STAGE
I’M A SERIOUS HOME SHOPPER
2
I HAVE AN OFFER ON A HOME
3
1 - 4 Months before move date
4
I’m thinking of moving? We talk and make a plan
Search online (get a feel for pricing and properties) Research areas and what is important to you Touch base with me quarterly/monthly Get mortgage pre-qualification (IMPORTANT) Check your credit score - www.creditkarma.ca Calgary-Real-Estate.com (faves, auto-notifications)
SHOPPING STAGE
30 days before move date
1
TO-DO-LIST:
• View properties bi-weekly/weekly with serious intent • Use the funnel process of elimination to narrow search • Refine needs ongoing • Keep rolling Top 3, discard all else • Keep a ‘backup plan’ in mind. (Area, price, size, etc.) • Check in with Mortgage Broker COMMON/COSTLY MISTAKES: • Don’t: Shop before getting pre-approved • Don’t: Try to see too much/too few • Don’t: Give listing agents any information
SHOPPING STAGE
“
DILIGENCE STAGE
TO-DO-LIST: SHOPPING STAGE
1
• Book due diligence vendors ASAP! • Send offer to Mortgage Broker • Review and assess reports COMMON/COSTLY MISTAKES: • Don’t: Cut corners with due diligence • Don’t: Leave town or be inattentive
DILIGENCE STAGE
“
I have an offer on a home - We do our due diligence -
I’m a serious home shopper - We meet and go shopping 7
7
W 5 - W H Y, W H O , W H E N ?
Change is exciting. Families evolve, financial situations develop, needs change, and you’ve grown. And the home you once loved so dearly, no longer feels the same. We'll help you to fall in love again.
”
8
YOU’VE EVOLVED, BUT YOUR HOME HASN’T KEPT PACE.
pMASSp p FEAR
MISINFORMED
Wing it PREPARE Strategic
8
LONGING
Chaos PROCESS Orderly
”
RIGHT MOVE
CONFIDENCE
Proceed Blindly COMPARE CLARIFY REFINE With Purpose
Settle EXTRA EFFORT Aspiration
CLARITY
FALL IN LOVE
Remorse CERTAINTY Contentment
W H E R E , H O W M U C H , W H AT ?
W5 - THE KEY QUESTIONS To Make Sure You Unlock the Right Home PEO PL E
Emotional
WHY?
Stage in Life
Hi-level Details
M O T I VAT I O N
M O T I VAT I O N
OPLE PE
Who’s Moving
Wants/Needs
WHO?
Life Events
Logistics Life Events Now/ Future
Interior/Exterior
WHAT?
Design
N ITIO
POS
$
HOW MUCH?
N TIO I S PO
”
Style
Timing
”
RIGHT MOVE by
WHEN? PUR
POS
E
PUR
POS
E
Family
Discovery
?
Price
Market
Work
Why 3
WHERE?
Mortgage Appropriate
Top 3
Lifestyle
Urbanity
Plan B
HOW?
PROCESS 9
9
Stage in Life
WHY?
Logistics
M O T I VA T I O N
WHY?
1.
THE PEOPLE
Emotional
WHY It starts with WHY This is the most important aspect
MOVING AWAY FROM | MOVING TOWARDS WHAT ARE YOU MOVING AWAY FROM? If you could wave a magic wand, what would you change about where you live now?
DO
Think about your deeper motivations to move
DON’T
WHAT ARE YOU MOVING TOWARDS? If you could wave a magic wand, what would your new life in your new home look like?
10
“
LE P O PE
Look strictly at the surface material things
PEOPLE - WHY?
Go deep with your “Why”
E M OTI ONA L
STAGE I N LI FE
A CTION
PAIN
PRIZE
There are aspects of your current home that are less than optimal. What are these?
There are certain things you would like to see in your life in your new home. What are these?
STARTER
MOVE UP
Jumping into pride of ownership and your most lucrative investment is the first step to your future.
Things are going well and you deserve to give yourself a home upgrade.
INVEST
EMPTY NEST
Having a tenant pay for your future retirement is possible.
The kids have left. It’s time for a place that fits your new needs.
RETIRE
LOGI STI CS
You now have the time and money to do as you wish.
DOWNSIZE
UPSIZE
If you’re finding your home too large, it may be time to look to simplify your home life.
If you are in need or want of more space, it may be time to look for a bigger home.
DOWNGRADE
UPGRADE
Sometimes life gets in the way. Sometimes it makes sense to unlock the equity in your existing home.
If you’re doing well financially, upgrading your lifestyle could be your ‘special treat’!
11
DO
M O T I VA T I O N
WHO?
2.
Prioritize a list of needs and wants for each person
Who’s Moving
Wants/Needs
DON’T
WHO?
Forget how those needs and wants will change over time
Life Events
Now/ Future
WHO “
THE PEOPLE
PEO PL E
Let’s talk about WHO The foundation of your home is the people who live, love and spend time there.
COSTLY & COMMON MISTAKES
Some people are emotional shoppers, some are logical. Balancing both is key.
EXPERIENCED GUIDANCE Part of our job is to balance emotion with logic and logic with emotion.
12
POSITION WHO? A CTION
WHO’S MOVING Who all is involved and what are their wants, needs and roles in this move?
M OT I VATI ONS You: Spouse? Parents? Children? Pets?
LI FE CHANGES Work Schooling
Their needs, wants & preferences
Now
LIFESTYLE
LOCATION
PSYCHOLOGY OF PURCHASE P Personal Factors
Family Changes
S Social Factors
Unexpected Events
T Tangible Factors
Future
PEOPLE
Have each person write down their needs and wants and then prioritize them.
M Money Factors
3 THINGS 13
DO
Plan this in advance and revise as need be
Timing
WHEN?
DON’T
3.
WHEN?
Market
PUR
Put the cart before the horse
POS
E
WHEN “
THE PURPOSE
Life Events
Finding your dream home happens in STAGES
COMPARISON SHOPPING You will compare 1,000s of listings online before narrowing a list of potential homes to view in person in order to find the home that offers the best value to place an offer on.
14
4
4 STEP PROCESS 1. 2. 3. 4.
Filter Listings Online In-person Viewings Make Offer Due Diligence
POSITION WHEN? A CTION Set a target move date.
LIFE IS THE WAY People move because of large events. (Sometimes slow growth). But they tend to base timing around smaller events.
TI M I NG
Family Changes
YEAR: Raise | Promotion | Wedding Birth...
Schooling
Unexpected Events
SEASON: School Year | Summer | Spring...
Future 5/10/15... years
MONTH: Lease End | Sale of Home...
Now
QUANDARY:
Buy First or Sell First
MACRO
Work
MARKE T Buyers
MICRO
L I F E E V E N TS
Selling
Boom
Move Up
vs vs
Sellers
& vs
Purchasing
Bust
Scale Down
WHERE?
WHERE?
Lifestyle
School Friends Family
Urbanity
COMMUTE LOCATIONS When you leave the community where do you commute to? Work, school, family, friends, hobbies, etc.
THE COMMUNITY ITSELF When you stay close to home, what do you like to do? Restaurants, golf, coffee, gyms, cycling, visiting friends, etc.
16
16
MA
RK E
Values
4.
THE PURPOSE
Work
Vibe
the
TO: Work
Family
WHERE
E
Lifestyle COMMUTE
POS
PROXIMITY
PUR
l
**** Check the fading when printed
POSITION WHERE? A CTION Pick 3 - 5 neighbourhoods to concentrate on.
FAMILY & WORK Where do you work? Where are the people that are important to you?
LIFESTYLE & URBANITY What are some things you like?
EATING OUT I love to go out!
CITY CORE High energy
STAYING IN I love to stay at home!
MIDDLE RING Moderate energy
HEALTHY LIFESTYLE I love living active!
SUBURBS (NW, NE, SW, SE) Relaxed pace
QUIET SURROUNDINGS I love a peaceful getaway!
SATELLITE TOWNS/RURAL Peace and quiet
LOCATION & LIFESTYLE Location. Location. Location. Your lifestyle is often defined by where you live. Choose location carefully.
17
N
Price
POS
Mortgage
ITIO
HOW MUCH?
DON’T
Focus on win/lose negotiations vs right place, right price
How much are you willing, wanting & able to INVEST
5.
HOW MUCH?
$
PURCHASE BUDGET People focus on price, but much more important is value. It is also important to note value is much more important than negotiating a large reduction.
MORTGAGE AMOUNT The amount you’re comfortable with for a loan is not necessarily the same amount a lender is comfortable loaning you. It’s important to get pre-approved. 18
HOW MUCH
Focus on the bigger picture and the best value
“
THE POSITION
DO
**** Check the fading when printed
PURPOSE HOW MUCH? A CTION
PRICE People focus on price, but much more important is value. It is also important to note value is much more important than negotiating a large reduction.
Talk to your mortgage broker and get a pre-approval.
MORTGAGE There are many considerations when getting a mortgage. The interest rate is only one of five major factors. IMPORTANT: The lowest rate is seldom the best rate.
DOWN PAYMENT Cash amount
%
INTEREST RATE What’s the cost of the loan?
TOTAL MORTGAGE Loan amount
PRIVILEGES Paying more = paying less
TOTAL PURCHASE PRICE Closing price
PENALTIES ~ 60% break their mortgage MONTHLY PAYMENTS Monthly budgeted amount
The *Best
vs
The Lowest
Interest Rate
CLOSING COSTS Cost of disbursements
19
Hi-level Details
DO
Revise and prioritize your needs and wants list
6.
WHAT?
Style
Design
N ITIO
POS
WHAT?
DON’T
Get caught up in staging or hung up on easy to change items (like paint colours)
WHAT “
THE POSITION
Interior/Exterior
If you could wave a MAGIC WAND, what would your new home be like?
20
PURPOSE WHAT? A CTION
HIGH LEVEL DETAILS • • • • •
Prioritize a list of all your needs and wants.
How much space do you need? How many bedrooms? How many bathrooms? What do you need for parking? How will you be using this space?
EXTERIOR/INTERIOR
STYLE & DESIGN
Tell us about the home and its surroundings. What are the details that make it the right home for you and your family? GOAL: Define your needs and wants
What makes your house a home. What are the design and architectural preferences that make a home special for you? GOAL: Define your personal style
INTERIOR What are the inside details?
• • •
Basement Bonus room Most important room
NEW OR RESALE Established or new build?
• • •
Brand new Nearly new Established resale
EXTERIOR What’s outside the home?
• • •
Back yard Views Privacy
HOUSING STYLE What type of home ‘fits’?
• • •
Apartment/Townhouse Bungalow/Two-storey Attached/Detached
DESIGN & ARCHITECTURE Your personal preferences
• • •
Layout Aesthetics Architectural style
21
Discovery
Have an open EXPLORATORY conversation with REALTOR® | with Mortgage Broker Delve into the REASONS you want to move and why
Why 3
7.
HOW?
Appropriate
Refine your search to APPROPRIATE and viable options
Top 3
Keep your rolling ‘TOP 3’ and discard the rest
Plan B
HOW?
Have an ALTERNATIVE (place, location, price, size, etc.), if you had to compromise...
PROCESS
HOW
To get the right place at the right price, and know you did well
22
“
THE PROCESS
?
PROCESS HOW? A CTION
PLAN Appropriate / Best Value
The key to finding the right home at the right price is to do the right things in the right order with the right people. Put a plan together and follow it!
DISCOVERY Exploratory in nature WHY TREE Delve 3 layers deep THE MAGIC WAND Your dream home is... MUST HAVES These are deal breakers
PROCESS Funnel Process of Elimination
ROLLING TOP 3 Keep a list of your favourites BEST OF THE BEST Only highest/best value FORGET THE REST Disregard inappropriate COURSE CORRECTION Readjust priorities HAVE A PLAN “B” Always have a 2nd choice FOCUS ON MUST HAVES These are your deal breakers
T
Buy With Knowledge
’S
TA
LK ABO U
T
LE
PURCHASE
WHAT’S THE BIG PICTURE Don’t lose sight of ‘why’ DUE DILIGENCE Ensure you’re protected 23
CARING AND COMPETENT SERVICE