The Other Costs Associated with Buying a Home

Purchasing a home can be a very exciting and stressful time. Buyers, particularly first time buyers, need to be aware that there are a host of costs associated with buying a home above and beyond than the actual purchase price. It helps to know what those costs are in advance rather than get an unexpected surprise when closing that can add to an already stressful experience.

Agent’s Commission Your real estate agent receives a commission when you sell — usually a percentage of the sale price — as does the buyer’s agent. A typical total commission expense may be between 2.6 and 6% of the selling price, but rates are negotiable. Generally, this covers the commission for both the buyers’ and sellers’ realtor, and the cost for both is paid by the seller.

Closing Costs These costs generally refer to legal fees, property tax and utility adjustment costs and, in some provinces, land transfer taxes.

Legal Fees The monies used to pay your lawyer for the legal transactions associated with the purchase of your home. Such transactions include: reviewing the terms of the offer, conducting a title search on the property, preparing and signing a mortgage, registering a new title, conveyance, obtaining relevant documentation and determining appropriate adjustment costs.

There are many types of lawyers and it is prudent and in your best interest to hire a real estate lawyer or notary who specializes in home conveyance to handle your home/property purchase transaction. You should budget at least $800 to $1200, or more if you need documents to be drafted by your lawyer.

Property Taxes and Utility Adjustment In the sale of contract there will be an adjustment date (the day the buyer assumes all responsibility for paying property taxes, etc.) Usually, the adjustment date is the same day as the possession date. Likewise, any prepaid utilities, condo fees or assessments need to be reviewed. Your lawyer will work out exactly how much is owed and adjust as part of the conveyance or statement of adjustment.

Your Statement of Adjustment
This document will show the net result for the purchase of the home, taking into account the purchase price, deposit, real estate commissions, legal fees, property purchase tax, property taxes and all other adjustments.

Land Transfer Tax  In some provinces this tax is levied when a property changes ownership. It varies with the purchase price of the property. In B.C. it’s called the Property Transfer Tax and there is an exemption available (on properties under a certain price point, plus other restrictions) to first time home buyers via The First Time Home Buyers Program.

Other Costs Costs other than closing costs can include but are not limited to the following:

Property Survey
Some banks require a survey in order to approve a mortgage on a house. This is undertaken to verify the location of a property’s boundaries, measurements and structures and identify any easements, rights of way or encroachments on your or adjacent properties. Title insurance is often an alternative to a property survey. The fee for having a survey done depends on the size and particulars of the property but can cost upwards of $1000.

Title Insurance
In lieu of a survey, many lenders will accept title insurance, which basically insures the title of the property against any disagreement about property lines, or even against fraud. The cost of the insurance usually depends on the size and /or value of the property. Your mortgage broker or lender can provide you with the details.

Interest Adjustments
This covers any interest accrued between the closing date of the purchase and the first regular payment date of the mortgage.

GST/HST-GST and sales taxes This will depend on the type of property being purchased and the province or territory you live in. Always ask if either or both of these taxes apply before signing an offer to purchase. Likewise, expect that real estate agents, lawyers, appraisers, building inspectors, surveyors, and anyone else you hire to help you sell your home will charge GST or HST on top of their service fees.

Home Inspection
It is a good idea to have an inspection done before completing the purchase to evaluate the structural and mechanical condition of the property. This can save you lots of money in future repairs, determine the sale price and if you even want to purchase the home/property. On average home inspectors charge approximately $100/ hour.  The amount of hours it takes to inspect a property depends upon size and age. A condo could take a few hours, whereas an older larger house could take upwards of six hours.

Appraisal Fees  Often purchasers want to ensure they are paying a reasonable market price for the home they are purchasing. You may want to condition your offer subject to a satisfactory appraisal by a member of the Appraisal Institute of Canada. Appraisal fees are based on the type of home and can run between $300 and $500.

Mortgage Life Insurance Special insurance coverage to cover the cost of discharging your mortgage in the event of death or severe illness.  It is available from most lenders and sometimes is a condition of your mortgage.

Home Owners Insurance
As soon as you have an accepted offer on any property, make sure you can arrange homeowners insurance including personal liability and Named-Perils (fire, theft, water damage). Often, depending on the type of property you are purchasing, this is a condition that would have to be met in order for the deal to become firm. Some properties, including those that may have formerly housed marijuana grow operations, may not qualify for standard insurance without meeting certain conditions, or undergoing remediation. Find out BEFORE you remove subjects.

Service Charges
Fees and installation charges to hook up utilities such as electricity, gas, telephone and cable services (which you would also be familiar if you previously rented).

Moving Costs Though it may sound obvious, purchasers sometimes do not consider moving expenses a cost of buying a home. Moving costs will depend and vary based on the distance of the move, the amount of furniture and goods to be transported and the time of year/month in which you are moving. Get several movers in to give you an estimate before choosing one. Friends rarely help friends move!  Also take into consideration the time and effort it takes to pack up your present home. Do you plan on hiring people to pack on your behalf? If not, you need to factor your time into the equation.

Appliances
Be careful in your deal that you check to see whether the appliances are included in the purchase agreement. If not, you will need to go out and buy them.

Landscaping, Fencing, Decks, Etc. If purchasing a newly constructed home, keep in mind that there will likely be a need to landscape and fence the yard in the first year or two. If purchasing an older property, maintenance is something to factor into your equation.

Annual Maintenance Homes, like other possessions, require care and maintenance to maintain their value. You need to plan for future painting, and replacement items like roof shingles, appliances and furnaces, depending on the age of the home you are buying.

Other incidentals include an alarm system, re-keying locks, acclimatizing your pets.

Nothing can be more stressful than buying a home and trying to move when you are strapped for cash. Selling your home is also an expensive endeavour. You also need to take into consideration that you are also spending a good deal of your time in the process. The phrase “Time is money” certainly applies!  Remember, anything you pass off to someone else will cost you money; anything you don’t will cost you time.

Which Season is the Best Time To Sell A Home?

Talk to any real estate agent, and they will tell you that there are certain seasons that are more favorable to sell your home than others. Often, the best time to list and sell a single family detached home is in the spring, followed by early to mid fall.

Most families want to make the purchase of their home and complete the transaction before the summer months, when the kids and family are on summer vacation. Parents are keenly aware that school registrations need to be dealt with — and who wants to be loading a moving truck in the middle of August?

Sensibly, spring also offers the best time of year to showcase your home. After a long winter, the first hints of cherry blossoms and crocuses seem to trigger the “moving bug” in many people. Gardens tend to look their best in fresh bloom, when the leaves are on the trees. Homes appear more appealing when the weather is warming up and buyers tend to be in high spirits.

It’s also usually easier to get your home ready for sale at this time of year — from painting inside or out, to the simple ability to keep the house cleaner without the winter muck being traipsed throughout every time someone walks through the front door. Just remember, when you sell at the busiest time of the year you will face more competition, so make sure your home shows at its best!

If you’re selling anything over a certain price (and that depends on where you live — but we’ll say anything in the top 20% price range of your community), expect the summer months to be particularly slow. Expensive homes require buyers with big pockets — and where are they in the summer? Most likely away on vacation, not looking for a home….so that’s where the early to mid fall selling season comes in.

Fall is considered the next best time to list your home on the market– especially if it’s a nice long Indian summer. Linked to the “back to school” mentality, with the leaves turning fabulous colors and nice cool crisp temperatures, you’ll have another good shot at selling a family home — often to someone who’s already in your neighbourhood. That being said, be prepared to keep up that curbside appeal as the weather changes.

Some properties will sell at any time of year — such as those aimed at first time home owners, especially condominiums and town homes. Often these buyers are not faced with the constraints of school catchments, and are much more interested in amenities like underground parking, recreation facilities and the nearest coffee shop. These buyers are happy to shop at any time of year, so sales will often be a bit steadier throughout.

Vacation properties always do their best in the spring and summer months, because that is when buyers visit these destinations. They benefit from the fact that vacationers will actually be where these listings are, and not just looking at pictures online or in a brochure. It’s also hard to imagine water skiing when the temperature is hovering at zero and the cottage for sale has had the water and power shut off for the season.

Having said this, there really is no wrong time to list your home, because if you price your home right, and make every effort to present it in a superior way, chances are you will sell your property in a timely manner. However, if you find that you have to list in December because of a change in career or what have you, remember to be realistic. The holidays in particular can be the hardest time to sell, when everyone’s minds are on other things. Don’t be frustrated though — you never know. After all, one of my listings sold last year on Christmas Eve.

Top Ten Things To Do To Sell Your Home

This top ten checklist was created to help you make your house more desirable to buyers when you put it on the market. The most important thing to do for your sanity and peace of mind is to start to disassociate yourself with your home. For some, more than others, this can be a challenge. Selling your home can be emotional. However, I suggest that you make the mental decision to let go of your emotional attachment to your “home,” and think of it as a “house” and focus on the fact that you will be soon living in another home. As hard as it may be, don’t look backwards, but focus forward on your future.

10. DE-CLUTTER! A de-cluttered home feels more spacious – and everyone wants more space.  When you begin this process, ask yourself, “Have I used this in the last year?”  If the answer is “no” then you probably don’t need it so make plans to sell or donate it.  Think of this de-cluttering process as a head start on your packing to move.  Pack up all your knickknacks, remove small appliances and other items from your kitchen countertops, remove books from your bookshelves and put essential items that you use daily in a small box that can be stored in a closet or drawer when not in use. It is also advisable to remove favorite items at this time. If you want to take window coverings, appliances or fixtures with you, remove them now and replace them with something else. If a buyer never sees it, they won’t want it.

9) DE-PERSONALIZE! Protect your privacy and pack up your personal family heirlooms and photographs.  Don’t distract buyers with your treasures.  Instead, provide them with the space to image where they will place their personal family photographs and treasures.  Furthermore, and I apologize if I offend, but for the most part, religious objects should be put away while showing your home too. Whatever your personal beliefs may be, they may be diametrically opposed to that of the family that wants to purchase your property, and can in some cases be an issue.

8) MAINTENANCE!   You might not care if the gutters fall off the house because they are choked with leaves – but your buyer does! If you aren’t performing maintenance on the visible aspects of your home, it’s going to raise suspicions about what remains unseen. So, clean the gutters, power wash the siding, weed the garden beds and make sure that all those odd jobs that you’ve been putting off are taken care of. Get the furnace cleaned, check the fireplaces, and check the roof for loose shingles and leaks.  Take the time to fix leaky faucets, replace burned out lights and fix doors that don’t easily close or drawers that jam. It’s pay now, or REALLY pay later on these issues!

7) DON’T BE LAZY-MAKE YOUR HOUSE SPARKLE!   Be proud of your house and show it in its best light.  Take the time to wash the windows inside and out, clean out the cobwebs in the corners of your basement. Dust ceiling fans and light fixtures, re-caulk tubs, showers and sinks.  Polish chrome fixtures, remove fingerprints from stainless steel appliances and mirrors.  Clean out your fridge, vacuum and wax floors.  Rent a power washer and make the pathway to your home look great!  Make sure visitors can clearly read the number of your house.  Paint walls that are showing major wear and tear, like children’s bedrooms, and hallway in neutral colors.   Invest in new towels; (white ones always freshen a bathroom up!) replace worn rugs. Air out your house and make sure it smells nice, not musty.  It may sound over the top, but be super-organized for those buyers that revel in snooping.  Take the time to rearrange bedroom closets and kitchen cabinets. By lining up your shoes, and organizing your clothes to have them all hang and face in the same direction you will give the illusion of more space.  Likewise, in the kitchen neatly stack your dishes, arrange your spice jars and turn coffee mug handles to all face the same way.

6) CLEAN OUT THE GARAGE AND RENT A STORAGE UNIT! You don’t want your home to appear as though it doesn’t have any storage space.  Make sure your garage is functional. People are looking for space and storage – if it looks like you don’t have any – you’re not selling your house properly.   Almost every home shows better with less furniture.  Stage your home to highlight space. Leave just enough furniture in each room to showcase the room’s purpose and plenty of room to move around. Remove pieces of furniture that block or hamper walkways and put them in storage. Store the empty book cases you created in your de-cluttering step. Remove extra leaves from your dining room table to make the room appear larger.

5) KNOW THE NEIGHBOURHOOD! Above and beyond knowing your neighbourhood, know what sells in your neck of the woods. Are you surrounded by condos and you have a single family home? Are there tons of 4 bedroom homes that sell like hotcakes, and you only have three? What will that mean? Can you make it up with other features in your home, – like a spacious den that could double as a bedroom – or maybe a room over the garage with potential? You need to know what is selling in your immediate surroundings, and even more important, what is NOT.

4) SET A REALISTIC BUDGET!  If you want to do some upgrades in your home before you put it on the market, don’t over or under improve for your area. If you live in an area that caters to first time buyers in a certain price range, expensive upgrades may push you out of their price bracket. You want the house to look good, but don’t overextend yourself.  Likewise, if you live in a high priced neighbourhood, where 75 to 100 thousand dollar kitchen renovations are the norm, don’t try and get away with an inexpensive upgrade. You won’t see any return in your investment – in fact – you are better off doing nothing but maybe adding some fresh paint and light fixtures, and pricing your home to reflect the lack of updates.

3) CALL YOUR MORTGAGE BROKER!  Make sure you know what you can afford. Nothing could possibly be worse than finding out your “dream home” that you wanted to buy is out of your reach – and you just sold the home that you could have easily remained in! Interest rates change, as do your qualifications –Stay current.

2) CALL YOUR REAL ESTATE AGENT. If you don’t have one, talk to people whose opinions you trust. Don’t be afraid to interview several real estate agents and ask them for honest opinions.  When dealing with selling your home, you’ll need someone that will tell you the truth, even if it may not be what you hoped to hear. Of course, you could go with the one that says everything that makes your heart sing – but that song could change if your home languishes on the market.

1) PRICE YOUR HOME RIGHT!  If you’ve done everything else, then you should know all the “ins” and “outs” of “what’s out there.”  Don’t ruin all your hard work by pricing your home too high. Buyers won’t look at it, and they certainly won’t offer, especially in the first month. The longer your home is on the market, the less desirable it appears to be. Sometimes, that can’t be helped because of other factors, but trust me, if you price your place right, it WILL SELL.

This ten-step checklist was created to help make a huge difference in the success of your future home sale and your ability to move to your next property, whether you are downsizing, or you need more space.

Women Love to Shop — For Real Estate!

The demographics of the typical first-time homebuyer are changing these days. More and more women today can afford to purchase a property on their own to build up valuable equity and are no longer waiting to find a life partner before they pursue the financial and lifestyle benefits of home ownership. One in four buyers these days is a single female, and new home marketing is actually starting to reflect that. We may be ready to jump into the commitment of home ownership but not all of us are willing to give up our valuable free time to outdoor chores. So single girls tend to look for homes that require little or no maintenance with an option to plant container gardens. Sound familiar girls?

The easiest and most popular way to hold on to our maintenance free lifestyle is to purchase a condominium. Its problem-free upkeep and unencumbered lifestyle is an obvious benefit to people who don’t want to be tied up every weekend with chores—there are no lawns to water and mow, and no leaves to rake. No yard means there’s no fence or deck to repair, and no driveway to shovel in winter. Choose a condo and you’ll never have to worry about this stuff. Condominium members are charged a flat monthly fee to cover maintenance of the common areas as well as provide prompt service by reliable tradespersons if there are maintenance problems in your individual unit. Heating, air conditioning, plumbing and electrical problems are handled by maintenance staff or service agreements set up by the condo association, so good help is available at a moment’s notice.

Security is also an important consideration for single women living alone, and the condo lifestyle can offer such measures as restricted access, a concierge on duty screening visitors, closed circuit TV monitors, patrolling security guards and panic buttons in garages to add to peace of mind.

Some single women still prefer a more traditional home as their first property. The appeal of having an outdoor space of your own to entertain, putter about in a garden and relax in can be inviting. A single family home sometimes offers more privacy and is also better suited to larger pets. Make sure to check if your pet will be warmly received by the condo board—they uphold the rules that the condo owners have set in place.

The Wish-List

There’s a difference between what you need and what you want. We all need a place to eat, sleep and call home, but when the time comes to buy that place, there’s a lot to consider. In a dream world we could envision our perfect home and magically make it happen. But this is reality, and in reality we all have budgets and other parameters we must work within, which is why I encourage all of my clients to start with a wish-list. It helps you determine exactly what you need, want, and must-have. It lays down a blueprint for your house hunt and it keeps you in check.

Here are some suggestions to help get you started building your wish-list:

• Make a list of all the things you love and don’t want to give up in the place you’re currently – a kitchen island, a soaker tub, a fireplace – whatever gives you pleasure and makes your house feel like home.

• A wish-list can also be referred to as a “change-list” – meaning, these are all the things about my current living space that must change. So take note of all the things in your current space that you are not happy with and highlight anything that frustrates you to no end.

• Consider how long you’re going to be in this home and what you envision happening in your life during that period. If you’re finally going to get that pet dog you’ve always wanted, then you’ll have to consider that when choosing the property.

• Identify which items you must have now, and which items can be added over time. Maybe you really want a deck in your backyard and you’ve just seen a great house that has everything but.  A deck is something you can add on down the road.

• Consider your wish-list a constantly changing thing. Trust me – once you start looking at properties, you’ll be adding and dropping things from your list. That’s the best part about house hunting – every place you see gives you a better sense of what you’re really looking for.

Top Five Things To Think About Before You Buy…

Buying a home is generally an exciting adventure – the thrill of finding a home that you and your family can enjoy, where you will raise your children, make friends – all the good things that home ownership. But there are several things that you should consider before setting down your hard earned money on a home purchase.

  1. Does this home make sense? Now when I say that, I mean will this home make sense for you and your family in the long run? Are you a young family and hope to expand? Maybe a two bedroom townhome is not the right buy. Sure, with one child it may be very manageable, but if baby number two is just a year away – you may be forced to move within a couple of years. With transfer taxes and realtor fees, you could eat up any profits made, and that’s just not a smart buy. Ideally you should look for a home that will accommodate you for at least five years. This may mean forgoing some fancy upgrades, but ultimately the cosmetics of a home can be changed, whereas adding square footage is a whole different ball game.
  2. Have I fallen in love with the finishings, not the home? This often happens with buyers. The reason show homes are so inviting is that the developers want you to fall in love with an ideal. However with all the fancy furniture gone, you may find the home you bought is not the home you need. You may have ignored all those stairs in that three level townhome because you loved that open concept living area. But if you noticed it when you visited, think about how it will affect your daily life. Do you have small children? Imagine carting baby buggies, strollers, and small children up and down those stairs. Suddenly, that home might not be such a great idea after all.
  3. Do you see yourself in the neighbourhood? If there are tons of children in the neighbourhood, and you are a professional couple who crave quiet, then you might be in the wrong place. Conversely, if you have children, but there are no schools within walking distance, and no basketball hoops in the driveways, then they may not have any friends to play with. Make sure you pick an area that fits your lifestyle, whether you’re looking in the city or the suburbs.
  4. Don’t buy the best home in a not so great neighbourhood. Ideally, you want to buy in the best area you can, even if that means buying a home that may not have all the extras that you want. Your home is your investment, and ultimately the old saying “Location Location Location” will always hold strong. You can’t make more land, no matter how hard you try. However, you can invest in the home that you purchase through renovation. It doesn’t have to be all at once. But if you buy a home with “good bones” – i.e.: good sized rooms, a practical floor plan, and structurally sound – all within a desirable location – you will be making a sound purchase.
  5. Can I really afford this? If you are a dual income couple and are planning on starting a family, you may have only one income for a while. Will the home put undo financial pressure on you? If your income was to go down, would you be able to afford the home? Just because you “can” afford to purchase a home, doesn’t mean you should. Sit down and think about your lifestyle. Do you like to travel extensively? If you do, make sure you budget that into the equation. Are you planning to send your children to private school? Factor in the annual tuition to your costs. Don’t forget to speak with your mortgage broker. Any changes in interest rates could change your mortgage payment in the years to come. Make sure you can handle any upticks in the interest rates.

These are just a few things to consider when you enter the world of real estate. But ultimately common sense will rule the day. Always make sure that when you are shopping for your new home, you leave your rose coloured glasses at home!

9 Steps to Staging Your Home

You don’t have to break the bank to have your house looking as though it was professionally staged. These tips and tricks will have your house sell-ready and gorgeous before you can say “why hasn’t it always looked this way?!”

 

1) De-Clutter

The first step in getting ready to sell is de-clutter, de-clutter, de-clutter so potential buyers aren’t overwhelmed by your stuff, but rather impressed by your home. Counters and other surfaces should be kept clear and any furniture that isn’t needed stored away. The good news about this tedious task is packing and purging will make moving day that much easier.

 

2) Lights and Mirrors

Warm lighting and well-placed mirrors can make your home feel bright, inviting and even bigger. Mirrors placed over fireplaces, and along hallway walls will make rooms appear larger than they are. Table lamps, and overhead lighting like chandeliers and sconces will brighten rooms and add some flair to your decor.

3) It’s Nothing Personal

Any personal effects should be packed away; family photos and mementoes, framed degrees, anything that’s a link to the current owner. Buyers want to imagine themselves in the house, so the more the house is a blank slate, the easier that is.

 

4) But Don’t Touch the Nursery!

Although the nursery and childrens’ rooms should be de-cluttered and tidied as well, personal effects can remain as they are. There’s something reassuring and touching about seeing a baby’s room that can mean all the difference to a potential buyer (especially ones that are starting a family).

 

5) Neutrals

Although you love that fuchsia accent wall, some buyers may not. A fresh coat of bright, neutral paint will not only enlarge the house and make it feel airy and more spacious, but it will also help buyers with their vision (there’s that blank slate again).

 

6) Accents and Colour

To complement the neutral house, a few well-placed bright pops of colour will bring the decor together. Bright throw pillows, or a canary yellow kettle on the stove will be noticed as soon as you enter the room and will stick in buyers minds once they leave. Fresh flowers are another great idea, and single flower arrangements are most effective.

 

7) Inviting Scents

Warm inviting scents will help your house be remembered. Taking the time to bake cookies or mull cider on the stove may not be in the cards (and the stove and elements should be off for open houses) but a safely placed candle or air freshener will do the trick.

 

8) Draw Attention to Selling Features

As a general rule closet doors should be kept closed, but if there’s a walk-in that should be noticed, a small note to alert potential buyers is ok.

9) Freshen Your Linens

Now’s the time to use your spare “good” set on beds, and ensure your towels and hand-towels are in tip top shape. And if it’s perhaps time to replace them, think neutral again.

Following these tips will have your house in tip top selling shape and make it the most appealing to the most potential buyers faster than you can say “SOLD!”

4 Tips to Selling Your Home Without a Real Estate Agent

What’s a Property Survey?

A property survey shows the boundaries of the property indicating the lot size, and includes a written description of the property. Property surveys, which resemble a map, are carried out during the original construction of a house and are provided to the buyer at that time. However, if the house you are buying is older you may find that the original survey has long been lost. Sometimes a copy has been kept at the city planning department and they will gladly give you a copy, but I’ve never been that lucky.

Surveys indicate right-of-ways and easements. Right-of-ways detail the right of others to access certain areas of the property (for example, it may allow access to hydro or telephone companies for servicing or a shared lane or driveway). Easements are a right that’s assigned to the property and cannot be removed very easily, if at all. Surveys may also indicate issues such as a fence located outside the property line or an overhanging roof from a detached garage and in these instances, the buyer can ask the seller to correct the problem before closing.

If you’re thinking of buying a home, you may be wondering if you need an up-to-date property survey. It’s definitely in your best interests to have one as your lender may insist on one before approval of your financing, however, Title Insurance may suffice. Your lawyer will most likely suggest that you purchase Title Insurance anyway, and it may soon be mandatory for all real estate property purchases. If you are buying a condo you won’t need a survey, not even for a condo townhouse as essentially the condo corporation will own the land, not you. A simple way to find out if it’s a requirement is to get pre-approved for a mortgage before you buy and quite frankly I insist that all of my clients get pre-approved before we start looking at homes.

Over time, you may want to add a fence, a pool, a deck or even an extension and you will need a survey when you make these improvements. Many times such changes have occurred since the last survey making it out of date and therefore it has little value in the real estate transaction, but could still be suffice for your own needs.

It should be noted that not every transaction requires a new survey, and Title Insurance may satisfy your lender. Ask your real estate lawyer to verify this before you purchase the property. It can also depend on when the last survey was completed and what physical changes have taken place since the survey was done. If a new survey is needed, you need to determine who will pay the cost in the Agreement of Purchase and Sale.

5 Mistakes of First Time Buyers (And How to Avoid Them)


Buying your first home can be exciting and amazing, and scary. But knowing the common mistakes of first-time buyers will ensure you don’t make the same ones, and can help make the transition to “New Home Owner!” that much smoother.

1) Spending Too Much

It’s important to be realistic about what you can afford. The final sale price isn’t the only cost to take into account when owning a home. Houses come with plenty of bills like heating and property taxes, future renovations and occasional unforeseen costs like burst pipes or city trees needing to be trimmed.

What you can do about it: Take a close look at your finances. Be aware of your current fixed costs and always leave some breathing room. Ask the homeowners what they spend in a year on their bills so there aren’t any surprises. Canada Mortgage and Housing Corporation has plenty of useful online budget calculators to help. As a general rule your monthly housing costs (mortgage, property tax and heating expenses) should be no more than 32% of your gross monthly income.

2) Spending Too Little

Yes, this can also be a mistake! If you spend too little on a home that you’ll outgrow quickly, you’ll incur the expense of moving (which can be quite pricey) perhaps before you need to.

What you can do about it: Think ahead. Are you planning on starting a family soon? Will you outgrow the house? Perhaps stretching your money a little bit to stay in a house for longer is a more sound financial decision.

3) Buying With Your Heart

Sure the house is gorgeous, fully renovated and painted your favourite shade of cream and has an ensuite bathroom for every bedroom. But it’s on a busy road and you have three young kids and two cats who like to run outside.

What you can do about it: Be smart! Visit the house at least twice (you’d be surprised at how your opinion can change on a second and third visit) and think critically. Go through every aspect of the house, every room, every floor, its location and neighbourhood and really try to picture yourselves in the house for years down the road.

4) Missing Hidden Closing Costs

The final sale price of the house isn’t the only cost of buying a home. There are many “closing costs” that should be taken into account when deciding what price range you can afford. Your realtor’s commissions, lawyer fees, transfer taxes and moving costs can all add up.

What you can do about it: Closing costs can be anywhere from 1.5-4% of the final sale price, so be aware and take this into account when determining your budget.

5) Not Doing Your Research

Blindly buying a home can be a big mistake. Whether you’re paying too much attention to your realtor and family “who just LOVE the place!” or are feeling the pressure to make a quick buy, moving into a house that hasn’t been thoroughly vetted can be a big, expensive, regretful mistake.

What you can do about it: Do your research! And do it first-hand. No realtor or family member can know exactly what you want more than you. Spend a day walking the neighbourhood, learn about your neighbours, research the local school and visit the parks. As for the house itself, get an inspection report. These can uncover unseen things like termites and flooding, two expensive undertakings.

Buying a home is exciting and daunting. But doing your due diligence can make the process a little easier, and get you into your dream home with (little) stress.