April 12


10 Rules for Success to Buy the Right House, for the Right Price, at the Right Time

With Les Lamb

April 12, 2024

Buying a house can be very exciting, and yet very challenging at the same time. Knowing how to navigate the process can make or break the experience, ultimately determining how quickly you buy, or in some cases, whether you buy at all. In this article, I’ll share insights gleaned from helping my clients buy properties over the years. By following the 10 rules for home buying success below, you’ll avoid many common pitfalls, giving you an edge against your competition.

1. Include All Decision Makers from the Start

Maybe you need a cosigner for your mortgage. Maybe you want a loved one on the deed, so the property can pass to them easily if you die. Maybe your parents are helping with the down payment, as long as they approve of the property. Perhaps you are investing with a business partner. If so, you’ll need a signature, and they may need a pre-approval. There also may be tax or legal implications, depending on the relationship, their residency status and their level of involvement. To avoid surprises when you want to make an offer, have them attend showings if you can, and ask for their direct involvement throughout the home buying process.

2. Understand the Full Cost of Homeownership

When you buy a property, closing costs include land transfer tax, legal fees, moving costs, commission (usually rolled into the purchase price, but exceptions can apply), down payment, and in some cases, HST. There are also inspections and utility deposits to consider. To help with your planning, I’ve provided several home buying tools and calculators here on my website.

Once you move in, you’ll be paying mortgage payments, property taxes, maintenance fees (if applicable), insurance and utilities. You’ll also need to budget for regular maintenance, upgrades and repairs.

3. Have Your Deposit Ready, Get Pre-Approved, and Don’t Change Your Finances Before Closing (If You Can Help It)

If you’ll be financing part of your home purchase, you’ll need a pre-approval from a licenced mortgage agent, prior to making an offer. Not only does this protect you from buying more than you can afford, it also increases the chances of your offer getting accepted. The listing agent’s job is to screen potential buyers’ financial strength to ensure the deal doesn’t fall through. If your own agent can’t sell your offer to the listing agent because you’re not pre-approved, your offer is unlikely to get accepted. A pre-approval can also guarantee you a rate lock-in for up to 120 days, which can save you a lot of money.

Get your pre-approval in writing, and don’t just get one online from a website. A mortgage agent should be checking your credit, verifying your income and asking for documentation. Know that a pre-approval is not a guarantee. In fact, even after you get an offer accepted and the bank approves your deal, they can technically audit it anytime before closing. That’s why it’s important that you make no voluntary changes to your finances, like opening or closing accounts, taking out a loan, financing a car, quitting your job, or buying another property. Any of these things could affect your ability to close, and you could lose some or all of your deposit, too.

Once your offer is accepted, you’ll need to deliver your deposit within 24 hours. That means the funds must be liquid and available to you before you make the offer. In Ontario, your deposit can be for any amount, but in our local market (Durham Region & surrounding areas) right now, a common expectation – in some cases it’s even a requirement by the seller –  is 5% of the purchase price or more. In times when many homes are selling in multiple offers, remember that the bigger your deposit is, the stronger your offer will be in the eyes of the seller.

4. Be Realistic on Price

Know the market you’re buying in. Is it an extreme seller’s market? That’s the wrong time to hunt for bargains and make lowball offers. Did 3 identical homes just sell for $800,000? Don’t expect to get it for $700,000. Does every house you put an offer on sell for 20% more? Adjust your expectations, or adjust your budget. Successful buyers get their offers accepted because they speak the language the seller wants to hear. That language is first price, second, price, and third (you guessed it), price. To be successful, you must be reasonable and willing to pay fair market value.

homebuyers decision pie chart with features, location, price.

I’ve never met a buyer who doesn’t want more home than they can afford. In The Homebuyer’s Decision Pie above, you’ll see that buying a home usually means choosing two of three things:

  • The features you want
  • The location you want
  • The price you want

Add an inground pool, and the price goes up. Upgrade to the best part of town, the price goes up. Want to stay within your budget? Be willing to compromise on either location or features. It’s a simple concept, but buyers who can’t accept it either don’t buy, or they have to figure it out the hard way. The sooner you get this, the sooner you get to move.

5. Get Your Own Buyer’s Agent Early

Some buyers are convinced they’ll get a better deal if they buy through the listing agent. This is not true, and it’s a bad idea for more than one reason. First, if they’re right, it would only be because the agent is unethical and dishonest, which would affect the buyer just as much as the seller. Secondly, the listing agent is representing the seller’s, not the buyer’s, best interests. Multiple representation is then required, leaving the buyer without the full representation they would otherwise benefit from. For example, this prohibits the agent from advising them on what the property is worth, so they don’t overpay, or suggesting clauses that could protect their interests over that of the seller’s. Thirdly, there is no guarantee the seller will consent to multiple representation, leaving the buyer to scramble for another agent to start the process over with, while a different buyer buys the property instead. As you can see, buying though the listing agent does not save you money. It costs you more, exposes you to risk, and creates missed opportunities.

To avoid these mistakes, it’s best to sign a Buyer’s Representation Agreement with your own buyer’s agent before you begin to search for a home. By not leaving this to the last minute, it gives a buyer’s agent the time they need to thoroughly understand not just what you want to do, but why you want to do it. This is crucial. For example – maybe you want an in-law suite. Why – for in-laws, or to rent it out? Maybe you want a bungalow. Why – to convert it to a legal duplex, or for your own accessibility needs? Maybe you want three bedrooms – why, because you have young children, or because you need an office to host clients in? The motivational answers to these questions completely change which property you need, and the advice your agent must give you. Involving your agent early so they can get these important things right can save you money and time, helping you buy the right property, for the right price, the first time.

6. Guard Your REALTOR©/Client Relationship

For those who are anxious by nature, or given to thinking out loud or online, don’t let your mouth or your keyboard undermine you. Searching for a home can be an emotionally exhausting and frustrating experience. It may take longer than you expected. You might have to put several offers in before one gets accepted. When this happens, friends and family will offer their opinions and advice, comparing your experiences to their own. If you’re already anxious, this can amplify that and cause you to second guess everything. Remember that you didn’t hire your friends, family, or Facebook group to help you buy a home, and for good reason: their experience is limited to buying one or two properties, often years ago, in a different market, under different circumstances.

The market is always changing, and so are its rules, best practices and strategies. The best person to vent to is your partner – and by this I mean the real estate professional you’ve hired, who has a vested interest in your success. He/she has the experience, tools, training and knowledge to help you navigate the home buying journey. Don’t allow the uninformed opinions of well-meaning friends or family interfere with that relationship. If you’re concerned about the advice your agent is giving you, or if you’re anxious about the process, discuss it with your agent, not your circle. Then you can move forward together as a united team. After all, if you don’t trust them, why are they representing you?

7. Keep Your Eyes on the Goal

It’s fun to look at properties. I do this every day, and I still love to drop by open houses. However, as a buyer, your goal is to buy a property, not look at one. Before booking a showing, ask yourself, “Is there anything I already know about it that makes submitting an offer impossible?” If the unfinished basement is a deal breaker, then it doesn’t matter how nice the rest of the home is inside. It’s just a distraction.

You only have so much time each week to look at properties. Every showing you say yes to means saying no to another. Make every showing count. Visit only properties you’d actually buy if they’re what they appear to be. Stay on track and avoid distractions to find the right property, for the right price, at the right time.

8. Don’t Let the Myth of the Perfect House Make You Miss the Best Buying Opportunities

It’s common for homebuyers to hold out for the perfect home, only to regret not buying one of the homes they turned down earlier. Why does this happen so often? It happens because they fall for the myth of the perfect house. Don’t let this fallacy crush your home buying dreams.

Repeat after me:

The perfect house doesn’t exist.

I can prove to you that the perfect house doesn’t exist. How? Because we’ve all known people who spent years designing every inch of their custom home. What do they say after they move in? “If I could do it all over again, I’d do it differently.” They’ll tell you about the door that opens the wrong way, or about the light switch on the wrong side of the room, and a dozen other things.

Once you understand that the perfect house doesn’t exist, it empowers you to buy the right house instead. How do you know if it’s the right house for you? You write down the 10 things that are most important to you. Then when you find a house that has 7 of those things, you strongly consider making an offer. If you’re fortunate enough to find one with 8 or more of those features, then you buy it! It’s not perfect, but it’s the closest thing you may find. Once you move in and make it yours, you’ll join the ranks of those who grew to love the home they bought in spite of its flaws. The imperfect home you own is better than the perfect one you never will.

9. Be Prepared for Showings

If you don’t understand homebuyer showing etiquette, it can cause you to miss out, and it can cost you money. Being properly prepared can set you up for success. Here’s what you need to know:

  • Be on time. Your agent is only allowed access to the property within the agreed upon time slot. Some listings even have electronic lockboxes that control access times, so if you’re late, you’re not getting in. Inconveniencing sellers can also leave a bad taste in their mouths, which can hurt you later if you make an offer and the seller has another one to choose from. Being late for one showing can make you late for all those that follow. Gas or charge your car before hitting the road, and leave enough time for traffic and weather. You should not use the seller’s washroom while on their property, so be sure to do that beforehand. Bring a snack for the car ride if your sugars are prone to get low, and avoid stopping between showings. These are no-brainers for most people, but I’ve had buyers miss showings because of them.
  • Arrange childcare for small children if you can. If you must bring them, teach them not to touch anything, and not to sit or lie down on the seller’s furniture. Keep them with you at all times, and be sure they do what you’ve told them. They could break something, but they could also get injured or hurt. Some properties can have pets, safety hazards and unexpected equipment.
  • Beware of hidden cameras. These can be anywhere inside or outside a property, from the doorbell, to the deck, to the bedroom. Assume everything you say is being recorded, just in case. You can still speak, but avoid showing too much enthusiasm, criticizing the property’s condition or decor, or discussing things like how much you’d be willing to pay, or how desperate you are to buy something quickly. All of these things can limit your agent’s ability to negotiate the best terms and price if you put in an offer.
  • Don’t bring unexpected guests. The only people attending the showing should be the buyers. Your agent is responsible for the property and the seller’s belongings during showings. You want them to focus on you and on the property you’re looking at. Dividing their attention is not in your best interests.

10. Remember That Jumping Off a Roller Coaster Hurts More Than Finishing the Ride

Buying a house is a huge emotional roller coaster that catches some buyers by surprise. If you’re not expecting it, it can pull the rug right out from under you. Some buyers tolerate this better than others. For example, it can take longer than you expect to find the right property, or your first few offers can be rejected, or home inspections can fail, or the market can shift suddenly to limit your buying power. Some people give up when they experience any of these things. Opportunity passes them by, and someone else buys the house that should have been theirs. But not you. None of this will affect your steely resolve, because now you’re mentally prepared and armed with realistic expectations.

Following these 10 rules for home buying success will help you to avoid some of the most common mistakes homebuyers make. Include decision makers from the start, and understand the full cost of homeownership. Have your deposit ready, get pre-approved, and don’t change your finances before closing if you can help it. Be realistic on price, and get your own buyer’s agent early. Guard your REALTOR©/client relationship, and keep your eyes on the goal. Don’t let the myth of the perfect house make you miss the best buying opportunities. Be prepared for showings, and don’t give up! Remember that jumping off a roller coaster hurts more than finishing the ride.

Thanks for reading this article. For even more information, download my free homebuyer’s guide here.

Les Lamb

About Les

I'm your hard-working, full-time REALTOR©, serving in and around Durham Region, Ontario. I specialize in client care and communications. My client-centered approach puts you first and takes the stress out of your home buying and selling experience. How can I help you?

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