Purchasing A Home

At last... you have found your dream home. Now it's time to make an offer.

Deciding what to offer can be challenging. If you offer too little, you could miss your chance to own the home (particularly in a seller's market). However no one wants to pay more than is necessary.

Your Royal LePage Foothills Real Estate Associate can be a tremendous help by showing you what comparable houses have sold for, helping you assess the condition of the home, and judging your competition in a multiple offer situation. Once you have decided on the price you are prepared to offer, your Real Estate Associate will draft the offer and explain the details to you.

Your Royal LePage Foothills Real Estate Associate will communicate the offer, sometimes known as an Offer to Purchase (a legal document specifying the terms and conditions of the offer) to the seller, or the seller's representative, on your behalf. The offer can be firm or conditional.

Firm Offer to Purchase: usually preferable to the seller because it means you are prepared to purchase the home without any conditions. If the offer is accepted, the home is yours.

Conditional Offer to Purchase: means you have placed one or more conditions on the purchase, such as subject to home inspection, subject to financing, or subject to the sale of your existing home. The home is not sold until all conditions have been met.

Making an Offer

The main elements of an offer are Price, Deposit, Terms, Conditions, Inclusions & Exclusions, and Possession Date.

Price: The price you offer reflects your opinion of the value of the house and is determined by the condition of the property and local market factors. You can make any offer you like. It does not have to be the same as the seller's asking price.

Deposit: The deposit shows your good faith and will be applied against the purchase of the home when the sale closes. Your Royal LePage Foothills Real Estate Associate can advise you on an appropriate amount.

Terms: Include the total price offered and the financing details. You may arrange your own financing or ask to assume the seller's mortgage, especially if it has an attractive interest rate.

Conditions: Conditions are items that must be completed or fulfilled prior to an offer being concluded. These can include subject to home inspection, subject to you obtaining financing, or subject to you selling your existing property.

Inclusions and Exclusions: Your offer may be contingent on certain items being either included or excluded in the sale. These might include appliances, fixtures and decorative items such as window coverings or mirrors.

Closing or Possession Date: The closing date is generally the day the title of the property is legally transferred and the transaction of funds finalized, unless otherwise specified.

Negotiating

Once your offer to purchase is drafted, it will be presented to the seller as soon as possible. The seller can accept your offer, reject your offer, or make a counter offer.

An accepted offer means the seller has agreed to all the terms and conditions exactly as set forth in your offer to purchase.

A rejected offer means the seller did not agree with any of the terms and conditions set forth in your offer to purchase.

A counter offer means the seller agrees with some of the terms and conditions of your offer, but not all of them. The seller then makes a counter offer - the counter offer may change the price, the closing date, or add or delete conditions.

Once you have received a counter offer you have two choices: You can accept the new terms and conditions or reject them. If you reject them, you can choose to start the whole process over again.

Inspections & Appraisals

Buying a home is probably the biggest single investment you will make. A home inspection prior to making an offer will provide some protection for you and your investment.

A qualified home inspector will give your house a thorough examination, checking the heating and cooling system, plumbing and electrical systems, the roof, attic, walls, ceilings, floors, windows, doors, foundation, basement and visible structures of the home.

The inspector will point out the need for major repairs, identify areas that may need attention in the near future, and explain what maintenance will be necessary to keep the house in good shape. But, it is not all negative. Most inspectors are more than happy to tell you about the home's good qualities as well.

Home inspections are relatively inexpensive considering the size of the investment you are about to make. Many people consider this a small price to pay for peace of mind.

Your Royal LePage Foothills Real Estate Associate can provide you with a list of reputable, qualified home inspectors in the Calgary and surrounding area.

What is an Appraisal?

An appraisal is a report containing an estimate of the value of the property. Appraisals are conducted for the purpose of mortgage lending by certified appraisers. The appraisal should not be confused with the home inspection or the market analysis.