What are the Risks of Buying a Home Without a Real Estate Agent?

What are the Risks of Buying a Home Without a Real Estate Agent?

Want to buy a home but wondering if it’s worth hiring a real estate agent to help you? Buying a home is a big deal and requires a lot of research to comprehend the complex real estate market. It may seem like the norm to go through the process of buying a home through a real estate agent. But many first time home buyers or even experienced ones, don’t understand why they need a professional real estate agent to help them.

There are many reasons why. Let us take you through the risks of purchasing a home without the help of a real estate agent so you are more aware during your search:

Lose out on a bargain

When you don’t have a professional helping you with the buying process, the home seller may not take you seriously. Negotiation can get you an amazing bargain on a home, however, it can be difficult as a buyer needs to be taken seriously. An experienced professional can do the negotiation for you in a professional way and make you appear like a serious buyer. A real estate agent knows how to get the asking price reduced to fit your budget; however you may not be proficient or comfortable in doing so.

Unaware of market knowledge 

The average person doesn’t understand real estate language or how the market works. This is essential when searching for a home so you make the right decision. Although it’s possible to try and learn about real estate online, can you really afford to make a huge life choice based on internet information? 

A real estate agent has the proper insights into the market changes, legal issues, various neighbourhoods, and home listings to help you make an informed choice.

Not asking all the questions

Having an expert go through the legal paperwork and answer questions on your behalf can be a lifesaver. An agent knows all the questions you need answers to, from enquiring about seller disclosures to closing costs and maintenance fees. An expert will have the answers ready to questions you may have not even thought of. This will relieve you of the stress of trying to handle every single aspect of home buying yourself, and you enjoy complete peace of mind.

Improper house inspection

Real estate professionals are required to vet a potential property fully for any risks to your health, water damage, and other dangers. They are trained to look for issues that an outsider might miss. Having an expert clear a property for move-in is more reliable for doing it yourself. You never know what you may miss during the house inspection.

Norm Merx is a top real estate agent who can help you find your dream home in a short time! With over 20 years of experience, Norm has the right tools and knowledge to find your property within your budget in no time. Simply fill out your contact information and your search criteria based on price, property type and the neighbourhoods you prefer to get started. If you have any more questions, feel free to call or send an email!

What the new mortgage regulations mean for buyers

What the new mortgage regulations mean for buyers

What’s been described during the past few weeks as a ‘sledgehammer crackdown’ on the Canadian housing market, the new mortgage regulations, some of which came into effect last month, are aimed at strengthening the country’s housing finance system ‘to help protect the long-term financial security of borrowers’ and ‘to improve tax fairness for Canadian homeowners’.

In simple terms, the changes will help ensure that homeowners are not taking on larger mortgages than they can afford. This will be accomplished using a stress test on all new insured mortgages, including those where the borrower has more than 20 percent for a down payment. The test will show whether or not a buyer is able to keep up with mortgage payments should interest rates increase and must be based on the Bank of Canada’s five-year fixed posted rate of 4.64 percent, regardless of the rate that is being offered by the lender.

The mortgage rate stress test will also look at the percentage of household income that is being dedicated to household expenses (GDS). The monthly mortgage payment, heat and taxes cannot exceed 39 percent of the borrowers income. In addition, the TDS (total debt service, which includes the previous stated monthly expenses plus debt repayment) must not exceed 44 percent.

Another aspect of the new regulations covers changes to the ‘eligibility rules for newly insured low-ratio government-backed insured mortgages. These new criteria will help target the funding support provided by government-backed low-ratio mortgage insurance towards safer forms of lending’. Effective November 30, low-ratio mortgages to be insured will include the following requirements:

Maximum amortization of 25 years
Purchase price under $1,000,000
Minimum credit score of 600
Owner-occupied (if a single unit)

The government has also introduced new reporting rules for the primary residence capital gains exemption. This regulation is aimed at addressing the issue of foreign investors ‘flipping’ Canadian properties while claiming a primary residence tax exemption.

For more information, visit https://www.fin.gc.ca/n16/data/16-117_2-eng.asp.

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