Starting out with too high of a listing price will add to the stress of selling your home.

Ideally, during the first few weeks, your home should be overflowing with activity.  Listing agents will market and promote your home to other agents who are working with homebuyers, increasing your personal sales force.

If you have overpriced, chances are fewer agents will promote your home to their clients.  As REALTORS®, it is their job to know the market demand and fair market value of a home. If your home was dramatically priced above market value, you will essentially be wasting your time.

Dropping Your Price Too Late

Your house could take longer to sell if you start with a high list price and then drop it later.  By this point, your house has become “old news” and has lost the chance of overflowing activity that you would have received with a realistic price.

Even if you were to sell your home at an above market price to an uninformed buyer, that buyer will likely need a mortgage.  Their lender may require an appraisal. If comparable sales and current market conditions do not support your sales price, the house won’t appraise and the deal will then fall apart.

If your home sits on the market a while, it is harder to get a good offer.  Overpricing your home in the beginning, then dropping the price may look like you are desperate to sell and potential buyers may make lower offers.  You could actually end up settling for a lower price than you would have normally received.

Of course, you want to receive the highest price for your home.  If you start out with a list price that is too high, you likely interviewed other agents who didn’t get the listing.

If your listing agent engages in “buying” listings if your home didn’t sell in x number of days on the market, chances are they probably pushed through other agents to tell you what you want to hear.  Now you’ve ended up with an agent who was good at selling you, but not good at selling your home and got paid the commission for it.

It’s tempting to choose the agent who tells you exactly what you want to hear.  Instead, look for honest advice agents will give. This way you won’t be frustrated about why your house didn’t sell close enough to the price you had listed it for.

There are countless advantages to purchasing a new home. You are able to build equity, enjoy pride of ownership, and truly make a home your own. If you are planning to buy property in the near future, preparing now can help you save time and money. Being prepared may also give you an advantage over other buyers. Here are a few tips to consider prior to your home search.

Know Your Bottom Line Before You Start Looking at Homes

I’m sure you’ve heard this before, but think about more than just knowing what price you are willing to pay. Consider the distance you’re willing to commute to work, the number of bedrooms and bathrooms you require and what you need in terms of local amenities. If you have children, you’ll likely want to consider schools and parks in the area. By determining your bottom line before you begin the search for a home you can avoid making snap decisions based on emotional responses to attractive home features.

Credit Check

Life happens, bad credit happens. But who wants to discover that they have a bad credit rating after finding the home of their dreams? Before meeting a lender, you can obtain a copy of your report which will give you an opportunity to take care of any unsettled debts. You can obtain a copy of your credit report from TransUnion or Equifax.

Avoid Major Purchases Prior to Buying a Home

Lenders tend to be uneasy when they see potential homeowners stretch their disposable income into buying a car or boat for example. Such purchases can make it difficult to obtain a mortgage or may lower the amount you can be approved for.

Anticipate Higher Interest Rates

Recalculate the above maximum monthly mortgage payment based on higher interest rates. Ask yourself if you can afford to pay a higher monthly payment without sacrificing other commitments.

Determine Your Cash Flow at the Time of Purchase

There are various fees involved with a real estate transaction which are outlined here. Moving from a rental suite, you should be prepared for expenses that may have been previously included with your rent such as heat, water, electricity or cable.

Your Paperwork Should Be in Order

Lenders will often need to see bank statements, pay stubs, and tax documents for the past two years.

Get Pre-Qualified for a Loan

Once you have a calculated budget you can live with, approach a lender to find out if you can get pre-qualified for a mortgage and how much you can spend on a home.

Buying a home is not only a lifestyle change, but it’s also an important investment. To make the most of your investment, plan ahead to find the right home and the best rates.

The last thing you want to end up with after purchasing your home is unanticipated costly renovations. That’s why home inspections are such an important part of the home buying process. Choosing an experienced home inspector can be tricky, so it’s important to consult with others to help you find a reliable inspector with good references.

Contact several local home inspectors and interview them in advance to determine their qualifications.

Questions to Ask

1. How long has the inspector been in the business with a home inspection firm?

2. Is the inspector specifically experienced in residential construction?

3. What does the inspection include? Inspections should include visual inspections covering exterior, structure, garage, plumbing, heating, cooling, electrical, and interior insulation and ventilation. Extras can include radon testing, a pest infestation survey or inspection of septic system or wells. The inspector should provide you with a written report.

4. How much will it cost? Determine fees up front. Inspections can cost as little as $200 to as much as $1,000, depending on the size of the home and which inspection services are requested.

5. How long will the inspection take? The time depends on the size and age of the home; typically inspections take 2 to 3 hours. Anything less than that isn’t enough time to do a thorough inspection.

6. Does the inspector encourage the client to attend the inspection? This is an educational opportunity, and if an inspector refuses, you may want to look for a different inspector.

7. Ask what educational and/or training facility the inspector attended. Does the inspector participate in continuing education programs to keep his/her expertise up to date? It’s okay to ask to see their papers.

8. Does the company offer to do any repairs or improvements based on its inspection? This might cause a conflict of interest, and it’s not recommended to deal with these firms.

9. Do they belong to an association that will investigate consumer complaints?

10. Do they carry errors or omission insurance?

Buying a home is typically a very exciting time for most people, whether you’re a first time homebuyer or this is the fourteenth time.

Many people think of the basic costs like legal fees, GST (in some cases), property tax adjustments, the cost of movers, set-up fees for utilities, new window coverings, etc.  If you’re a first-time homeowner you should also consider home maintenance costs like purchasing tools, a lawnmower, etc. You may also have to consider some major costs like replacing flooring, windows, or roofs.

On the opposite side, some buyers may gain a cost-benefit from purchasing a new home.  You could purchase in a development that has a fitness center or swimming pool – so no more gym membership or transportation fees.

Next, you’ll want to consider the location.  Look at the location from many viewpoints by asking yourself “Where am I going to live relative to…?”  That relative to should include work (yours and your spouses), leisure activities (children’s classes, golf memberships, night school etc.), children’s school or daycare, proximity to family, best friends or the old neighbourhood.

Life rarely goes according to schedule, so try to determine the likely disruptions to a perfect schedule:

• How often do you or your spouse have to work late or unusual hours?

• Is your commute very efficient?

• Does this mean your children may have to miss soccer practice or other activities they enjoy?

• Is the commute likely to leave you too tired by the time you get home?

It can sometimes be overlooked, but consider the value of your purchase in relation to the emotional costs associated with the purchase.  When you buy a home you want to be satisfied on all counts.