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You keep hearing “it’s a great time to sell your house”… and it is! However, if you’re trying to purchase a home right now you are facing more challenges than ever before. That doesn’t mean that it’s impossible! Your For Sale In Barrie agent is here to help smooth out any bumps in the road and will be with you every step of the way. 

With the majority of the Canadian housing markets being identified as Seller’s Markets, this means that most buyers, here in Barrie and Nationally, will likely be up against limited housing supply, lots of competition, and the same question on their lips; how do you buy a home in a seller’s market, with the cards stacked against you. 

We’ve identified some buying strategies to employ that will help you find a home in a seller’s market.

Be Informed

Having a handle on market conditions is a key first step in a successful transaction. This is the case regardless of market conditions, but especially if you’re trying to buy a home in a seller’s market. Remember, real estate is very local, so what is happening in one community might be different in another. Here’s where it helps to tap into a professional, experienced real estate agent. Every For Sale In Barrie agent will be able to empower you with all the information you need to help make informed decisions. 

Know Your Budget

How much can you afford to spend on a home? This is different from a mortgage pre-approval. Take into consideration your lifestyle, and what sacrifices you’re willing to make. If you’re planning to buy more home, you might have to curb your spending elsewhere. If you won’t be making any lifestyle changes in interest of home ownership, you may have to lower your home-buying budget or make some other concessions, such as the size of the home or the community.

Really Important Tip… GET PRE APPROVED! 

Get pre-approved for a mortgage. This gives you an idea of how much a lender is willing to finance, and how much you can spend. A pre-approval also locks in the current interest rate for up to 120 days, so you can shop with the peace of mind that you’re insulated from rate hikes in the near future. If the rate drops, your lender should honour the new lower mortgage rate when you’re ready to make your purchase.

Be Prepared To Act Fast

If you’re hoping to buy a home in a seller’s market, you’ll need to take quick and decisive action when you find a property that interests you. For every home that you’re interested in, so are many other buyers. 

Make A Strong Offer

In a seller’s market, you may only get one chance – and it’s not always about the money. A real estate transaction can be complicated with a lot of moving parts. With all other things being equal between your offer and someone else’s, one that’s tailored to the seller’s needs (such as a short or long closing) can tip the scales in your favour. Aside from conceding to the seller’s wishes, an offer in a seller’s market should have as few conditions as possible. This is where you will really benefit from the experience and knowledge of your For Sale In Barrie agent. Every transaction is different and they will be able to guide you on what to include and what not to include based on the property that you’re interested in. 

A conditional offer means that certain terms must be met in order for the offer to be valid. Some common conditions include:

• Conditional on financing: This is a common condition for first-time homebuyers, which requires the mortgage lender to sign-off before the deal can go through. The buyer has a few days to get this, and the process will include a home appraisal. If the lender does not agree to finance the property, the buyer will notify the seller and the offer becomes null and void.
• Conditional on home inspection: A home is the biggest purchase most people make in their lifetime, so a satisfactory home inspection is generally recommended. This ensures the house is in good condition before the deal can go through. If it isn’t up to par, the buyer can return to the seller and request repairs, a reduction in the price, or can rescind the offer entirely.
• Conditional on the sale of a home: If a prospective homebuyer already owns a home, he or she may want to ensure that it is sold before agreeing to purchase a new property.

Offer conditions aren’t ideal for the seller, as each one has a potential domino effect. But buyer beware! You may be tempted to remove the “conditional on financing” or home inspection condition in an effort to beat the competition. For your own protection, we recommend keeping these as part of your offer but once again, your For Sale In Barrie agent will guide you through the process and react to each different situation.

Be Prepared To Pivot

After the last couple of years, you’re likely already accustomed to this as a key Pandemic survival strategy. And if you’re hoping to buy a home in a seller’s market, you’ll need to keep it up. As we all know, market conditions can change on a dime. Have a back-up plan in place, in case you need to delay the purchase – or need to jump on an opportunity sooner than expected!

Work With A Pro

Homebuyers always have the option to handle their transaction on their own, or to work with a professional real estate agent. Working with an experienced agent can ease much of the stress associated with finding and buying a home in a seller’s market. Not to mention, most of the time your agent’s commission will come from the seller’s end of the transaction thus not costing the buyer anything. Your For Sale In Barrie agent will help explain this to you when you meet. Just some advantages include:

• better access to homes in and out of the local market.
• knowledge of neighbourhoods and market conditions.
• negotiating skills (not usually a factor in a seller’s market, but good to have in your back pocket!)
• we handle the paperwork – enough said.
• guidance and support in the biggest buying decision of your life.

Have Thick Skin

Last but not least, don’t take rejection personally. Instead, learn from the experience and keep trying. Homebuyers who have been living in persistent seller’s markets know the pain of rejected offers and being “beat” by another buyer. Working with the right real estate agent helps buyers see new listings as soon as they hit the market, so you can jump on “the one” when you find it. At For Sale In Barrie, we’re with you every step of the way. 

“Where will I move to??”… Where do you WANT to move to? Let’s talk!

Liens often have negative connotations for homeowners. Yet if you’re reading this, you may be surprised to find out that you already have a lien on your home and that liens are not always as bad as they sound. We’ve compiledeverything you need to know.

Understanding How Liens Work

A property lien is a legal claim against a property, allowing the creditor to use it as collateral to collect what they’re owed if the debtor cannot make payments.

Consider this common scenario to better understand how liens work: taking out a loan to finance a purchase. To secure loan repayments for the duration of the contract, the lender will use one of your assets as collateral. In most cases, the chosen asset will be your home. However, if you fail to repay the loan through some unfortunate circumstances, the lender can file a property lien on your home. This gives them the legal right to force the sale of the property to recover the amount they’re being owed.

In Canada, the most common property liens result from falling back on mortgage payments. Yet homeowners can also be faced with a lien if, for example, they fail to pay taxes and even bills of contractors working on their property.

Types of Liens

Property liens can be split into two main categories: consensual (or voluntary) and non-consensual (involuntary). Let’s take a closer look at each one.

Consensual or Voluntary Liens

As the name suggests, a consensual lien is one that you consent to. In the simplest of terms, any time you take out a loan, you voluntarily agree to have a consensual lien. Taking out a mortgage loan is the most common example, but liens can also occur when taking out a line of credit. In the case of a mortgage, your home is used to secure your obligation to pay for the newly acquired asset. And as long as you stay on top of the payments, you will retain ownership of the property.

Involuntary or Non-consensual Liens

Involuntary liens are any liens attached to your property without your consent. They result from local laws being enforced and can be put on a home by a lender, a tax authority or a legal judgment.

• Mortgage lien: this lien may start as consensual, but if you default on your payments, the lender has the legal right to take possession of your home and sell it to recuperate losses. Out of all property lien types, this one is the most likely to result in foreclosure if you are more than 120 days overdue on payments.
• Tax lien: if you fall behind on paying your property taxes, the municipality may put a tax lien on your home. As with overdue mortgage payments, the taxing authority can sell the property through a foreclosure to settle the debt. In most cases, the municipality will issue a tax certificate giving you one year to pay in full prior to the lien being issued.
• Mechanic lien: this type of lien occurs if a mechanic or contractor is not paid for the work they performed on your property. In some cases, it can also occur if the contractor did not pay their supplier for the materials used for the work.
• Judgment lien: occurs when a creditor wins a lawsuit against a debtor, and they become entitled to the funds resulting from the sale of the debtor’s property to settle the debt. It can result from loan nonpayments, but also in case of accidents and injuries where insurance is not enough to cover the bills, for example.

Is It Bad to Have a Lien on Your House?

The short answer is: it depends. For example, consensual liens will be visible on your credit report, yet as long as you’re up to date with your payments, they do not damage your credit score. In fact, consensual liens can benefit your credit score, letting banks and lenders know that you are a trustworthy borrower.

Liens become problematic if they are the result of nonpayment. Keep in mind that your payment history makes up a significant part of your credit score, and late payments can deduct valuable points. In addition, tax, mechanic, and judgment liens will remain on your credit report for seven years, so it’s best to avoid them at all costs.

An involuntary lien can also make it difficult to sell your home. And, in a worst-case scenario, you can even risk losing your property altogether if it goes to a foreclosure auction.

Removing a Lien From Your House

The best way to remove a property lien is to pay off your underlying debt. Alternatively, you can also negotiate a partial payoff with the lien-holder.

Do you have a lien on your property and are considering moving? Talk to your For Sale On Georgian Bay agent to discuss your options. We’ll be with you every step of the way.