The Real Estate Council of Ontario (RECO) recently published 10 common home buying and selling mistakes that consumers tend to make. I'd hazzard a guess that most people don't know what RECO is (including some agents!!), even though they play an important role in the real estate industry. RECO is responsible for regulating the real estate profession in Ontario; administering the legislation that governs trading in real estate; and protecting the public interest when it comes to real estate. This list is based on feedback that RECO receives from the home buyiing and selling public. Being aware of these 10 considerations as well as always working with a Professional Realtor, will hopefully help make your buying or selling experience that much better!
Top 10 Home Buying and Sell Mistakes:
1. Allowing Emotions to Overtake Common Sense
When you fall in love with a property it can be hard to walk away. Know your budget and don’t overpay.
As part of this you shouldn't forego a home inspection just to win a bidding war. (Your willingness to walk away from a deal is an important negotiation tool that your agent needs to have when negotiating on your behalf).
2. Hiring the First Salesperson you Meet
Toronto has nearly 40,000 agents, with a broad range of experience and approaches to the buying and selling process (Many of these agents are either part-time or do very little business in a year. You need to take this into account when looking to work with a professional). Meet with a few different representatives before settling on one, and make sure you feel comfortable with them and their approach to the process. Also be sure to get references and contact them to learn about their experience with the salesperson.
3. Not Making your Expectations Clear with Your Real Estate Professional
It’s important that you and your representative have a mutual understanding about what you’re looking
for and what services the brokerage will be responsible for and what you expect your agent to provide. Once you've agreed to work with someone, get their committment in writing.
4. Failing to Read and Understand Forms and Contracts
It can be tempting to speed the process along by signing forms that you haven’t read. But taking the time to understand what you’re signing can avoid a lot of problems later on. For example, you don’t want to find out that you’re on the hook for a six month listing agreement to sell your home if you only want your house on the market for three months. Most importantly you should have your agent walk through any documents requiring your signature before you sign and be sure you get a copy of whatever you sign.
5. Assuming everything is included
Don’t assume that the furnace, dishwasher or other items are included with the property. The seller may want to take the dishwasher with them to their new home and the furnace might be under a rental contract that you’ll be required to take over. Before making an offer, detail all items, known as chattels, in writing. Your offer can also include a clause stating that the seller will pay out any outstanding leases on the home’s major systems.
6. Forgetting about what’s within the walls
Granite countertops and new hardwood floors are appealing, but the insulation, wiring and plumbing are just as important when you’re evaluating a property. Ask your real estate representative to look into the age of the home’s systems and if there have been any upgrades. If extensive renovations have been done, your real estate professional can determine if the appropriate permits were issued.
7. Forgetting about what’s outside the walls
When you buy a house you’re also buying a place in a community. Some places are lively, others are
quiet. Some places are filled with kids while others are not. Visit the neighbourhood at different times of
the day to see if it fits your lifestyle. Talk to the neighbours about the community and the locations of
various amenities like grocery stores, schools and transit.
8. Not doing your research
If you’re concerned about buying a home with a troubled past, a simple Internet search for the address
can go a long way. This is also something you can ask the neighbours about.
9. Making verbal agreements
Verbal agreements aren’t a problem, until they become a problem. Putting everything in writing forces both
parties to be clear about their expectations and provides a record that can prevent disputes later on.
10. Underestimating closing costs
From land transfer taxes to title insurance to a home inspection, the costs of a real estate transaction
can add up quickly. Take the time to include estimates and other expenses in the full cost of buying or
selling a property. Your agent should be able to give you an estimate of these costs based on the type of property you're looking to buy and/or sell.