Tips for Buying Real Estate in Toronto and GTA

Dec 10, 2019

Buying real estate in the City of Toronto and the Greater Toronto Area (GTA) can be challenging given how tight the real estate market is in Toronto and the Greater Toronto Area. However, this guide with tips for buying real estate in Toronto and GTA should help to demystify the process of buying property in Toronto or the Greater Toronto Area (GTA).

Related article: Commercial Real Estate Outlook For 2020

Tips for buying real estate in Toronto and GTA

First, get pre-approved for a mortgage

Before you even start seriously looking at homes you should be getting pre-approved for a mortgage if you will need financing from a bank to buy your home. Getting pre-approved for a mortgage will help you figure out how much a lender will be lending to lend to you for a home. This would also be a perfect time to determine your budget.

When you are applying to be pre-approved for a mortgage, a potential lender will be looking at:

Your income
Your debts
Your income to debt ratio
Your credit history
They will be verifying your employment and your income
They will want to look at the source of your down payment.

Your pre-approval will need to be in writing and include a set interest rate that will usually be valid for 90 days. Getting pre-approved for a mortgage will help ensure that you will know how much money a lender will be willing to give you to buy a home. This information will help you to determine your target budget and you will be able to narrow down your search to homes that would be within your budget.

Additionally, getting pre-approved for a mortgage before you start house hunting will help eliminate some of the risk and uncertainty associated with having to apply for financing after finding your ideal home. This way, once you find your ideal home you will not be worrying as much about losing out on it if you have already secured a pre-approval for a mortgage.

Do Research on Potential Neighbourhoods

You will need to do your research on potential neighbourhoods and decide on which area or areas you would be interested in buying in. You will need to consider what is important to you in a neighbourhood and be clear on what you want to ensure that you will be buying in a neighbourhood that will be a good fit for you now and for the future.

Develop a Wish List for Your Next Home

Next, you need to sit down and make a wish list for what you really want in your next home. You will want to get really clear on what you want in your next home, i.e. the number of bedrooms, the number of bathrooms, specific features, amenities, location, etc.

And have yourself to prioritize and rank what matters most to you and your family to what matters least to you and your family. This way when the time comes for you to look at homes and make decisions about your next home you will know what you are looking for and can be extremely focused in your search.

Find a Great Real Estate Agent or Broker to Represent You as the Buyer

Now, once you are clear on what you want, your budget, and where you are looking to buy you will need to find a great real estate agent or broker to represent you as the buyer in this transaction. Your real estate agent or broker should be someone who you trust, feel comfortable working with and who has a lot of experience working in the neighbourhood(s) where you are looking to buy.

A great agent will not only be showing you homes and finding you homes to look at, but they will also be your main point of contact for this transaction. They will also be negotiating on your behalf, so it is essential that you like them and trust them. The more familiar they are with the neighbourhood(s) where you are looking to buy, the better prepared they will be to help you, advise you, negotiate on your behalf, etc.

Have Your Deposit Money Ready

Given how tight Toronto’s real estate market it is essential that you will be able to easily access the money that you will be used as a deposit when you are ready to make an offer. This means that when you find your ideal home, you will not be panicking at the last minute to get your money together, running the risk of missing the opportunity to purchase your dream home.

Submitting your offer with a deposit demonstrates to the seller(s) that you are serious about purchasing their home. Frequently, a deposit that is equal to 5% of the purchase price is typical for real estate transactions in Ontario. If the seller decides to accept your offer to buy their home, the money from your deposit would be required within 24 hours unless indicated otherwise.

Consider Your Future and What Your Needs Might Look Like

When you are looking at homes you should consider your present and what your future might look like in five or ten years. In other words, it’s common for buyers when looking at homes to only consider how large their family is presently not how it could grow in five to ten years.

Something to ask yourself is would change for your family force you to sell your home? Another thing to take into consideration is are you looking to buy in an area with good schools? Given how expensive Toronto’s property taxes are, making a lateral move could cost you a significant amount of what you might have gained from your initial investment. You should carefully consider anywhere where you might be looking to buy before making any important decisions about buying a home.

Buy Within Walking Distance to the Town Center (if possible)

The Greater Toronto Area (GTA) has been projected as becoming the fastest-growing region in Ontario. The population of the Greater Toronto Area is expected to increase by 49.6% to be approximately 10.2 million by 2046. With this population increase, properties with close proximity to existing or future subway lines will see the greatest increase in value. And these properties also tend to be closer to restaurants, shops, and schools.

As the population of the GTA increases, you can expect traffic in the GTA to become more challenging to navigate. Will it make a lot of sense to buy a home that is far out but that is larger than a smaller townhouse with lots of bedrooms and that has a lot of lands if you will be spending hours each day in your car going from place to place? This is something that you will have to ask yourself and consider.

Contact Athouse today for real estate concerns! We are more than willing to help you land that dream property of yours!