Is home-buying or selling on your list of goals for 2022? Many people’s New Year’s Resolutions relate to finances, and rightly so. A home is the biggest investment most of us will make in our lifetime.
Here are five New Year’s Resolutions for homebuyers that you’ll definitely want to add to your goals for 2022
1. Down payment
It’s time to start saving. This is arguably the biggest, most difficult part of the home buying process. Think about it – in December 2021, the average home price in British Columbia rose to $994,000.00. To avoid taking out a high-ratio mortgage, you’ll need at least 20 per cent as a down payment, or about $198,800.00. How will you come up with the money? Some ways would be through RRSPs with the first-time Home Buyer’s plan, savings, or financial help from the Bank of Mom and Dad. Do not feel embarrassed asking your parents for help, it’s more common than you think now with escalating prices and higher required down-payments.
2. Credit Rating
Checking your credit score is very important, because your potential mortgage lender will be doing the same. A credit score is a number between 300 and 900 that rates your credit-worthiness. According to credit-rating company Equifax, a score of 690 or higher is considered “good.” Lenders will use this score in tandem with other factors, such as your debt-to-income ratio, to determine mortgage eligibility. If your credit score is low, this leads us to the next step.
3. Credit Clean-up
Remember that parking ticket you forgot to pay a couple of years ago? It can come back to haunt you. Unpaid parking tickets, late payments on a phone bill can negatively impact your credit. If you’re not happy with your credit score, take some time to bring it up to par before you start the pre-qualification process.
4. Pre-approval for a mortgage
It’s rumoured that interest rates will be rising in 2022, take advantage of this low interest-rate environment while you still can. Getting pre-approved for a mortgage will lock in your rate for up to 120 days. A mortgage pre-approval is not an obligation to purchase in this time fame, nor are you committed to that particular lender. It’s just a written confirmation of the approved amount and the promised rate, so you can shop with confidence within a budget you know you can afford. In order to get the final approved mortgage be prepared to pay off any credit debt, car debt, and student loans.
5. Start your Search
Online is a good place to start your search, but nothing beats first-hand experience. With budget in mind, bundle up and hit the streets to explore different neighbourhoods and the amenities you’ll have access to. Consider your day to day activities and what amenities you need close access to? What can you live with or live without? Do you prefer a brand new home or an older home with a bit more space and character? The more that you narrow down your criteria, the easier it will be to find what you are looking for.
Are you thinking of selling your home in the New Year? Have you got a plan? Regardless of the market remember first impressions are everything. Make it memorable. If you are looking for quick sale at the highest price commit to these five New Year’s resolutions:
1. Set Date
Marking your calendar with the date you would like to list your home will help with your plan and get you better prepared to sell your home. There is a lot of moving parts and coordination which is required when selling your home. You need a team of experts to help you with the process, think real estate agent, lender, lawyer, trades, movers… the list continues. Reach out to a selling agent early in the process to help you coordinate a plan and let you know what updates are required to make your home ready to list.
2. Update and Repair
When planning on selling your home you should create a list of anything that is required to be fixed and update where it can add value. If you have no idea where to start, speaking to your Real Estate agent can help. They know what will be important to potential buyers when viewing your home. Sometimes the list of things can be overwhelming, start with the most important and work your way down. Having a home inspection done before listing your home can catch defects a potential buyer may find on their own that could turn them away. This could possibly cause you to lose out on a good offer. Spending money to enhance your home before listing will always give you a better return and smoother sale.
3. Comparables
There is a variety of factors which may affect your home’s selling price, like interior finishings, layout and lot size, proximity to trains, busy roads, schools and parks; or demand for a certain area of town. Three to six months before your home hits the market have your agent provide a list of recently Sold properties in the area that are similar to your home. Your real estate agent will be able to provide you with the most relevant comparables, taking into account all the other factor’s listed above which will determine the correct price for your home. Pricing your home accurately to start is imperative to a successful sale of your home.
4. Remove Clutter
Make your home look like no one lives there. Clutter can suggest lack of space and lack of cleanliness. For best results treat it as if you are moving out, pack up your stuff, rent a storage locker and remove all unnecessary items. Removing all your small appliances from kitchen counters, cleaning up paperwork on office desks, decreasing the amount of décor items and plants throughout the home can help make the space look much larger. When buyers come through a property, they want to be able to visualize themselves living there. When there is too much clutter, it is harder for them to visualize their own items in the home. If this is too overwhelming, there are home organizing services available to help with this process.
5. Stage
Most of the time your own furniture and décor can be used for staging. Allowing your real estate agent or stager to move your furniture in order to make it work better for the space, can help create more appealing photos which will bring more buyers through the home. If your furniture does not work for the space, then it may be time to consider renting some new furniture or hiring a stager to set up the home with new furniture. This can all be coordinated through the listing agent.
Hiring the right real estate agent who has an eye for design and knows the market and type of buyer for your home is imperative to a successful sale.
Last but not least…work with the right real estate agent who has experience and knowledge of the local area and the type of home you plan to purchase or sell. They will make setting up viewings easy and will be ready on your side to negotiate the best price when it comes time to finally make or accept an offer.
