Condos are currently the fastest growing property type in Montreal, with average prices falling far below those of single family homes or townhouses. Many buyers prioritize the central location and convenience associated with condo ownership, trading in square footage for affordability and amenities. Here are some tips for buying a condo in Montreal this year:
Start with a pre-approval
A pre-approval strengthens your offer by proving to the sellers that you have already been qualified for a mortgage loan by a bank. In a competitive market, having a pre-approval could mean the difference between winning or losing a bidding war. Buyers putting in an offer without a pre-approval attached may need to go above the asking price in order to compete with other pre–approved offers. Avoid this easy mistake by requesting a pre-approval from your bank or from a mortgage broker.
Set up an alert
In a hot market, a good deal will sell fast. Make sure you stay up to date on new listings by signing up for a property alert. Property alerts automatically send you homes listed on the market by and real estate broker or agency in Montreal. You can filter by price, location, and other buying criteria.
Shop around for a mortgage
With interest rates rising, buyers are recommended to shop around for the best terms before signing on the dotted line. Don’t be fooled into thinking your mortgage must be provided by the bank your credit history or pre-approval is associated to. In reality, you can and should compare loan quotes across multiple lenders to find the best interest rates and terms. Alternatively, hire a mortgage broker to do the legwork when it comes to negotiating interest terms and finding you the best deal. Mortgage brokers are free to use as a buyer (they are paid by the bank, not the consumer). Over the course of a 25 year mortgage, a .1% decrease in your interest rate will save you $3,756 on a $300,000 home.
Back your offer up with a CMA
Before submitting an offer, request a Comparative Market Analysis (CMA) to determine fair market value. CMA’s are provided for free by most real estate brokers, and factor in recent sales in the building, street or neighbourhood. They also take into account market trends and the unique building characteristics.
Keep the rental market in mind
Chances are, the day will come when you will want to upsize to a single family home or townhouse. Most homeowners choose to sell their condos and leverage the equity to finance the purchase of their family home. However in some cases, it will make more sense to rent your condo out as a continued source of passive income. For this reason, it’s always a good idea to keep the rental market in mind when purchasing a condo, even if you plan on occupying the property yourself. Prioritize “rentable characteristics,” even if they don’t fall under your own buying criteria – for example, easy access to public transportation.
Look for deals
When the market’s hot, buyers will need to take extra steps to find a good deal. Try signing up for an investor’s mailing list which handpicks properties listed below market value – such as repossessions, fixer uppers and pre-construction offers.
Do your research on the builder
Not all condos are created equal, and shoddy work can plummet the resale value of your unit. Since condo owners collectively contribute towards the building’s maintenance, it makes sense to do your due diligence to ensure you’re making a smart investment. Look at reviews online, consult with your real estate broker, and, if possible, reach out to other owners in the building.
Work with a broker
An experienced broker will save you plenty of money and time, by steering you away from risky investments and negotiating on your behalf with the selling agent. In a hot market, their market knowledge will come in extra handy, as they will help you compete with other interested buyers. Buying with a broker is free (commissions are paid by the seller, not the buyer) so it makes sense to benefit from the professional guidance.
This article, 8 Tips For Buying A Montreal Condo In 2018, appeared first on Shupilov Real Estate.