Making an Offer

When you’ve found a home that you’re interested in, it’s time to make an offer. As your buyer agent, we will draw up a contract with your offering price and necessary contingencies into a formal contract.

You will want to review this document carefully and make sure it states your terms exactly. If the offer is accepted by a seller, this contract will become a legally binding agreement.

In addition to an offer contract, you will need to provide an earnest deposit.

The deposit typically equals roughly 1-3% of the property purchase price. You will not be at risk of losing earnest money as long as you do not default on your contract. The amount will be credited towards the purchase price of the house at closing.

After you’ve made your offer, the seller will be able to:

• Accept your offer
• Reject your offer
• Counter your offer

In most cases, a seller will not accept your initial offer outright. Typical counter offers include modifications to:

• Purchase Price

• Closing date

• Possession date

• Inclusions

When you make an offer on a house, you should be prepared for the negotiations to go back and forth several times before both parties agree to the terms. You might also have to compete with other interested buyers in certain market conditions.

When an agreement is reached on all issues, and both the seller and the buyer have signed the offer, you are both under a legally binding contract.

As a buyer, you will be in a better negotiating position if:

• You have been pre-approved for a mortgage

• You are not selling a house at the same time

• You have not loaded your offer with other contingencies

No one can deny that during the summer, real estate is at its peak busiest time of the year. But these solid points on fall real estate might convince you that waiting for the end of summer may be more advantageous than you might have previously thought!

There is way less competition | Fall is often considered an off season for real estate, which is why the competitiveness drops. There are still homes for sale, new inventory and old inventory that may be more eager to sell after not selling during the hotter spring/summer market. This leaves you in a position with greater negotiating power. Many sellers are also motivated to sell before the holidays, so with a favourable possession date in mind, you can give whatever offer price you had in mind and be aggressive in negotiating. 

Sellers are more eager to sell | Some sellers who listed in the prime spring/summer market and didn’t sell, for any number of reasons but most likely because they could have been asking too much. After however many weeks or months that they’ve had no action on their home, when they do get an offer they’re more likely to make a deal and more willing to come down in price. 

Sellers are more serious | Not all homes on the market are summer leftovers. The timing may just be right when sellers list in the fall, because of a new job or for whatever reason. So sellers who list in the fall are generally more serious about selling and are more open to lower offers and negotiating. 

Tax break advantage | For any first time homebuyers, this ones for you! Property tax and mortgage interest are both deductions you can take for your whole years worth of income. Any payments that are made prior to the closing of the loan are tax-deductible. This can make a serious difference in the amount you owe the government at the end of the year.

You become a higher priority | Because the summer months are the busier seasons, real estate agents are busier during that time. This is also true for other service professionals like mortgage lenders and title companies. So in the fall when everyone is moving out of the sales swamp they can provide you with more attention and respond quicker in regards to a sale. 

Today we are going to answer the question, “How much cash do you really need to buy your first home?

So let’s dive right in. We’ll explain a bit about the number one thing you will need to save for in order to buy a home – a down payment.

So it’s fairly obvious that you need a down payment to purchase a home, but many people don’t know how much you need. That answer really depends on your lender and also if you want to avoid paying the Canada Mortgage and Housing Corporation (CMHC) mortgage default insurance. If you can come up with a 20% down payment then you can avoid paying that insurance. However, 20% down is a lot for most first time home buyers so most will typically lean towards 5% down. This means on a $200,000 mortgage your down payment would be $10,000.

Another cost to purchasing a home that most buyers do not factor in are the closing costs. Closing costs include everything from legal fees to title insurance to paying a home inspector. We believe that closing costs can amount to approximately 3% of the purchase price. So sticking with the example of a $200,000 mortgage, that would put your closing costs at around $6,000.

In summary, with a 5% down payment and approximately 3% for closing costs, a buyer looking to purchase a $200,000 home would be wise to save about $16,000. Of course, if you’re curious and want to learn more about this topic, any of our team members here at Realty Executives Gateway in Melfort, would be more than happy to give you their advice.

With winter not too far away, fall is a great time to get any repairs done and get your home ready for the cold months of winter ahead. We’ve got you covered, here's a checklist of some things you can do this fall to get everything ready for the ice and snow.

1. Take care of trees and shrubs | Prune properly to avoid falling limbs in storms, trim any dead trees or branches.

2. Rake leaves |  Everyone's least favorite job, but leaving fall leaves on your lawn over winter can inhibit spring growth. To make the job easier, choose a lightweight rake and wear gloves to protect your hands.

3. Clean Gutters and Downspouts | As soon as most of the leaves have fallen, clean the gutters and downspouts on your house, or hire some help. Clogged gutters during storms cause water to pool and can damage your roof or siding.

4. Make exterior repairs | Look for signs of damage to the roof, siding and foundation, if anything needs repair, schedule it before winter weather hits.

5. Add weatherstripping | Weatherstripping applied around the frames of windows and doors helps boost winter warmth and cut energy costs. Add door sweeps to the base of drafty doors to keep heat in and cold air out.

6. Shut off exterior faucets and store hoses | Protect your pipes from freezing temperatures by shutting off water to exterior faucets before the weather dips below freezing. Drain hoses and store them indoors.

7. Clean dryer vents | Lint buildup in dryer vents can make your dryer work less efficiently and even cause a fire — cool, dry fall weather increases static electricity, which can ignite lint that has built up, so now is a key time to get that lint out.

8. Deep-clean the kitchen | Take a day to tackle some of the more labor-intensive cleaning tasks, and keep your kitchen working efficiently and looking great:

- Degrease the range hood and filter

- Clean the oven

- Vacuum the refrigerator coils

- Scrub tile grout

- Clean light fixtures

- Wash the walls and backsplash

- Wash the garbage can and recycling bins

- Clean small appliances

9. Check safety devices

- Test smoke and carbon monoxide detectors

- Check the expiration date on your fire extinguisher 

- If you haven’t checked your home for radon, fall is a good time to do so — with windows shut, radon is more likely to become trapped in your home.

- Radon at high enough levels is extremely harmful, so if you find that your home has radon hire a contractor qualified to fix radon issues.

10. Clean and maintenance heating system | Making sure your furnace or boiler are cleaned, maintained and in working order before you need to turn on the heat is an important safety measure. 

Let's talk about a buyer’s market and why you should invest in Real Estate now! Realty Executives Gateway is a Real Estate Team here in Melfort, SK and area and Richelle Rogers and Eleah Sims are your local Real Estate Experts.

So, before we explain the 3 reasons you should invest in today’s market, let’s get into what a buyer’s market means: 

A buyer’s market is when there are more sellers looking to sell homes than there are buyers looking to buy them; simply put, it means that supply exceeds demand. This is definitely true in our market. There are currently 56 homes listed on the market in Melfort, with almost 1/3’s of those having been on the market for more than 90 days (17 to be exact).

The average days on market is a good indicator of whether or not a buyer’s market exists. At the end of July, 2020, the average days to sell was 136, up 61.9% from 84 days last year (and above the 5-year average of 102 days and above the 10-year average of 93 days).

So now that we’ve discussed a buyer’s market let’s dive into the 3 reasons why you should invest in this type of market.

1. Low Interest Rates - July 4th, the Bank of Canada lowered the interest rate to 0.25%, bringing borrowing costs to the lowest since June, 2018. It is the first time since March 2009 that the central bank has reduced rates by that much.

2. Real Estate Prices are Low - In the last 10 years, 2016 had the highest recorded average sale price of $216,000, which is 12.5% higher than the average sale price at the end of 2019. Prices are down, which makes now a great time for a first time home buyer to enter the market.

3. The Buyer has Negotiating Power - The fact that there are so many homes on the market and the average days to sell has increased means that buyers have the upper hand at the negotiating table. There’s a greater chance of getting an accepted offer below asking price.

So there you have it, if you or someone you know is interested in buying real estate, then there is no better time than now to do it!