BUYING A HOUSE IN 2021 – WHAT YOU SHOULD KNOW.

Let’s talk about buying a house!

As you guys might already know, Andrew and I bought a house just recently! What you may not know is that we have been looking for a house for over a year. That’s right…

This INSANE housing market had us looking at over 40+ houses, and bidding (and losing) 5 other houses before getting the one we have. Most people advised us to “wait until the market slows down a bit”. Not sure what that means, but it’s not the best advice. This market is FIERCE, and isn’t slowing down anytime soon.

The one thing we found in the year of looking at houses is that you need an amazing agent. We went through 4 agents (LOL) and only one understood our needs. Listen, I’m super picky, and I’m the kind of person that just won’t settle for anything less than what I want. I had a vision for our home and as much as we knew that no house will ever be perfect, there was a list we needed to tick off. Regardless of the number of houses we saw, we ended up finding the perfect home for us.

And that’s all thanks to one agent, Evelyn Lacerda. Evelyn really understood what we were looking for. She was fierce, just like this crazy market. We only knew her for a short time, but in that short time she was efficient, honest, and just a no bullshit kind of agent. Which I loved.

In fact, she was so good that I had to bring her on the blog to share some insight on the housing market. Lots of you had messaged me asking how we did it? How we bought a house in this market? What were some strategies we used? We’ll check out what Evelyn has to say.

Introduce yourself to The Chic Confidential Community – tell us about yourself. When did you get into the Real Estate world?

When I was 24 years old, I bought my first home and became a landlord.  Within a few years, I became an investor purchasing, renovating and renting out additional properties. 

In my early 30s, I got my real estate license for three reasons: 

1. I’ve been obsessed with real estate from as early as ten years of age; 

2. to further building my wealth through owning, improving and renting properties; 

3. my intense need to help and protect people.  

I am not a salesperson. I help people find a place where they love to live and build wealth while protecting them from potential issues. I help people maximize marketing their homes in the best light to attract the highest number of interested parties in the most timely and ethically profitable way possible. I am fiercely motivated to protect my clients, increase their wealth, and create a positive experience for them. 

My mindset comes from abundance, so I can focus on putting my clients’ best interests first and not be focused on how much money I make from each deal. I believe that is the key to my success. I’m fortunate to have amazing clients. Those clients have ranked me as the #1 Agent in all of Mississauga through Rate-My-Agent, and #17 in all of Canada.  

The housing market is crazy right now! What advice do you have for people who are looking to buy a house?

  1. The first step is to get prequalified for a mortgage, so you know your actual budget and can act quickly when you find a home you love. 
  2. The second step is to find a talented realtor. To locate a specialist in your city of preference, you can go to  https://www.rate-my-agent.com. That’s where you found me. Your realtor will make the difference between losing out on offers consistently OR putting you in a position to win without overpaying.

Let’s talk about bidding wars. How does one beat out the competition in today’s market when buying a house?

  1. Have your pre-approval in place so you can waive the financing condition.
  2. Be ready to see properties the same day they are listed. They might sell before the weekend.
  3. Be prepared to do a home inspection before the offer date or ask the listing agent if they have a pre-inspection. If you are in competition and have a home inspection condition, you won’t win, but you still need to do your due diligence to avoid buying someone else’s problem/money pit.
  4. Your realtor needs to create trust and likability with the listing agent and the Seller so they will want to work with your offer.
  5. Your realtor needs to think/act outside of the box to get your offer accepted. In your case, I ignored the offer date and submitted a strong offer with a shorter irrevocable prior to the offer date. There is more I do, but those secrets and competitive advantage are reserved for my clients.

What are some key things someone should look for when buying a house? How do we get passed the superficial stuff?

  1. Keep an eye out for DIY work, which could lead to a host of expensive issues.
  2. Look at the ceilings for discolouration or change of texture. There could be active water leaks/damage.
  3. Is the house immaculately well cared for or grungy & neglected? How well the home shows is often an indicator of how well it has been maintained.
  4. Location, Location, Location. Don’t front onto a school. Don’t back onto a hydro corridor. Avoid being able to see and hear trains. Look at the neighbours – are their homes well kept? Avoid backing/fronting onto busy streets. These are all things that could hurt your resale value when the market changes to a Buyer’s Market.
  5. Get a home inspection from a trusted professional. Preferably with insurance just in case anything is missed. I recommend Pillar to Post.

Is there a ball-park percentage that people should know when it comes to lawyer fees, land transfer tax, etc.? 

  • Lawyer’s fees for Buyers should range from approximately $1,400 to $1,700, and roughly $1,000 to $1,300 for a Seller. These costs should include disbursements and taxes. Make sure you ask for a quote that provides all disbursements and taxes so you get the total price. Often lawyers don’t give the full cost when quoting their services.
  • Here is the link to calculating the land transfer tax based on price and location. In Toronto, you will pay double the land transfer tax than outside of Toronto. https://lacerdarealestate.com/land-transfer-tax-calculator
  • If you are buying a home, the cost to work with a Realtor is usually free. The Seller is generally responsible for the commission of both the Listing Agent and the Buyer Agent. The Seller will typically pay 2.5% to the Buyer Agent. 

Listing Agents typically charge 2.5%, but it can range from 1% to more than 3%, depending on the experience/talent of the Listing Agent and what services you choose to include. 

It’s important to remember that the quality of your Listing Agent will have a significant impact on your profit. So, if you choose to ‘save’ money with a 1% agent, you are highly likely to ‘save’ on commission but lose on profit. The more talented agent could net you tens of thousands, and sometimes hundreds of thousand more than an inexperienced/part-time agent.

Is it important to have pre-approval before even looking at houses? 

Yes – Critical and Mandatory. I will not start working with a client until we have this in place. It is the very first step. How else will you know what you can afford to buy?

Let’s be transparent about Real Estate fees. Can you tell us how it works? 

That’s a great question because I don’t think the general public has any idea how expensive it is to be a Realtor. I mentioned above how much Seller’s usually pay in real estate commissions to agents. Here, I will outline what the real estate fees pay for. Our operating and marketing costs are incredibly high. After our expenses, we don’t make as much as people think. Fees differ between brokerages, and different Realtors spend different amounts on operating their businesses. I’m happy to share my costs for 2020 to give people an idea:

General Business Costs: including splits to my brokerage, internet, phone, accounting, mandatory organizations fees (CREA, OREA, RECO, TREB, REMAX)… = $38,514.28

Office Expenses: last year this included a new computer = $19,165.85

Marketing/Advertising: including website, software, CRMs, postage, printing, staging, photography, client gifts, graphic design = $21,184.40

Assistant Salary between 45,000 to 50,000 plus hst = $50,850 to $56,500

Auto Expenses = $15,176.86

My Total Business & Operating Cost for 2020 with an Assistant @ $45k= $144,891.39. 

Then there are taxes… 🙁

A lot of people are giving up on the market currently. What can you tell those who are feeling defeated by this market? 

The GTA market is already changing to a more balanced market. There are not as many offers per offer date, and some offer dates are not receiving any offers. 

This is a normal part of the real estate cycle. Typically just before the spring market and just before the height of the fall market, there is less inventory and higher buyer demand. I’m referring to the last few years in the GTA market. This doesn’t necessarily apply to activity outside of the GTA and all years. 

Low Inventory and higher buyer demand = multiple offers/Seller’s Market

Adequate Inventory for demand = Balanced Market

An Abundance of Inventory and Low demand = Buyer’s Market

It is still a Seller’s Market in the GTA, but the chaos has subsided. That being said, prices are not lower than they were earlier this year. My advice is to do what you did. Find a talented agent that will do what it takes to help their client win because waiting for the market to slow down doesn’t mean that prices will go down. It just means you won’t have to act as urgently. Waiting will often cost you more money. 

Are there any resources you want to share that can help people in the buying process?

I provide my clients with an Informed Buyer’s Guide and Informed Seller’s Guide, including moving checklists to help the moving process go more smoothly. It helps to walk them through the process and brings up information they might not know.

My clients have access to discounts for services and products like locksmiths, PODS, GOT JUNK etc. 

I also provide Plain English copies of all the forms we use so my clients can understand what they are signing. I am happy to share these with anyone interested. Feel free to email me at info@evelynlacerda.com.

Where can people find you? Drop your social handles below!

Email info@EvelynLacerda.com

https://www.instagram.com/lacerda_real_estate_team/

https://twitter.com/EvelynLacerda__

https://www.facebook.com/EvelynLacerdaRealtor

https://www.linkedin.com/in/evelynlacerda/


Thank you so much Evelyn for your insights on this housing market! When it comes to buying a house, she knows!

Are you in the market for a new house? Check her out, and let her know The Chic Confidential sent you 😉

What are your thoughts on this market? Share in the comments.

Xx, kim

+++ If you enjoyed this post, check out Money Saving Tips for Millennials.

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