When we bought our first home last month, many of you had asked me if I would share the story of how this home purchase came to be, and I promised you that I would.
Today, I am going to share part of the story. Come back tomorrow for part 2!
Step #1: Save enough money
Of course, the very first thing we had to do before we bought a home was save money. We were very specific about how much we needed to save. We didn’t want to get a mortgage with less than 20% down, because we didn’t want to pay the CMHC fee. So, a 20% down payment was our goal.
But that’s not all. We wanted to make sure we had all of our bases covered, so we also started saving for a home inspection, our lawyer’s fee, land transfer tax and all other closing costs. We also saved up money for furniture, since we knew we’d have to replace most of ours (it was very old and not in the best condition).
I’ll be sharing tips later this week on how we saved up so much money, in not much time (2 1/2 years).
Step #2: Determine ideal location
We did this one kind of backwards. We should have found our ideal location first, researched the prices of homes in that area and then started saving – but, we didn’t.
We already knew we wanted to move closer to Toronto (because that’s where my husband works), but we also knew that we would never be downtown because it was just way too expensive to buy a home there.
We started looking at MLS, Kijiji and Craigslist for homes in our target area (Markham). We went to a few open houses and left them all very disappointed (small homes, or not very nice neighborhoods). One night I came across an ad on Kijiji for a beautiful home in Scarborough that seemed perfect. Right on budget and had all the things we were looking for. We called the realtor and set up an appointment to view the home.
When we saw the home, we were sold. We wanted it right away, but told the realtor we wanted to sleep on it. When we got home, my husband did some research on the neighborhood and found out that it actually had a very high crime rate and that the schools in that area ranked poorly. Sadly, we had to walk away from that home.
We kept the realtor, though (Kirby Chan – he’s awesome!) and started looking at more homes – only now we started researching areas and schools before going to visit a home.
Step #3: Putting in our first bid
One day our realtor took us to look at 4 or 5 houses and the last house we looked at really got us excited. Again, we decided to sleep on it.
The next day, we still really loved the house and decided to put a bid on it, so our realtor set up the appointment. We met at the home and sat outside in our van while our realtor went into the house to present our bid to the homeowners.
He came out, dejected, and told us that they said no – and they didn’t even counter. Our bid was only $26,000 under the asking price, so I don’t see how we could have offended them with our bid, but I guess that’s what happened.
Since they didn’t give us a counter offer, we had to move on.
We decided to put a bid on a home that we saw with our realtor earlier (we really loved it, just not as much as the one we’d already bid on). Those homeowners came back with their final offer, which was just way too high for us, so we had to walk away from that home, as well.
At that point, we were mentally exhausted, so we took a break from house hunting.
And then there was that phone call…
After moping around for what seemed like forever, our realtor called us with some interesting news…
…to be continued