When you purchase a home in Ontario, the onus is on you to discover everything there is to know about the house. The seller can’t knowingly hide something from you that would affect value, but that’s about it. That just means that they can’t use paint to cover up a mould infestation in the house. But, if they don’t paint the mould and leave it in the open for you to see, they don’t need to disclose it to you. If it is ‘discoverable,’ it is up to the buyer to ‘discover’ it.
So, as a buyer, you want to do as much due diligence as possible before you buy a home. Sometimes, you need to make decisions very quickly, and you’re signing an offer within thirty minutes of walking through the door. But, in a perfect world, you have a bit of time to reflect. Let’s assume that you have a few days to decide.
Here’s what you should be doing:
Home Inspection
You can review the seller’s home inspection (if they have provided one), or you can schedule your own before placing an offer. If you are reasonably sure that you won’t compete, you could also make an offer conditional upon doing a home inspection. However, unfortunately, most of your competitors will be bringing offers without conditions, and yours will end up at the bottom of the pile. You can find more information on home inspections here.
Online Research
Googling the street address to see what, if anything, pops up (you’d be surprised! Sometimes you will see stories of house fires or crimes)
Home Insurance
Call your home insurance company to get a quote for insurance on this kind of home. This is especially important if the home inspection identifies something that makes insurance more problematic, like knob and tube wiring or KITEC plumbing.
School District
If you have children, research the school district. You can even call the principal and ask them questions about the learning environment. This is especially important if your child will need extra accommodations.
Decision-Makers
Schedule a showing with your secondary decision-makers. If you value your dad’s handyman skills, or if you want your adult kids’ input in your new space, schedule a separate showing so that you can take them through the house. Only do this if you are the kind of person who wants that input. Some people feel the most comfortable making decisions independently, and that’s great.
Mortgage Broker
Call your mortgage broker: Send your broker the MLS listing and your estimated offer price. Have them run the numbers to make sure that you will qualify. This can be important because banks take property taxes into account when qualifying you. So, if the home that you are looking at has been recently reassessed and the taxes are higher than the average home, your qualification may change.
For more information on the role of a mortgage broker check out: What’s the Difference Between a Mortgage Broker and a Bank?
Neighbourhood Tour
Take a walk around the neighbourhood: Arguably, the pandemic and WFH culture has made the neighbourhood walk a key component of our mental health. So, take a stroll on your own to get a feel for the community. Do you feel at home here? If you are a woman living alone, try to return at night to get a gut check for the neighbourhood’s safety if you ever need to come home late.
Online Communities
If you are purchasing a condo, try to get on the condo’s Facebook page to get a tone for the building. There’s rarely a positive Facebook page for condos, but some will have more problems than others. Ask questions on the page. You can also call the property manager and ask them as many questions as you’d like
Status Certificate
Review the status certificate: Again, this is only necessary if you buy a condo. If it is available to you in advance, you should always have your lawyer review the status certificate for you. You’ll find more information on status certificates in this post.
Zoning
Review the zoning by-laws for the neighbourhood: You may want to do this if you plan to do a renovation that includes adding a lot of square footage to your home.
The best due diligence is the kind that you do yourself! Your real estate agent will be very good at advising you on what to do and who to ask questions to. But, you should never rely on your real estate agent to do all this on your behalf because we may not always know the exact kind of questions you would ask or precisely what matters to you in a house. Once you have satisfied yourself on the house, you will feel much more confident making an offer on offer night.
Good luck!
Robyn VanderVennen
The Kim Kehoe Team
