1. Preparation of Funds
Since new immigrants in Canada may not have employment or may have been employed for less than one year, banks or lending institutions will typically only provide a mortgage covering 65% of the property price. If you bring 100,000 CAD for a down payment, you can generally only purchase a property worth around 290,000 CAD. While 290,000 CAD can purchase a decent 2-bedroom or 2+1 apartment, purchasing a townhouse or a detached house at this price point usually means the property will be in average condition or older. It is recommended to consult with a bank or mortgage broker to obtain a mortgage pre-approval before you begin your property search. This will provide a significant advantage during subsequent negotiations.
2. Property Selection
You may search for properties yourself via newspapers or online platforms. However, this is often inefficient, time-consuming, and does not necessarily save money. Furthermore, as you are new to the area, your understanding of Toronto may not be comprehensive. Therefore, it is recommended to engage a real estate agent who can select neighborhoods, school districts, and properties based on your specific circumstances. Generally, the properties they identify will be closer to your goals than those you find yourself. An agent can take you to view several different properties in one trip, saving you time and energy—both of which are very precious to those who have just arrived.
3. Price Negotiation and Contract Signing
This step requires the assistance of an agent even more. An agent can advise you on what price to offer, what kind of contract to prepare, how to utilize contract terms and conditions to secure greater benefits, how to protect your interests during negotiations, and how to provide strategic advice when you are unsure of what to do. Protecting your interests is the fundamental duty of an agent.
4. Mortgage Processing, Home Inspection, and Legal Representation
Many new homes in Ontario come with a 5-year builder's warranty, and Ontario also has a 7-year New Home Warranty Program. For those purchasing older homes, hiring a home inspector provides peace of mind; the cost typically ranges from 250 to 350 CAD. Additionally, take your signed contract to a lending institution to process your mortgage, and hire a lawyer to conduct a title search, handle the title transfer, review the condominium status certificate, and calculate applicable property taxes, maintenance fees, utility costs, etc. These legal fees generally range from 3,000 to 15,000 CAD. There are usually no other significant expenses.
5. Paying the Down Payment and Receiving Keys
The day before the closing date, go to the bank to obtain a bank draft for the down payment and deliver it to your lawyer. The next day, your lending institution will transfer the remaining balance to the seller. You will typically receive the keys from your lawyer before 6:00 PM. The process for a detached house is simpler; for condominiums, you should go to the management office to activate your access cards and garage remote controls, and complete the registration procedures.
6. After Moving In
If you discover any damage to appliances or other items, contact your agent and lawyer promptly to negotiate a resolution.