If you're looking buy a property for resale, there are important factors to take into consideration that ensure that you make a tidy profit in the process.
Aside from home buyers, investors are also eyeing Canada's real estate market. Canadian laws make it easy for anyone to buy properties, making it a good frontier for investment even if you're not a resident.
You've probably heard it a couple of times from real estate agents, but this bears repeating: location, location, location. To be more specific, you need to look for a property in a strategic area where there aren't too many new real estate developments. Even if the property is old or in need of some repairs, you can work on redevelopment for a more hefty profit.
Who will most likely buy the property from you several months or years down the road? Are you eyeing a three-bedroom house? A commercial property? A single bedroom flat? You need to keep in mind the needs and preferences of your target market. For example, a 3-bedroom home may have a higher resale value if it's near a school.
If you're going to buy a property for resale, you need to consider not just its purchase price, but also the cost of repairs and remodelling. This allows you to move within your budget and have a more realistic expectation of profit from your investment.
Aside from the inherent characteristics of the property, you need to be mindful of the nitty-gritty detail of the transaction. Typically, the transaction starts when you find a property you want to buy and you work with Realtor to prepare an Offer to Purchase. If the seller accepts, both parties will sign the offer.
The agreement is then sent to a lawyer who will check the conditions of the agreement, the closing dates and the financial penalty should any party cause a default. The lawyer will also check other legalities and prepare the Statement of Adjustment, which details the purchase price. Finally, when all legalities are accomplished, the seller is paid and the lawyer registers the property under the buyer's name.
The process of buying and selling a property in Canada involves other expenses, which includes legal, registrations, notary, appraisal and Realtor's fees, as well as taxes.
