Frequently Asked Questions
(first time buyers)

1) How much can I afford?

Before you begin shopping for your first condo or house, it is important that you contact a mortgage representative about getting a mortgage pre-approval. In the interim, use a ratio of 32% of your gross monthly income to allocate to mortgage payments. To get an idea of monthly borrowing costs, visit and type in "mortgage calculator".

2) What are "Agency Relationships"?

Basically, if you are selling your property with a real estate Salesperson, she/he and their real estate brokerage represent you and are obligated to work in your best interest. A "Listing Agreement" is signed by the Seller and the Sales Representative, creating an agency relationship; in this case it is called "Seller Representation".

Buyer agency establishes a relationship in which a brokerage and the Salesperson represent the Buyer in a real estate transaction. The Buyer and Sales Representative are required to sign a Buyer Representation Agreement.  The Realtor®, then has obligations to the Buyer client such as confidentiality, loyalty and working in their client's best interest. The Buyer is obligated to work exclusively with that Salesperson for a certain time period. This is referred to as "Buyer Representation".

The Canadian Real Estate Association requires Real Estate Representatives to explain agency relationships to customers and have them sign to acknowledge that they have read "Working with a REALTOR®" brochure. To read the "Working with a REALTOR®" brochure click here.

3) Do Buyers pay a service fee to their Sales Representative or her/his brokerage?

No, only Sellers pay REALTOR® fees.

4) Why do I need a Real Estate Sales Representative if I am looking to purchase, if I can just search properties for sale on the internet myself?

Two important reasons: First, the consumer website (, now ) is NOT the same as the real estate industry's internal website. The consumer website does not give important information that only licensed real estate professionals have access to. It is also not updated and kept current like the industry database, which means a great property could be listed for sale on the internal database and sold before it even appears on the consumer one. If you want to be the first to have access to available properties, then you must have a representative working for you.

Second, the Seller's Sales Representative is legally obligated to work in the Seller's best interest, not yours. When you have your own Sales Representative, they must work in your best interest, which includes getting you the best possible price. The Buyers service is also free.

5) If I am looking to purchase a new condominium or new house, should I get representation?

Absolutely.  The builders' sales staff works in the builders' best interest.  Using your own representative will protect your best interests and provide you with valuable information.  There are many extra costs and clauses you must be aware of when purchasing new.  This service is also free.

6) What are "closing costs"?

Closing costs are inherent in any real estate transaction and are comprised of two main expenses: Buyers pay land transfer taxes (government) and legal fees when they take possession of their property, while sellers pay REALTORŪ service fees and legal fees.

7) How much are land transfer taxes?

It depends on the location and price of the property. In Toronto, for example, a purchase price of $400,000 would be subject to pay $ 3725 (municipal land transfer tax) plus $4475 (provincial land transfer tax). For more information, visit for the "land transfer tax calculator".

8) Are there any rebates for land transfer taxes?

First time home buyers are eligible for 2 rebates: There is a first time home buyer provincial land transfer tax rebate of up to $2,000. There is also a first time buyer municipal (Toronto) land transfer tax rebate of up to $3,725.

9) What is the "Home Buyers' Plan"?

The federal government allows a tax-free withdrawal of up to $25,000 from your registered retirement savings plans (RRSPs) for the purpose of purchasing a qualifying first property. For more details, visit

10) How do I know when the best time to purchase is?

If you are thinking about buying a condo or house, I'm sure many lay people (as well as the media) have already offered you their two cents of advice. The truth is, we can discuss "the market" until we are painfully bored, but at the end of the day what is comes down to is that we all need a place to live. So we can rent and pay someone else's mortgage, or we can invest in property and begin our climb up the proverbial property ladder, while living in a place we love. If you can afford it, take advantage of the current range of choices in property, buyer incentives, and extremely low interest rates.

Simply put, the best time to buy is when it is the best time for you.

Andrea Davidson: Real Estate Sales Representative