Home for a first time buyer

[residnt]

Hello there,

My sister in law is looking for purchase her first home and I am trying to help her find a good deal. Now I do not know very much about real estate yet, but I am looking for advice. How can I determine what the property is actually worth. Right now I have calculated that she will be paying $257 psf which seems quite high for a 38 year old building but it is in port moody, BC.

I`m just looking for suggestions and what to ask the realtor when we get there to look at it.

Any advice would greatly be appreciated.

Thanks
Jason

 

[MikeMcCrae]

You need to see what the properties in the area are selling for. I am not sure that pricing a 38 year old house by the square foot is the best method of valuating a property. Have a look at what similar sized houses in the area have sold for recently, what is the lot like, proximity to schools etc. Condition as compared to other sold houses and what is the market doing there.

 

[Thomas Beyer]

QUOTE (residnt @ May 9 2008, 05:07 PM) Hello there,
My sister in law is looking for purchase her first home and I am trying to help her find a good deal. Now I do not know very much about real estate yet, but I am looking for advice. How can I determine what the property is actually worth. Right now I have calculated that she will be paying $257 psf which seems quite high for a 38 year old building but it is in port moody, BC.

I`m just looking for suggestions and what to ask the realtor when we get there to look at it.

Any advice would greatly be appreciated.

Thanks
Jason

Do some research !! do A LOT OF research .. likely this is the biggest investment EVER in your / her life .. hence TEN TIMES the research needs to go into it compared to: buying a car or going on vacation to Europe ! spend a few hundred $s driving around, reading, looking at comparables, hiring an appraiser to give you an appraisal on this house .. find what sells , what doesn`t sell, what is a bad area, what is an area of transition ...

Here is what I know about Port Moody .. but I am NOT an expert:

a ) it is in the Lower Mainland - and that area will receive 1,000,000 more people over the next 20 years
b ) it is relatively cheap compared to Burnaby or other surrounding areas
c ) land is tight in the Vancouver area .. and they are not making any more of it (unless they release the agricultural land reserve, which would make sense rather than growing blueberries on valuable land)
d ) it is on or close to a scenic river
e ) it has some very rough neighborhoods
f ) traffic is a nightmare

Some question: how big is the land ? even with a 0 sq ft house, there is value .. called land .. what do other homes in the immediate neighborhood sell for ?

Become an expert .. on both the area and the type of property .. then the answer to the question "Is this good value" will be very easy !

Also, feel free to read this here: How to Get Started

 

[RedlineBrett]

QUOTE (residnt @ May 9 2008, 05:07 PM) Hello there,

My sister in law is looking for purchase her first home and I am trying to help her find a good deal. Now I do not know very much about real estate yet, but I am looking for advice. How can I determine what the property is actually worth. Right now I have calculated that she will be paying $257 psf which seems quite high for a 38 year old building but it is in port moody, BC.

I`m just looking for suggestions and what to ask the realtor when we get there to look at it.

Any advice would greatly be appreciated.

Thanks
Jason

You will always pay more $/ft for a smaller property. There is a `cost of entry into ownership` being the land that subsidizes most $/ft values. So you might be paying 500/ft for a matchbox sized condo but only 100/ft for a 4000ft2 mcmansion on an acreage.

To make sure you are getting a good deal ask your agent to provide you with all of the MLS sales in the complex in the last 12 months. Get the pictures, unit sizes and everything and compare the approximate $/ft value of those units vs. the subject property you are evaluating and the time period relative to the overall market for the city.

If you are ok with the comparison at that point then you need to evaluate the sales in that building vs. the rest of the area. Are they in line? if the building is much older relative to other buildings in the area it should be priced a bit less but not a lot lower.

After that follow through with your due dilligence by evaluating the condo board and reserve fund etc.

good luck!