Making an Offer
You’ve found the perfect home, you have your deposit, and you’re ready to make an offer. There are a few things you can do to prepare:
Review the Real Property Report: A Real Property Report (RPR) is a legal document prepared by an Alberta Land Surveyor that shows property boundaries and improvements (structures) relative to boundaries. You want to ensure an RPR has evidence of municipal compliance, which confirms property improvements comply with municipal Bylaws and Regulations. If there is no RPR available, discuss your options with your real estate licensee and your lawyer.
Search the address: Search the address of the property or, in the case of a condominium, the name of the condominium building/complex. An internet search can uncover quite a bit.
Conduct a Historical listing search: A historical listing search will show you the listing history of the property.
Look into warranties and representations: Alberta has an online public registry of homes covered by a new home warranty.
Writing the Offer
Offer price: Your real estate licensee will provide you with information to help you make an informed decision on what to offer. That information will include looking at comparables (recent sales of similar properties in the same neighbourhood), and discussing your preferences. It’s your choice what to offer.
Deposits: A deposit can be a sign of how serious you are about the purchase. You need to have the deposit ready at the time of your offer.
Terms: A term is a detail in the purchase contract that the buyer and seller agree to. Terms include:
- Possession date: the date on which you will take possession of the property.
- Inclusions and exclusions: Inclusions are items you want included in your purchase, typically appliances, security systems, etc., and exclusions are items excluded from the purchase, for example if the sellers are taking the curtain rods or TV wall mount with them. Inclusions and exclusions can be negotiated between the parties.
Attached goods are items you cannot remove from the property without causing damage. Unattached goods are movable items. In the absence of specific inclusions or exclusions in the offer to purchase, attached goods are typically included in a sale while unattached goods are not.
- Time for acceptance/expiry of offer: You want to include an expiry date/time that:
- creates a sense of immediacy for the seller
- may encourage the seller to review your offer before others
- removes the need for you to formally withdraw the offer at some point in the future
- Pre-possession inspection: A pre-possession inspection term gives you the opportunity to view the property, with your real estate licensee, prior to possession. Such an inspection can help you confirm the property is in substantially the same condition as it was when you viewed it and made your offer.
Conditions: Buyers often place conditions in their Offers to Purchase to protect their interests. When you write a conditional Offer to Purchase, it means you want to buy the property but before making it a firm sale, you want the ability and time to review or confirm information. Some common conditions include home inspection, financing, and a review of condominium documents (if buying a condominium).
The conditions you may want to include will differ depending on the type of property, for example:
- if you’re buying a single-family home, you may want a home inspection
- if you’re buying a condominium, you may want condominium document review condition
- if you’re buying a country residential property, you may want satisfactory results of a water or soil test as a condition
All conditions need to have an expiry date. Make sure the expiry dates you include will provide you with enough time to satisfy the conditions. If you don’t waive your conditions in writing by their expiry date, the contract ends, and you and the seller have no further obligations to each other. If you are ready to waive your conditions, your licensee will provide you with the required waiver, and the purchase contract becomes final and binding.