Nineties TV buffs will probably remember Marge Simpson’s brief foray into real estate, which saw her offload Springfield’s “murder house” onto the Simpsons’ unsuspecting next-door neighbours, Ned and Maude Flanders. After closing, Marge was tormented by her ethical duty to tell the Flanderses about the home’s sketchy past, but was urged to keep quiet by her broker.

Sure, it’s a cartoon but, believe it or not, this is a situation that has grounds in reality. Recently, the Toronto Star and other city media outlets have been following the story of the so-called “murder house” at 934 Ossington Ave., which took nearly two years to sell. The challenge was finding a buyer who didn’t mind the house’s ghastly history. Eventually, though, someone bit.

News junkies are fascinated with stories like this—sensational cases make great reads—but most would never entertain a purchase like this themselves. Would you buy a house in which somebody was brutally murdered? What about an accidental death? A disputed legal history? What if your charming present-day duplex sits on the grounds of an old strip club?

A subsection of prospective buyers probably couldn’t care less, and their easygoing nature might result in them scoring their future home at a greatly discounted price. (A house somebody has been murdered in will sell for less than fair-market value, no doubt about it).

With just a cursory scan of its features—size, location, and a beautiful combination of old-world character and modern finishing touches—934 Ossington could easily merit a million-dollar price tag, but it sold for just $900,000. And that was after being listed four times, by three different agents, over a period of 16 months. I think we can all agree that in the Toronto market, in which the supply of freehold homes pales in comparison to the demand for them, no property should be that difficult to sell.

According to the Real Estate and Business Broker’s Act, realtors are required to disclose any “material facts” to potential buyers—that’s “a fact that would affect a reasonable person’s decision to acquire or dispose of the interest,” according to section 21 of the Real Estate Council of Ontario’s Code of Ethics. This stipulation leads to an ethical grey area of sorts: There have been instances wherein agents didn’t consider an on-site murder a material fact during bargaining. A couple in Bowmanville sued the agent and former owners of a house they purchased, along with the Re/Max branch that listed the property, when they found out that a man had murdered his mother and stepdaughter on those grounds in the late ’90s. For some bizarre reason, neither the former owners, the listing agent, nor the brokerage deemed this information relevant to the sale. And now, they’re in court.

Some pundits will caution “Buyer beware,” but I recommend, that you disclose, disclose, disclose. If you know about a material fact, whether that be a murder in the house or an oil tank buried in the front yard, fess up.  Otherwise, you could end up paying large down the line if you’re sued by the buyer.

The disclosure also doesn’t have to be broadcast far and wide. You’d be hard pressed to find an MLS listing that reads, “Previous owners brutally tortured here, but brand-new hardwood throughout,” but you might see, “Please speak to listing agent before submitting offer.” At that point, the listing agent might hit you with the property’s slightly unsavoury backstory, and ask the purchaser to sign an acknowledgement.

In some cases, the seller might fail to mention a murder because, well, they just don’t know about it. Last fall, I sold a former hospital built in the 1880s. I’m sure that, at some point, somebody died there, but neither myself nor the sellers—who owned the property for just 20 years—had specific knowledge of any deaths. I can also recall a house on Balliol Street where, about a decade ago, its owner was found suffocated to death. Two shrewd realtors eventually purchased the home, gutted it, held onto it for a while, then sold for a massive profit. Sometimes, the real-estate market has a short memory.

David Fleming is a Realtor with Bosley Real Estate in Toronto, and author of the best known real estate website in the city: www.torontorealtyblog.com. A constant thorn in the side of condominium developers, David’s sarcastic, opinionated, outlandish thoughts can be read daily, although for some people, that’s far too often.

28 Eversfield Rd. (pictured above)

Days on market: 31

The price: $467,500. Sold for $460,000

The draw: It’s a fully detached, two-storey house, with a generous master bedroom and a kitchen that’s big enough to eat in. The 125-foot-long lot has mature trees in front, while sliding doors in the family room lead out to a brick patio.

The catch: While painting a house before selling it is always a nice touch, the previous owners have gone a bit hard on the mellow yellow. The backyard definitely needs some attention from a green thumb.

164 Day Ave.

Days on market: 42

The price: $435,000. Last sold for $285,000 (2011)

The draw: This recently renovated two-bedroom bungalow has brand new guts—the wiring, windows, and furnace are all two years old or younger. It also has fresh hardwood floors, handsome wood trim, and a finished basement.

The catch: The rooms are all quite small—the master bedroom isn’t even 100 square feet, and the wee, 80-square-foot kitchen won’t be much of an upgrade for recent condo-dwellers.

54 Bowie Ave.

Days on market: 30

The price: $539,900. Last sold for $330,000 (2012)

The draw: You need more than a street called Bowie? Fine: A renovation has given this two-bedroom bungalow fresh floors, countertops, and windows, as well as a potential income unit in the basement. Plus, you can walk to the subway.

The catch: Again, teeny, tiny bedrooms. The hallway splitting the basement apartment from the main house would need to be more securely divided before renting it out. The front has nice curb appeal, but the backyard is a muddy mess.

333 McRoberts Ave.

Days on market: 10

The price: $369,900

The draw: A recent $50,000 price drop makes this aesthetically dated three-bedroom bungalow more affordable. There’s air conditioning, a two-car garage, and a potential income unit in the finished basement.

The catch: Frighteningly gaudy linoleum is just one reason the main kitchen needs a renovation, pronto, and one of the bedrooms is only 50 square feet. Smack dab in the middle of the neighbourhood, the house is a kilometre from both Eglinton and St. Clair.

Imagine trying to buy your dream home while blindfolded. Impossible, right? In reality, condo developers regularly manage to convince buyers to plunk down a deposit on something that isn’t built yet. I don’t sell pre-construction condos myself, and I haven’t for about six years. The pricing structure no longer makes sense, construction delays are almost guaranteed, and the occupancy periods—when you live in the condo, but the building is still under construction—are starting to average over a year.

So how do developers take these preformed lumps of coal and turn them into fully formed real-estate diamonds? Magic? Well, not quite. What really entices buyers is a developer-driven mix of real-estate smoke and mirrors: some pretty savvy marketing and pricing gimmicks, and little research on the part of the buyers.

As with any brand-new product, cool names alone are often enough to lure a host of uninformed, inexperienced homebuyers into the sales centre. “X2” on Charles Street sounds so bad-ass you might imagine running into Wolverine on your way to the rooftop pool. Provided the name is a punchy, one-syllable tag, like Fabrik, Ion, or Expo, and is accompanied by an appropriately flashy colour scheme—X2 was bright pink—a condo’s aesthetic can be a surprisingly effective first line of attack for developers.

Then there are the launch parties—a classic gimmick. Throw a shindig, ply potential homebuyers with alcohol and chicken skewers, and watch them commit to buying a $500,000 asset that can turn into a liability as soon as the ink is dry. VIP sales events are also a great opportunity for developers to get rid of the “dog units:” the ones next to the elevator, garbage chute, or with a picturesque view of a brick wall. Because of the engineered exclusivity, attendees are made to feel special, and, thus, might be more vulnerable to making a big purchase.

Of course, hors d’oeuvres alone aren’t enough to close the deal if the price is wrong. The idea of “friends and family pricing” is another commonly employed sales tactic. From my perspective, if something is too good to be true, it generally is. If the developer claims to have offered you the same rates he gave to his loved ones, he must be a rotten father and a terrible friend. Watch out for this, and try to crunch some marketwide numbers with the help of a trusted agent to get a realistic picture of what you should expect to pay.

After the marketing gimmicks have stifled any internal shouts of “buyer, beware!” and prices have caught customers’ attention, it’s time for the developers to create scarcity—or, at least, the idea of it. Have you ever had the experience of waiting outside a nightclub for 20 minutes only to go inside and find a half-empty room? In order to move product, corporations have to create the illusion of demand, and selling pre-construction condos is no different.

A fair number of developer projects are advertised as 30 per cent sold before they ever really sell a unit to the the public, and salespeople rarely re-adjust their “70 per cent sold after opening weekend” banners to reflect the 35 to 40 per cent of the units that are consistently back on the market following the 10-day “cooling off” period. Buyers want what they feel other people want as well, and a shrewd developer is apt to capitalize on those all-powerful social pressures.

Developers pay cooperating agents up to six per cent commission for a single sale, rather than the usual two-and-a-half, so it’s no wonder some realtors are still burying their clients in these towering messes. Provided buyers continue to conduct little to no research on the risks involved with pre-construction condos, developers will keep manipulating your consumer fantasies, build their projects (literally), and continue to make sales. The case of pre-construction condo buying is one particularly high-stakes situation wherein consumers may need protection from themselves.

David Fleming is a Realtor with Bosley Real Estate in Toronto, and author of the best known real estate website in the city: www.torontorealtyblog.com. A constant thorn in the side of condominium developers, David’s sarcastic, opinionated, outlandish thoughts can be read daily, although for some people, that’s far too often.

6.9%

Increase in average semi-detached property price in March 2013 compared to March 2012.

24

Average number of days a property spent on the market in Toronto in March.

13

Average number of days a property spent on the market in the east end neighbourhoods between Danforth and the lake, and Broadview and Victoria Park.

40

Number of bids on a fixer-upper on Armstrong Avenue in Wallace Emerson that sold for almost $200,000 over asking.

$607,334

Average price of a semi-detached home in the 416 area.

MIMICO: 152 Stanley Ave. (pictured above)

The price: $499,000

The draw: The huge 126-by-50-foot lot is dotted with stately, mature trees. Both bedrooms are sizeable, and there are three parking spots. The GO station, the lake, and the Humber River are all within walking distance.

The catch: Where to begin—the royal blue carpet? The ancient wallpaper? The never-been-fashionable light fixtures? It’s all got to go. There are only two bedrooms, but there’s lots of space to build out or up.

EAST YORK: 247 Linsmore Cr.

The price: $469,500

The draw: This detached house on a 138-foot-long lot has three bedrooms and a finished basement with a fireplace (caveat: it’s pink). It’s within walking distance of a number of schools, as well as the farmers’ market at East York Civic Centre.

The catch: The front and back yards are both bricked over, and if you dig up the front, you no longer have a parking spot. There is cutesy, floral wallpaper in almost every room (including the bathroom), and lots of old carpet to tear up, too.

KING WEST: 725 King St. W., unit 1204

The price: $299,000. Maintenance fees $505

The draw: About 600 square feet, this unit has a 108-square-foot bedroom and a wall of windows to let the sunshine in. It’s walkable to just about everything, and the complex has a host of amenities, including two pools.

The catch: A wood-burning fireplace is a silly curiosity in a condo—eliminating it to open up the living room would be a better use of space. The kitchen could use modernizing and some more light, and hardwood would be nicer than broadloom.

LESLIEVILLE: 14 Minto St.

The price: $475,900

The draw: This two-bedroom on a 24.5-by-110-foot lot is a location-based proposition. It’s walkable to the Beach, Queen Margherita Pizza, the Leslieville farmers’ market, and has great access to the Martin Goodman Trail.

The catch: This is a project for an ambitious renovator—inside, the house is a messy, post-hoarder nightmare, accented by loud wallpaper. If you’ve got money, the similarly rundown lot next door is also for sale.

Trust me when I say that the irony of a magazine columnist warning readers against the pitfalls of believing the media’s real-estate hype is not lost on me. The thing is, I’m also a full-time realtor and, from what I’ve seen, it’s growing increasingly difficult for the average newsreader to figure out what is—and isn’t—really going on in the housing market. Here are a few tips to help you cut through the fluff and get to the real deals.

Distinguish between “sales” and “prices.”

If you saw a headline that read, “The housing market is down 16 per cent,” you might take that to mean that prices are down, when it could be referring to sales. The average homeowner doesn’t care about the volume of sales—that’s the domain of realtors. What is relevant, however, is the going rate for his or her home, or one similar in style or neighbourhood. Often, a bigger figure makes for a better headline, but it’s important to know what the numbers actually mean, regardless of how dramatic they seem.

Perspective is everything.

One major Canadian daily recently published a column that asserted that the average price of Canadian homes was going to decrease in 2013. At the end of the piece, they revealed that the drop would amount to a meagre 0.2 per cent. If you think about it, that’s a pretty insignificant amount: The average house price in Canada is $362,600, which means a 0.2 per cent dip is equal to just over $726. Really? I spend more than that each year on gum.

Houses are not condos.

Forever linked, like peanut butter and jelly, houses and condos are often thought of interchangeably, but that doesn’t mean their prices move in tandem. I would encourage you to delve further, reader: Crunch housing numbers by location, age, and, most importantly, freehold versus condo, house versus high-rise, and so on. Statistics are often quoted in very broad terms, using catch-alls like “the market,” but not every property can be lumped into a neat little average.

Canada is not Toronto.

Real-estate articles are often bolstered by stats that apply to Canada as a whole, when, for the most part, you and I only care about what’s going on in our city. These seemingly straightforward facts and figures are way off base if you’re looking only at Toronto’s housing trends. Vancouver’s home prices are down 5.6 per cent since the peak—does that have any bearing on our lives? The price of the “average Canadian home” isn’t necessarily of major concern to us Torontonians.

It’s okay to be self-centred.

Whether you’re 24 years old and itching to get out of your mother’s basement, or 66 and looking to sell and downsize, what you read in the papers—good or bad—shouldn’t take precedence over what you decide is best for you and yours. Your financial advisor, mortgage broker, and successful entrepreneur uncle are all great real-life resources, but remember that you can’t change your plans every time you read conflicting market reports in the dailies on the way to work.

Nobody is Nostradamus.

Don’t place too much value on published “expert” predictions. Like stock market analysts who routinely revise their target prices for individual stocks based on market fluctuations, housing analysts typically change their outlook every four to six months. I don’t know about you, but my average customer doesn’t buy a new house at that rate, so projections that are constantly revised can be unnecessarily confusing, and can paralyze buyers and sellers. The currently hot Toronto market will change. But when? And by how much? Market bears—those with negative outlooks—have been predicting the slowing of the city’s market since I got into the business in 2003, but how do they explain the last decade of gains? It’s all guesswork.

In a world where misinformation overload is becoming the norm, homebuyers are not exempt. Everyone knows eye-catching headlines sell newspapers, and when each news outlet relies on housing “experts,” economists, and market analysts with varying perspectives, quite often, the bottom line gets lost. Remember: Whether the market goes up, down, or sideways, only you will have to live with (and in) your decision.

David Fleming is a Realtor with Bosley Real Estate in Toronto, and author of the best known real estate website in the city: www.torontorealtyblog.com. A constant thorn in the side of condominium developers, David’s sarcastic, opinionated, outlandish thoughts can be read daily, although for some people, that’s far too often.

It’s not abandoned—not quite. But for four years now, the building on the south side of Bloor, just west of Ossington, has looked it, held together by sun-bleached wood sheets and disintegrating blue tarp. In the last two years alone, it’s been investigated 11 times by the City of Toronto’s Municipal Licensing & Standards division, and found in violation of city bylaws eight times for offences from “loose garbage debris everywhere and broken fallen fence in backyard” to “Graffiti throughout north elevation of building on windows and door.”

“It’s been a big hassle for me,” admits Jong Kyu Huh.

Jong Kyu, who goes by John, bought the three-storey building with his wife, Kyung Soon Huh, in 1988 for $935,000, according to land-registry records obtained by The Grid. In 2008, he explains, they decided to renovate it. The plan wasn’t much, at first. A building permit issued in July of that year was for “Interior alterations to all levels to accomodate larger residentail [sic] component”; another in November detailed “underpinning, interior alterations, and addition to convert [the] building to 3 residential units with rental office at front and portion of basement and common storage room in basement used by all residents for laundry, mechanical and storage.”

Soon thereafter, though, Huh found out that he was allowed to do more than just move a few walls around inside—under the zoning bylaw, the building could be made a little bigger. He figured it was worth taking advantage of the opportunity. “You know, renovating the whole thing, that’s the time to maybe build more, right?”

It’s not to so simple to just build more, though. Huh’s change of plans required starting over with something called a site plan control application. As the City puts it in their development guide [PDF] (“development” being the key word, since that’s technically what Huh was now proposing), “site plan control” is:

“…a process that examines the design and technical aspects of a proposed development to ensure it is attractive and compatible with the surrounding area and contributes to the economic, social and environmental vitality of the City. Features such as building designs, site access and servicing, waste storage, parking, loading and landscaping are reviewed.”

It’s not a simple or short process, in other words. To make matters worse, Huh kept having trouble putting together what the City needed for his application. Around October 2009, he stopped work on the building altogether, and it took him months more, he says, to find a surveyor and an engineer willing to take on a project so small. It wasn’t until November 2012 that the application was finally approved, according to Bruce Hawkins, a spokesperson with the City’s Planning division. “This length of time isn’t terribly out of the ordinary,” Hawkins explains. “Sometimes there is some back and forth with the applicant on these applications, and the length of time it takes to process these applications depends in part on the time the applicant takes to respond to the City.”

What it all means is that the ungainly blue-and-brown giant might be mere months away from casting off its slap-dash coat. Huh’s applied for a new building permit that he’s waiting to hear back about, one that would keep the building three storeys tall, but stretch it back and carve out a total of eight apartments on the two top floors, leaving the first floor for a business to move into. What kind of business? He laughs. “I have no idea yet!” When will it be done? “I’m not so much in a hurry,” he says, though he’s hoping to get the outside done by this October, and the inside by the following June. “That’s what I’m thinking. All depends how it goes.”

GOT A MYSTERY THAT YOU WANT THE GRID TO SOLVE? Even if it’s not about something hiding behind a tarp, email it to ask@thegridto.com, and we’ll see what we can find.

RIVERSIDE: 68 Broadview Ave., Unit 418. (pictured above)

The price: $438,800. Last sold for $340,000 (2007)

The draw: Huge windows help brighten this 750-square-foot space. It’s a loft in a former Rexall warehouse, with 10-foot ceilings, concrete floors, and some exposed brick. Nearby Bonjour Brioche has been slinging buttery delights since before the neighbourhood was cool.

The catch: The patio is private but tiny and the south-facing view is often clogged with traffic (though, hey, great DVP access). A row of condemned houses on the northeast corner of Broadview and Eastern isn’t that pretty, either.

TRINITY-NIAGARA: 100 Strachan Ave., Unit 606.

The price: $382,500. Maintenance fees $280

The draw: This condo townhouse is walking distance to both Clafouti and Nadège, you lucky duck. It’s over 900 square feet, with reasonable maintenance fees. There are two decent-sized bedrooms and a private terrace with a gas-barbecue hookup.

The catch: Whoever decorated last was really into the bordello look: either the walls are painted a moody, slate grey, or they’re papered in hot-pink damask. That may be be why the seller dropped the price by $2,000 since putting it on the market a month ago.

OAKWOOD: 8 Cloverlawn Ave.

The price: $639,900. Last sold for $441,000 (2012)

The draw: A fresh renovation of this three-bedroom semi has touched on fashion (quartz kitchen countertops, bamboo flooring) and also function (the roof, wiring, and windows are all brand new). Plus, it’s a short walk to Pain Perdu.

The catch: Two parking spots cut into the yard space. The house just sold this past August, meaning the renovation was really fast—be sure to get a home inspector to tell you if the work was done properly, not just prettily.

ROSEDALE: 40 Glen Rd., Unit 314.

The price: $399,000. Maintenance fees $624

The draw: You get to live in Rosedale and eat croissants from Patachou every day. This renovated one-bedroom is 600 square feet, with all sorts of custom detailing, like a super-fly double shower with heated floors and four rain-shower heads.

The catch: Space-saving is great in theory, but sleeping on a Murphy bed every night is less than ideal. (However, hidden shelves in secret compartments are pretty cool.) The maintenance fees are rather high, and there’s no balcony.

The second you sign the lease on a rental apartment, several people you’re related to (probably the parents; maybe a meddling aunt) will fire off this question: Why pay some other clown’s mortgage when you can have a place of your very own? When you’re 20 and swimming in student debt, it’s a question easily ignored. But then you get older, land a real job, and sock away a bit of cash, and you start thinking that your meddling aunt might be onto something. So you lose a weekend clicking through MLS listings and discover that, last month, the average detached home in the 416 went for $749,000. Scary!

Uncurl yourself from the fetal position: You can still buy a house in this town for much less than that. To get one of those homes, though, you’re going to have to look hard, move fast, and let words like “five-year fixed-interest term” fall effortlessly from your lips. We can’t exactly help you there—but we (or, more accurately, our expert panel) can help ease 10 of the most common newbie concerns. Deep breaths, first-timer, and read on.

No. 1: Should I Even Buy a House?

Perhaps you’re tired of renting or roommates; that’s not a good enough reason to buy a house. Maybe you’ve already saved up a healthy down payment; that still doesn’t get you all the way there. Not to sound like your dad, but owning a home is a commitment—you’re going to have to fix stuff on the regular and have actual conversations about things like water heaters and tuck-pointing.* You’ll have to comparison shop for tree trimmers and compromise with your neighbours. Buying is expensive, and so is selling, so you’ll also need to really love your spot and be willing to stay put for a decent chunk of time (like, at least five years). Do not buy a home because you think it’s a good investment: It might not be. Buy a home because it’s where you want to live.

You’re still in? And you want Toronto, even though it’s way pricier than Pickering or Guelph? Okay, then—we’re here to guide you.

*Refilling the mortar between bricks as it wears down over time. Super boring!

No. 2: And a house, right? Not a condo

Starter condos come much cheaper than starter houses, and you can probably afford one much closer to downtown. Maintenance fees are a pain, it’s true, but they mean that, typically, if something breaks in a condo, you’re not the one who has to fix it. You’ll never have to shovel snow or teeter on a ladder to clean the outside of upstairs windows. Some people really like that.

So why buy a house? Many economist types think the condo market is riskier than the house market—such a ridiculous number of units have been built in the past decade that there’s far more out there to attract buyers—and a house is a safer place to put your life savings. A house also allows you to run the finances yourself, not pay attention to how a board does it, and it lets you have an enormous dog. Generally, a house is more work, and gives you way more autonomy.

No. 3: How much cash do I have to pony up?

The lowest allowable down payment in Canada is five per cent of a home’s total purchase price—so: $25,000 on a $500,000 home. Of course, if you can, put down more than that. “It makes your mortgage lower, your monthly payments lower, and the interest you pay lower,” says Alyssa Richard, CEO of RateHub.ca, whose thoroughly useful website offers a bunch of free financial tools for homebuyers.

To encourage banks and other lenders to work with higher-risk buyers, the Canada Mortgage and Housing Corporation (CMHC, an arm of the government) insures high-ratio mortgages. This is why down payments under 20 per cent end up costing more in the long run: First, the cost of that insurance gets folded into your total mortgage; then, the insurance’s PST is an upfront closing cost.

If you’ve been contributing to RRSPs, consider drawing some of your down payment from the RRSP-based Home Buyer’s Plan. First-time buyers are allowed to take out as much as $25,000 from their RSPs to finance a property, up to a year before (or 30 days after) a purchase. This is awesome, just don’t forget about it—it’s an interest-free loan to yourself, but you have to pay it back. Two years after you buy, the feds demand you start reimbursing your RSP at tax time, and you’ve got 15 years to get it all settled. “Budgeting to pay back your RRSP needs to factor in when you’re asking yourself, ‘Can I buy this house?’” says Richard.*

No. 4: And how do I get the rest of the money?

After saving up a down payment, it’s time to ask someone to lend you the rest. A mortgage pre-approval is when you bare your financial soul to a bank or other lender to learn how much money you can borrow, at what interest rate, and for how long. Remember, your monthly costs include not just the base mortgage, but insurance, property taxes, and utilities. If you’re stretched to the limit, a lost job or a rise in interest rates could mean losing your house.

Definitely get a pre-approval from your home bank, but please, don’t just accept whatever interest rate is posted on its website today. You’re far more loyal to your bank than it is to you, and promiscuous deal-hunters get way better rates—up to 9 basis points, or 0.09 per cent, says the Bank of Canada. That sounds small, until you look at the monetary difference over a mortgage term.

“What really bothers me about the banks is that they play a price-discounting game that’s all predicated on coming into the branch and talking,” says RateHub’s Richard. She’s a big fan of mortgage brokers, and her site posts the absolute lowest interest rates being reported by brokers across Canada, every day.

What a mortgage broker does is negotiate and shop around for you. Brokers are paid by the lender you ultimately choose, so using one is free. Lenders often give brokers a discount the more buyers they deliver. “It’s important that your broker has done a lot of volume,” says Richard, who notes that Canada Mortgage Professionals publishes an annual list of the 50 highest-volume brokers. Ensure that your broker has been in the business at least two years, and that he or she works regularly with a slate of lenders, not just the same two over and over again.

If you are going to secure the mortgage yourself, stay strong. “Even if you really want to stick with your bank, force yourself to drop into two others,” says Richard. Along with your bank-account statement and proof of income, bring a printout from RateHub to your pre-approval meeting, to show you know lower rates exist. Negotiating is a must.

No. 5: Where can I scrounge up a realtor?

Using a real-estate agent isn’t mandatory, but most buyers enjoy the expertise and quick access to listings they provide. Cost shouldn’t be a factor, since agents are (almost always) paid a percentage of the purchase price by the seller, and most are found by word of mouth. That’s a totally decent method, as long as you’re not working with your cousin’s friend who never leaves Mississauga when you want a nice little place in North York. Talk to two or three people, even if you end up going with your first choice.

“You want somebody who is willing to take the time to explain the process to you, especially if you’re a first-time buyer,” says John MacEwen, a sales representative with Sage Real Estate. Choose a full-time realtor with up-to-date observations on how homes within your budget and in your preferred neighbourhoods are selling right now—as in news from yesterday and last week, not last month or 2012. Your agent should return your calls and emails, send you listings every day (or more often), and drive you to showings, if you need it. They should never, ever pressure you to buy a house that you’re iffy about.

Once you choose an agent, you’ll sign a buyer representation agreement. It outlines the type of property you’re looking for, and in what part of the city. It also specifies how long you’ll work with that agent (probably three or four months) and conditions for breaking up if the relationship isn’t working out. You can’t just walk away from someone you don’t like—your ex-agent can try to get a percentage of the selling price from whatever place you do eventually buy. Messy.

No. 6: Where Should I Look?

“Sit down with your agent and do a needs-versus-wants analysis,” says MacEwen. “Think about what’s mandatory, and what would just be nice.” Consider how many bedrooms you require, and how far of a commute you’re willing to make. Think about the next five years of your life—if kids are a possibility, look at nearby schools.

One fun toy is the Neighbourhood Match tool on Realosophy.com. “I like to call that tool ‘eHarmony for neighbourhoods,’” says John Pasalis, president of Realosophy realty, a brokerage specializing in real-estate analytics. Users fill in a bunch of home basics, like price and number of bedrooms. They rate the importance of schools, walkability, and coffee shops, and choose between semis, detached homes, and townhouses.

That search produces a first tier of results, then allows for further sifting. Sure, you can still get something for $500,000 in Leslieville, but it’ll be a fixer-upper or on a busy street. Off the east part of Danforth, that same price could get you a bigger lot, more privacy, or more rooms. “The area’s not as cool, because commercially it’s not there yet,” says Pasalis. “But it’s right on the subway line, and a Red Rocket Coffee just opened.”

Chances are exceedingly good that your search will be guided by budget. “Most first-time buyers are going east and west,” says MacEwen. It would be nice if east and west meant Riverside or Parkdale, but think East York, Wallace Emerson, and Brockton Village. Also hot: the Junction, New Toronto, and Victoria Park Village, for those who can handle a longer commute. (Don’t forget, we’re talking a Monday morning stress commute, not a Saturday afternoon house-hunting and latte-grabbing commute).

No. 7: But How Do I Pick a House?

First impressions mean almost nothing during a house hunt—your goal is to move beyond aesthetics. Consider the possibilities in a dumpy place that hasn’t seen new paint since the ’80s, and don’t get sucked in by fresh flowers in a highly staged home. What you care about are a house’s bones: the foundation, the appliances, the wiring. Even if you know nothing about that stuff, you can keep your eye out for red flags.

“Research the basic terms of residential home construction,” says Mark Benerowski, owner of The Inspection Consultants Inc. “Then you’ll be more prepared to spot a home that’s been neglected.” Benerowski, an inspector for a decade, advises that you check out where the downspouts deposit rainwater. Depressions in the soil mean poor absorption and drainage, which could be a problem for your foundation. Look up at the roof’s shingles, too: The wider the spaces between them, the sooner the whole thing must be redone.

Judge whether a recent renovation was executed well. “Look in the corners of a floor, or where cabinets attach to a wall, where the fine finishing comes into play,” says sales representative John MacEwen, who has a background in engineering. “It can look pretty, but you need to gauge the workmanship and see if it was done by a professional or an amateur.” He advises carrying a checklist of musts (you need office space and two bathrooms, for example) and deal-breakers. (If a house has knob and tube wiring, your insurance provider will insist you replace it within two months, at a cost of about $15,000.) Refer to that list regularly, so the slate flooring in the bathroom won’t distract you from your needs.

There’s no time frame for how long a house hunt will take. Some people nail it on their first try; some spend months before they find a place. In a competitive market like Toronto, that also means there isn’t much time to mull over a decent house. Pasalis updates the new listings on Realsophy.com every hour (MLS.ca only does one public update a day), and he encourages his clients to check it as often as that. “A smart client is ready to rush out at lunch hour and make an offer before anyone else gets to see the house,” he says. “You have to avoid competing with five people. That’s the speed of the market.”

No. 8: I Found the House! Now How Do I Get It?

Once you’ve ducked out on your lunch break, found a decent house, and are ready to make that lightning-fast offer, your agent will compile a list of sales from the past six months of similar homes in the neighbourhood. Those will help you figure out a reasonable purchase price, which doesn’t have to be the same as the seller’s asking price.

Along with an actual price, your offer includes a promise to give the seller an immediate deposit: It’s usually about five per cent of the purchase price. You decide whether to impose any conditions, like a chance to walk through the house with a home inspector (seriously, do this), or to ensure that your lender will finance this particular property (you may think it’s worth a mil, but will they?). You’ll set a closing date, probably 30 to 90 days, at which point the house would actually become yours. You also need at least one more visit to the property, in the week before closing, to make sure there aren’t any surprises.

“I had one client who realized that the seller had painted around all of the furniture, leaving big blank spots on the wall,” says real-estate lawyer Shadi Nasseri.

First thing on offer day, you’ll be at your bank, getting a certified cheque for the deposit amount. (Have ID, and be thankful if the teller wants to verify it before releasing tens of thousands of dollars.) Meanwhile, your agent will notify the seller’s agent that you’ll be making an offer. Sometime in the afternoon or evening, you’ll all meet somewhere, maybe at the home or in the selling agent’s office. Your agent will take your offer to the seller’s agent (you get to wait in the car), who will discuss it with the seller. It might be accepted or rejected right away or, most likely, you’ll head into negotiations.

Price is crucial, but it’s not everything. Timing is important: Often, sellers have bought a new place already and are worried they’ll get stuck paying two mortgages at once. Getting a home inspection in three days instead of seven, or closing in one month instead of two, could be the difference in making the deal. If the seller accepts your offer, congratulations—you’ve bought yourself a house.

So you’ve entered a bidding war: The official name for a bidding war is a “multiple-offer scenario,” and what it means is that other people want the same house that you do. If a house seems priced below what it’s worth, or offers are only being accepted on a certain day, chances are the seller is hoping to force two or more buyers to compete.

“You can’t be a cowboy, overbidding on everything,” says John Pasalis, who expects bidding wars to be less insane in 2013 than last year, but still pretty insane.

He says first-time buyers often don’t realize that a pre-approval is just a figure based on your income; a full approval also factors in the value of the specific home you buy. When you make an offer for a certain address, the bank calls in a real-estate appraiser—and if he or she doesn’t think the house is worth what you’ve offered, the conditions of your original pre-approval don’t apply. You could be stuck with a higher interest rate or smaller loan, leaving you to scare up the shortfall.

One way to handle an expected bidding war is to get a solid approval for that particular property before you head in. You’ll know exactly how large a loan you can get, and you can waive the financing condition on your offer. It also helps to get a home inspection in advance—only fools bid on a house without one, even if the seller has left out a binder from her own inspector to flip through. Then you can drop that condition, too, and not worry about a house’s mysteries.

“Try to treat it like a business decision,” says John MacEwen. Don’t let the actual value of the house get obscured by stress, drama, or a need to win—which can become extra-tempting if you’ve already lost a couple of bidding wars. MacEwen recently advised a woman against increasing her initial offer price by $115,000 on a house he believed cost too much. “It was in horror-film condition, and a suicide occurred in the home,” he says. She went ahead anyway and beat out six other offers, but only after removing all her conditions. “There will likely be surprises when renovating,” says MacEwen. “If you get wrapped up in emotions, it could cost you a lot of money down the road.”

No. 9: What Do I Need From My Home Inspection?

Benerowski recommends finding someone who is registered with the Ontario Association of Home Inspectors, meaning they’ve done at least 200 inspections. The cost should be $500, give or take $50. Try to shop around before the offer stage, because, yeah, the actual buying moves pretty fast.

Home inspections are interactive: The inspector should walk you through everything he’s looking at, tell you what he’s thinking, and answer your questions patiently. “I can’t see a client getting their money’s worth in less than four hours; my full report will be 45 to 80 pages long,” Benerowski says. The goal of an inspection is to provide you with an assessment of the property’s condition. That means ballparking when—not if—you’ll need to pay for a new furnace or a new roof. The inspector will not tell you whether or not to buy the house; only you can decide how this information will affect your asking price, or how long to keep bidding in a war.

No. 10: How do I get the keys to that house in my hot little hand?

Your lawyer is the main player on closing day, so, again: Take referrals only from people you really trust, and do a quick phone interview before you choose one. Ask the lawyer how long she’s been working, how many transactions she’s handled, and whether she specializes in houses or condos.

“The lawyer brings everybody together,” says Shadi Nasseri. It’s her job is to make sure that everyone—you, the seller, both agents, your insurance provider, your lender, and the seller’s bank—has their business in order, then make it all legal.

You’ll hand your lawyer a bank draft for the full amount of your closing costs, as well as proof that you’ve purchased home insurance. She’ll already have determined that the seller has the right to actually sell the property, and that there are no debts against it that’ll become your problem. Next, you’ll sign the huge mortgage agreement and make idle chit-chat while you wait for your lender to approve your documents, then transfer the full price of the house into the seller’s account. The seller’s lawyer will release the deed to your home, and your lawyer will fill out a new deed for you.

After that—after all that—your lawyer will give you the keys to your house.

I HAVE TO PAY WHAT?

Too many innocent first-timers don’t realize just how pricey closing day will be. Here’s where that precious cash goes.

› Home insurance: Your lender will require it. Cost depends on the size and age of your house and how detailed your coverage is. You’ll have to pay the first month on closing day.

Lawyer: Nasseri charges between $850 and $2,000, depending on the size of the house and how complicated the deal is. You’ll have to reimburse your lawyer for searches and legal transactions (called disbursements), so be clear if those costs are included in, or on top of, any quote that you get.

› Title insurance: It’s not mandatory, but protects you from someone else saying they own your house (it happens). It’ll run you about $300.

› Adjustments: If the seller has pre-paid property taxes or utilities, you have to pay them back.

› Land Transfer Tax: Here in Toronto, we pay LTT to both the province and the city. First-time buyers can then apply for a rebate of all or some of their portion.

› PST on mortgage insurance: If your down payment is less than 20 per cent, Canada Mortgage and Housing Corporation insures your mortgage for the bank. The cost is added onto your monthly payment, but you must pay the sales tax now.

› Oh, and your down payment—minus the deposit you gave the seller when you made an offer.

We know, it hurts. We’re sorry. But hey: You’re a home owner now!

NEXT PAGE: Tough-love advice from our real-estate columnist (and realtor) David Fleming and other first-time home buyers; a glossary of need-to-know terminology; and tips for acquiring an income property to help pay down your mortgage.
CORRECTION, MARCH 14, 2013: The original version of this article—as it appeared here and in the March 14, 2013 print edition of The Grid—misidentified RRSPs as RSPs, and claimed the payback period begins after three years, when it is in fact two years.

Location: 878 Yonge St.

Formerly: Urbana Coffee, a small coffee shop chain using fair trade products, which had been at that location since 2008. Before that it was the sales centre for Lotus Condominiums (the building has since gone up at Yonge and Scollard) and prior to that it was a convenience store and magazine shop.

Vacant Since: Late February 2013.

Size: 1,720 sq. ft. spread across the main floor and the basement. There is about 900 sq. ft. of retail space. The corner building has about 40 feet of window exposure running along Scollard St.

Price: $7,300 semi-gross—meaning the tenant pays rent, plus chips in on fees for insurance, taxes, etc—per month, excluding utilities.

Length of Lease: Depends on the tenant.

Renovation potential: According to Kaive Wong, the property’s broker of record, the interior space is “fairly clean.” Former tenant Studio 99 renovated the space to include the glass rolling garage doors out to Scollard St and Lotus removed the drop ceiling to expose the ductwork. There’s also the possibility of putting patio space along the long frontage on Scollard overlooking Frank Stollery Parkett—something that would require a bit of work and a municipal permit.

Major draws: Twelve-foot ceilings, corner positioning overlooking a parkette, and a high traffic location, close to the brand new Four Seasons, in an area Wong refers to as “the gateway to Yorkville,” which will become increasingly busy from the influx of area residents that will appear with the completion of the nearby Florian and Milan condos.

What’s happening with it now? Only on the market for two weeks, the property has attracted interest from a variety of different potential tenants, among them, other coffee shops, restaurants, fashion retailers, art galleries, hair salons, and even professional offices. However, the landlords are being selective with who they let into the space next. Says Wong: “Something like this, in this area with this visibility probably won’t stay vacant for long.”