Prime Edmonton Real Estate - Our home renovation adventure really started to become real once we wrote the purchase contract and started negotiating the terms. Real estate investors, many of whom are smarter than I, maintain that you make your money on the buy, not the sell. What we did as part of the purchase helped to protect us against both market fluctuations and hidden surprises.
Now the property was a complete 'fixer upper' - and that was being kind. Built in 1947, this had been a one family owner home up until it went on the market - almost 70 years. There had been deaths in the family and it had been passed down, but we would essentially be the 2nd owners. It was an estate sale, which is a factor that can complicate purchases at times, should there be multiple beneficiaries who all want different things. It was a 3 bedroom 1 bath 1250 square foot bungalow with a completely finished basement that sat on a 66 foot wide lot in one of Edmonton's most desired neighborhoods. Sure, there were plenty of great Edmonton homes for sale, but this one caught our eye!
The home was priced decently for what it offered, but for it to make sense for us to purchase and renovate, we need to be able to have as little . With it being an estate sale, and because it was a single family who had owned it the whole time, we knew that they most likely wasn't any large mortgages encumbering the property that the seller would have to pay off, and that any proceeds would be money in their pocket. With these facts (and assumptions) at our disposal, we created an offer that was most convenient to them in every way possible, except the price.
Here are 3 things that helped us during the negotiation and purchase phase:
- We kept our emotions in check - Although home buying can be very exciting, we knew that the best chance we could give ourselves was to understand that it needed to be a sound business deal above anything. We negotiated fairly aggressively because we knew that the home needed to basically be completed gutted (more on that later). We had no problem with walking away if we didn't like the deal that was presented.
- We identified strengths & weaknesses of property - The reality is that there are some things that you can't renovate, like location, home style and lot size. Those strengths were what we really liked about the property. What we didn't like about the property were things we knew that were fixable, home design, layout, basement development, and landscaping.
- We were able to look at things long term - this is similar to what I mentioned in part 1 of the series regarding patience. We knew that the home would not be in an optimum state for many years, and that it would be a long, slow, process. Rather than a 'buy now, enjoy now' plan, we chose to have a 'buy now, invest long term, enjoy long term' plan which meant that things would have to be developed in stages. And we built that idea into our price - because there is a cost to it.
We were pleasantly surprised when we were informed that our aggressive offer was accepted by the home seller, subject to financing and home inspection. Next time we will talk about how our home inspection paid for itself many, many times over, but for now we were very content with the negotiating and purchase of our latest project!