More Money Podcast - 124 What You Should Do Before Buying a Home - Penelope Graham, Managing Editor for Zoocasa

Episode Date: October 26, 2017

Thinking of jumping into the housing market? There's a lot to know and even more pressure to make a good decision (it is the biggest purchase of your life after all). I talk with Penelope Graham, Managing Editor of Zoocasa to find out what potential home buyers should know before buying their first place. Long description: If you have some questions about the home buying process, my guest Penelope Graham, Managing Editor for Zoocasa, has the answers! Penelope was actually one of the panelists for my Millennial Money Meetup #2 in May 2017, and the focus for that event was homeownership and renting vs. buying. She was one of the top voted panelists by attendees, so I knew I needed to bring her on the show to share her wisdom. Having bought my first place just a year ago, I still remember all the stress, research and more stress that went into finally signing on the dotted line. Toronto is a hot market, so I knew I needed to be prepared and not take this home buying process lightly. Now that that’s behind me, I want to make sure that other millennials who are thinking of buying are just as well informed and prepared for this very big purchase. And if you have any questions after this episode, contact Penelope and she’ll be happy to guide you on the right path! Tips If You’re Thinking of Buying Your First Place Remember that getting pre-approved for a mortgage is your first step. This will help you figure out how much mortgage you’ll be approved for, and how much you can afford and what your budget should me. Also, don’t borrow the maximum you are approved for, especially if only putting 5% down. You don’t want to be house poor after all! Interview potential realtors as if it was a job interview (because to them, it actually is!). Make sure you pick a realtor that’s the right fit for you, ask for their stats (how much homes sold/bought for clients), ask for references, and make sure they are a full-time realtor and completely invested in working with you. When given a buyer representation agreement from your realtor, negotiate a term for the contract that suits you best (ie. no longer than 3 months). This way, you can end the relationship if it’s not working and you won’t be tied to a lengthy contract. For full podcast show notes, visit: https://jessicamoorhouse.com/124  Learn more about your ad choices. Visit megaphone.fm/adchoices

Hello, hello, hello, and welcome to episode 124. I'm your host, Jessica Morehouse. Welcome back to the Mo Money Podcast. For this episode, I am interviewing someone who was actually part of my second millennial money meetup that I did in Toronto back in the spring of 2017. I had a panel of guests join me for that event to talk more about real estate and homeownership and renting versus buying and all this great stuff. And so one of my guests who I invited on the panel was Penelope Graham. She is the managing editor of Zucasa, which is a website that has real estate listings. She obviously runs a blog, so lots of information on tips and tricks and insights on real estate in Canada and lots of great stuff. So she really does have kind of her

finger on the pulse when it comes to real estate in Canada, which is why I wanted to have her on the show so we could talk more in depth about that because it's such a hot topic. Even I still absolutely love talking about housing and homeownership and renting and buying and all that great stuff. So we're going to get into all of that in this episode. But before I get to the show, first a few words about this episode's sponsor. Support for this episode comes from Credit Card Genius, the only tool that compares over 50 features of 150 Canadian credit cards using math-based ratings and rankings that respond to your needs instantly. Now you can get rewarded faster without all the headache. Visit creditcardgenius.ca to learn more. Once again, that's creditcardgenius.ca.

Thank you, Penelope, for joining me on the Mo Money Podcast. I'm excited for you to join me to talk about housing and real estate for this episode. Yes, thank you so much for having me. You're welcome. It was a blast having you with me as a panelist at my last Millennial Money Meetup back in May, and that was so much fun. And I got a lot of great feedback, especially for, you know, as you being a panelist, a lot of great feedback for you. So I think a lot of people really just appreciated just your advice and also the perspective of, you know, you're a homeowner and you know, a lot of stuff, but you're also a millennial. So you kind of know some of the ups and downs that we have to deal with being in this, you know, generally crazy market, depending on where you're living and also being, uh, you know, where we are having to deal with, you know, the recession back several years ago and, you know,

all this stuff. So we're excited to have you on the show. Um, so, but before we kind of jump in and I asked you like all of my real estate questions, I would love to, you know, learn a little bit about you and your story. Uh, how did you, uh, you know, learn a little bit about you and your story. How did you, you know, kind of get into this realm of, you know, writing about real estate specifically? So currently I am the managing editor for a realty company called Zucasa. So it's a little bit of an interesting realty business. So it's a full-service brokerage. We have a team of in-house agents, but it's also a tech company. So we're constantly creating new tools so people who come to the site can find prospective properties to purchase or properties to list. And we connect them with all these really interesting ways to sort through the market and

narrow down what they're looking for. And for me, that was very appealing because I have a background of working for various tech companies. It's also writing about personal finance and mortgages. So it's a really natural fit for me to come to here. And it's a really great and exciting company to work for. So I have a journalism background. And I started off in the industry, you know, as many young aspiring writers do, wanting to be a magazine writer or a beauty blogger. But then I kind of made the leap into personal finance, just sort of advantageously, and fell down the rabbit hole of, you know of learning about saving strategies and investing and how to get further in life by understanding how these work. And it's especially for millennials, such important things to know.

And something we don't necessarily learn about in school. And that led its way to real estate. And real estate is an extremely exciting thing to cover right now. I don't think there's a week that goes by where we don't have some crazy news happening. It's also a very emotional thing to cover. So as a writer, it's extremely interesting for me. And the fact that I can provide people with real advice that will help them get ahead is very appealing to me. And I think very important that we have clarity out there and

we have resources where, you know, especially for people breaking into really tough markets, like the Toronto real estate market, it's important to have solid advice and to know where to turn. Absolutely. And I feel like this is kind of the time where there is kind of the most information out there, which is, you know, thank goodness. It's so great because I feel like, you know, you know, 10, 20 years, if you wanted to become a homeowner or invest in real estate, you could pick up a few books from the library. You could talk to a realtor who's, you know, although they could be very helpful, they also have the perspective of they want to sell. So they are salespeople. So you have to be, you to be conscious of that. And so I feel like, yeah, now is kind of the best time to probably be the most informed buyer that you probably could be

because you can find so much, especially free information pretty easily. You just have to definitely set some time. I think that's one of my things that I learned before I kind of became a homeowner. When we're just thinking about it, I definitely said, let's not find a realtor and go shopping right away. Let's do some research to really know because we thought we knew. We thought it wasn't that complicated because so many of our friends our age bought and it didn't seem that complicated. But honestly, it took us a couple months to really kind of write down our wants and what area that we want to buy in, what kind of place we thought we could afford. And and, you know, what area that we want to buy in, what kind of place we thought we could afford. And, you know, I read a bunch of books and I

didn't realize how much research, you know, could go into, you know, making a really smart, informed decision, which you absolutely want to do because this will most likely be the most expensive thing I've ever bought. And I can certainly relate to that. So I purchased my own condo as first-time buyer two years ago. And at the time, I was writing mainly about mortgages. And I thought to myself, well, I know more than the average buyer probably knows going into this. It was still a very complex undertaking, overwhelming at times. I relied heavily on the real estate professionals that I was working with to guide me through the process. And it's so important for buyers to have people that they can trust. So having a fantastic agent

is really your guide to the market. Having one that really knows their salt. They can, first of all, find the listings that you need. And as a solo buyer, you might think you know what you want, and you might think you know what you can afford. But homes, especially deep-patched homes, can come with all sorts of little nuances that may or may not be a good fit for you. So they can help you navigate that. And then once you're actually in position to make an offer, they help guide you through that process. They help you negotiate. They can help you sort out what kind of conditions you need to put on that offer. And as a first-time buyer, it's extremely valuable to have somebody who's guiding you

through that way. Absolutely. And just to go back to what you said about searching for things online and doing your research that way, as millennials especially, those are the kinds of consumer behaviors that we become. Yeah, that is what we do. Yeah, that's, you know, those are the kinds of consumer behaviors that we become. Yeah, that is what we do. Yeah, that's what we do. The days of, you know, so-and-so saying, I have a great realtor, you should use them, are over. You know, we want to find out information for ourselves

and find the information online. So one of the mandates of Zucasa is to have that information readily available, including access to this in-house real estate team. So you can come to our site and you can say, I like the look of this house. I want to learn more about it. And you can request an agent and then they will connect with you. And all of a sudden they're working directly with you. And that's something that really appeals to me about this company because I would have really enjoyed that when I was a first-time buyer. I would have really appreciated that service. Absolutely. So yeah, going back to talking about finding a realtor that you can entrust, what are some of the ways if people

aren't necessarily doing the, oh, my friend referred me to this person and people still do that. That's definitely how I found two of my past realtors. However, you still want to make sure you're doing your due diligence. And what are some of the things that people should do before kind of being like, yeah, I'm going to go with this realtor. I know lots of people kind of talk about like, you need to kind of do it as if it's a job interview for them. Absolutely. You will probably be working very closely with this person, depending on the type of home you're after, maybe for months. So it's really important that you work well with them. So when you're selecting a realtor, it's important to know they're not all created equal. There's a

lot of really fantastic professionals out there. There's also some people who maybe do this part time. So they might sell or help broker a buying deal once or twice a year, and then they take their commission and that's that. So we always recommend finding a realtor who is full-time. They're 100% committed to the industry. This is what they do. They wake up, they look for listings, they look for something that's going to be a good fit for their client. If something comes up, they're in a position to let you know right away, hey, there's a listing. We need to go look at it. You need to take some time off during your lunch break. Let's make a move. So you need somebody who's got the commitment and the flexibility who is going to put you at the very front of the market and give you every

advantage. The other thing that you need to know is, are they a specialist in the neighborhood or the type of housing you're looking for? So some realtors, they specialize in condos, some specialize in detached. Some say, you know, I'm all about King West and I know every listing that's happening there. So find somebody who really has that specialized knowledge. And if you're working with a full-timer, you're more likely to come across somebody who just, they know the market back and front. You can go to them. If you read a scary article with some stats, for instance, they should be able to provide clarity for you around what those mean and what it means for you as a buyer. So another thing that you can do too is ask them for their stats. So much like, you know, a professional ball player or something. Say like, what is your batting average for the past year? How many homes have you helped sold? Or how many

buyers have you placed in homes? If you were helping somebody sell, did it go for over asking? Did it go for under asking? You know, what kind of negotiations did you help them with? And, you know, if they say, oh, I helped one person by last year, that can be a bit of a red flag. That's not good. Yeah. Maybe I should find somebody who has a little bit more experience. And just make sure that they seem to know their stuff and that you have a personal connection with them as well. It's really important that you feel that you can trust them and that they seem knowledgeable and you can

follow the advice they give you. What would be your advice if, say, you chose a realtor that you thought, oh yeah, I think this would be a good fit. And as you maybe go see a couple houses with them, you're kind of like, ah, maybe it's not. Go on a couple dates. You're like, this isn't actually what I signed up for. What would be, you know, I think a lot of people feel like they're obligated to stick with the realtor because they, I don't know, they don't want to make this person feel bad. They don't want to break up with them. But at the end of the day, you want to make the best decision for you. What would be your advice for if you want to break up with your realtor?

Okay. Well, from a technical aspect, if you're working with a realtor, they've likely made you sign a buyer's agreement. And that means that they have the right to represent you and only you, you would still be on the hook for their commission, essentially. So that's what that means. However, if your finance is really not working out, you can go to what's called the broker of record. So that'll be whoever is running things at the brokerage that your realtor works for. If you have a true complaint, you can take it to them first.

They'll likely try to remedy the situation. In an extreme case, they might place you with another agent at that brokerage because you will be under contract to work with that brokerage for whatever the set term is in the agreement. So that might be three months, six months, whatever. And when that expires, you can hire another realtor as you choose. But as a first step, it's important to talk to them to make sure that your expectations are on the same page and just say, you know, I'm finding that the properties that you're showing me haven't really

been in line with what my expectations are. Is there something wrong with my financial expectations? Do I need to adjust what we need to be looking at? And just, you know, clear communication is important. But you do have some recourse if things are absolutely not working out. So one thing that I realized, you know, dealing with a couple of realtors was with the buyer agreement. Sometimes they don't necessarily make you sign it up front, which I think is also good. So you could say, you know what, let's wait until maybe we've worked together and like seen at least one house together.

I can kind of get the vibe from you. And also, I also had the experience of where you can negotiate the time frame within that agreement. So if it says, you know, a long period of time, you're like, how about we do like one month or three months instead of six? That makes me more comfortable. Most of the time, they're, you know, totally fine with that. So just keep that in the back of your mind. Absolutely. That's an excellent point. So you do have negotiation power. You have negotiation power at every stage of your home search. So it is important to look at that agreement before you sign it. Like you said, make sure you're comfortable with the timeframe. You know,

you don't necessarily want to be locked in with this one profession for a year. Three months might be a more reasonable timeframe. And it is okay to say, you know, let's go kind of do a test viewing. Why don't we make sure we're on the same page? But a good realtor will really go to bat for you. So you want to make sure that they're guaranteed the commission fairly early on in the process. You don't want to lead too many of them on,

but you absolutely do need to do your due diligence to make sure that it's going to be a separate. Yeah. It's got to be a good balance and a good partnership for you and for them. Absolutely. Absolutely. So don't feel pressured to sign it on the first, you know, sitting down. Exactly. You've got to feel comfortable signing any type of contract. So don't feel pressured. Now we kind of talked a little bit about how Toronto is a really hot market. Vancouver is also a hot market. There's a lot of different hot markets going on. And as you said, it seems like every single week there's a new change in the markets. How can someone like right now thinking of, oh, one day I'd like to own a home maybe in a few

years or maybe next year. I mean, what are some of the things that they should really consider? Especially, I know the Bank of Canada raised their interest rates. So interest rates are going up as we all kind of expected. You know, is this still a good time to buy? I think a lot of people are confused as to what they should do. Absolutely. And you know, it is a scary time to be a buyer in, let's say, the Toronto market. Understandably, there's a lot of change happening this year, both on the mortgage front, as you say, the Toronto market, understandably, there's a lot of change happening this year, both on the mortgage front, as you mentioned, with interest rates rising, as well as the Ontario Fair Housing Plan, which has changed some of the dynamics with

supply and demand. So the advice I always give from a general perspective is people get really caught up in trying to time the market. Like it's a stock market. They're like, Oh, I need to make a fit on my, my home purchase.

I can't end up behind. Well, a home purchase is most often a longterm investment. You have to approach it that way. So if you're going to be buying a house, you know, where are you five years from now? Are you still in that house?

Look at the market trends in terms of, you know, what, how they performed longterm five years from now? Are you still in that house? Look at the market trends in terms of, you know, what, how they performed long-term. Five years ago, if you bought a home, you have come out, you know, so on top, you've seen fantastic appreciation in your home. If you purchased a home in April, you know, a detached house, let's say, and you've seen some significant loss in, you know, the softening that we've seen since then, that can be really scary as well. But you have to keep in mind, it's a paper loss. And if you're staying in that home for the next five years, 10 years, probably going to see it even out, you know. But it is a very overwhelming time to break into the

market, which is why it's all the more important to have a professional that you can really trust, who can guide you and say, you know, this type of house or this particular house is always going to have good resale value in this particular neighborhood. You know, all real estate is local. So in terms of if you're going to maintain that value is really dependent on the area that you're buying, house type that you're going to maintain that value is really dependent on the area that you're buying house type that you're buying. But we always say, you know, kind of buy for your needs. Don't get too hung up on whether or not it's a great investment.

But having said that, there are some things that people need to be taking into account right now. So the condo market continues to be really popular because affordability is still really steep in Toronto. A lot of people still can't afford a detached house, even though prices have come down, they're still over a million dollars at an average. So that even though we've seen some letting up there, it's still not super viable for a lot of buyers. So we're seeing the condo market continue to appreciate. Condos are a fantastic investment right now, especially if it's a great layout, if there's something a little bit premium about that condo, it's likely that that's going to have fantastic

resale value. In terms of detached houses, there is an opportunity right now. There's a lot of highly motivated sellers on the market. We've seen a lot of sellers yank their listings. They're like, oh my gosh, this isn't a great time for me to sell. I'm not going to get as much as I was going to get a few months ago. So the people who are still on the market probably have a really important reason as to why they need to continue to sell. So if you're really determined to get into the detached market, you want to do it within the city, have your agent look around for these highly motivated sellers and see what kind of negotiation power you might have there. Another thing that we're seeing that's really interesting is the reemergence of conditions.

So even three, four months ago, if you were trying to buy a house and there was a lot of competition for it you would absolutely not have a condition for a home inspection or um you know upon financing because it would you would just be out of the running um but now we're seeing buyers are asking for these conditions again and it's so important, especially in a market where prices fluctuate rapidly, that you have a financing condition because appraisers might not agree on the value of the house. This can go both ways in a rapidly escalating or de-escalating market. You might find that both sides don't align and you might not get the mortgage you thought you were going to get. So that's a really nice thing to see again is that buyers are having some more

built in protections and they should absolutely ask for them, especially if you're dealing with a highly motivated seller, make sure you've got those protections in place. Absolutely. Yeah. When we bought our place is about one year ago today. Yeah. We,

we did not put any conditions on which like I was like, as you know, me being like, Oh, I know you're supposed to,, yeah, we did not put any conditions on, which I was like, as me being like, oh, I know you're supposed to. But yeah, how the market was, you just would not win and kind of battle if there's another offer on the table, which there was. And the only reason we got this place was because we didn't have any conditions, even though the other potential buyer apparently offered more money, which I thought was quite interesting. But now, yeah, it is interesting to see. So I was actually just talking to my old realtor about what's going on in the market. I thought it was really interesting. Yeah. He said, yeah, conditions are being kind of put in place again, which is kind of a good sign for buyers, which is kind of why lots of people

are saying this is a buyer's market now, not a seller's. But I thought another interesting thing that he mentioned was, although the media is saying, oh, it's a buyer's market now, prices haven't necessarily dipped like people may expect. And we're even looking, we got a list of some of the places that sold recently in our complex and we can see what their asking price was and what their final selling price was. And it's still over asking. So I'm like, oh, okay. As I said, it's very local. So you're going to have pockets where sellers are really having a hard time and there might be a lot of inventory to choose from. And it's a very different scenario than a few months ago. But markets that are still very desirable neighborhoods that are still very

desirable. We're still seeing them go quickly, especially premium units, you know, like really nice condo units with great layouts, et cetera, that the premium inventory is still selling quickly. And it's still either selling for asking or slightly over going back to what

you said, you know, the media reporting on this buyer's market. So that's probably giving people the impression that it's now extremely affordable to buy, but that's simply not the case. What they're reporting on is actually a technical ratio. So like the inventory to sales ratio, and this is a metric that's used by analysts to determine what the balance is in the market between supply and demand. So because we saw so much inventory come onto the market immediately following the housing plan rules, that really skewed it. So all of a sudden, we saw the ratio plunge below 40%, which is considered technically a buyer's market.

So that's why the media is saying it's a buyer's market in Toronto. But that doesn't mean you're going to go out there and lowball a house seller and walk away successfully. So it still takes a lot of very finely honed strategy as a buyer. Work very closely with your agent to ensure that you're in the most advantageous spot to put forward a successful offer. Absolutely. So I'd like to pick your brain a little bit about mortgages because you said you know a lot about them. And I think that is kind of sometimes the thing that people kind of get really excited about the idea of going house hunting. They

probably watch way too much HGTV like I used to. I used to watch every single show. And so I kind of thought that was the main part of house hunting. I didn't realize that actually probably the most important part is the mortgage part. Not super sexy or exciting, but super important about getting the right mortgage, the right terms, right interest rate. So what are some key things that people should know about getting a mortgage? So mortgages are actually the first step of your home search. You should not go and look at any housing inventory with first knowing where your finances are at and how much you're going to qualify for. So the first thing that you need to do, let's go way, way back. Let's say, I'm going to start saving for a home. So work with a financial advisor. I found that that was

really effective in my case. We had automatic payments going into a savings account that we couldn't see or touch and it put a tangible timeline around. When am I going to have my down payment together? How big will my down payment potentially be? So then once you know, okay, let's say in three years time, I'm going to have enough for 5% down on, let's say 500K. Then you can go to a broker or a lender of your choice and get a pre-approval. So knowing that you're going to have this cash down, they're going to take that into account.

They're going to take into account whatever the interest rates are at the time, how desirable you are as a borrower. So your credit score, your employment at the time, your existing debts, and your history paying off those debts. And they're going to determine kind of a map ceiling of what you can borrow. So having this knowledge in hand, you can then go and actually look at homes with fairly solid knowledge that, okay, I'm going to be able to get a mortgage for this house. I can realistically afford it. However, a pre-approval is not the same as a mortgage qualification. And I think a lot of people get them confused. So you've got

your pre-qualification. And then when you actually go to make a move on that house, you have to go through the mortgage approval process. And they're going to take into account all of those things all over again, and then officially qualify you. And that's going to be part of your closing. So it's really important to go through that due diligence. If you're out shopping and you don't have a pre-approval, oftentimes when it comes for you to put in an offer, you're already out of the game. You're up against borrowers or potential buyers who already have a pre-approval. they can make their offers with certainty. So it's really the egg that comes before the chicken in this instance. You can't start your home search without one. As well, we're, as you mentioned, in a rising interest rate environment, and we haven't been in one in some time. It's been seven years since interest rates really rose.

Interest rates in general, both fixed mortgage products and variable mortgage products have been at record lows for really the past decade and getting lower and lower every year. And that, I think, has created an expectation for people that carrying costs are always going to be really, really low. And now we're seeing that's not necessarily the case. They're still at very, very low levels. And we're not going to see any dramatic jumps in affordability,

although we might be in for a couple more rate hikes. But that's not to say your mortgage costs will go up 5% in a year. It might go up 1%. So it's important to build in a buffer and make sure that you've got about a 2% mortgage buffer there. If that renewal time rates are that much higher, you can still carry your mortgage. You're not going to be underwater on your mortgage. And it's important to work closely with your lender when you're hashing out what your financing is going to be. It can be really

tempting to borrow at your max, especially if it makes or break the home that you can purchase. But it really does put you in a vulnerable position, especially if you're only putting 5% down. So in any kind of borrowing environment, but especially in a rising one, make sure that you're building in that buffer. Absolutely, absolutely.

Yeah, no, that's definitely one thing that we were really conscious of when we were pre-approved for our mortgage and they said, oh, this is your kind of max amount that you can get. We were shocked. We're like, there's no way we could actually afford the amount that you're giving us. So I think it's really important to really do your own calculations and see what you can actually afford. And yeah, like you said, sometimes it'll mean that you, and that's kind of what we realized. We're like, I don't think we can actually afford our dream of owning an actual house on land. I think we're gonna have to look in the townhouse and condo market. And I mean, it's fine. We're glad that we made that choice. And especially as someone who's owned a house for a year, who's been paying a mortgage, I'm so glad that we've kept our mortgage low because we bought a house or a place that is way lower in price.

And it's all about setting expectations early on as well. So you have to know what you're willing to give up if breaking into the market is your end goal. So that might mean, okay, I really want to get into a detached. And then you realize a townhouse might be more realistic or a condo might be more realistic. Okay, so maybe I do still want a detached. Am I willing to drive to a community where detached houses are a little bit more affordable? So it's all about knowing, you know, like what kind of compromise you're willing to make. And that goes back to working with your realtor as well. You know, you make sure that they understand like what you're willing to give up and what you're not willing to give up and to find inventory that lies within that. I wanted to talk a little bit about getting a mortgage.

I think a lot of people are not aware or confused about what a mortgage broker is compared to, say, a mortgage specialist or a mortgage advisor at a bank. What is the difference between the two and what are some advantages for one over the other? Sure. So a mortgage broker is a professional who often works with a number of banks. So they're kind of a free agent and they're like your personal mortgage shopper, so to speak. So you connect with the broker, you let them know this is kind of the payment that I'm working with. This is kind of the range of affordability that I'm hoping to stay within. And then they're going to shop around at all the various lenders that they work with or represent and come back to you with the best rate that they can offer you. So this is great because you have an expert working on your side.

You're not having to go through this process yourself. The other thing as well, you know, working directly with a lender might be great for some borrowers and it might not be great for others. You know, if you're going to work with one of the big banks that have a knowledgeable brand, or if you're going to work with like a smaller credit union, for example, it's just really important to understand how these lenders differ and why you might pay more at a bigger bank than versus a smaller bank and it all really comes down to like your knowledge of the market and if you know more about how rates are priced and how they apply to you you have more negotiation power and a broker can really help with that as well. No, no, I'm really happy that we, well, you know, first, of course, what we did was look at what, yeah, rates are

available. There's a ton of comparison websites out there, thank goodness. So you can have an idea of what are the type of lenders out there? What are the interest rates in general that they're offering? So you have kind of like, okay, I understand what a ballpark number I should be thinking about. And then what I personally did, like you mentioned, I liked working with a mortgage broker just because they kind of took the hassle out of me doing my own shopping. And I think another kind of misconception is lots of people think that you have to pay a mortgage broker. I know maybe that could be the case, but generally no. It's always good just to ask up front if you do have to pay them, but usually they're compensated through the lenders themselves.

That's correct. Yeah, it'd be quite rare if you had to pay a mortgage broker out of pocket. So they get a referral fee from the lender that they're working with. And it's important to ask them too, you know, up front, what lenders do you work with? Do you only work with a handful? Do you work with quite a wide variety? You know, it's the same as working with an agent. Make sure you find somebody that you think is going to be able to work to your best advantage and provide you with the best variety. Absolutely. Absolutely.

So before I let you go, what is one or two things that you absolutely want, especially new potential home buyers to know before they get into this kind of crazy race to find a home? Mm would say, you know, don't be too emotional about your home search. A lot of people get really caught up in the frantic environment that is the housing market. They're scared by what they're reading in the news. They think, I have to buy now or I'm never going to be able to buy. And that's simply not necessarily true. If you're staying within your income fundamentals, if you've got a solid down payment, if you're working with professionals for ensuring that you've got a mortgage rate that you're going to be able to continue to afford,

regardless of how the market shifts, you should Be in a good position. Make sure that your expectations are aligned with what kind of product is available to you in the market. So for example, if you have your heart set on a two-bedroom condo, but you can only afford a one-bedroom condo, it can still make a lot of sense. Buy the one-bedroom condo. You're in the market. You're building equity. You might just have to shift your timeline a little bit there. The other thing too is if you want a detached house, perhaps look for one with an income suite in it, and then that'll help offset your mortgage payments. You know, don't be afraid to kind of shift what that home ownership picture looks like. And just make sure you're surrounded by experts who are going to guide you through these somewhat scary real estate times. But it is possible to be a homeowner in this environment. People are still managing to

do it every day. It's all a matter of strategy and expectation. Exactly. And just making the choice that's right for you, not necessarily one that it seems like everyone has their opinion, especially in real estate, everyone has their opinion. But I feel like, yeah, especially if you make a decision that you know at your core is right for you, then you'll be fine. And like I said, it all goes back to the professionals that you're working with. So if you're ever working with an agent or a broker who seems to be encouraging that you overstep your affordability, maybe take a step back, like, is this going to be right for me? It's all about being cautious in this market. Absolutely. Well, thank you, Penelope, for joining me. Where can people find you if they

want to kind of look you up and maybe ask you a question on Twitter? Absolutely. Well, they can check out the Zucasa blog at www.zucasa.com slash blog. And I can be found on Twitter at PJ14. So that's P-J-E-G-1-4. And please do send me all of your questions on Twitter. I love to hear from prospective buyers and people looking for advice, especially if people have stories to share. You know, that's a blogger's best friend. Yes, I bet. Send them my way. Well, thank you so much, Penelope. It was a treasure. It was a pleasure and a treasure to chat with you. Thank you so much for having me. And that was episode 124 with Penelope Graham, managing editor of Zucasa. If you want to read more of her articles, some

helpful insights, tips and tricks on real estate in Canada, make sure to go to zucasa.com slash blog for all of that good stuff. And also make sure to check out the show notes, JessicaMorehouse.com slash 124 for more information about stuff that we talked about, important links that you'll definitely want to click on. JessicaMorehouse.com slash

124 is where you can find the show notes for this episode. Now, I've got a few more things to let you know, but before, I want to share some info about this episode. Now, I've got a few more things to let you know, but before I want to share some info about this episode's sponsor. A big thank you to Credit Card Genius for supporting the Mo Money podcast. If you're not aware, they are the only tool that compares over 50 features of 150 Canadian credit cards by using math-based ratings and rankings that respond to your needs instantly. Now you can get rewarded faster without all the headache. If you want to find the best credit

card for you, make sure to check out creditcardgenius.ca to learn more. Once again, visit creditcardgenius.ca to learn more. All right, so before I let you go, a few things I just want to remind you of. Number one, I am running a contest right now, a contest throughout the whole season where you have the opportunity to win $25 in the form of an Amazon gift card. All you have to do is check out the show notes for more info, JessicaMorris.com slash 124. But really, it's just a matter of you leaving me an iTunes review and sending me that review, some evidence and your contact details. And then you have a chance to win a $25 Amazon gift card. So make sure to enter if you would like to win free things. Also, if you are looking for some

helpful resources to get your money situation back on track or on track in the first place, I highly recommend you go to my resource library. It is where I house basically all of the spreadsheets, worksheets, everything that I could think of so far to help you out. So I've got my budget spreadsheet, my network spreadsheet, a bunch of other great spreadsheets that you'll definitely want to check out. And it's all for free. So if you go to jessicamorehouse.com slash resources, again, I'll link it in the show notes if you're interested. And one last thing, if you're not currently part of my Facebook group, my private Facebook group, I highly recommend you get in there. We've got over a thousand people there, and it is basically just an online support group for people who want to better their financial situation. It is called the Money Life Balance Community.

It is a positive, nonjudgmental space where you can ask your questions. There's no dumb questions. Ask for some tips, advice, suggestions. Maybe you're working through something and you just kind of want to see what other people think, this is the place to do it. So if you want to be part of a awesome, empowering community and to help you get better with your money situation, definitely join my Facebook group. All you have to do is go to facebook.com slash groups slash money life balance, and you'll pop right in there. So hope you decide to join after listening to this episode because we're always looking for new

awesome members. And you're clearly awesome because you're listening to my podcast right now. Okay, so that is it for me. But I will of course be back next Wednesday with a fresh new episode. So make sure to subscribe on iTunes, SoundCloud, Stitcher, YouTube, wherever you are listening so you don't miss an episode. All right. I will see you back here next week. This podcast is distributed by the Women in Media Podcast Network. Find out more at womeninmedia.network.