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Making an Offer on a House? Here are 6 Tips To Help You Avoid a Critical Blunder


After becoming a Realtor® in 2002, AJ Hazzi noticed a gap in the real estate market...

After becoming a Realtor® in 2002, AJ Hazzi noticed a gap in the real estate market...

Dec 2 8 minutes read

An illustration of a house on a field in a prairie with birds flying overtop.

House hunting in Canada?

Buying a home might be the biggest financial decision of your life.

If you get it right the first time, you’ll save some hard-earned cash and prevent headaches when you loan money to buy a house.

This article shows you how to make an offer on a house in Canada, then shows you 6 ways to avoid the most common home bidding blunders.

How to Make Offer on House in Canada

If you’re buying a home, here are the steps to make an offer on a house.

1. Get pre approved

If you're house hunting, you should get mortgage approval from a bank or mortgage broker before making an offer on a house.

You should know exactly how much you can afford as a mortgage principal before going shopping.

It takes about 1 day to complete the necessary documentation, then 1 business day to get a pre-approval contract for loans.

Check out our 2023 mortgage rate forecast.

2. Go house hunting

After getting mortgage approval, you can start your home search with your real estate agent.

Since finding the right neighborhood is just as important as choosing the right home, ost Kelowna buyers prefer neighbourhoods with good schools, adequate safety, and affordable homes.

3. Draft an offer letter

Once you’ve found a home you want to buy, you’ll draft an offer letter - ideally with an experienced realtor.

An offer letter is a legal document that states:

  • Basic information about the buyer and seller (name, address)

  • How much you’re willing to pay for the property (the purchase price)

  • How long your offer lasts for (expiry)

  • When you want to take possession (the closing day)

  • Any contingencies items you want included like a completed home inspection or appraisal

4. Negotiate

After submitting your offer letter to the seller, you should expect to negotiate before the seller accepts.

If your purchase offer is below asking, you can expect the seller to counter with a price that’s closer to their initial offer.

For most people, this is the most intimidating part of buying a home and where real estate agents really show their value.

Working with a certified negotiator removes stress from your life and gives you an  advantage when it comes to price, conditions, and agreeing on contingencies.

5. Finalize your mortgage approval

If your offer is accepted and you’re ready to move forward, the next step is finalizing your mortgage approval with a lender (bank or mortgage broker).

The loan approval process, also known as “live approval” can take up to 30 to 45 days.

6. Closing day

On the closing date, the buyer and seller sit down with the buyers and sellers real estate agents, sign contract documents with lawyers, and finally give the buyer possession of their new home.

Closing usually takes place during the first half of closing day between 9am and 12pm.

About Earnest Money (The “Good Faith Deposit”)

Earnest money is a cash amount paid to a home seller to secure the right to purchase their property.

Earnest money is generally 1 to 2 percent of the purchase price and works as a credit towards the down payment and closing costs.

Also known as a “good faith deposit”, earnest money gives buyers a specific timeframe to take care of details like lender financing, home inspection, title search, and appraisal.

Earnest money is essentially an offer to purchase; the buyer has the right to buy the property at a certain price, but they also have the option to walk away and lose the deposit.


Contingencies, or a contingency clause, is a set of conditions that must be met in order for the deal to proceed.

If any contingencies arise, for example, during the inspection or appraisal process, the buyer reserves the right to walk away from the deal without forfeiting their deposit.

A person writing a letter at a desk.

Tip #1 - Write a Compelling Offer Letter

In the 2020s we’re seeing a lot of young homebuyers write personalized letters with their offer to the seller.

Good offer letters include a sympathetic background story, your request to purchase their home, the maximum asking price you can pay, and any contingencies.

Overall, you want to pull the seller’s heartstrings a little and give them some great reasons to pick you instead of other buyers with bigger budgets.

If it’s an older seller, try to help them remember what it’s like to be young again when you make an offer.

A couple making a pinky-swear agreement

Tip #2 - Buy Within Your Budget (aka: Do Not FOMO)

Fear of missing out (FOMO) can lead to all kinds of reckless behaviour. Making an offer on a house is no different.

Just because you get pre-approved for $800,000 in financing, it doesn't necessarily mean you can afford to purchase an $800,000 home.

If interest rates go up in the future, you’ll want to make sure you have some financial resources tucked away to deal with the higher interest payments due to your lender.

Keep in mind that banks are usually eager to maximize your approval amount because they earn more interest with a higher principal payment.

In today’s market, we’ve seen a lot of new buyers overbid on houses to avoid the risk of underbidding and losing out on the deal.

Instead, you need to find that sweet spot known as fair market value. To understand the fair market value of the home you’re about to buy, you should know recent market statistics about the transactions happening in your area.

A couple smiling at each other in front of a home

Tip #3 - Buy A House That You’ll Love

Don’t settle for a property that doesn’t meet your needs today and in the future. You might have kids, get a dog, or need space to work on your hobby projects.

If you’re buying to hold, you’ll be responsible for a 25 year mortgage, so make sure you do your research first.

Once you’ve located a home, don't skip the inspection or appraisal.

Even if the inspection doesn’t affect your final decision, the process often reveals information that can benefit you during negotiations.

A woman thinking

Tip #4 - Use Multiple Offers

In real estate, multiple offers refers to a situation where more than one buyer submits an offer letter to the seller.

When a seller gets multiple offers, they can choose to accept or counter any of the offers, or counter the offers, or decide to reject the offers.

The coronavirus pandemic started a frenzy of home buying activity and multiple offer situations have become the norm in many parts of Canada.

In British Columbia, we use a blind bidding system, so there’s no way of knowing exactly how much other buyers are willing to pay.

If you’re bidding against multiple offers, a realtor who has sold homes in the last quarter can help you determine a fair counter offer to help you secure the deal.

A home entryway

Tip #5 - Have a Solid Exit Strategy

Unless you’re buying to hold forever, you should plan an exit strategy.

Popular exit strategies include selling on the market (MLS), selling to a cash buyer, flipping, and writing a lease option or purchase contract.

A glowing review for Calista at Vantage West Realty

Tip #6 - Hire a Reputable Real Estate Agent & Lawyer

Unless you’re a real estate expert, working with a real estate agent can help you avoid some of the common pitfalls we’ve discussed so far.

Realtors and real estate firms get first hand exposure to a wealth of data to help you make a strong yet affordable offer on a house.

According to, a buyer’s agent guides you through the home-buying transaction and helps you find the right property, negotiate your purchase agreement, recommend other professionals, and help you overcome setbacks.

A seller’s agent - also known as a listing agent - has a fiduciary duty to help the home seller manage the transaction, quickly sell the home, and negotiate an optimal selling price.

Overall, a good real estate agent saves you time, eases stress, and saves you money during the negotiation stage of the deal.

Vantage West Realty is a Kelowna-based realty and property management firm with 2 decades of experience and over 600 5-star Google reviews.

Before you make one of the biggest financial decisions of your life, contact a real estate agent.

Call Vantage West Realty:

+1 (250) 717-3133

Email us:

[email protected]

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