Property value is key to determining the amount of the mortgage you’ll be offered.
How home value is measured
A home’s value is based on its features. These include square footage, location, age, quality and number of bedrooms and bathrooms.
A property’s value isn’t fixed. It’s a snapshot of what it’s worth in the current market in relation to what similar properties are selling for. Renovations will affect a home’s value. So will changes to the neighbourhood and in the housing market.
What you need to do
When you apply for a mortgage, your lender will ask you questions about the property. You’ll also need to give details about any renovation costs you plan to add to your mortgage.
Professional home appraisal
Your lender may arrange for a professional appraisal of the home. This assesses it in more detail, compares it to recent sales in the area and considers market conditions.
Get the amount you need
If your home appraisal doesn’t support the mortgage amount you want, talk to your lender and real estate agent. They can help you explore your options.