Tips from Your Trusted Toronto Real Estate Brokerage
Feeling ready to get your first home? You might be going through one or more of the following…
- You have attended the latest real estate show in Toronto and are in awe of the glamorous displays.
- You are binge-watching home buying and home improvement shows on television.
- You are fed up of living in the basement of your parent’s home and being unable to entertain.
- You are tired of paying rent on your apartment and feeding someone else’s mortgage.
No matter what triggered the thought of investing in Toronto real estate, if you are considering being a first-time homeowner, you need to check if you are truly ready.
Although owning the roof over your head has several advantages, you may still need to consider the timing and the trade-offs between renting and buying. Moreover, you may have a long list of ‘must-haves’ in your first home, but aspects such as, the housing market ups and downs, and fluctuating mortgage rates may determine the number of compromises you may have to make. Before you plunge into the search for a new home, make sure that you can afford it and will not come out house poor or broke.
Top 3 Questions to Ask Before You Leap Into Homeownership
Give a thought to these few critical questions to check if buying a house is a good move for you. After all, you do not want this decision to be one that you will regret shortly.
- Are my Finances in Order?
From your bank balance and debt, to your job stability and mortgage eligibility, you need to consider several key aspects regarding your finances. Higher the down payment, lower the outgoings and overall interest over the tenure of the mortgage.
- Can you afford to make more than the minimum required down payment?
- Are you carrying a lot of debt, such as outstanding credit card bills or student loans that may impact your credit score?
- Have you recently started a new job, or are you planning to change jobs soon?
- Do you have some challenging life goals, such as backpacking across different countries, or pursuing an expensive sport, which may be hindered by parking your finances in real estate?
Many of these factors can help you determine whether you will have any money left after buying a property.
- Have I Accounted for Hidden Costs?
In addition to the basic cost of the property, have you accounted for the costs that are coming your way after the purchase? Inexperienced buyers may overlook, or underestimate the expenses associated with repairs and maintenance, property taxes, homeowner association fees (in the case of condominiums), and other enhancements that a new home may need. If your property search is tending towards attractively-priced fixer-uppers, have you made realistic financial estimates to bring the home to your expected standards? Before finalizing a home that needs a lot of updating, evaluate whether it is worth investing your free time and money in time-consuming and tedious home improvement projects.
- Are my medium-term plans aligned with buying property?
If you are investing in Toronto real estate for the first time, and want to make it a truly profitable transaction, owning the property for longer periods of time may give you higher returns. Ask yourself:
- Are you here for the long haul? Do you want to maximize your investment?
- Are you going to be at this location for the next 3 to 5 years? Will your current job or life priorities lead you to a relocation?
Remember, when you buy a home, you will incur additional expenses, such as the cost of securing a loan, closing costs, packing and moving, home inspections, and other minor repairs or home furnishings. If you put your property on the market too soon, you will not be able to recover most of these additional costs, and will also lose about 6% of the sale value towards real estate sales commission. Depending on what you do for a living, and the state of the current housing market, you should give a serious thought to your decision about buying v/s renting.
Study and Track the Housing Market in Toronto
In addition to all the questions that you can ask yourself to determine your readiness for being a first time homeowner, it is important to have a pulse on the market. When you are considering buying your first property in Toronto, partner with the experienced agents at Home & Condo Market Brokerage. As an established real estate brokerage, we continually track the Toronto real estate market and are in a position to advise you on the advantages, as well as any pitfalls of investing in your first home. Should you decide to go ahead with your buying decision, our friendly and proactive agents look forward to understanding your requirements and finding you your dream home.
To schedule a consult, call us at 416-551-5020 or contact us online. One of our agents will be in touch soon.