For most Canadians, buying a home is the most significant investment of their lives. Housing inventory is moving up in most major centres across the country, leading to a more balanced market. Historical data demonstrates that purchasing a home has proven a sound long-term financial investment. However, home buyers – especially first-time buyers – are often understandably anxious when it comes time to making what could be the largest purchase in their life. Here are some simple “dos” and “don’ts” to make the process easier for everyone dreaming of home ownership.
The Home buyer “DO” List:
- DO access and closely review your credit score. A sound financial track record and solid credit score can help you get a mortgage and lower interest rates. Check your records in advance to catch any errors ahead of time, and to better understand how lenders may perceive you.
- DO explore mortgage pre-approval. Getting this early green light will help others involved with your purchase know that you are serious about home ownership – and well-qualified.
- DO line up your “all-star” team of professionals before game day. A team of experienced professionals will be key to making the home buying process simple and seamless. Start by interviewing and selecting a Real Estate sales representative who you “connect” with. Your sales representative can help you identify suitable lawyers, mortgage lenders, home inspectors and others who play a role in the process.
- DO anticipate your future needs and buy for lifestyle. Try to anticipate how long you’ll live in your next home and plan for major lifestyle changes when possible. What may make a perfect starter home for a couple might not work as well when children come into the picture.
- DO hone in on your housing priorities. Your ideal home may have a porch, a pool and five full baths. But before you start looking, make sure to separate your “must-haves” from your “nice to haves,” so you know where you can compromise, if necessary, to meet your budget.
The Home buyer “DON’T” List:
- DON’T fall in love with the first house or neighbourhood you see. That grand colonial with the picturesque view may win your heart at first glance, but you need to keep an open mind to make sure you find the right fit for all your needs. At the end of your search, it may turn out that the riverfront ranch that’s closer for your commute is a better bet all-around.
- DON’T buy beyond what you can afford. It’s easy to fall into that all-you-can-eat attitude, especially when it comes to your first home purchase. You “want it all” when it comes to size, amenities, location, etc. But remember that your eyes may have a larger appetite than your wallet. Make sure the down payment, closing costs, monthly expenses and taxes are truly within your income and savings range before you sign an offer.
- DON’T treat your home the way you treat your stock portfolio. It’s unrealistic and unwise to expect your housing investment to appreciate as quickly as you’d hope for your high-risk bonds. Buying for lifestyle, and remembering that real estate is a great long-term investment, will help you look at home purchasing and ownership in the right context.
- DON’T underestimate the value of your Real Estate professional. While being a savvy buyer and doing your homework will help on the road to home ownership, a local expert with years of negotiating experience is invaluable when it comes to scouting out the perfect home – and closing the deal.
If you have any questions at all about the market or the home buying process, then just pick up the phone and give me a call. It might just be the best call you’ll ever make!