Are you in the market for buying a new home? Many news sources are producing articles about the Canadian housing market as of recently. There is discussion about it being too hot, about it cooling off, about mortgage rates rising, about personal income levels not allowing affordability. Based on the reading I have done, it is becoming more difficult to decide whether or not home ownership is for you. Here are a few really basic tips on what to do and expect when you consider buying a home.
1.What does your lifestyle allow for? You really need to consider if you are a detached, condo or town home kind of person/couple/family. A condo offers you a lot of freedom in terms of not requiring up keep to the outside of the home. Owning a detached is a lot of work and costs a lot of money. Therefore, look at the long term costs of condo fees vs. purchasing equipment like snow blowers, lawn mowers as well as gardening materials. Also, do not forget to value your time. So many people forget that your time has a cost. Owning a town home almost gives a hybrid of both, however that depends if it is a freehold or condo town home. Freehold means you own the property around like backyard and drive way.
2.Do your research: Research is a must. However, do not get crazy or you will get analysis paralysis which basically means you will be stifled by too much information. Do a brief cost of living analysis in terms of living locations, look at prices vs. products variety among different builders as well as understand your commuting costs. We all know it is more expensive to live in or around the GTA verses cities like Barrie. Make sure you research what you can afford. If you do not know your budget. You are pretty much writing your own bankruptcy claim.
Also, look at the builder image and make a reasonable assessment. Every home builder has experienced problems before. No one is perfect. However, the past is the past. What a company did five years ago is not a reflection of what they are doing now. Look at their current projects and assess the quality to really get a feel.
3.Don’t bite off more than you can chew: This is plain economics. Live within your means. If you make 45K per year and you have very little down payment, do not go after the most expensive house you can afford. Make sure you can pay the mortgage, the bills and still have money left over for personal savings and stuff like food.
4.Mortgage rates will rise: I cannot tell you by how much, but the common consensus among articles I have read on the National Post, Huffington Post, and Toronto Star etc… is that Mortgage rates will have increased and will continue to increase. Therefore, if you are in the market now, consider buying sooner than later. Also, in most cases mortgage brokers are more likely a better option than big banks for obtaining an mortgage the suits you best. (read article)
5.In Barrie, growth paying for growth: The city of Barrie has a growth strategy until 2031 to increase population to 200,000 K+ and over 100,000 jobs. Development and permit charges on new home builds will help pay for that growth which in turn means housing prices will rise. It is inevitable. For more information ask our sales team who has been equipped with information to help you better understand the future of this. (read article)
Most importantly, I am not an expert. Do not take this advice as gospel then run out and instantly purchase a home. Do your homework and ask advice. This is one of the biggest decisions you’ll make in your life.
Marketing Director, Pratt Homes Barrie.