Often first time buyers are doing so because there is a life style change. A new relationship, marriage, a baby, a new fabulous job whatever the case may be. Its important to plan for some surprises you may not have considered. Before you move forward with the purchase of a condo or house plan as follows.
Run through your monthly expenses with your current interest rate and prepare some scenarios if the interest increases substantially by the time you renew your mortgage. Besides your mortgage don't forget to include property taxes and insurance.
If there's a new addition to your family, did you allow for higher grocery bills, diapers, day care, nanny or baby sitting costs. Talk to a friend who's been there, done that. Its all nice to be home with the baby but you need a regular night out.
How old is your car? Any chance you may have to change it in the next year or two? Are you moving closer to work or farther? Do you need to buy a second car?
If you are moving into your first property, do you need new furniture? Your parent's hand-me-downs may not work size-wise in a condo! Are you moving into a house and need more furniture than you had in your rental?
If you're moving into a house, not a condo, you have to allow for repairs & maintenance you might not even know about yet! Even when you can do repairs yourself, there are the costs of materials. When you have to pay for repairs, the costs are higher when including labor.
As your home ages, it will need major repairs or replacement. For example, when you bought your home, you knew that the roof would need replacing in a few years because of its age. These are expected repairs and can be planned for. However, many repairs are unexpected, and can sometimes be costly. Your water pressure isn't adequate and you get a plumber in to take a look. It turns out you need new pipes throughout!
Home ownership is a great investment, just be sure you are not borrowing to the point of being house poor and not be able to deal with unexpected surprises.
For more info on selling your condo or buying a new condo or house, and for info on the current market, contact us by email on the right side menu or call us at 416-322-8000.