We're faced decisions throughout our normal day, and usually get them right without much difficulty.
But while each of us is well equipped to make every day decisions, it’s not always so simple. When we consider selling our home, that decision is one that obviously requires much greater scrutiny. Consider the following:
How much equity do I currently have? - The amount of money you have put in the home (either as part of a downpayment or other payments made against the principle) is imperative when cosidering selling. If you borrowed 100% to finance the home, and 6 months later you are thinking of selling, you will probably lose money.
What's happening with interest rates? - Interest rates are slowly going up, but there are still some lenders who are actually lowering their fixed rates to give people the opportunity to get into the housing market. There are still good rates to be found.
Will my income allow me to qualify for the house I want? - Maybe. A good rule of thumb is to multiply your income by 4, and that's the price range you should be looking in. However, please see a Mortgage Agent to find out exactly what you qualify for.
Should I sell my house first, and then buy? - Most definetly. Put it on the market, ask for a longer closing if you must to give you an opportunity to find something else. Otherwise, you risk having to take on bridge financing while your first home sells, and could be forced to lower your asking price to ensure that it sells.
Should I make any improvements before selling? - That depends on what shape your house is in, and what improvements we're talking about. A neutral coat of paint is relatively inexpensive and can make a big difference. Making sure your all hardware is tightened is also important as visitors to your home are always opening doors, cabinets, drawers. Visit CMHC - Getting Your House Ready to Sell for more info.
Will I have to pay GST/HST on the sale or purchase? - Only if you are buying New Build over $400,000. And even in that case, the rebates from the government will mostly offset your added cost. HST does not apply to resale homes, but will apply to services rendered by lawyers, REALTORS, etc... Click for more.
Can I get a deal buying Power Of Sale? - Very rarely. These homes are priced at Market Value, and you assume a lot of risks. Deals are almost non existent.
Is Location, Location, Location still important? - Very much. Especially so today, when you want to be close to a lot of infrastructure.
What’s happening with the housing market in Ottawa? - Still strong, outpacing our numbers from last year, which was a record breaking year.
Should I buy a condo or freehold? - This is a personal choice, both have their advantage, disadvantages. Note: Just because you have "little or no" property, does not necessarily mean your property tax will be any less then if you had a huge lot. See CMHC - Buying a Home for more info.
Can I use my RRSP to put towards the new home? - Yes, up to $25,000. This amount must be paid back over a time period to avoid having to pay the taxes on the amount borrowed. Please see the CRA Home Buyer's Plan web-site for details.
ready2move.ca
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