As a first time real estate buyer, you might not fully understand how the purchasing a home process works or how to make sure you’re making the right decisions. And you’ll be very surprised to learn how much work it really is to buy a home. Here are a few tips that you should consider:
Get lender-qualified & find a good real estate agent: when beginning the home buying process, you should get qualified by a lender to see what price range you can realistically afford and interview some real estate agents to find the right person to represent you in your transaction. Once you’re qualified and have your price range estimate, you’ll be able to spend your time shopping in neighbourhoods you can afford. But remember: just because the bank says you can qualify for a certain amount, that doesn’t mean you should spend that amount. Make sure you can actually afford the monthly payment, along with all your other bills. For real estate sales professionals, you should get referrals for a full-time agent or broker who sells at least five or more properties per year and is well-educated on the process and location where you plan to live.
Make sure you plan to be a long-term owner: once you know your price range and have a look at some properties, it’s time to make sure that you believe you can find a property that you will own for a minimum of five years. If your price range doesn’t match where you want to live, you’re better off renting for a while longer and saving some additional money until you can afford where you want to live. This is because an owner really doesn’t earn any equity on average, in a property for at least five years. That’s the general breakeven point, and you really need to shoot for longer that that as an ownership strategy. Long-term real estate ownership can be a great way to earn wealth, but short-term ownership usually will diminish your wealth.
Educate yourself: buying property is probably the most complex, riskiest and expensive thing you will ever do. Do your homework: talk to real estate owners, go to first time-buyer seminars, check out online materials and read some books to learn what to avoid in the buying process. The more you educate yourself, the better the chances that when things go wrong—they will only be minor issues.
Find a nice affordable property: the real gems in real estate are the nice, decent shape, moderately priced, boring houses, town homes, and condominiums that are within your budget. Most buyers stretch to purchase the most expensive property they can afford. What if you loose your job? How about saving some of your money for retirement? You want your home to be an asset you can afford, not a liability that leaves you with no addititional funds over the cost of homeownership. Skip the fixers, prize properties or anything that sounds too good to be true: those always end up having issues, and owners realize, after the fact, that the deal they thought they were getting was just too good to be true!
Take your time: realistically it should take you six months or longer to buy a nice quality property that will add to your long-term wealth. Make sure you have a full understanding of what the marketplace has to offer in your price range and that you know what you’re doing.
CENTURY 21 Miller Real Estate Ltd.
Brokerage Independently Owned and Operated
#4 Office in Canada
By Production CENTURY 21 Canada 2013
467 Speers Road, Oakville, ON L6K 3S4