If you’re quickly reaching 36 years old, the average age to buy a home in Canada, you may be wondering if it’s time you leave apartment life in the dust. After all, owning a home has several perks, like the freedom to update how you’d like and the ability to get some money back when it’s time to move.
But buying a home can be nerve-wracking, whether it’s your first home or your fifth. Luckily, there are some tips for first time home buyers that can help make the process a lot easier.
Do you want to know what they are? Let’s dive in!
Start Saving Now
Your first home is likely the most expensive purchase you’ll make to date. While you’ll get a mortgage that allows you to pay it off over time, there are still a lot of expenses you’ll need to pay for up-front.
Your down payment is perhaps the biggest of these costs. A 20% down payment is common, but you may be able to put down less depending on your lender.
Unfortunately, even if you can score a 10% down payment, that’s still a huge chunk of change. After all, 10% on a $250,000 home is still $25,000.
So, if you’re just starting to think about buying a home, start saving for it now! Future you will be thankful.
Research Assistance Programs
Buying a home is no easy feat. The government knows this, so they’ve created all sorts of assistance programs that you may qualify for.
Make sure you do your research before you get too deep in the home buying process, so you know what to expect. Search at the federal, province, and even local level to see just how much help you can get as a first time home buyer.
Once you have a general idea of the assistance programs you qualify for and what kind of down payment you’ll need, it’s time to create your budget.
Many first time home buyers make the mistake of putting their entire budget into the down payment. However, you’ll also need to leave enough money to cover closing costs, moving costs, and any renovations that have to be done before you can move in.
Also, remember that you’re now responsible for anything that breaks in your new home. You’ll want to leave yourself some extra room in your budget in case your water heater breaks or one expense ends up costing more than you thought.
Get Pre-Approved For a Loan
You may have spent a lot of time thinking about how much your first home should cost. But you don’t want to start the home-buying process with just your idea in mind.
You should get pre-approved for a loan before you start viewing houses. Not only does this tell you for certain how much you can spend, but a lot of sellers won’t consider an offer unless the seller has proof they can pay. That means while you’re running around trying to get a loan, someone else (who already got pre-approved) can swoop in and buy your dream house.
Pick Your Ideal Neighborhood First
When you start the search process, you may become overwhelmed at just how many houses there are. You’ve probably heard that location is key when buying a house, so start by picking your ideal neighborhood first.
This will help you narrow down your search and ensure you get a home in a great area. What constitutes as an “ideal neighborhood” will vary, but this is likely somewhere close to work, a grocery store, and anywhere else you visit often. If you have kids or think kids are in your immediate future, you may also want a neighborhood with a park, lots of other children, and one that’s in a good school district.
Schedule an Inspection
So, you finally found the perfect home. Now, it’s time to double check that it really is perfect.
You should never buy a home without having it inspected first. Depending on where you live, the inspection may be done before you make an offer or after your offer is accepted. In the latter, a home inspection is considered a contract contingency, meaning you can back out of the purchase if you’re not happy with the inspection results.
While the seller doesn’t have to make repairs to problems flagged in the inspection, you may be able to negotiate with them. Many sellers would prefer to make the repairs rather than lose the sale, so make sure you talk to your agent about all your options.
Know When to Walk Away
If the inspection on your dream home yielded disappointing results, you may have to consider walking away.
It doesn’t matter how much you love the bay windows or the brand new kitchen. If the home has a serious problem, like water damage or a cracking foundation, it’s probably best to leave it behind before you end up in a money pit.
When buying your first home, it’s all too easy to follow your heart instead of your head. But you want to make sure you think through the decision logically. There will always be other homes, and you’ll have the ability to renovate any home over time to get those amazing features you love.
Best Tips for First Time Home Buyers
If you’re ready to buy your first home, you may not know where to start. Just follow these tips for first time home buyers to help ensure the process goes as smoothly as possible.
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