What it really means to be a homeowner
Be prepared for the task of buying a house
Despite the ups and downs of the real estate market, home ownership in Canada is a long-term financial goal for most immigrants. But the pride of owning such an asset can sometimes impair your judgment and lead to hasty decisions. It probably took years of saving to accumulate enough funds for a down payment, so it is understandable why many would get overly excited when house shopping, resulting in irrational choices.
Slow down, analyze and be practical because you are entering into a contractual agreement that will bind the parties involved.
Will the house you choose meet your needs?
For starters, ask yourself if the house will meet your needs throughout the term of the mortgage. Consider the location and proximity to schools, daycare, church, work, grocery shopping, transit and whatever else is important for your lifestyle or current life stage. It can be frustrating to travel long distances to work or walk several blocks in snow to an unsheltered bus stop and wait for another 20 minutes for the arrival of the next scheduled bus. Time saved with shorter commute gives more available time for rest or doing other things.
Can you afford the house?
Affordability is a key factor in buying a house because foreclosure is real. The initial deposit is not a true determinant of whether you can maintain the monthly mortgage payments. Avoid draining all your financial resources for the down payment. This could lead to dire consequences if there is no money for unexpected repairs upon occupancy.
It should not be taken for granted that an inspection will uncover every defect. It is easier said than done but being emotionally unattached prior to having an inspection is an excellent approach. The detection of foundation, roof or any structural issues is bad news because they are very expensive problems to solve. In such occurrences, it is best to walk away and save yourself the headache. However, minor issues that require less resources and time to rectify may be worth the investment. It can actually be a bonus to be able to make cosmetic changes that will suit your taste.
READ MORE: What does housing cost in Canadian cities?
Time to budget
It is also crucial to budget for additional expenses such as utilities, property tax and insurance. Select a house that fits within your budget. Carefully manage your income and expenses to adequately prepare yourself for the responsibility of being a homeowner.