Nervous about buying your first home?
It’s perfectly normal—everyone is anxious when buying their first home. 32 years ago, I bought my first home in Toronto for $128,000 and I was a nervous wreck. Today, you might be able to buy a parking spot for that price in Toronto and definitely not a home in Guelph, Kitchener, Waterloo, or Cambridge. So now you are making the biggest investment of your life and also spending $300,000+ of your hard-earned money. Regardless of how prices might change, what you need to successfully buy a home hasn’t changed. Your first and best step? You need a trusted guide to hold your hand through your home-buying journey.
Find a trusted real-estate guide. ‘How do I find someone I can trust?’ you might ask. Start by asking people you already trust for a referral and ideally, ask people who have bought a home in the area you want to buy in. Or if you know and trust a real estate agent in the area you currently live in, ask them to refer you to someone in the area you want to move to. The best way to find a trusted guide is through trusted referral!
Establish what you can afford. After you find your trusted guide, it’s critical that you figure out how much house you can afford. The most important number for buying a home is the monthly payment; sadly, houses are not listed that way. Find a good mortgage broker the same way as you found an agent. The agent you are working with should have a trusted mortgage broker. Or you can ask the bank you are currently with. However, a mortgage broker will most likely get you a more customized option and the best possible mortgage lending rate for your financial needs. They also generally have companies that offer more flexibility than banks for changing the terms and conditions of a mortgage down the road.
Start looking at homes online. You realtor can set up a search on the local Multiple Listing Service (MLS) that will send you listings of homes for sale as soon as they are listed. You should know that if you are looking for new listings on realtor.ca, it’s often too late to book a viewing or put in an offer to buy the home because realtors will see them as soon as they come on the market and share them with their clients right away. I often have buyers without an agent or using an out of region agent contact me to place an offer on my listings and they usually are very unhappy at having missed a good opportunity.
Review the immediate vicinity. You can often spot problems just by looking at the immediate vicinity of a home. If you’ve found a couple of homes you really like and you live in the area, drive by the homes and check out the neighbourhood. If you live too far away, use Google Maps to look at what is the home, the street, and neighbouring homes and features. Does it back on shopping mall? Is it near a busy exit from Hwy. 401?
Tour the homes. If you’ve narrowed your search down to a couple of homes that you really like, ask your agent to escort you on a viewing. Be prepared to follow current COVID safety measures (see my blog about buying during the time of COVID); your realtor should have all the equipment and know the protocols to keep you safe.
By the time you have your trusted guide, an idea of what you can afford, have reviewed some neighbourhoods, and are ready to look at a few homes, your anxiety will hopefully be turning to excitement. To learn what happens after you find the right home, stay tuned for Part 2 of my first-time buyer blog.