There is a never ending supply of different types of homes available for purchase – ranging from condos to townhouses to semi-detached to fully-detached homes. The key is to decide what you can afford and which amenities you would like before starting your search for a new home. You can make a list of need to have’s and nice to have’s, and this will make it easier to narrow down the properties you must go see.
As discussed in last week’s blog, budgeting is one of the most important steps towards buying a home. Make sure you save not only for a down payment and up-front costs, such as closing costs and emergency reserves, but also enough to cover expenses such as moving, tools, and maintenance supplies, window coverings, furniture and of course a television to watch all the Netflix needed during this pandemic.
The next step is to get a pre-approval for a mortgage. This will give you a very good idea of what your price range should be – and, therefore, which type of home you can afford – before you start looking.
With a pre-approval under your belt you are ready to make your home purchase a reality. Depending on your budget and preferences the options below will be available to you to pick from:
A condo makes a great first home because it typically costs less than a townhouse or a detached home, which translates into a smaller down payment. But there are, however, monthly maintenance fees you must take into consideration when budgeting for a condo.
Condos are also ideal for those who do not want to maintain a front or back yard or worry about clearing snow away from walkways and driveways.
If the condo life is not your cup of tea, or you need more space and you’re not looking to maintain a big yard, then a townhouse may be your best bet.
A townhome costs less than a semi or fully-detached home and results in less in property taxes as well.
Many townhouses also come with monthly maintenance fees (condo townhomes) unless they are freehold townhouses. In situations where you pay a monthly fee, however, you won’t have to worry about outdoor maintenance or snow removal.
If you are craving more privacy than you had in a condo or townhome then a semi-detached home is what you need, where only one wall is shared.
However, a semi-detached home will be freehold and you will have to maintain the front and back yards and also take care of snow removal during the winter months.
If you need more space, larger yards and complete privacy, a detached home is your ideal choice. The price range on these can vary drastically based on various features.
The size of the home and property (if you decide not to opt for a condo) are also important things to consider before you start looking. You can have an idea about what kind of space you would need based on your belongings or standard of living.
You should also have a rough idea about which area or neighbourhood you’d like to live in for the next one to five years at least. Keep in mind which area or neighbourhood would give you the best appreciation for when you decide to sell and upgrade. Definitely know which home features are absolutely essential for you – including what you can live without and what aspects are an absolute must have.
Take a look at real estate ads for the areas you’re interested in to see what’s on the market and the price ranges. Drive around a few neighbourhoods and see what’s for sale or visit some Open Houses. You can only tell so much by ads and photos. Seeing the place in person is absolutely essential.
Lastly keep in mind that your first home purchase will most likely be a modest and affordable ‘starter’ home, but have solace in the fact that you will be putting money towards a mortgage that will build equity in that home. Once you’ve paid down a significant portion of that first home’s mortgage, you will then have more money to put towards an upgrade into your dream home.