Oh yes house-hunters and new homeowners, you’re in for a treat! Owning your own home triggers all sorts of tingling exhilarating feelings and everyone will be patting you on the back for a job well done. Reality sets in and soon you’re starting to wish someone had forewarned you about all the surprises homeownership brings.
Well, we’re doing just that. Here are 7 things everyone should know before buying a house.
1. The price isn’t the cost
To put it exactly, the price of a house is not the same as the cost of buying the house. Assessments, land surveying, insurance, closing cost, and transfer fees are some of the costs that you may face when you decide to own a “piece of the Rock”. The last thing you want is to be “house poor” – owning a home but having nothing to put in it and no money in your accounts. Its best to have a clear understanding of the various processes and tasks that need to be completed.
2. Bigger isn’t always better
Many of us dream of owning a large home and a family to fill the rooms and hallways. Instead of looking at new developments with smaller homes, some folks decide to save a little more and wait for that bigger house with a yard and a picket fence. Real estate is one of the few items in the world that’s always appreciating in value, so the more you wait, the more you’ll pay per acre. It’s usually a good idea to get into the market as soon as you’re ready to do so. You can always trade up after a few years or expand and your family grows. A home purchase is more than just a roof over your head. It’s an investment, and if you invest early and wisely you may get some good returns.
3. You’re buying into a community
Be sure that your new community offers everything you need for your family, and you can see yourself settling in for at least 5 to 7 years.
Your children’s schools, church, recreational areas, the commute to work – all of these should factor into your decision-making process. You also have to consider your new neighbours, the crime rate in the area, the business opportunities and potential resale value. One thing you should always be assessing when BUYING a house is what you’ll be able to get when you’re SELLING the house, and a huge factor in that resale value is the area where the property is located.
4. What’s in a title?
More aptly, who’s ON the title? This one is a touchy subject but it’s a necessary and practical consideration for future purchases.
Should both you and your partner’s names be on the title for that first house? It all depends on what you have planned for the future.
There are pros and cons to having both names on purchase documents. There’s the assurance that you have attained a major milestone as a couple and also the security of having proof of ownership if one partner dies. For home improvement purposes, after 15 years it may be possible to access National Housing Trust (NHT) loans in each party’s name.
If, however, you are thinking of future investments in real estate, then access to a new NHT mortgage loan will depend on whether or not you’re already listed as a homeowner. For couples thinking of buying an investment property in the future (a home or apartment to rent to a tenant), it may be a good idea to get the first home in only one person’s name and work towards obtaining the second in the other party’s name. Be sure to have a living will done to bequeath the property to your partner in the event of a tragedy.
Make that carpentry, plumbing, masonry, electrical wiring, painting, tiling…you catch the drift. You’ll need some basic lessons in all the above for the maintenance and upkeep of your home. Or you may want to have a trusted friend who will help you through the minor issues.
If there is a big job (or a dangerous task) that needs to be done on your home, you’re best advised to call in the big guns. Someone who has mastered his craft for years can save you money in the long run by correcting the problem. Realistically though, home repairs tend to be an unending series of small jobs – a squeaky door here, a leaking pipe there – and you can cut your expenses by a huge chunk if you freshen up on many of these skills and get in the do-it-yourself mode. Call a parent, long-time homeowner, or use the internet to get DIY home repair tips.
6. It’s NOT all in the family
A home purchase is a very personal and emotional event. It can be the crowning achievement of your life’s work or the beginning of the life you’ve planned. This is an occasion you want to share with family and loved ones, but some strangers will gladly help you pay your mortgage.
If you can acquire a property that either has enough land space for a small apartment, or a house that can accommodate a tenant in their own quarters, you can cover a major part of your monthly mortgage payment without even touching your salary. If you look at it from another perspective, you’ll also be assisting someone with a roof over their head until they themselves are ready to purchase their own home. Everybody wins.
Now picking the right tenant – that’s all on you.
7. You’ll never get that dream home
Real estate agents will tell you that your first home is never usually your dream home.
Your first home purchase may not be your dream home but you can make it your dream home. Without going overboard, add the fixtures, colours and renovations that will make you and the family happy and comfortable. Enjoy what you have!
The truth is, even the second home may turn out to not be what you imagined growing up. And by the time you get to a third or fourth home (if you are one of the lucky ones to own as many), your vision of the dream home has changed all-together. So make the best of what you have, while you have it. It’s the family that truly makes your dwelling the home of your dreams.