Step #3: Determining Your Needs
Once you determine what you can afford, it's important to have a good idea of what you want and need in your next home.
Homeownership is a popular dream. For most people, with the right planning, it can become reality. But there is a lot to know before you begin moving. We'll take you through the planning process step-by-step, to determine exactly the kind of home that's perfect for you.
What Does Your Future Lifestyle Hold?
How many bedrooms will you one day require? Your preschoolers will be teens some day. Are you planning to stay in your home that long? Perhaps your teens are ready to move out on their own. What will you do with all the extra space? When you're thinking about accommodating your family's needs, think of things like parking. How many cars will require space? You'll also want to consider proximity to -- and the reputation of -- schools in the area.
How is your work situation? These days' people tend to change jobs frequently, and sometimes the best way to get a promotion is to move to another company. If you might be transferred, will you be able to sell quickly? Keeping work in mind, how long do you want to spend commuting? Do you drive or rely on public transportation?
As you can see, you will want to give some thought to how long you intend to stay in your home. It may be difficult to answer before you've even found your home, but if it's your first home give some thought to the resale value when it is time to upgrade. On the other hand, if you're planning to stay in your home for a long time, consider your future needs and purchase a home that will accommodate them.
Do You Live a Maintenance-Averse Lifestyle?
When you're looking at homes, consider the advantages and disadvantages of different types of construction and exterior finishing's (example wood, vinyl, hardi board, brick) when it comes to painting. Take a look at the garden. If you don't enjoy cutting grass, then an expansive lawn may not fit into your lifestyle. You can also evaluate the possibility of future maintenance and repairs based on the age of the house. If you don't like the idea of major renovations, a newer home may be your best option.
Is Your Lifestyle More Geared to a Fixer-Upper Fantasy?
Many first time buyers have them. It goes something like this: You find a big home in a great neighbourhood that's well below what you'd expect to pay for that house in that neighbourhood . You see a couple of coats of paint, new flooring, a few repairs, and voila, a dream home without the nightmare price.
Before you jump headlong into this 'once-in-a-lifetime opportunity' consider how you'll do all of the work. Will it be weeknights after a long day at the office, or will you hire someone? Are you ready to live in a dusty mess as you renovate? Do a realistic assessment of the job at hand and be sure to have the house inspected. The last thing you want is a bargain home that turns into a money pit. You're far better to find a house that costs a little more each month but doesn't need much work than to buy a fixer-upper that eats up hundreds of dollars each month. For example, let's say you could buy a really nice house with minimal work required for $25,000 more than a fixer upper. At today's mortgage rates, assuming you could stay within your monthly budget, that really nice home would cost you only about $125 per month more than the fixer-upper. If you buy the fixer-upper, you'll be spending a lot more than $125 each month to whip it into shape.
Explore new areas and home styles
Are you set on a specific area? Downtown? The suburbs? A rural setting?
Do you have a preferred type of home? Detached? Duplex? Condo? Townhouse? Apartment? New or Resale? There are a variety of home styles you will want to explore.
If you're contemplating the move to an unfamiliar neighbourhood, take the time to go exploring. Walk around, drive around, and get a feel for the distance to the nearest convenience store.
Make some notes. Take the neighbourhood tour at different times of day and contact the local municipal office to find out what future developments are planned.
You'll also want to check zoning by-laws and fire codes, especially if you plan to rent the basement or conduct a business in your new home. In law suites, student housing, basement apartments and duplexes all have very specific code requirements.
As you can imagine, each type of home has its advantages and drawbacks and no two buyers will have the exact same wants and needs. The only way to truly evaluate which home is right for you, outside of price, is to consider what you absolutely must have and what you can live without.
Before you go house hunting, prepare a list of 'can't live without' features and a list of 'would be great if...' features.
Types and Styles of Homes
Single-family detached homes stand on their own lot thereby offering a greater degree of privacy. They are designed to house one family.
A duplex has two units, attached by a common wall. A duplex is a strata; however there are no monthly maintenance fees. The building is insured together and the two homeowners must work together when it comes to exterior repairs.
Townhouses join several single-family units by common walls. Townhouses are strata properties. and typically have a monthly strata fee.
An apartment is a multifamily, multistory residential building with individual housing units frequently with a common entrance and hallways that share two or more common walls/floors. They are also strata properties and have a monthly strata fee.
What is a Strata (townhouse, condo, patio home)?
Strata is a type of property ownership, not a style of home. When buying into a strata complex, your home will usually cost less and you often won't have to worry about snow shoveling, lawn mowing or major exterior maintenance like fencing or the roof. Strata can also come with extras like a security service or recreational facility. Of course, you should be prepared to pay a monthly strata fee. This fee goes into a collective cash reserve that is used to cover property maintenance, repairs, replacements and insurance.
Before you purchase a strata home, do your research. Find out the value of the cash reserve and upcoming projects which the reserve will fund. Ask about annual increases and compare the strata fee to similar condominiums in the area. Most importantly, read the minutes of the strata council meetings, going back at least 2 years.