Today’s sky-high real estate market can make buying a first home seem like a distant dream. Don’t be discouraged. It might take a bit more planning, but you can do it. Good financial strategy and some real estate research can help you get into your first home sooner than you’d think.
Your first priority is to get your financial basics in order. Reach out to your bank or a financial planner to help you make a plan. A financial expert will be able to find a strategy that best suits your goals. You will also need to plan for your down payment. Many first-time buyers find this intimidating, but good old-fashioned saving is a great start.
Make sure your monthly budget allows you to put some money into savings, and work with your financial planner to help your savings grow as quickly as possible. Government programs are also available to help first-time buyers. You may be able to use savings from an RRSP or other resources — check with your bank for the programs and requirements in your region.
Reaching out to family can also be a win-win, but approach these arrangements with caution. Ensure any loan terms are realistic and clearly set out, and treat these arrangements with the same respect you would give a business agreement.
Once you have your finances in order, look for locations that will get you the best bang for your buck. Skip the high-priced, trendy spots where you’ll pay a premium without necessarily getting a better home. The best deals are often hiding under tacky décor: if you can look past the cosmetic hang-ups and make sure the house is structurally in good shape, you may have a great opportunity in the making.
An often-overlooked strategy for a first home is land-lease. In this arrangement, homebuyers purchase and own their home and lease the land on which it sits. A home in a land-lease community can cost up to 30 per cent less than a comparable home in the same market, making it a much more affordable option. Land-lease communities, such as those offered by Parkbridge, also often include amenities like a pools and recreational facilities similar to condo developments.
The main thing is just getting started. Find a realistic strategy that will get you into a home, and then work your way up to that dream home. Think of real estate as a process. You may need to start small or look outside your ideal neighbourhood at first. But once you own a home, you’ll be building equity and value, which sets you on the path to your forever home.