You’re an experienced homebuyer. Maybe you are just finishing up the financing term on your mortgage or your income has increased and are considering an upgrade. So what do you need to consider when moving from one property to the next, check out these tips.
How much of an upgrade do you need/want?
If you haven’t been through it before, buying a new home (and selling your old one) is a costly process. You’ll need to pay for realtor commissions, land transfer taxes, legal fees, moving costs, utility set-up costs and others. It comes down to the practicality of it – if you want to make a move, you should make the upgrade significant enough to justify the extra costs. If you need more space but don’t have that much more budget you could think about moving to a different neighbourhood where you will get more bang for your buck.
Should you buy or sell first?
So how do you know whether to sell your current home or buy your new one first? Consider your financial situation first – can you manage a month or two of transition while paying for two mortgages if your current home doesn’t sell? It is possible that your property may not move as quickly as you think, so consider carefully and trust us to get expert advice on understanding the current market conditions
Your changing life needs
If you decide to make an upgrade, how long do you plan on living in your new home – 3 years? 5? 20? Depending on your age and family situation, you’ll likely need to think about things you didn’t have to consider the last time you bought a home. Do you need to be near daycare or schools (elementary and secondary)? Should you consider getting a house with a second apartment for a nanny or housing aging parents? Are you a dog-owner now and need to be near leash-free parks?
What are the pros and cons about your current home and area?
There are always compromises to make, even when upgrading to a more expensive home. Do you love being able to walk to coffee shops and restaurants? Or do you long for green space and want to be closer to parks Do you love your current kitchen storage? Dream of closets? Do you hate shoveling your current driveway and want to live close to work so you can live commute-free?
How much space do you need?
One of the top reasons people want to move is to have more room to “live”….but when 80% of your time is being spent in the bedroom or living room, how much space do you really need and where do you need it? If your family is growing, you will most likely want more bedrooms, possibly a conjoined bathroom, and some playroom. Alternatively, you might be looking for different types of space – a home office to basecamp your business from, a larger entertaining area or outdoor yard space, etc.
What kind of home-owner are you?
So when it comes down to it, how have you managed your current home over the years? It’s not always fun dealing with the variety of issues that crop up when you own your own homes, especially when it comes to houses (there is no strata to take care of problems). If you are the kind of homeowner that turns a blind eye to little issues that crop up then buying a new (or newly renovated) house with fewer foreseeable issues might be a good option. If yard work isn’t your thing then you may even want to consider a strata based property where all of the monthly and daily chores are taken care of for you. It’s all relative.
The almighty dollar
Your residence property is one of most intelligent investments you can make because it grows your equity 100% free of tax, but how much more can you comfortably afford to spend without giving up your life? Make sure you consider that a newer and more expensive house will always have higher property taxes and utility bills. If you’ll be draining the equity in your current home or financially straining yourself to afford a new home, you might want to wait. Estimate how much extra your new mortgage will be and to start saving that extra money now so that you’ll be used to the higher payments when you make a move.