5 Things Millennials Should Know About Home Buying
As a millennial, buying your own home may be exciting, but it can also be overwhelming process. Whether this will be your first home or you’re looking to upgrade to something bigger, there are a few things you should know.
Here are five tips to consider before buying a home to ensure you get the best value and a house you will truly love:
1. Learn to Budget
When you own a home, there will be several routine expenses for which you’ll always pay. In addition to the mortgage and utility bills, there may be unexpected repairs and maintenance. If you’re looking to purchase your first property, it’s a smart idea to learn how to budget. Know where your money is being spent and try to reduce your debt.
In addition to your savings account, if you set aside some money in case of an emergency, it will help tremendously if you have to miss a mortgage payment due to unforeseen circumstances. Being financially savvy will be beneficial when you buy your own home.
2. Research Housing Prices
When you start looking for a new house, comparing home prices in the immediate area is essential. Take your time and get to know the value of previously sold homes in the area. Prices can vary significantly between suburbs, and you don’t want to make a bad investment. Consider the popularity of the area and whether any amenities are convenient. It may be a possibility to move slightly farther away in order to get a more affordable home or a bigger block of land.
3. Use Your Head
Buying a house can be emotional. When you look at homes, you can quickly get caught up in the dream and jump into something for which you aren’t prepared. A shiny new home with no furniture could look appealing, but when you assess the floorplan, it may not have the space you need.
Alternatively, the perfect house could be filled with mismatched furniture, have an unusual color scheme and an overgrown lawn. These issues can easily be rectified. Try not to make any decisions on the spot, and if you don’t have building experience, a fixer-upper is will likely be more trouble than it’s worth.
4. Get Advice
Getting the right advice is essential, and this could come from real estate agents, mortgage brokers or others experienced in home buying. There is a range of loan options available, and one common decision is whether to choose a fixed or variable rate mortgage or a HELOC.
If you have an existing property, a HELOC will give you a line of credit, which is about 65 percent of the value of your home. Getting the best HELOC rate in Canada will require some comparisons between lenders. Just know you should never accept the first offer without trying for a better deal.
5. Only Borrow What You Can Afford
While banks can offer you a large mortgage, know that interest rates are your life circumstances can change in an instant. IN that vein, think about whether you are planning a family, career change or another big purchase in the future. It can be hard to predict what will happen, but being stretched thin doesn’t give you much flexibility. Only ever borrow what you feel comfortable with and be honest with yourself. This will make the process of buying your own home more successful.
The Wrap Up
For millennials, now is the time to start thinking about buying or upgrading a home. It’s possible to have a comfortable mortgage or HELOC that fits both your current and future circumstances. Try to keep a clear head, set a budget, and seek advice before making a big commitment.