At today’s low interest rates, buying a home for first time buyers in Calgary has never been more affordable. The real estate market is still very vibrant and looks rosy and promising for the immediate future. A new home is an excellent investment. Buying a new home can be intimidating for the first time buyer so what should you do to get ready for the process?
Determine what you Need
It’s always a good idea to sit down and figure out what type of home you are seeking. Some of the questions you want to ask your self include the following:
• How many bedrooms do you need right now and down the road?
• How many bathrooms will you need?
• How much parking or garage space will you require?
• What type of facilities will you require nearby such as schools, access to public transportation, shopping, daycare?
• How close to work will you be as it can be important to consider the cost of traveling and the time it takes to get to and from work.
Type of Home
Are you going to be looking for a new home, an older home or a condominium? Newer homes tend to be much more energy efficient which is a cost savings. They also do not require as much maintenance as older homes. Older homes may have repair and maintenance issues which you will have to carefully scope out and figure into your overall budget.
It is best to always use the services of a qualified and licensed Home Inspector to perform a thorough inspection of either a new or older home, so you are aren’t caught with unexpected repairs or expenses.
What can you Afford?
Price ranges vary in the city of Calgary depending on the neighbourhood which interests you. Many sites which offer mortgage advice and compare rates also offer you handy calculators which allow you to calculate various scenarios for down payments and different types of mortgages and terms to give you a better idea of how much your mortgage will cost.
It is also important that you consider that you will also have to factor in other important items like property taxes, insurance such as mortgage insurance or life insurance to cover the mortgage along with homeowners and content insurance. You will also have to factor in your utilities into your monthly budget as they are more expensive than what you would likely pay for an apartment. Additionally, there will be closing fees and the cost of using a real estate lawyer.
If you are thinking of getting a condominium, there are also usually extra charges for condominium fees to cover general maintenance such as landscaping or snow removal and general repairs.
Get Mortgage Pre-Approved First
Before you go house hunting, sit down with your banker and get pre-approved for your mortgage first. This will help you understand the process and where you stand regarding how much a lender might allow for a mortgage relative to you financial circumstances and down payment.
You aren’t committed to anything with a pre-approval but it will give you a price range from which you can start with your house hunting. The big banks also tend to be a bit more expensive when it comes to interest rates, so if you want a better deal it might be wiser to use the services of a mortgage broker when you find that perfect home as they can get you the best rates. Mortgage brokers earn their commission from the lenders so it doesn’t cost you anything to use them.
Photo by nancyarora
