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For most people buying their first house is both exciting and anxiety-inducing. Most young Canadians dream about being able to afford a place of their own for a substantial period of time, and when they finally determine they’ve built up the nest egg they need and are pre-approved for their mortgage this signals the end of a long journey (albeit one that was likely much shorter than paying down their mortgage will be!).
Because North Americans hold home ownership up as a coveted ideal (for better or for worse) buying a house isn’t just a financial transaction for most people. Instead it often represents a major step in life where the roof over your head goes from merely being an arbitrary structure to a home that you will take personal pride in. Some might argue that peoples’ emotions for their homes or houses are unhealthy and often lead to irresponsible decisions, but there is little doubt that the Canadian middle-class vision of owning your own home is alive and well.
Related: Porting Your Mortgage
Size Doesn’t Have to Matter…
Personally, because of where I chose to live in Canada (rural Manitoba) I was able to purchase a house at a younger age than most. This ensured that I had very modest expectations for my first place. My budget was so small that it would be unimaginable to many urban Canadians, and my only adult living experiences consisted of living in a shoebox of a dorm room (a fantastic experience – but that’s a story for another time) and sharing a place close to campus with several other guys. Next to the relative lack of personal space and certain lifestyle expectations that came with those, almost any freestanding structure looked like a pretty good deal by comparison. I never had a upscale condo or even a nice apartment to call my own before making the transition to homeownership.
Related: How Much Home Can I Afford?
Consequently my wish list was pretty basic when I started looking at houses. I’m a pretty simple guy when it comes right down to it, so in a perfect world I was hoping for at least 800 sq ft, a modest garage, somewhere close to work, and not a building located in a flood plain (a major issue in Manitoba). I don’t want to go into too much detail on the house I ended up with because it was a pretty great deal (and no, that wasn’t just my real estate agent’s view of the situation) that I’m very fortunate to have gotten and I don’t want to create a bunch of ill will amongst the many Canadians who work extremely hard every day to build up large down payments (many of which are probably about what my house cost in total) to buy houses in urban centres. Suffice to say I love our place (now that my fiancée has moved in it is officially “our” instead of “my”) and I’m very happy with The One that I chose – the house that is – not that fiancée – that one I’m ecstatic about!
Do Your Own Homework or Pay Someone to Do It For You?
When I began my quest to purchase home I sort of went into full nerd mode and read an ungodly amount of stuff about mortgages and how real estate worked. I checked out books at the library, read countless blog articles, and talked to a couple of family friends who had worked in the business for decades. I didn’t think I had much choice seeing as how I didn’t really know anything at all about how to buy a house before this point. After doing all that reading I determined that I could handle my own affairs when it came to looking for and negotiating a house purchase – and merely needed a lawyer to handle some of the paperwork for me. This route certainly isn’t for everyone. If you’re not the type that wants to invest a couple dozen hours reading about how this stuff works and what is involved in doing it yourself, then you’ll instead have to determine what sort of team of professionals you’ll want working on your behalf. Keep in mind though, while many real estate agents and other professionals can bring a lot to the table, they also need to be paid. In a limited market like the rural one I was moving to there really wasn’t many choices involved and I managed to save a substantial amount of money by taking care of a lot on my own. I have to admit though that there were a few headache-inducing situations where it would have been nice to have a professional there to lean on.
Two Quick Tips
I’m certainly no expert on buying houses, but I will say that two underrated tips are to get your paperwork fully done early (and if you’re wondering why I threw the term “fully” in there, don’t worry, you’ll see how many stages of “done” there are when dealing with mortgage documents and other paperwork when buying a house) and to take 20 minutes to read about what your closing costs might be. The frustration of trying to get paperwork done and returned to multiple parties on tight deadlines is a hassle that needs to be avoided if at all possible. I had the experience of trying to get stuff done during the summer when it seemed like every person I needed was on vacation, just getting back from vacation, or about to leave on vacation. Needless to say I won’t do that again. Make sure you triple check with your lenders or any professionals you’re working with if they have ABSOLUTELY EVERYTHING that they need from you so you can avoid phone calls to you from people needing certain documents immediately when you’re in the middle of a four-hour drive.
When I saw my house I really hoped it would be “The One” and now I’m very happy to call it my home. I know many young Canadians out there are jaded about real estate in general and that there are many advantages to renting. That being said, anyone else out there still thinking the “Canadian Home Ownership Dream” has treated them pretty well?
This post content is sponsored by Royal Bank of Canada, however the views and opinions expressed herein represent my own and not those of Royal Bank of Canada or any other party and do not constitute financial, legal or other advice.
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