You've been working a side hustle, cutting back everywhere you can, and you’ve found the perfect condominium just begging you to call it home. How do you know if you're ready or if it's the right time? Read on for our checklist to help determine your condo-buying readiness!
1) You have a pre-approval. Saving for a down payment is the best way to get ready to buy, but how much do you save and what can you afford? Getting a pre-approval will fill you in on the pricetag of the home you can buy, which will help you set a goal to work toward (likely at least 10% of the purchase price, however circumstances vary). Starting your journey at the bank will also allow you to consult with a professional who can take a look at your finances and lay out any options available to you (are you a first-time homebuyer with RRSPs? You may be able to use that money as a downpayment).
2) You have full-time employment with job security and a steady income. This is a big one and it not only helps with pre-approval, but without a steady job, it's hard to manage the consistent monthly costs that come along with home ownership.
3) You've found a location where you can see yourself staying for years to come. The idea of some consistency excites you, and you love knowing you could never get kicked out of your place whenever your landlord decides to sell. Still, if you haven't found a neighbourhood or city you’d like to sink into for a few years, then it might not be the right time for you to buy just yet. Buying and selling real estate does come with transaction costs (property transfer tax, legal fees, realtor fees, etc.) that do add up if you aren’t planning on staying a while. After about three to five years, these costs are usually absorbed by your gain in equity and appreciation.
4) You're fed up being a renter. Are you over being someone's tenant? If you’re tired of not being able to make changes in your space, or just really looking forward to not paying someone else’s mortgage, then you're probably ready to be a home owner.
5) You're financially able to handle the monthly costs of owning. If you have enough savings or cash flow to cover the costs associated with home ownership, then you’re likely ready to buy. Want to know how much to budget for on a monthly basis? Take your mortgage amount and add in costs such as property taxes and condo fees to come up with a final number (speaking of condo fees, take a peek at this article to get the low down on what condo fees really cost and cover!).
Did you nail this list? Check out some currently selling condos on the market if you can’t wait to take this next step.