It's a big deal, purchasing a new house. In fact, this is probably the biggest purchase you'll ever make in your life. There is a lot to take in and yes, there is paperwork galore. So where do you start? We put together this list of steps to take before purchasing a home as a timeline to help you out.
Talk to Your Banker
First things first - you need to make an appointment with your banker or mortgage broker. You need to get into all the details of your finances and determine if you can afford to purchase a house at this point or not.
Time to Budget
It's a word a lot of people talk about, but not many actually put into practice. If you're serious about buying a home, you need to stay on track. Do you have a down payment already? If not, it's time to put together your plan to save for it. Look at your debts and reduce or get rid of as many as possible. You don't really need three credit cards, do you?
When you create your budget, make sure you do some research on what your additional costs could be, and build that into your plan. If you don't need it, great! Extra cash for you! But if you do, you'll be happy you have that set aside. This could be things like closing costs, lawyers/realtor fees, HOA fees, home inspections and more.
What Kind of Home?
This is the point where you want to look at what kind of home you want, and what fits your lifestyle. Single, married, kids, retiring - these all play into what types of homes you should look at. Is a duplex or a town home what you're looking for, or would a single family home on a large lot fit into your lifestyle better?
You will also need to create a needs versus wants list for your new home. Determine exactly what you have to have; these items aren't negotiable. Your wants on the other hand, these are things you could live without. This will help eliminate potential homes from the beginning and save you a lot of time.
Don't forget to think about the future. How many bedrooms do you need? Is there another baby in your future? Is this your first home or your final home? If you're planning on selling your house, make sure the floor plan would work for a variety of lifestyles, otherwise you could have a hard time selling.
You can have the perfect home, with the exact kitchen you've been dreaming of and that extra family space in the basement but if you don't like your neighbourhood, you're going to feel like something is missing. Do your research on the different communities in the area of the city you want to live in. Do you want to be close to your work, or is a bit of a longer commute okay with you? Are you trying to stay close to family and friends or do you really want to be close to that brand new rec centre? Once you pick your location, you can't move your house if you don't like the neighbourhood so this is a pretty important decision.
So this step ties into our first step and involves more research. Look at the current mortgage rates and the market as a whole. There are patterns in real estate that tie in with the stock market and dollar values, which all play into the value of your home. And of course, being in Alberta the oil market has a bearing on our housing market. One thing you want to remember is to not solely base your decision on what the media is saying. They tend to be lean towards the negative side!
Get Some Advice
If you're at the point in your life where you are looking at buying a home, chances are good that some (or most!) of your friends and family are there too, or they've already gone through the process. So talk to them! Ask them about their experience - things they did right, things they would have changed and so on. Get their take on the process and learn from it.
Show Home Time!
Here's the fun part - it's time to do some show home tours. Before you go, research potential builders online and talk to people you know who have recently built a home (see the above point). Make some appointments or drop in and view the show homes, walk around and get a feel for the floor plan. You'll get an idea on what you're looking for, style-wise, and what options you have that fall in your price range. And pay attention to how the sales person at the show home treats you; you'll want to choose one that seems to go the extra mile with you.
Overall, the key thing you need to remember is that research is the most important thing when it comes to purchasing a home. Whether it involves finances, home models, the community or the builder you decide on, expect to spend time wading through information. Don't rush the process and be inquisitive. You'll never know if you don't ask. Buying a home is one of the most important purchases you will make. Don't forget to have fun while doing it!