If you are like most Canadians, the dream of owning a home is one that you have been pursuing a considerable amount of time. This dream is implanted in us at a very early stage in life. Perhaps as young as a teenager, you began to learn more about home ownership from your family, your friends and of course, the internet. It is a dream come true when you first open the door on your first home or when you unlock the door of your newly renovated family home.
Your home ownership dream must include an awareness and understanding of the costs incurred when you purchase a home and the costs incurred to operate, maintain and improve your home of its useful life. You need to acquire information about the cost of money (e.g. mortgage) to finance your home; legal fees; transaction costs (e.g. realtor commissions); realty taxes and of course, the cost to insure your home. Once gathered, this information should be reconciled in a budget and subsequently shared with your lender, to determine what you can afford to purchase.
Home operations, maintenance, and improvements. Utility costs are incurred the day you take possession of your home and they will continue until you sell your property. These costs tend to escalate over time due to inflation, market forces, and regulatory change. Regular maintenance requires you to perform thorough housekeeping on the interior and exterior of the home; complete occasional repairs and ensure all important home systems (e.g. heating and air conditioning) are efficient and in sound working condition. Last but not least, home improvements to a new deck or a renovated bathroom are on the mind of every homeowner. Most of these things may be completed by you, the homeowner. But undoubtedly, they all cost time and money whether you are a do-it-yourself handyman or you contract the work to a professional.
Your home will likely become your most valuable asset over the long term and it will have enormous sentimental value for you and your family. Take care of your home and adequately protect it with comprehensive, affordable home insurance. A loss of your home due to a fire or theft of a family heirloom can have traumatic and devastating consequences. Like all of the other aforementioned costs, comprehensive, adequate insurance coverage is an important determinant of your home ownership decision making.
Doing your homework before you leap into an ownership of a home, will get you the home you can afford!