Tips on Buying your First Home with a Small Budget

This is it. You’ve decided to make the biggest purchase of your entire life and you’re all fired up about it. Congrats! You can already picture what it’s going to look like – gourmet kitchen, massive dining room, suite-like master’s bedroom, the work! Images of your dream house are slowly populating your mind like it was going out of style.

Hold on to those thoughts and keep them in a safe place for now, because I’ll burst your bubble a little bit. If you’re a first time buyer, chances are your first home purchase won’t be anywhere near your dream home. Unless you have rich parents or have a multi-million dollar business operating out of your kitchen, getting your dream home on your first buy is pretty rare. It’s not impossible, but rare.

Choose where you want to live

Location is probably as important as the house itself. The worst thing you can do is get an affordable and beautiful house in a crime riddled neighborhood. No wonder the houses are cheap! Do some legwork and ask around. Do your research. Don’t neglect the location of your new home because you’ll be living here for the foreseeable future. You must enjoy being in the area and it has to be safe for you and your kids. The distance to amenities will also affect your fuel bills, car maintenance needs and vehicle insurance. Will you be able to walk or bike to work or other frequently visited places?

Consider Starter Homes

You should really consider starter homes if your budget is a little tight and you’re just starting out as a family. Your space needs would probably be modest at best, and a well built 2-bedroom starter home can give you a roof over your heads. This wouldn’t be the house of your dreams, but it’s a good start and an investment you can either rent out or flip when you buy a bigger home.

Look for Fixer Uppers

Be on the lookout for fixer uppers in the area your targeting. These houses may look bad now, but imagine what it’ll look like once all the renovations are made. You can also get fixer uppers below market value if you know a little bit about real estate. If you don’t, look for a broker you can trust that will give you deals on houses below market value. The money you can save on housing costs can be used to renovate the house.

Keep an open mind about Condos

Many condos and townhouses have enough space for a small family and should also be considered when you’re looking to buy property for the first time. Look for condos with balconies, extra storage space and enough amenities to keep you occupied. Condos are priced competitively and are usually situated in the heart of the city. You’ll be near everything and you’ll never run out of things to do. Just don’t forget to factor in the monthly association dues.

Kick it Old School

Older houses made in the 1920’s to the 1970’s are more affordable than newly built ones. Consider the savings you’ll make when you get an old house that needs minor renovations versus a new build that’s probably 20% more expensive. Plus, you’ll get that old world charm that newer houses don’t have. Who knows, an old house may just put you a step closer to your dream home.

Your Funds

Where you source your funds is completely up to you. It can be in the form of family savings plus a loan or purely from a loan. You can source it from a bank or from any legitimate private lender in Montreal, Toronto, Winnipeg or Vancouver just as long as the rates are good and you have flexible terms.

It’s all up to you now. What are you going to buy?

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