Are you a move-up Buyer? Looking to upgrade your current condo or house to a bigger house or better neighbourhood? If that sounds like you, read on for our 10 top things to consider:
1. Should you buy or sell first?
The answer to this question is largely dependent on what kind of property you currently live in and where it is. If you live in a hot ‘hood, downtown house or unique loft or condo, you’ll likely be able to sell quickly. If you’re in a less-in-demand area or building, selling may take 60 or 90 days, and you probably want to sell before buying. The second big factor to consider is your financial resources – can you afford to carry both mortgages if your current home doesn’t sell? What if Buyers don’t think your current home is worth what you think it is? Your lender and REALTOR can help you decide whether you should buy or sell first.
2. How big of a move-up should you make?
Selling and buying are expensive – there are land transfer taxes, legal fees, real estate commissions, moving costs, utility set-up costs and more to consider. If you’re going to make a move, make it count. If you need more space but don’t have that much more budget, consider a neighbourhood change. Lateral moves are expensive.
3. How has your life changed and how will it change?
Do you plan on being in your new home 3, 5, 10 or 20 years? Depending on your age and family situation, you’ll likely need to think about things you didn’t have to consider the last time you bought a home. Do you need to be near daycare or schools (elementary and secondary)? Should you consider getting a house with a second apartment for a nanny or housing aging parents? Are you a dog-owner now and need to be near leash-free parks?
4. What do you love about your current neighbourhood? How do you wish it was different?
There are always compromises to make, even when upgrading to a more expensive home. Do you love being able to walk to coffee shops and restaurants? Or do you long for green space and want to be closer to parks and trails?
5. What do you love most (and hate) about your current home?
You know what they say about the devil you know vs. the devil you don’t. Do you love your current kitchen storage? Dream of closets? Do you hate shoveling your current driveway and want to live close to work so you can live car-free? Has your ensuite bathroom saved your marriage?
6. How much house do you need?
One of the top reasons people want to move is to have more space….but how much space do you really need and where do you need it? If your family is growing, you probably need more bedrooms, possibly another bathroom, and some playroom. Alternatively, you might be looking for more or different space – a home office to house your business, a bigger entertaining area, etc.
7. What kind of homeowner have you been?
It’s time to be honest with yourself: have you maintained your current home or have you closed your eyes in the hopes that the water in the basement/leaky tap/squirrels in the attic would go away? It’s OK if you don’t like being a homeowner – buying a new (or newly renovated) house or townhouse might be a better option for you. If you hate gardening, why buy another house with a big yard?
8. Money, money, money.
Mortgages are cheap these days – you can borrow an extra $100,000 for under $500/month. How much more can you comfortably afford to spend without giving up your life? Your primary residence is one of the smartest investments you can make because your equity grows tax-free. But don’t forget that the new more expensive house will come with higher tax and utility bills too.
9. What do you need to do now to be ready to sell your current home?
We’ve had more than a few move-up Buyers fall in love with their new home out of the blue. If you start to prepare your current home now, you’ll be able to jump on those opportunities. Have a read of our guide 30 Days to Preparing Your Home for Sale and get started.
10. Should you suck it up and wait?
Sometimes, the right decision is to wait. If you’ll be draining the equity in your current home or straining yourself financially to afford a new house, you might want to wait. One of our favourite strategies (and one we have used ourselves) is to estimate how much extra your new mortgage will be and to start saving that extra money now so that you’ll be used to the higher payments when you make a move. Bonus maneuver: put that extra cash on your current mortgage and build more equity.