Today, Adrian is joined by Chris Behie to discuss some of the most common mistakes first-time homebuyers make and tips on how to avoid them.
Buying Too Large of a Home
As a first-time buyer, it’s easy to get caught up in the idea of buying the perfect home right away.
Many people refuse to buy a condo or a small townhouse, and because what they really want is unaffordable, they see it as impossible to get into the market.
Ariel and Mily had a bit of a heated debate on this topic in this controversial clip about Gen Z homebuyers.
Instead of looking for perfection, buy something you can afford to get into the market, and two or three years from now, move up to the next size. If you wait to afford the house you want, you’ll always be priced out of the market.
Alternatively, you can purchase an investment property to rent out. Rent prices are through the roof right now, and it’s a great way to jump into the market and gain equity, so maybe you can afford the house you want to live in a couple of years down the road.
An investment property also gives you some tax deductions for expenses such as home and mortgage insurance, heat, hydro, and water.
Here’s an example of why spending a bit more money to get the larger house may be a worthy consideration.
Getting Too Caught Up on the Staging
Staging is an effective tool for sellers. The point of staging is to get as many prospective buyers to fall in love with their house as possible. First-time buyers, in particular, can fall into the trap of seeing only the staging and the vision of how they want to live.
In reality, you can have two homes, one far more upgraded that doesn’t show well due to old furniture and carpeting and a less-upgraded but well-staged home, and the one that should be worth more sells for less because it looks a little frumpy.
It can be hard for people to see beyond what’s in front of them. They get so caught up in the colours, finishes, and other cosmetic upgrades, which can easily be changed for a very low cost.
You’ve got to focus so that you’re seeing the potential in a home, not what’s currently in front of you.
Check out these professional home staging stats to find out how much of a difference it makes when selling a home.
How Parking Affects Home Buying Decisions + Parking Regulations
The guys suggest buying a house for the vehicle you have. Park in the driveway and see if it fits. The other side of the coin is if you have the house first, make sure the new vehicle you want will fit in your driveway.
Parking is probably one of the biggest reasons first-time sellers move: people get sick of shuffling vehicles.
Depending on where you live, a lot of municipalities have parking exemptions. For example, Parking requirements in in Milton, Ontario include the ability to get a temporary street parking exception if you need to park on the street for more than five hours or overnight between 2-6 a.m, for up to 16 nights per license plate.
This ties into the importance of finding out more about the area before you purchase:
- Look into the schools, amenities, traffic, etc.
- Talk to neighbours to get the low-down on what it’s like living there
- Google the address, the street, and the community
Often people end up moving because they hate the area.
Check out this podcast about parking problems in the GTA.
How Working from Home Has Changed Real Estate
One thing people often overlook is the commute to work. During COVID especially, people moved to more affordable towns without considering the impact of their daily commute.
When people could work from home, upgrading and moving further away seemed like a good idea. Now they’re getting pulled back to the office, and having hours of driving time added to their day is a stressor.
Before you decide to move to a less expensive town:
- Do the drive yourself during your regular commuting hours to get a realistic idea of how much time will be added to your working day
- Consider fuel costs, toll costs, and the depreciation of your vehicle
- Think about how you feel about winter driving conditions
- If you move to a less expensive area and then decide to move back, it’s probably going to cost you more to buy another home
Would you rather spend more time at home and less time on the road? Many people move, only to realize they hate the commute.
Condos Rules and Regulations for First-Time Buyers
Know the bylaws, rules, and regulations. A big one is pets. Since Covid, more people are bringing animals into their lives, and Chris has found that rules around pets are stricter than before.
When it comes to pets in condos, there can be restrictions, including:
- Total number of pets
- Types of animals
- Weight and type of dog breed
- Pets not being allowed in the lobby or elevators
- Pets not being allowed to go to the washroom on the property
Making a Decision Online Before Seeing the House in Person
Don’t be too quick to judge a home before you see it in person. First-time buyers tend to keep scrolling if there’s even one thing they don’t like about a house. But what you see online and what you get in person can be very different.
It’s why Adrian would rather take his buyers to a few houses with multiple options instead of sending them listings and why first-time homebuyers should be open-minded to different areas and types of homes.