Are you thinking about buying your first home, but feeling frustrated that you can’t afford to? You are not alone. In fact, data shows that over 40% of first-time homebuyers in Canada can’t afford to buy a house without help from their parents.
Today’s overheated housing market makes buying your first home a real challenge. But don’t worry, you still have some options to become a homeowner.
Downsize your expectations
Most of us have a clear idea of how our dream house should look like. You have your own as well, right? Well, unfortunately, you may have to become a little bit more realistic and downsize your expectations. Before you can dream about the ideal property, make sure that you determine what you can afford.
Analyze your current financial situation and the upcoming events that may affect it, such as a change in your career. Next, start taking a look at the housing market to see where you are standing. Determine what you can afford and for how much money you can get it. Doing so, you may realize that you actually can afford to buy a home, just not one as big as you have imagined or without a particular feature that you considered a must.
For example, maybe you were looking for properties in the most expensive area in your surroundings because it is the closest to your workplace or other amnesties. Yet, perhaps you can find a home just as beautiful and worth-buying in a farther neighborhood. Or, maybe you don’t necessarily need to purchase a home with a pool, as dreamy as it may sound, and by giving up on this criterion, you can find the ideal property for a lot less money.
In other words, make a list of all the things that you were dreaming about having at your first home and decide which ones aren’t indeed a necessity.
Wait a little bit longer
Not exactly what you want to hear when you dream of becoming a homeowner for a long time now, but your goal may need just a little bit more time.
So, there are two questions you should ask yourself at this point: “is it really the time for me to buy a home?” and “can I afford to buy it right now?”. These two questions have a solid connection. If you can’t afford to buy a home, it is most likely not the time to do it anyway.
One of the biggest mistake first-time homebuyers do is rushing into securing a home as a long-term investment. However, rushing into this often leads to making a terrible investment decision. Plus, you shouldn’t feel pressured by the rising prices in your house market, another mistake most first-time homebuyers do.
The rising prices of the housing market can increase the pressure of buying a home as quickly as possible. And, it may be tempting to spend more than you can afford to secure a home. But that can be a wrong decision if you only make this choice based on the pressure you feel.
The housing markets, no matter where in the world, always have their ups and downs. So, although it seems like prices are skyrocketing right now, in a year or two, they might become a lot more affordable. Plus, you also get more time to save more money for buying a property.
But, don’t forget to keep an eye on the housing market because you never know when you find an excellent deal.
Get a loan
We realize that getting a loan was one of the first options you thought about to have enough money to purchase your dream home. But, since you are still out here looking for options instead of looking for a property to buy, it means that you may be struggling with a bad credit history. So, here’s the good news: even if you have a bad financial history, you may still be able to get a loan, a guarantor loan.
Banks and other lenders always check a potential borrower’s financial history to determine whether or not the borrower will repay the loan. So, if you have a bad credit score, they will decline your application.
But, guarantor loans require you to find a friend or family member who will vouch for you that you will make the repayments on the loan or they will become responsible for the payments if you fail to do so. Now, a guarantor loan won’t give you enough money to pay for a property, as they typically go up to $10.000, but it can give you the additional sum you need to purchase one.
You can check with multiple Guarantor Loans Canada providers and choose the one that suits your financial needs the best.
Try to negotiate
If you would be the one selling, would you lower down the price just to get the house off the market? You’d probably will. So, the chances are that if you keep an eye on the housing market, you’ll eventually find a seller that will be willing to bargain with you.
If you found your dream home and you are really close with your budget to afford it, you shouldn’t pass up the chance to negotiate the price. Negotiation in the process of buying a home can result in significant savings, or your case, it may take the property’s house so down that you can afford it.
Even if the seller isn’t willing to lower the price, you may still negotiate for them to cover other costs, such as the closing costs or make some necessary repairs to the property. Either way, you will be saving money and may afford to become a homeowner.
Buying your first home is a critical moment and a significant long-term investment. That’s why our advice is to not be in a rush to become a homeowner if you can’t afford it right now. However, even if you don’t have the money right now, keep an eye on the housing market to hunt for a great deal.