Toronto: Canada offers a fertile ground for immigrants to buy a new home for themselves. However, new home buyers often face certain challenges to make a property their own. Some first-time home buyers seek the help of a real estate agent, others surf through the listings and try to find a home for themselves. Whatever mode you opt to acquire a home, here are a few common problems first-time home buyers face while buying a house and wise ways to combat them.
Mortgage & debt-income-ratio
Any purchase of a home, old or new involves a lot of money for down payment. Hence, before you finalize on a home, make sure how much money you will need for down payment and start working on it well in advance. Most bankers calculate the debt-income-ratio before offering you a loan. Money lenders require their borrowers to have debts that are 44% lesser than their income. Most real estate agents are well acquainted with the bankers and money lenders, talk to them before you get into the deal.
Your credit score determines your mortgage amount and the down payment. A good credit score is the most important factor that decides your interest rates and loans approval. A credit score between 750 and 900 is considered as very good. The closer your score is to 900, the better your chances will be of getting your home loan approved.
Budget and affordability
Your and your family members might woo a property, but it might be beyond your budget and affordability, this is definitely a challenge for many home buyers. Talk to your friends and relatives, ask them whether they would be interested in a shared living space and go for it. Also, there are a few institutions in Canada who help people below the poverty line to buy their first home. If you cannot afford a home at all, get in touch with them.
While buying a home, there will be extensive paperwork that you need to complete. Put attention into it, read every statement and complete your paperwork carefully. Get legal advice whenever needed to avoid future litigations. If you have a real estate agent assisting you in the process, he will be able to complete everything for you meticulously.
Location of the house
Some people prefer a big home in the outskirts and a few prefer a smaller home in the heart of the city. Whatever is your look out or need, make sure you keep all factors in mind, like your child’s school, spouse’s job, your workplace, vet center etc,. before choosing the location of your home.
Lack of inventory
Another major problem, first time home buyers in Ontario face is, there is a great demand but low inventory of houses. The Canadian Real Estate Association states that Ontario markets had a shortage of homes by the end of November 2021. This shortage of residential properties, in the single-family properties, is expected to continue in the year 2022 as well. Real estate agents can help first-time buyers because they have enough experience with finding a perfect home for you.