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Taking the leap from renting to owning a house

Taking the leap from renting to owning a house

Couple kissing in house doorway of a house they either own or rent

Couple kissing in house doorway of a house they either own or rent

To rent, or not to rent? That is the question – whether to continue renting or to buy a house and take on a mortgage. There’s a common misconception that renters are throwing their money away, and another that you need to buy a house as soon as you can afford a down payment for a mortgage along with the monthly payments that come with it. Each choice comes with its list of pros and cons. Hence, depending on your financial situation and your lifestyle, one may be the better choice for you than the other. If you’re debating on whether it’s time for you to stop renting and buy a house or not, this is what you can expect when buying a home in Barrie and the surrounding area to help decide if now is the right time for you.

What are the big differences between renting and buying?

When you go from tenant to homeowner, there are a lot of big changes you should be prepared for, including:

  • Your maintenance and expenses: As a renter, your landlord is expected to take care of any maintenance and repairs. However, as a homeowner, that responsibility is now yours to take care of. This means you should have some savings set aside for any emergency repairs.
  • Separate bills for everything: When you buy your own home, the bills are all separate now as opposed to the monthly rent payments you used to make. You will now need to ensure you have enough for mortgage payments, utilities, insurance, and so on. If you pay rent plus utilities this might not seem like a big difference to your monthly budget.
  • Watch for property tax increases: Along with extra monthly costs, you will also need to pay your property taxes. Now as a renter, you could always guarantee your monthly payments were consistently the same amount. As a homeowner, however, you will need to be prepared for any increases in property taxes or other bills.
  • Your money is now building equity: When you buy a house and take on a mortgage, as opposed to your money going to your landlord, never to be seen again, your money is now helping you gain value for you to use in the future.

Is it time for you to own? Or keep renting?

Perhaps for the last few years, you’ve been saving up a down payment to apply for a mortgage and have worked hard to keep your credit in good standing to prepare for buying a home, that’s fantastic! But there’s more beyond that which you should think about before you start shopping for a house:

  • Are you prepared for all the costs involved with owning a house: This includes utilities, insurance, mortgage payments (including interest) property taxes, maintenance fees, and so on as mentioned above. Yes, a good size down payment will help you buy a house, but you need to be able to properly maintain and afford that house every month afterward. If you can’t right now, here are some helpful ways to save and prepare for buying a home while renting.
  • Are you ready to settle down and stay in one place: If you currently work in a job where you’re constantly moving around or if you have a nomadic type of lifestyle, buying a house may not make as much sense as renting would. However, if you know you’re at a job where you will be living in one area for a long time, then buying a house would make sense if you can afford it.
  • Have you researched the area where you want to live: You may already know where you want to live, but have you researched how much it would cost for you to live in that area? It may be worth researching surrounding areas in case the town or city you want to live in is out of your price range.

Do you think you’re ready to take the leap from tenant to homeowner, with the added responsibility of taking on a mortgage? Want to see where you financially stand and apply to get approved for a mortgage? I can help. As a professional mortgage broker, and financial advisor I can show you if you’re ready to take the leap realistically, or what your next steps are if you want to save up to buy your first home. Just give me a call at 705-315-0516 to set up a virtual meeting, and let’s discuss whether buying a house right now is the best financial choice for you!

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