How First Time Home Buyers Can Remain Calm In A Hot Housing Market

It’s no secret that being a first-time homebuyer is stressful, especially right now.

The average Canadian home price rose 31.6 per cent year-over-year in March to an average price of $716,828, according to the reports that there was only 1.7 months of inventory left at the end of March 2021 — the lowest reading on record.

online mortgage affordability calculators to get a better sense of how far your budget will stretch to accommodate the total cost of housing — including monthly payments, property tax, utilities, insurance and maintenance.

Finding a home in your price range

If the numbers aren’t adding up for you, then consider creative solutions.

“More home for less dollars tends to be outside of large city centres, so consider living further out, if possible,” Lucreziano says. “Perhaps you can work from home, or work from home 50 per cent, depending on your commute.”

You can also start looking at fixer-uppers, which tend to go for less, or look for properties where there’s a unit you can rent out. If you are planning to purchase a home with a rental unit, this may increase your pre-approval amount. Talk with your advisor to find out if this is an option.

The more research you do on the neighbourhoods and the kind of property you want, the more you’ll be ready when something does come along.

“Buying a home or selling is one of the most stressful things that people go through, and I just encourage people to buy within their means,” says Christopher Alexander, chief strategy officer at RE/MAX. “It’s totally natural to feel buyer’s remorse for a little bit, and that’s why it’s so important to do your research and see as many homes as you can so you feel comfortable with your decision.”

To get a realistic feel of how much homes cost in your desired neighbourhood, download real estate apps and sign up for MLS emails. Compare sizes of homes, new developments versus resale and different property types, such as townhouses versus detached homes. That will also increase your confidence because when you see a good deal, you’ll know it.

“You just have to be smart and patient and don’t get caught up in the frenzy,” says Alexander.

“The real estate market has a natural way to calm itself down.”

Financial Post - May 11, 2021