Introduction to Buying Real Estate
When it comes to getting the most out of your finances, making an investment in real estate can be one of the best decisions you make in your lifetime. Similar to the stock market, the real estate market has it’s ups and downs, but unlike with stocks, real estate tends to experience more peaks than dips. Times of sustained growth are also longer with the overall trend always being upwards. There is also the added benefit of being able to live in your new home as it increases in value.
What Do You Need To Know About Investing in Brantford Real Estate?
The Brantford real estate market is a great place to put your money, as the area is experiencing unprecedented growth. The best position for home buyers to be in is when they plan to live in the home for five years or more. This turns your home into more than just an investment for the future, but also a place to live and raise a family. Having your own home is priceless and opens up the options of renovating to customize your home and become part of a community. Buyers that plan on living in their home for an extended period of time will also benefit from being able to time the market when it comes time to sell.
Some home buyers are looking at a home strictly as a financial investment. This usually means generating income through rentals while the home and property accrue value over time. Buying a home and renting it out to tenants is a great way to play the market and allows homeowners to choose the most advantageous time to sell. The rental income generated can be used to pay for a mortgage, the upkeep of the home and necessary repairs or renovations.
Most homes in the Brantford real estate market are purchased to be lived in or be owner-occupied. Even though it’s not the norm, some buyers do purchase a property as an investment. These are often pre-construction condominiums or homes that are in a state of disrepair that the buyer can repair or renovate in order to increase the value before a sale. This property flipping can be a great way to generate income but can be a risky and demanding profession. Business acumen, keen property finding skills and being able to plan ahead are necessary assets for anyone going this route. As with many types of investments, flipping homes is all about timing. Get it right and there is lots of money to be made, but getting it wrong can lead to having to hold onto a property while finances are tied up in the venture.
Here is a list of additional financial benefits to owning real estate property:
- Tax deductions on investment property mortgages
- Tax benefits for home improvements
- Home equity that can be used as security for additional loans
- Eco-friendly renovations benefit from government rebate programs
- Equity built through owning a home increases the ability to upgrade in the future
Before beginning to search for a real estate property it’s important to consider your current financial and personal circumstances to figure out if now is the right time to buy. Consider these points before making a decision:
- What is the maximum down payment I can afford?
- Can I afford monthly payments (taxes, mortgages, utilities, repairs etc.)?
- Do I have a stable source of income?
- Am I able to meet associated closing costs?
- Have I considered all my needs? These include changing jobs, starting a family, growing your family and more.
- Am I prepared to begin the process of purchasing and moving into a new home?
- Will I be selling a home before purchasing a new one?
It is always recommended to thoroughly explore all your options and to plan for possible complications. Make sure to research all mortgage options available to you before making a decision. You don’t want to end up in a situation where you’ve found the home of your dreams, only to have your hopes dashed by an unforeseen financial matter. Pre-qualifying for a mortgage will tell you how much you can afford to spend and what price range to home shop in. Speak with your bank and financial planner to look into your income, expense and debt to figure out how much you can borrow.