“There is nothing permanent except change” – Heraclitus of Ephesus, which is why Step 2 of the First Home Buyer Guide is Assessing Stability.
Now no one has a crystal ball, and life will change – however I think it is still worth spending some time thinking about whether or not any major life changes are on the horizon and whether or not they will influence your home buying decisions today. After all, selling a home within the first couple years of ownership can eat into your equity – and no body wants that.
There are two areas of your life to look at, your personal life and your professional life. The three things to consider are:
1) Relationship Status: Are you single or married today and how likely is that to change in the next year or two. If there is no change likely – then this is not an issue. However, if you think your relationship status is likely to change, you need to ask yourself – will this impact your decision to purchase a home today or the type of home you purchase? For example, one friend of mine was fairly sure she would meet someone in the near future, but wanted to own a home in the meantime. What she did, was purchase a smaller condo. She chose a condo that would be an attractive rental in the future, with positive cash flow so should she want to move in with someone else in the future, she could keep it as an investment property.
2) Family Situation: Do you have elderly parents that may need more support? Do you plan to have children, will the home need to accomodate a growing family? There are a number of family situations that may impact you – spend some time thinking about those – and determine if any of them change the requirements for the home you want to purchase.
3) Job Stability: Research released by McMaster University and United Way Toronto states that barely half of people working in the Greater Toronto and Hamilton areas have permanent, full-time jobs that provide benefits and stability. How stable is your job? If you lost your job, would you likely need to move to find another? Would your income likely be impacted?
Buying a home is incredibly exciting, but it is a major financial commitment and not one to enter into lightly. I personally love helping people achieve their dreams, the last thing I want is for someone to feel remorse from a home purchase. So I encourage you to give these areas of your life some thought.
Now for some fun stuff, next up: Step 3 of the First Home Buyer Guide – Location, Location, Location.