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Balancing mortgage rate (Comstock Images/Getty Images/Comstock Images)
Balancing mortgage rate (Comstock Images/Getty Images/Comstock Images)

Book Excerpt

Home ownership isn't for everyone Add to ...

YOUR MUST HAVES…Most of the first home buyers have a long list must-have items for their homes. When looking for a new home, if you find everything on your must-have list, you will be lucky and unusual. When you start house-hunting, you will realize few places are perfect and the houses that have most features are more expensive. Be smart and flexible. Don't be an emotional buyer, be a smart one. It might be worth it to live with the ugly wall paper or carpet you don't like for a while in exchange for getting into a house you can afford. If the home otherwise meets your needs in terms of the big things that are difficult to change, such as location and size, don't let physical imperfections turn you away. Besides, doing home upgrades yourself, even when you have to hire a contractor, can be cheaper than paying the increased home value to a seller who has already done the work for you. However, something they say in the real estate business is good to know here: sellers rarely get the money back out of their investments in renovations. This is because few buyers have exactly the same tastes as home sellers.

Sellers Tricks

Minor upgrades and cosmetic fixes are inexpensive tricks that are a seller's dream for playing on your emotions and eliciting a much higher price tag. Sellers may pay $2,000 for minimal upgrades or staging for which you'll end up paying $40,000. If you're on a budget, look for homes whose full potential has yet to be realized. Also, first-time homebuyers should always look for a house to which they can add value with their own labour, as this ensures a bump in equity to help you up the property ladder. Buy What You Really Need

Don't get a two-bedroom home when you know you're planning to have kids and will want three bedrooms. By the same token, don't buy a condo just because it's cheaper if one of the main reasons you're finished with apartment life is that you hate sharing walls with neighbours. It's true that you'll probably have to make some compromises to be able to afford your first home, but don't make a compromise that will be a major strain.

Home Inspection

Get the full picture of physical condition of a house that interests you. If it is not sound, you can avoid making a serious financial mistake. Buy a different house or get enough compensation in the price to pay for all the needed repairs. Don't find yourself surprised after you buy your home and be fully prepared for what will need to be fixed in the near future.


It's impossible to predict the future of your chosen neighbourhood, but paying attention to the information that is available to you now can help you avoid unpleasant surprises down the road.

Questions to ask about each prospective property include:

  • What kind of development plans are already in the works for your neighbourhood in the future? You probably don't want a property that may be expropriated for some public project.
  • Is your street likely to become a major street or a popular rush-hour shortcut? Many other prospective buyers are not going to want to live near intense traffic noise, which will lower the resale value of the property.
  • Might a highway be built in your backyard in five years? Not only will a highway mean noise. It will also mean air pollution, a threat you likely do not want to give your family.
  • What are the zoning laws in your area? You may not want to be moving into a neighbourhood where the nature of the housing fabric will soon change as larger and larger buildings are installed.
  • If there is a lot of undeveloped land? What is likely to get built there? Buying a property with few neighbours may give you only a short period of isolation if the urban boundary is nearby.
  • Are nearby houses being renovated or replaced with fancy new houses? Gentrification may mean high property values in future.
  • Have home values in the neighbourhood been declining? Your property might suffer a similar fate if the social landscape is deteriorating.
  • How much crime is occurring in the neighbourhood? This you can determine from published police statistics. Like most people, you probably don't want to face repeated break-and-enter crime, home invasions, or assaults.
  • What are the geologic hazards in the area? Is the property on a flood plain, near the foot of a slope that could slide, or near a geologic fault? Why buy into a hazard zone if you do not need to do so. Consulting a surficial geology map or geologic hazard map of the area, likely available from a local government agency or library, could save you some big headaches.

Where are current and past pollution sources within a few kilometres of the property? Checking to ensure you are not buying on or near a major factory, dump, fuel spill, or other pool of pollution could mean you avoid going through years of suffering with health complaints, followed by a big environmental clean-up. Again, local agencies may have maps that show such features.

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