5 Tips for Buying a Home When Single
Friday Sep 18th, 2020
Since 2016, the number of Canadians living alone has surpassed all other household sizes, accounting for 28% of the population at the time. Today, this number continues to grow as the average size of a Canadian household shrinks. For the first time, there are more one-person households than four-person households and thus, more single homebuyers than before. As the face of Canada changes, so does the face of the average homebuyer.
Although singles make up the more significant percentage of the home buying market, the financial burden of buying a home can be difficult to carry alone. Without a partner to split expenses, singles are foregoing another person’s income to help pay for the bills of owning a home. Especially when it comes to property in hot markets such as Toronto and Vancouver real estate, competitive prices can make buying a home by yourself an even bigger challenge. That being said, there are plenty of single homebuyers with success stories to show that it can be done.
If you’re looking to buy a home on your own, here are some tips to help streamline the process.
Look for a Home that Suits Your Current Lifestyle
Buying a home on your own is not only a milestone but also one of the biggest financial decisions you will have to make. Before thinking about what kind of home you want to live in, think about what this home will bring to you in your current life. While it can be tempting to jump into buying your dream home, remember that it can be risky to plan too far ahead. You want to avoid buying a home with more bedrooms and yard space than you can handle.
Instead, buy a home that meets your needs now, with just a little room to grow. If you’re a single person who loves city life, consider a one to two-bedroom Toronto condo or townhouse, which would also give you the space if you did meet a special someone – whether that be a future spouse or a canine companion.
Predict Your Finances
Buying a home on a single income means that your lender will be scrutinizing your finances closely. Your lender wants you to have secure and steady employment so that you won’t default on your mortgage. If you’re working a job that makes your income variable and unpredictable, the first step you should take is to try and make your income as predictable as possible. You might need to consider using a co-signer, such as your parents, to guarantee your mortgage.
On top of this, other expenses such as debt repayment, taxes, renovations and credit scores can limit your budget. Before you start looking for your next home, you need to improve your credit score and pay off your debts so that you’d be able to better apply for a mortgage loan. It’s important to consider the prices that come along with owning a home so that your lender sees that you have a good understanding of what you can and can’t afford.
Choose a Real Estate Agent That Understands Your Needs
Your real estate agent is your guide to everything you need to know about buying a home. That being said, most real estate agents have their specialties. Some excel at working with baby boomers, some enjoy helping first-time homebuyers, and some even deal exclusively with houseboats! Since you’re buying a home as a single, it makes sense to work with a real estate agent who has experience with your situation. You’ll have different needs than a traditional home buyer, such as your budget, so it’s important to find an agent that understands those needs and can help you find the perfect home.
Get a Support System
Even though you’re looking to buy a home on your own, this doesn’t mean you have to make all the decisions yourself. Sometimes you need an outside opinion to help weigh in on pros and cons. This is where your support system comes in. When you begin viewing homes, bring along a trusted friend or family member to the viewing. They’ll be able to help you evaluate each home fairly and keep you in check if you fall head over heels for a home. It can be easy to ignore water damage or crumbling drywall if a home is next to your favourite coffee shop – your support person is there to point out those potential issues to you and keep you from making a purchase you’ll regret.
Hedge Your Bets
Finally, when viewing homes, it’s always smart to keep resale value and rentability in mind – especially if you are single. Don’t choose a home with features that might turn off potential buyers or renters when you go to sell the home or rent it out, and stick with properties that traditionally have good resale value. For example, condos and townhomes can be a great option in the Toronto real estate market because they are in high demand and make great investment properties. If you’re considering leasing your place in the future, you want to choose a townhouse or condo that allows renters as some residential building managements have bylaws against it.