To buy, or not to buy
When should you make that leap from renting to owning? by rory MacLean
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move to take on a mortgage. Wait until you can generate more income, or take some time to pay off your debts or trim your expenses before making the leap to buying property. That said, if the numbers still look good for you after you’ve done your calculations, you’re almost
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very realtor will tell you it’s no use paying someone else’s mortgage when you could be building equity of your own. That way your home becomes a physical savings account, growing in value every month.
sider how long you plan on staying in this property. Where are you at in your life? Are you a few years away from starting to have children? Could you be offered a job in another city and want to leave? The equity in your house grows the longer you stay there, but if you decide to sell again right away
this growth in value may not be enough to justify the transaction costs of selling. This is a decision that can take five or more years to start paying off. Give it some thought. For more information and to try out a handy mortgage affordability calculator, head on over to
the Canada Mortgage and Housing Corporation website.
Feedback? Text it! (306) 881 8372
@VerbSaskatoon rmaclean@verbnews.com
This is a decision that can take five or more years to start paying off. Give it some thought.
But is buying really the best option for everyone? The truth is: no. There are a few important things to consider for anyone trying to decide whether to rent or to buy. First off, can you afford it? Start by tallying your monthly household expenses and debt payments. This includes heating, rent, car loans, credit cards and lines of credit — any of your monthly obligations. The general rule of thumb is this figure should not add up to more than 40 per cent of your gross monthly household income. If you are beyond or at this threshold then you’re spread pretty thin as is, and it’s probably not a wise
ready to talk to a lender. But before you do, get your hands on a copy of your credit report. Lenders want to see how well you’ve paid your dues in the past before they are prepared to loan you any money. Even with a loan there are a few more costs to consider. On top of a down payment on your future home, which will affect your interest rate, there are other sizable costs associated with the transaction itself — things like brokers’ and legal fees, home inspection fees and possibly a deposit to show the prospective seller you’re serious. The cost of the transaction itself is a major factor to consider. Con-
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