How Much in a New Home Can You Afford?

If you’re thinking of shopping for a new home, one of the first considerations
is price range. You want to know what you can reasonably afford.

How do you figure that out?

First of all, you need to determine the initial out-of-pocket costs you will need to cover. There are often more costs associated with purchasing a home than its actual price. You need to take into account such additional expenses as moving costs, legal fees, and a home inspection, not to mention the costs of prepping your current property for sale. Experts say you should budget 2-5% above the purchase price for these items.

Another factor to consider are the potential proceeds from the sale of your current home. We can help you determine how much your property will likely sell for in today’s market.
Any existing mortgage will need to be subtracted from that amount
to determine how much cash will be left.

Of course, you should speak to a mortgage broker or lender who can
compute how much of a mortgage you qualify for. Remember, qualifying for
a big mortgage doesn’t necessarily mean you should have one. You also
need to consider your personal finances and desired lifestyle – and whether
or not having a large mortgage is a good idea for you.

Once you have gathered all of your information, you can add any potential
sale proceeds to the amount of mortgage you qualify for, add other sources
of cash available for this purpose and subtract 2-5% for initial expenses,
and you’ll have an idea of the price range you should be considering.

Finally, it’s important to take the time to decide what kind of home you want.
Do you want a large backyard with trees? A quiet, family-oriented
neighbourhood? Four bedrooms and a finished basement? Once you
decide what you want most in a new home, it becomes much easier to find
one that’s in your price range.

Need help deciding how much you can afford when shopping for a new home?

Call us today!!

Richard Thyssen, Broker of Record
Colleen Thyssen, Sales Representative
Direct: 519-495-1541
Office: 519-438-8000
Email: richardthyssen@kw.com
www.thyssengroup.com