Don’t be Sucked Into Buying Single-Family Unless it Makes Sense
Single-family homes. Visit a city like Toronto and they’re all any buyer seems to want. And that’s undoubtedly why the average price of one of these homes in the GTA is currently hovering around $800,000 – a price tag that’s simply too far out of many people’s reach. Still, it can be hard not to get sucked into all that space, the bathroom on every floor, and that fully furnished basement. So how do you make sure you don’t? How do you know when buying single-family makes sense for you?
It’s in a good, central location
There’s no sense in paying nearly $1 million for a home when you live in Brampton and work in the heart of Toronto. That’s because on top of your home price you’re going to be spending thousands of dollars every year on transportation and transit costs alone. Living in that big home in the suburbs is a dream. But it’s one you should only capitalize on if you also work closer to the suburbs than in the downtown core.
It’s in its pre-construction phase
If you must purchase a single-family home no matter where it’s located or where you work, then try and purchase it during the pre-construction phase. Yes, you may only be able to look at blueprints and floor plans, with maybe a trip to a sales centre to give you a better idea of what your home will look like, but it will also be thousands of dollars cheaper. During pre-construction developers are desperate to sell, partly so that they can get financing from the bank to go ahead with their project.
It’s in the U.S.
Last year Warren Buffet said that the best investment anyone in the States could make after the crash was a single-family home. The U.S. is in the process of recovery, and single-family homes here are seeing huge gains on the market, making them one of the most sensible investments anyone could make. Of course, you may not be able to live in it if your work and life is in Canada – but it could still be a nice way to turn a tidy profit year after year.
Yes, it’s all too easy to get sucked into the notion that everyone must own a single-family home. It follows the same kind of irrational thinking that we saw two years ago on the market, when everyone thought they had to have a condo. The condo craze eventually wore off, and now those prices are back to within reasonable norms. If you just don’t fall into any of the three above categories and they don’t seem right for you, the most sensible thing to do might be to simply wait. Just like condos, prices on single-family homes will fall too. And then you’ll feel much better about the price you paid for that sprawling lot in the burbs.