anyone in Finance? Real Estate? need some friendly advice
if anyone could offer some friendly advice before we start asking professionally to see if it's worth it..
so here's the background:
we live in a newly built condo (2009) on the PH level (nothing too special) it has higher ceilings and an extra DEN compared to other floors. and it is a little bigger. (1100sqft). purchase price was $355,000 (Toronto is expensive) about 2 years ago.
We moved from a semi detached house which we made a decent profit to pay off debt, cars, etc. so we have ZERO debt (revolving wise)...we just had a kid (1 year old) and planning another in the next 6 months or so.. my wife is off MAT leave and isn;t planning to go back to work for a few more years. my income is decent enough to support.
we were thinking of moving a little bigger house but we just don't know if it's worth it at the moment.. we wanna long term house (~8yrs) so we don't wanna go to another smaller house since we will have 2 kids.
at the moment our mtg with our condo fees it's about $1600 a month .. the problem is the longer we wait the higher the market is gonna be on houses and the longer my wife will be without a job. with all the lawyer fees and agent commission we don't know if it's worth it...
i am hoping our condo is worth over $400K at the moment but to go into a house that's about $500K a little more north .. i dunno.. is it smart? should we just wait? if worse comes to worse my wife can get a teaching job cause it's not like she can;t work, but we would want her to raise our children herself instead of keeping them at a daycare until they are at least 3.
my gut is telling me it may cause more financial issues, but my mind wants a bigger place ; >
Thanks in advance ; >
- 01-03-2013, 11:36 PM #3
At the end of the day, only you can make the decision regarding whether you are ready to take on a bigger mortgage, but what I CAN tell you is you are absolutely right about prices continuing to rise! Also, interest rates won't be as low as they are right now again in your lifetime...
Without knowing your entire situation, or talking to you more thoroughly, my advice is if you are financially ready to take on the extra responsibility.. there's no time like the present, and lock in to as long of mortgage as possible!
As far as moving a little bit north, what you'll spend for a larger home depends on what you consider a little bit.. I can get you a gorgeous 3,000sqft 2 storey a hop, skip and a jump away from the go train station in Barrie for under 400k! But if you want to stay in Toronto.. well I don't have to tell you what that means!!
If you want to talk offline my contact info is in the link in my signature. The downtown condo market is not my area of expertise, but I have a friend who specializes in it and comes highly recommended. If you're interested I'd be happy to put the two of you in touch.
Last edited by just_luc; 01-03-2013 at 11:58 PM.
- 01-04-2013, 08:47 PM #4
How old are you and your spouse?
The key questions:
1. How much money do you have saved right now? Is that total? How much is set aside for retirement? Emergencies? Children's college?
2. When would you like to retire? How much annually do you want to live with in your Golden Years? For how long?
And I wouldn't worry about "the market" of housing prices. If you don't have a solid foundation built up then it doesn't matter how good of a "buyer's market" it is; you'll just create financial issues down the road. And do consider your mortgage as a debt. Banks/mortgage/real estate companies have done a great job of "educating" middle America that there's a thing as "good" debt and a "bad" revolving debt. Debt is debt; if you owe, you owe. Just ask all the people buying houses and rentals they truthfully couldn't afford in 2007 and 2008 what happened with their "good" debt...
There is much more to consider than what most people normally think of when making major purchases; most people just think, "Well, I can afford the monthly payment, and I have good income, so I guess it's the right move."
Buying a house is a part of a bigger picture, and unfortunately most people don't think of it in that capacity... You can truly, TRULY, master your financial future. Or, like most American home-owners, they fall slave to their mortgage... "I-owe-I-owe, it's off to work I go... I-owe-I-owe, it's off to work I go..."
Last edited by JRAnciano; 01-04-2013 at 09:05 PM.
- 01-05-2013, 10:18 AM #5
EDIT: Another thing I was factoring into my mental calculations but forgot to vocalize, is that while the market in his area increases substantially as a whole each year, the freehold home market (which he wants to get into) increases at a much higher rate then the condo market (which he is currently in) so with each passing year his equity will become less significant in terms of how much of a down payment it will serve on his new purchase.
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