Buying real estate is an exciting endeavour. Investing wisely can ensure that you can grow your wealth and maximize your returns. Like with many things, it helps to be realistic about your experience from the start. You can learn from other people’s mistakes by keeping these five things in mind when you’re ready to hit the market.
- Be aware of basic psychology principles. These include traps like wanting what you can’t have or perceiving something as more valuable because it’s in high demand. A big one is fearing loss more than seeing the potential for gain. It’s impossible to be completely immune to human nature, but remember to approach major decisions with awareness of what’s driving you. This way you can help ensure that you’re making a sound choice.
- Don’t rush. I’m not saying I agree with you if you’re holding out for a major market crash in the next few years, banking on a price drop. But I am saying that it’s far too big of a decision to be pushed into. Spend time doing your research, see a bunch of homes, and make sure you are comfortable with your budget. It might always feel a little nerve-wracking to place an offer (especially in competition), but that’s different than rushing into a case of buyer’s remorse.
- Manage expectations from the start. If you’re looking for a desirable product in a competitive price range, expect competition (for example, a stylish move-in ready two-bedroom condo in the core). This likely means being available to view properties quickly, dealing with making decisions in a shorter time frame, and contending with offer nights and bully offers. Don’t be scared. With the right support, this is all totally manageable. Talk with your realtor about what to expect based on your budget, location, and needs and make sure you are getting the facts.
- Be Open. A large number of my clients end up purchasing a property that’s different than what they were initially looking for. It may be a different location, price point, or type of home, but you will discover things about real estate as you do your research and begin seeing homes. It’s important to let this new information shift your perspective and guide you in the right direction.
- Be willing to compromise. Like most relationships, your involvement with real estate (and in particular, Toronto real estate) is more likely to succeed with compromise. Having a list of must-haves is important but these must be realistic. If you aren’t sure how viable your expectations are, then do some research. Have your agent search to see how many properties fitting your requirements have sold in the last year. If there have only been three and you need to buy in the next two months, then you may want to adjust your expectations. Consider that if you absolutely need parking, three bedrooms, and proximity to transit, then perhaps the difference between east-and west-facing shouldn’t be a deal breaker.
Stay tuned for part two of lessons learned from buying real estate with additional tips on how to get the most out of your home and experience. If you’re looking for additional considerations when buying outside the city, check this out.
