For an increasing number of women, there’s no better commitment than home ownership. Women may be putting off marriage, but they aren’t putting off what is usually a person’s single biggest purchase of their life. Gone are the days when a single woman would wait to find a significant other before laying down money on a real estate purchase and today, mortgage lenders and condo builders are eager to court the single’s business.
It’s believed that around 20 per cent of home buyers in North America are single women. That statistic is based on a report released last year by the U.S. National Association of Realtors that said single women comprised 20 per cent of all home buyers. While many of those buyers are purchasing condos, a sizeable proportion will be buying houses.
Here are three financial tips for prospective home buyers.
1. Know what you can afford
Affordability is a huge issue. That means not only affording the mortgage but also the taxes, the maintenance, the insurance and having money set aside for emergencies. If you do not for see the other variables in purchasing a house you will becoming house rich and cash poor.
The conventional wisdom for a down payment has not changed. Expect to put down 20 per cent for the mortgage. At the same time, have an emergency fund to cover at least six months of expenses, experts say.
Even if you are purchasing a new property, you will need a reserve to cover repairs. Remember that you have to pay property taxes, too. With interest rates being at an all-time low a mortgage is more affordable than ever. A good idea is to sit down with a mortgage broker or a bank and find out exactly what you can afford, before you go home-shopping.
2. Protect your assets
When you are buying a property alone it becomes even more important that you have adequate insurance coverage. That includes life, disability as well as healthcare insurance.
You might also want to look into setting up a trust so that the proceeds from your insurance policies go to your independent beneficiary if something happens to you.
3. Consult experts and take your time
Since buying a home is one of the biggest financial decisions most people make, it is a good idea to work with a real estate agent and consult with a financial adviser. Do your research and take your time. Once you know what you can afford, be prepared to stick with it, even if you see a house you love that’s just a little over your price range.
For many Canadians, there’s just something indefinably satisfying about owning your own acre of ground—even if it’s several storeys up.
Source: Kerry Gold, The Globe and Mail