real estate

Stay or Go: A Guide to Figuring Your Real Estate Shiz Out

Hello friends!

Happy Tuesday! Yesterday was my birthday. As long as I didn’t think too hard about the number attached to said birthday, I floated through the day on a cloud of birthday happy and Facebook messages from good friends. Since I’m still kind of floating, I thought I’d settle in and talk a little bit about that house hunting thing we’ve been doing and impart a little wisdom we’ve learned over the past few months.

Namely, this: how on earth do you figure out whether or not to pick up and move?

In all honesty, we’re still right in the middle of this decision. We think we’ve finally figured it out, but I can’t guarantee that our minds won’t change sometime in the next 24 hours. Or the 24 hours after that. Or next week. But, over the past couple months, we have learned a lot about the questions we should be asking ourselves.

One: What do we need from our home? 

For us, the answer to this question is space! Our house is, essentially, a one bedroom, and it’s tiny. For now, it’s perfect for us, just two people and a few pets. But, there’s no space here to grow. By that, I’m not saying anything about when we’re planning on growing our family, just that someday, we know we’ll probably want to add a couple tots. We’re a typical young couple! We can’t, however, envision doing that in our teensy little bungalow, especially not long term.

Two: Does buying a new house make sense, financially? 

This is, of course, the biggest question and contains a heck of a lot of other questions:

  1. What can we afford?
  2. How does purchasing move us forward?
  3. How long do we need to live in the new house to pay off realtor fees, land transfer taxes, lawyers, and all the other expenses that come along with moving?
  4. Will a new and better house make the financial cost worth it?
  5. How is our lifestyle going to change if we purchase a more expensive house and therefore, increase our financial burden?
Anyone who has experience with the Toronto market can find that first question depressing. That burst in the market that everyone claims is just around the corner? We certainly haven’t seen any signs of it. But it’s the second question that always stops the Husband and I. We view our real estate as not just a home, but as an investment. How is purchasing going to solve our space needs while also helping us move forward, financially? Is there a chance to renovate and improve a property to add value? Enough rental income to help us carrying a larger mortgage?
And then, there’s the thing I always forget about: those closing costs. Closing costs make buying and selling expensive. We’d be looking at least 2-4 years of owning whatever home we purchase to make that cost worth it.
But, perhaps the improved home would be worth all that? 

Three: Where do we want to be, long term?

The answer to this question affects how we view those closing costs I spoke of earlier. See, we’re both country kids, and we’ve always asserted that we won’t be here in the city forever. When we first got here, we always said we’d only be here for a few years. We’re coming up on 3 this spring, and our feelings about the city have changed. We’ve come to appreciate it, love it some days. The close proximity to our neighbours, the ease of movement around the city, the opportunities here, even the dog parks – there is so much we would miss if we were to find ourselves back in the country.
On the other hand, there is so much we miss about those wide open spaces; the stars, the trees, the sharpness of the chill air in the winter, the space to put the snow from the driveway, the large backyard for the dogs to explore. 
We haven’t answered this question yet. Perhaps we never will, and one day, we’ll realize that life made the decision for us.

Four: What other options do we have?

This is a question to take the stress off as you work through all the other questions. If you need something more from your house, but it doesn’t make sense financially and you’re in the same place we are, still struggling with what is coming in the future, realizing that there may be other options can buy you time to figure life out, save more money, or wait for the market to be a little friendlier.
Thankfully, we do have other options! 
  • Renovate! I’ve talked a lot about this option here and I’m going to talk even more about it, hopefully soon. It remains at the top of our list of options.
  • Reclaim our rental space. We have a beautiful basement apartment that we’ve been renting out for the past year and a half. We love the extra income and wouldn’t want to give it up, but it is an option should life get really confusing. This isn’t an option we plan on acting on, but if you’re in similar situation, keep in mind that it’s possibly cheaper to lose that bit of income than move houses.
I know a lot of my readers have gone through this experience themselves, struggling through the real estate game as second-time buyers and discovering a whole new set of challenges. What other questions did you have to ask yourself as you made the decision, and house hunted or turned to your other options? Care to share your thought process?
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