Well before you start getting involved with the home ownership process, you should be asking a few fundamental questions. Before you start digging deep and wonder, “What is a mortgage?” and “What is a mortgage broker?” it’s best if you deal with the fundamentals.
You need to be clear on why you want to go through the process of owning your own home. Granted, there’s been many things written and said about the market in the GTA, but most, if not all exeprts, will agree the underpinnings for Canadian properties are solid. That said, here’s a few other reasons why getting the keys to your own place is a good idea.
1. Appreciation. Buy a new car and enjoy it for a few years but remember while you’re zooming around town, the appreciation is dropping every year you own it. That’s often because things wear and need to be replaced on almost every big ticket item you buy with the exception of real estate. Historically the price of houses and other types of real estate rise although there are always periodic dips that sort themselves out over time.
2. Equity. When you rent, you’re giving your money away without any hope of long term return on the investment. That’s not the case when you buy a home and one of the most satisfying answers you’ll get when asking, “What is a mortgage?” is finding out the money you pay is divided into interest and principal. The more interest you pay off over time, the more equity you have in the property.
There’s a stability to having a home. When you’ve lived in the same place for years, you develop lasting relationships with neighbours and a sense of community that lasts for years.
