their purchase on hold thinking they could buy for a lower price 6 months to a year down the road. Most of these buyers were wrong and ended up paying more, not less. I've often said you will never know where we are in the cycle until 6 months from now when you look back. The bottom line is if you are buying to own for a minimum 5 yrs. even if the market does correct after you purchase it will most likely rebound within 5 yrs anyway. I once bought a property in 2007 just before the crash of 2008, my value dropped 18% in a year but by 2011 my value was right back to what I paid for it. Do you think you will need your house to be part of your retirement plan? Canadians are used to their homes being a store for wealth to liquidate in retirement when downsizing their lifestyle. There are many strategies you can use when you have a clear title or at minimum good equity. I've assisted many people downsizing from a larger home to a smaller home and pocket some equity to help with retirement. We've witnessed many people sell their home in the city and move to a small town within 45 minutes from Calgary or Edmonton. Another strategy is a CHIP mortgage that allows you to take equity out and never make a payment or pay it back. The bottom line is a healthy retirement plan would include a home paid for. Having a home paid for protects you from souring rental increases that could really be difficult in your fixed income retirement years. Eg. I know many seniors that don't have a big retirement nest egg but they at least have their home paid for, so their monthly expenses are quite low. I also have seen several seniors rent out their basement for added income. Are you financially ready? Owning a home is a financial commitment that requires planning how home ownership fits into where your life is headed. Ask yourself what your budget is and if either buying or renting would require you to stretch your finances. Crunch all the numbers. A frequent mistake of
24
Powered by FlippingBook