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Once upon a time, it was commonplace to know a person who had lived in the same home their entire lives. Growing up it seemed like people didn?t really move all that often ? I can still drive around the old neighbourhood and point out houses of friends whose parents still live there.
But for us 20- and 30-somethings, this will likely not be the case. We will change jobs, cities and inevitably homes in our continuous pursuit of happiness. Along with the excitement of buying a new home comes challenges, and with the average number of homes being purchased going up, we need to get used to them.
The single biggest factor for buying more homes in a lifetime is price. Real estate costs more than it did a generation ago ? a lot more in most major cities. Gone are the days when a ?starter home? was a small detached dwelling with a lawn that actually required mowing.
Now, most of us will start in 900 square feet or less in a condo, or perhaps a slightly larger row home. Simply getting to a comfortable size for the average family may take three or more ?starter homes.?
Other major contributors to this age of continual move-up is the younger generations lack of loyalty to employers, and getting married later in life. Switching jobs often means relocating and staying single longer means less disposable income than that of a dual income home.
The primary consideration with buying more homes is the cost associated. Realtor fees, land transfer tax, inspection fees, title insurance premiums and possibly penalties from your mortgage provider add up quickly. As a long term investment, real estate has historically been a safe bet; but on a short term basis the transaction costs can seriously hurt your return.
Realizing this, some new home builders have gone as far as selling your existing home for free in an effort to reduce the barrier to move-up while others offer incentives for repeat purchasers and existing client referrals ? both well worth looking into.
If you are one of the many caught in this dilemma, the best thing you can do for yourself is stay as flexible as possible. Sacrificing space and certain luxuries for a more affordable home the first and perhaps second time you buy will decrease your transaction costs when you sell and allow you to pay down the principal faster. Building equity as quickly as possible will allow you to buy more space and stay in your next home longer, something most of us are now aspiring to.
? Brent Wilker is marketing manager for Conasys Inc., and consults to the new home construction industry. Find him at conasysinc.com or twitter.com/brentwilker.
Source: http://homes-extra.ca/home-garden/homes/21251/
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