Finding the right property type for your budget

Are you in the market for a new house, or perhaps your very first home? If so, one of the first things you will likely think about is finding the right property type to purchase. There are several kinds of home styles, and it’s not always easy to decide which is best for you. A large part of this decision will depend on your budget! Here are some important points to keep in  mind as you navigate today’s market.

First, nail down your budget

You won’t get far finding the right property type for your budget if you don’t have your budget in place! This is the first step when buying a home. You should determine what you can afford to spend, and then find a property that matches your needs. 

The best way to narrow down your budget is to get a mortgage pre-approval. This process tells you what you might qualify for at that specific time. Based on your current financial situation, you can learn where you stand in today’s market, and the type of mortgage you could potentially afford. It’s important to remember that your pre-approval doesn’t mean you have actually secured financing. You will need to maintain or improve upon your financial situation leading up to the time when you are ready to apply for a mortgage. It’s for this reason that we recommend not making any major financial changes during this period if possible.  

Of course, your budget should take into account more than your mortgage. As a home owner, you will also be responsible for utilities, property taxes, maintenance, and any other home-related expenses. These come with homeownership and they are not always predictable. This means your budget should account for some unexpected expenses.

How much does each property type cost?

What are the average prices of each property type? Of course, it depends on your location, the size of the property, its age, and a whole bunch of other factors. However, we can provide an estimate of what you can expect in the province. 

Detached houses, townhomes, and condos/apartments are three of the most common property types. According to the CREA, the average price of a detached house is currently sitting at around $430,000. Meanwhile, townhomes are averaging a higher price at $547,000, and apartments are hovering near the $472,000 mark. Province-wide, we are seeing apartments and townhouses are actually more expensive than detached houses. Of course, this is heavily dependent on the area, which we will discuss in more detail below. 

Consider your location

Location plays a big role in determining the cost of your future property. For example, if you want to live in downtown Halifax, you should expect to pay a higher price for any type of property. Smaller dwellings like condos and townhouses are more common in this area as space is limited, meaning you are more likely to find this type of property in your budget in this region. If you are set on buying a detached house, looking in the Halifax core will result in higher listing prices. 

Alternatively, if you are hoping to live further away from the hustle of the city centre, you will often find homes are priced a bit lower. This is partly because they are further from the convenience of transit and amenities that city living offers, which can impact a home’s market value. This means you may need to travel further to get to work, go shopping, or perform other daily tasks.

Think about your future

When searching for the right property type for your budget, you should think about the future as well as the present.  If you are a first-time home buyer, for example, it’s common for your first property to be a smaller or more outdated home than you would ideally prefer. However, working with your budget to buy a home you can afford means you can start building home equity. Down the road, this will provide you with a valuable asset that you can use when it’s time to sell and buy your next property. It’s much better to buy a home within your budget than try to purchase a home you cannot afford. Many people’s first homes aren’t perfect, but they are a stepping stone you can use once it’s time to move up. 

Reach out to a mortgage broker today!

Finding the right property type for your budget gets a whole lot easier when you enlist the help of a mortgage broker. We can work together to help you determine your budget, your buying goals, and the type of mortgage product that is best for you. This will guide your search as you embark on your housing hunt, as you will have a solid idea of what you are looking for. 

Our goal is to help you enter the housing market with confidence! If you are ready to begin the home buying process, reach out to us to start discussing your needs and goals. We are here to make your transition into homeownership as smooth as possible.

If you have any questions about your mortgage, get in touch with us at Clinton Wilkins Mortgage Team! You can call us at (902) 482-2770 or contact us here.