There used to be a 30% Rule Of Thumb. We were told to spend no more than 30% of our monthly income on housing. That would include rent or mortgage and all the associated expenses (taxes, utilities, etc). But that just doesn't work anymore. Housing costs have increased at a higher rate than income. Also - we are all different? Some people are okay to make sacrifices for the home they want - they are okay to be "house poor" and others still want to have money for travel, clothing, or whatever is important to them.
I remember years ago, when my husband and I were shopping for our first home, the agent encouraged us to stretch our budget. She told us to skip some restaurant lunches. We did not appreciate that comment. It is not the job of the real estate agent to decide how the client should budget. We did not want to have to give up restaurant lunches to afford a house - and we stuck with our budget.
While I won't tell you how to budget - I will ask what your budget is! It is important to know your budget - and it will allow me to show you houses that are within your means.
So how do you know how much to spend:https://youtube.com/shorts/qBCvWXu37Ns?feature=share
1) Ask a lender what you are approved for.
2) Look at your monthly and annual spending - just because you are "approved" for a certain purchase amount, it doesn't mean that should be your budget. For example -the bank doesn't know that you have to pay for your kid's competitive hockey!
3) Understand your personal circumstances - where are you in your career? If you are a professional starting your career, you may be able to stretch your budget knowing that your income is on the rise.
Curious about home prices in Ottawa - and what your budget can buy you - I'd love to talk!
I remember years ago, when my husband and I were shopping for our first home, the agent encouraged us to stretch our budget. She told us to skip some restaurant lunches. We did not appreciate that comment. It is not the job of the real estate agent to decide how the client should budget. We did not want to have to give up restaurant lunches to afford a house - and we stuck with our budget.
While I won't tell you how to budget - I will ask what your budget is! It is important to know your budget - and it will allow me to show you houses that are within your means.
So how do you know how much to spend:https://youtube.com/shorts/qBCvWXu37Ns?feature=share
1) Ask a lender what you are approved for.
2) Look at your monthly and annual spending - just because you are "approved" for a certain purchase amount, it doesn't mean that should be your budget. For example -the bank doesn't know that you have to pay for your kid's competitive hockey!
3) Understand your personal circumstances - where are you in your career? If you are a professional starting your career, you may be able to stretch your budget knowing that your income is on the rise.
Curious about home prices in Ottawa - and what your budget can buy you - I'd love to talk!