Making the Final Decision

Making the final decision when buying a home is like jumping into a freezing cold lake of an unknown depth. You know it's going to take guts, but you also know it's going to be refreshing.

Before you make that plunge you are going to want to be as confident as possible. Most experts agree that the best way to do this is to get a comprehensive checklist together, go down the list and make sure that all of your bases are covered.

This is after all a huge investment; you are going to want t get the maximum capital return on your investment as well as having a dandy place to live. There is also the factor of timing, something that in many ways is completely out of your control.

Listed below is our detailed sample checklist. Use this as a guide for your own venture and feel free to add your own variables. For instance, we haven't mentioned ghosts. If you are scared of ghosts or other paranormal activity you might want to ask the previous tenants if they had any trouble.

The Checklist


Overall, where do you want to live? An urban area, suburb or rural area. Make a short list of neighborhoods that fit that description. What amenities do you need. Work, schools, shops, recreational facilities. When you look out of your window what do you want to see. Trees, water, a beautiful skyline or a sunny garden.

Where you will live is one of the hardest decisions to make because it is almost completely up to you. There is a delicate balance that must be maintained. Obviously there are places where you want to live, but can you afford them? Chances are, if you really want to live there, so do a host of other people. This situation may drive up the price of the home well beyond market value.

If the location is overpriced, it still may be a good investment, but it will take a longer time before you know just how much it will pay-off. Also, trendy neighborhoods can witness a much higher taxation rate, so the house could become a financial liability in the future.

On the other hand, if you choose a location that few people want to live in, chances are it may stay that way, and you might have a hard time selling the home. If it is a fixer-upper, make sure you have an accurate assessment of what it will cost to renovate the property. Factor this into your calculations.


Price range Type of home e.g. freestanding house, terrace, townhouse, unit New, used or old Renovated or not renovated Style preferences Number and size of bedrooms Other requirements such as family room, more than one bathroom, formal and informal dining areas, a home office, space for your hobbies/interests Yard or balcony Access for vehicle, parking

Unlike where, you have a little more flexibility withy what. Besides load bearing support walls, most homes are open canvas- that can be torn down and rebuilt in whichever image you choose.

If you think you know what you are doing, you can do all of this over the course of time, on your own, for a fraction of what it will cost a contractor. It also means that you can tailor your home to your specific needs.

Most experts agree that it is a good idea to renovate based on your personal preferences, not what you think the market will want when you resell your home. NO renovation can guarantee a 100% return on investment. Most of the value you will get out of a renovation comes from the comfort YOU get from it. Any value added should be welcomed as bonus.


When will you have enough cash on hand to pay for a down payment? Have you obtained the mortgage plan that you want? Is the market right? In other words, is the appraised value of your home on par with the market price?

In many ways you have the least amount of control as to when you buy a home. After all, you only make a finite amount of money at a job, and if that has to be saved for a down payment, things can take a while.

Also be sure to remember that there are many hidden costs when buying a home. For instance, on average you must add 5% to your budget on top of the cost of your home when you are buying.

Hidden costs include:

Paying inspectors Moving costs Legal fees Stamp duty

Also, the market may be terrible. Generally today, the market is really good for buyers. Home building is at record highs and this competition makes for better mortgages and cheaper homes. But, the market can change in a heartbeat, so be careful. You can wait for the market to get better forever.

You also want to get a mortgage that is right for you. Most banks will offer a fixed mortgage. This can be a scary commitment. It means that no matter what happens to national interest rates, you will be paying the same interest rate for the entirety of your mortgage. Today, some banks will offer you a split mortgage that is both fixed and flexible.

The Recap

The following is a list of the top ten things you should do to make your search for a home a smart search.

Get informed. Do lots of research. Start saving your deposit as soon as you can. Try not to buy around the top of a boom in property prices. Location and special features are the most important factors in choosing your home. Dont get your heart set on any particular property - it will impair your judgment. If you miss out on one, you will in time find something as good or even better. Always check the condition of what you are buying with a property inspection. Shop around for a loan. Also, choose your legal advisor and building consultant carefully and make the most of their advice and expertise. Before making the final decision, ask yourself whether you could easily resell the property in the worst economic times. Never sign anything in haste and if you dont understand what youre signing get your legal advisor to explain it to you.