Your first home will always be a special place. However, there will come a time when it no longer suits your family’s needs like it used to. So, when the time comes to move up to your second home, you’ll want to take all the right steps to find the perfect spot.
In some ways, your second home purchase will be even easier than your first – but there will also be a few new and unfamiliar elements this time around.
In this blog, we’ll go over how your second home purchase differs from your first so you know what to expect when you take on the process of upsizing.
Selling Takes Time
Right off the bat, one of the biggest differences between your second home purchase and your first is that you’ll also be selling too. Of course, selling your current property and buying your next one are two completely separate transactions. However, they’re not completely unrelated. Your buying goals will ultimately impact your selling goals (and vice versa). Therefore, it’s important to think about how your upcoming home sale will impact your next purchase.
Having a home to sell can also impact how quickly you’re able to begin the buying process. For a lot of move-uppers in Ontario, it usually makes the most sense to sell the existing home before placing an offer on something else. This avoids the costly risk of getting stuck with two mortgages at once and gives you a better idea of what you can afford to spend.
However, home sales don’t happen overnight. Although your buying journey can commence with a simple phone call to your real estate agent and a mortgage pre-approval, the selling process usually involves a lot of preparation – especially if you want to sell for top dollar. Along with all the pre-listing tasks, there’s no guarantee that your home will sell on day one once it finally hits the market.
With all this in mind, if you have a specific timeline for when you’d like to buy your next home, don’t wait too long to start the selling process. It’s never too early to talk to your real estate agent about an upcoming move.
Looking for more home-buying insights? Consider these other posts from our blog.
- What Should First-Time Buyers Know About Home Insurance?
- Can You Buy a Home Without an Agent?
- How to Improve Your Credit Score Before Buying a Home
Building Your Budget Will Look Different
Another major difference between buying your first home and your second is budgeting. No matter how long ago you purchased your current place, you’ll be in a completely different financial position the next time you head to the market. Maybe you’ve changed jobs since then, welcomed new family members, or made a few smart investments – all of these examples can factor into your overall financial health. However, there’s one big difference that will greatly impact your buying budget: you’re a homeowner.
As a first-time buyer, you paid for your home with a blend of personal income, savings, and perhaps a little help from parents or other family members. However, you didn’t yet have home equity that you could tap into. When you buy your second home, you will.
You Should Still Get Pre-Approved For a Mortgage
Having a mortgage pre-approval isn’t just beneficial for first-time buyers. Although you’ll have greater financial leverage as a second-time buyer, that doesn’t mean you should skip out on creating a detailed budget. One of the best ways to do that is by applying for a mortgage pre-approval.
Your lender will again look at your income, savings, existing debts, and credit health when determining your loanworthiness. However, they’ll also factor in the projected market value of your current home before offering a conditional amount. With this number in your back pocket, you’ll have a much more informed idea of what you can reasonably spend on your next home.
Another perk of being a second-time home buyer is familiarity with closing costs. As you learned during your first home purchase, your total expenses aren’t just limited to the property itself.
Looking for more tips on saving up for a home? Explore these other blog posts for helpful advice.
- Will I Ever Be Able to Afford a Home?
- How Much Do You Need to Make a Deposit & Down Payment?
- How Long Should You Plan Ahead Before Buying a Home?
You Don’t Need to Follow the Same Path
One more thing to consider before you start your house-hunting journey is that you don’t need to follow the same path that you did the first time around. For instance, if you were unhappy with the real estate agent you worked with before, you can start fresh with a new Realtor this time. That’s where we come in!
Bosley Real Estate has helped Canadians find the perfect home for close to a century. Today, our advanced buying systems, client-first approach to service, and vast industry relationships can help you build a thoughtful home-buying roadmap – leading to a smooth and successful home purchase.
Ready to buy your next home? We can help! Give us a call at 416-322-8000 or email info@bosleyrealestate.com to get in touch.
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