As a prospective homebuyer, you might be asking yourself “Where should I live?”, “What type of home do I want” and most importantly “How much can I afford?” Buying your first home is one of the biggest purchases of your life, but with some research, getting onto the property ladder may not be so daunting.
Things to consider when buying your first home
Many of us feel pressure to take the plunge into homeownership, but is it the right choice for you? Here are some questions you should ask yourself:
- Why am I deciding to purchase a home?
- Am I financially ready to take on the costs of owning and maintaining a home?
- Can I qualify for a mortgage?
- Do I plan to stay at this location for a while?
- Am I ready for responsibilities of homeownership, like maintenance and repairs?
Advantages and disadvantages of owning a home
Since buying a home is a huge financial commitment, it’s a good idea to weigh out some of the pros and cons of homeownership. Here are just a few things to think about:
- Property values typically increase over time
- Potential for rental income
- Freedom to renovate
- Sense of community and stability
- Long-term financial commitment
- Larger upfront costs (such as down payments, closing and legal costs)
- Time and cost of maintaining of your home
- Ties you to a certain neighbourhood
- Property taxes
Choosing your home insurance policy
Home insurance isn’t a legal requirement in Canada, but most mortgage providers will require you to show proof of insurance before they lend you money. Insurance will ensure your property and possessions are protected in the event of fire, natural disasters, and theft or vandalism.
Aviva Canada offers different types of home insurance depending on your property and living situation:
House insurance is for homeowners, and covers the building, including any swimming pool or sheds you might have in the backyard or front yard. It covers the entire structure of your home and all of your belongings (contents) subject to the limitations of your policy.
Condo insurance is for people who own a condo or apartment, and covers the contents in your unit and renovations such as new flooring or cabinetry. Your condo policy would cover the common area as well.
Tenant insurance is for people who rent a property and want to cover their belongings (contents). In a rented property, the landlord should have insurance which covers the house or condo, and the tenant is responsible
for their contents.
Home insurance is customizable. Once you’ve got the basics covered, contact your insurance broker for any additional add-ons from Aviva like Overland Water Protection for loss or damage related to water entering your property from the overflow of lakes and rivers, or identity theft coverage for costs arising from identity theft. By adding Aviva’s Disappearing Deductible endorsement to your policy, your deductible is reduced every year you don’t make a claim.