Toxic Workplaces: How to Stay Positive
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Keeping a positive mindset in a toxic work environment can be an extremely difficult task. I've spent some time in toxic work places and motivating workplaces and there is a vast difference between employee moral …

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Buying Your First Home

Submitted by on Saturday, 12 March 2011One Comment
Buying Your First Home

Purchasing real estate is the single largest expenditure that most people face at some point in their life (unless you plan to buy a jet or island). It could also be one of the scariest experiences if you don’t aren’t well advised of the costs and implications or certain things. Furthermore, getting emotionally attached to a house and not solidifying the deal can be discouraging and frustrating and could hinder you from continuing to search in fear of the same thing happening. But you know what? You’re not the only one feeling this way. Many home owners go through the same experience, but when you ask them to reflect back, their feedback has generally been that they’ve learned a lot and it was worth the experience.

Real estate houses have increased year over year in north america and will continue to rise given the strong dollar and favourable interest rates. The questions then begs, when are you paying too much? A lot of people may or may not know this but the best way to value real estate is price per sq. ft subject to quality adjustments. When I speak with some of my clients, their valuation is heavily dependant on emotional value. Some would pay the premium because they feel its the house of their dreams while others expect miracles to workout within their lower than average budget in a given area. Having the basic skill set before purchasing your house can save you emotional distress and a lot of money. Here are some of the things that I would consider before purchasing a home:

1) Understand the property value. Have your real estate agent show you similar properties that have sold in the area recently and ask them to do a comparative analysis. Looking simply at comparables can be misleading. There are certain renovations that can add value to the subject property therefore preparing an adjustment analysis is something your realtor should provide to you at no cost.

2) Understand the hidden costs. There are plenty of costs that are not factored into the purchase price of the home, this can include lawyer fees, small renovation costs, land transfer tax, property tax, home insurance and general maintenance. Understand what your monthly outflow and one time costs will be. Prepare a budget and ensure you follow due course.

3) Get your financing pre-approved in advance. Understand how much you can borrow so you can target the price point based on your financing approvals. I have seen far too many clients get emotionally attached to a property only to later understand that they simply cannot afford it. Close down any line of credits/loans that are paid. This impact your borrowing capacity even if you don’t use the funds.

4) Be prepared to let go. Sometimes you really want to make that deal but set a cut off point for yourself. Once the deal has exceeded your cutoff point be prepared to walk away. This makes for good negotiation and provides your clarity about your financial goals.

5) Be prepared to make concessions. We generally prepared a nice big list of must haves and likes (lets be honest, its mostly must haves). Its important to be firm about your requirements but be reasonable. Just like yourself, there is a person on the other side of the table who wants some value. Expecting too much can really make the deal go down south.

Most importantly remember one thing. Whether you get the next house you see or not will not be important in the future. But when you do find the property of your dreams, you will fall in love with it and the rest will be history. Stay positive!

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One Comment »

  • Deon said:

    Many thanks for spending some time to describe the terminlogy towards the starters!