Buying a home may look like a dream for some of you.
Well you’re in luck because despite the doom and gloom reports there are many paths to homeownership and it just may be closer than you might think.
Let’s face it, the conventional methods of homeownership is not helping most of the would be buyers looking to purchase a home in today’s market. That’s why in this blog we are going to take a look at some unconventional hacks towards homeownership.
House hacking has become more prominent as the cost of living has continued to rise. So what is house hacking and how can it help you when buying a home? House hacking is a method of homeownership where the buyer purchases a home with 2 units, one that they intend to live in and the other they intend to rent out. In some circumstances the buyer could end up living at the property rent free as the other unit’s income is able to cover the entire mortgage payment. In other circumstances the amount that the buyer would have to pay would be substantially less than it would be if they weren’t house hacking and oftentimes less than if they were renting a unit that they didn’t own.
Buy a House To Rent Out!
Now you may be thinking I need somewhere to live, why would I buy a property just to rent it out. Well imagine you have a family of 3-4 and require 3 or more bedrooms however your down payment and mortgage approval will only qualify you for enough to purchase a 1-2 bedroom property. Purchase that property and rent it out while you yourself are still renting somewhere else. Now you are a homeowner and landlord. Your tenant is paying down your mortgage and after a year or 2 you can pull the equity to purchase a property that will better suit your family.
Buy a House With An Investor
This method has a few variations that might work best dependent upon your situation. One method is to pool your funds with a silent investor to purchase the property where you will live and pay the mortgage. After a year or two refinance the property and buy the silent investor out of their portion. Another option is to purchase the property with other like minded investors where you all live in the property and then again after a few years you can buy out the other investors or they can buy you out and you can now utilize the funds to purchase a property on your own
Bonus Hack: Purchase a House Outside of the GTA
Most buyers want to buy a property in a convenient location. Somewhere close to work or at least close to accessible easy public transportation. Most of those properties happen to be in the GTA, and as you may have guessed it is pretty pricey. How about considering moving slightly out of the GTA just for a few years and then using the equity in the home to move closer to your desired location. Keep in mind that some underdeveloped communities are the locations that see the greatest jump in house prices. You may be making a sacrifice but you will definitely have a huge return in the long run. Always consider that one of the considerations of lenders is the proximity of the home in question to your place of employment so be sure to speak to your lender to get the correct radius.
Now that you have learned 3 Hacks to homeownership in the GTA you may interested in learning more about how you can protect yourself and your investment, especially when purchasing with your partner.
In our next videos we will go over some important tips that you will need to follow to protect your investment.
To book a free buyer consultation contact us, we would love to help.