Are you among the thousands of households in British Columbia that pay rent each and every month, knowing full well that you'll never see that money again?

For many, this need not be the case. Why not take income lost forever, and instead build it into an investment that can last a lifetime? Right now, there are excellent opportunities for first-time buyers. Mortgage rates are low and there are an abundance of reasonably priced starter homes on the market.

Before you run out and start viewing homes, it's a good idea to first take a close look at what you need, what you want and what you can afford. Whatever your taste and budget, there's a home out there for you. A little planning and forethought can help make your dream a reality.

Buying a home is never based on one specific factor--instead it's a balance of many requirements, such as family size, location, income and lifestyle. REALTORS are excellent sources of advice and assistance in these matters. Not only do they have the experience and knowledge to make sure the choice you make will be the right one, but will seek out suitable properties for you.

You should first ask yourself exactly what you need in a home. How many bedrooms? How close to schools or shopping malls? Do you plan to have more children? Do you need a garage or a finished basement?

All these questions and more can be itemized in a "buying blueprint" that will serve as a guideline in your search.

Next on your agenda should be deciding on a preferred location. "City people" should make sure that amenities such as theatres, shopping, and sports events won't be missed in a move to the suburbs. Small town dwellers should think carefully before braving the urban grind.

Commuting is a factor not to be taken lightly. Before you decide to succumb to the lure of a more spacious home in an outlying community, make sure the extra hour of driving each day won=t detract from your enjoyment of the property.

The housing marketplace also offers many options when it comes to the age and type of home you might purchase:

New homes are a good bet because of their extensive warranties and pristine condition. On the other hand, most won't have mature trees or landscaping--that's something you'll have to plan over a period of time.

Resale homes offer a great combination of affordability and character. Many will include improvements such as finished basements or rec rooms, decks or patios, and mature landscaping. But, make sure to have any resale home inspected for needed repairs or upgrading.

Townhouses and condominiums are obviously suited to particular lifestyles or budgets. Maintenance is usually taken care of by the management and upkeep costs can be low. Townhouse or condominium living often means sharing common areas such as parking, hallways and landscaping.

Rural properties offer the idyllic ambience that many of us crave: green pastures, wooded areas, friendly community and safer streets. These pluses must be weighed against more limited services and additional commuting time.

Once you've determined what it is you want and need, you'll have to find out what you can afford. It is crucial to avoid a situation referred to as "house poor". Many homeowners have found themselves in a state where the costs of paying for the home are so burdensome that any enjoyment is outweighed.

The first tip is to set a maximum price range instead of just an upper price. It's not always wise to buy the most expensive home you can afford, but better to aim lower in anticipation of extra costs or fluctuations in your income.

What you can afford will be based on two things: the amount of your down payment and the maximum monthly payments. Obviously, it's preferable to make as large a down payment as possible. This will keep your payments down and save money in interest costs.

A REALTOR or your financial institution will determine the amount of the mortgage you can carry by calculating your debt-service ratio. The rule of thumb is that the sum of all your current loan payments(car, personal, credit card, etc.) plus your mortgage payment should not exceed 40 per cent of your gross income. In addition, mortgage payments and property taxes should not be more than 30 per cent of gross income.

Buying your first home may seem intimidating in the beginning, but with careful planning and a clear idea of what you want, home ownership can become a joyful reality for you and your family.

The above article was prepared by the Vancouver Island Real Estate Board - "An Association of REALTORS" for the information and benefit of consumers.

June, 1996
rev Jun/98

First-Time Home Buyers' Dream a Reality
Tips on Making an Offer to Purchase
A Home Inspection Can Be a Wise Investment
Looking for a Mortgage? It's a Good Idea to Shop Around
How To Books Offer Advice
Buying or Selling a Home? Use a Realtor
Picking the Right Neighbourhood