Tuesday, March 01, 2011

House Hunting

I never thought I'd see the day when I've become that friend, you know that friend, who slips in market value, home equity, interest rates, and mortgages into casual conversations. Except, I've become that friend.

Paul and I went house hunting on Sunday. None of the places we saw fit my criteria. Paul is even pickier. The properties were all decent, but as an investment, they were far from tempting.

My mom and I agreed that it might be better to look downtown. While the prices are steeper for less living space, these properties aren't as vulnerable to market fluctuations as their suburban counterparts. Furthermore, it's far easier to rent out or sell a one-bedroom to young professionals than it is to growing families in a trendy region of the city.

I spoke to a broker today for half an hour, discussing the pros and cons of Toronto's real estate environment. We discussed the factors that determine maintenance fee hikes under various conditions, seasonal trends, price gouging, etc. It was really quite fascinating.

My main dilemma is this: Should I purchase a 1 bedroom/1 bathroom and pay if off myself or purchase a 2 bedroom/2 bathroom and rent out the extra room?

Although I would be able to afford both scenarios (the latter with the help of the renter), I'm weary about investing in a property that Paul and I will easily outgrow. Granted, my salary might change and Paul will have entered the job market by then, but those are (in)variables I can't consider when I'm looking for a place right now. I also don't want to depend on Paul, knowing his job prospects will be unpredictable in his field. (I have, however, unwavering faith in his abilities to succeed.)

Patience might work out in my favour to an extent. But time is a-tickin' and the prices, overall, are still relatively affordable (at least, for this city). I just don't know how long it will last. A property I had my eye on 2 years ago has already gone up by 200k.

What to do? There are so many things to consider, minor as they are. The location of the property will determine whether or not I can rent out an extra parking spot, which can net me an extra $150-$200 a month. Its distance from my job will determine whether I will have to shell out the $120 for a public transit pass (extortionist to TTC: "Girl, that's a bit much!"). Will I be able to cover utilities? Have I made allowances for food, entertainment, and emergencies? Will I make sure to have enough money in my account to pay off my mortgage on a bi-weekly basis in order to save thousands on interest? (That last one was mostly rhetorical.)

And yet, I feel pretty good about my life. I've had some great adventures in my 24 years and while it may appear that I'm settling down hardcore, I believe I am providing a solid foundation to help usher me into the next phase of my life. While re-tracing Audrey Hepburn's steps in Roman Holiday and walking past throngs of paparazzi were fun, these experiences (and those like them) were fuelled by the need for novelty. I know now that a trip to the Amazon will not help me discover more about myself nor will I suddenly feel the urge to change my values because wherever you go, there you are.

In other words, I believe the next few years will involve developing strong professional relationships so that I may (collaboratively) contribute something tangible and positive to the world. Or maybe, it's my mind at 2:00am speaking ...

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