Buying your first home is exciting, scary, and overwhelming. It’s a big decision and you want to make the most of your budget and make the right first choice.
THE CHALLENGE
Often times when buying your first home, the budget you’re working with can be a limiting factor. This was the case here, and we were in a strong seller’s market with homes often going for over asking price. That makes is hard to secure a property when everything you’re looking at is selling for over your maximum budget.
Their max price of $250,000 got them condos they were happy with, but anything lower was in need of renovations and repairs; something they weren’t capable of doing. They didn’t have surplus cash on hand, so they felt they couldn’t afford to do the renovations.
THE SOLUTION WE CAME UP WITH
This may sound obvious to some, but we simply reduced the budget. Instead of looking at homes up to $250,000 we set the target price at $225,000. We were able to find a condo at that list price, and because the client had some “wiggle room” we were successful in a competing offer at $232,000.
Here’s where the magic happened. We worked with their mortgage broker to secure a “purchase plus improvements” mortgage for $250,000; the buyers’ original budget. Using that extra $17,000 allowed the buyer to do a few renovations to turn the condo into what they wanted but couldn’t secure in the open market.
THE RESULTS
They stayed in budget, got a condo they are happy with, and ultimately achieved their primary goal of starting their life in their first home.
