Graduation comes in different stages. It might be high school, university, entering the work world, or for any age – the graduation to acting your wage.
Today we’ll talk about buying your first home and every single one of the four sections in here are chapters in the Money Tools book. It’s THE best $20 gift for yourself or anyone graduating to any stage in life. Mosaic has a bunch of signed copies now, or just go to yourmoneybook.com – it’s a tiny investment in yourself or paying it forward to help someone else avoid what many of us wish we had known.
There’s an old Rod Stewart song with the title: I wish that I knew what I know now – when I was younger. Oh boy, I wish I could make that happen. I bought my first house in the early ‘80s when rates were insane. To hang onto it, I had two years of using my Visa cash advance in order to pay my MasterCard. Owning a home is so worth it, because it builds equity in two ways: By the principal you pay on your mortgage and a historical five percent return each year.
But I wish I had held off for a few years in order to build up my savings. The younger you start saving, the bigger the amount when you retire.
Don’t listen to developers who advertise that buying a place is cheaper than renting. It’s totally false. You are now responsible for property taxes and at least a couple of hundred bucks a month for everything from paint to plumbing problems and repairs.
One of the biggest blessing you can get is from your parents or grandparents lending or gifting you the money for a down payment. Do NOT make it on a condo, but a duplex or single family home. Condos are the first to plummet in value if there’s a correction, and the last to regain their value. You’re also competing with everyone else in the condo complex who may want to sell. There’s a condo complex on the popular Whyte Avenue in Edmonton that currently has 13 units for sale. (I’ve posted the picture). If you’re selling, you need to always lower your price to be the bottom two or it’ll be years before it’ll sell.
If you as a parent or grandparent lend someone in your family the money for a down-payment you can do it in three common ways: Just as a gift, or have a lawyer put a lien against the property to assure you’ll be paid back, or have the amount of that gift or loan noted on your will to be paid back out of your estate to the beneficiary.
George Boelcke – Money Tools & Rules book – yourmoneybook.com