Prospective homeowners who are ready to head for the suburbs in search of cheaper listing prices may want to think again. A new report analyzing how “location-related” costs factor into the sticker price of a home suggests that the suburbs may not actually pay off in the long run.
Here are three things to consider when choosing a new home in the GTA:
1.) You may want to ditch the car
It is no secret that car ownership is costly. But when purchasing a home, be sure to actually crunch all the numbers when it comes to transportation, including insurance, registration, car loans, interest, maintenance, parking, fuel costs and even the cost for lost time for commuting and sitting in traffic. The Ontario Director of the Pembina Institute, the think-tank behind the new report, says that ditching one car could save a homebuyer $200,000 over the lifetime of a mortgage.
2.) Walkability and quality amenities make a big difference
In a previous report published by RBC and the Pembina Institute, 80 percent of respondents said they would rather live in a walkable neighbourhood that is close to transit and closer to work even if it meant they had to give up a large house and large yard. Accessibility to quality amenities and transit are big factors to consider when buying a home. Is the neighbourhood pedestrian friendly? What is the volume of traffic like? Is the neighbourhood bike-friendly? These factors could save you loads of time and a little bit of cash too.
3.) Don’t forget about taxes, closing costs and interest
Factors to consider when purchasing a home include a lot more than just the sale price. Consider closing costs, such as land transfer taxes, mortgage costs and interest, property taxes and condominium or maintenance fees, as well as HST and warranties for new homes.
