How purchasing a car is like purchasing a house

Wednesday Mar 15th, 2017

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A few weeks ago my car died, God rest her soul. She had over 254,000 kms on it and I spent untold hours in that vehicle driving between Windsor, London and Oshawa with Cinder (my Cocker Spaniel). 

 

There was no question, I needed another vehicle.  So I started the analysis of what type of vehicle I was going to purchase and it occurred to me how similar the car buying process is to securing a new home:

  • should I buy new or used?
  • own or lease?
  • what features do I need to have?
  • what features would be really cool if I could afford it?
  • what style do I want?
  • what aspect are deal breakers for me?
  • what's my budget?

I found it ironic that similar to a home, a vehicle is one of the largest assets most people will invest in and  many will end up choosing the one whose style they like and that "just feels right". 

 

So how do you decide when there are so many options and emotions play such a large role? 

Start with the criteria that truly has the largest impact and continue to eleminate options as you go. What is your overall budget and what is your "month-to-month" budget? This is the single most important decision you need to make because it will impact the rest of the criteria. For example, let's say your budget is $20,000 and you only have $200/month to put towards maintenance and other costs related to the vehicle. This will eliminate everything outside of that budget thereby making your decision easier as you can only look at product within that range.

 

Next look at what you need that product to do. For me, I need a hatch so I can easily get my signs in and out of the vehicle.  I also need a vehicle that allows me to sit up just a little so its easier for me to get in and out and is good on gas as I am in my car a lot. With this criteria I eleminated everything that didn't fit. Now my pool to choose from is smaller. 

 

This same approach applies to purchasing your home. Although there is more demand that homes, there is still a lot to choose from so it is important to set realistic expectations for you and your family and to choose your criteria wisely. Once you narrow down the pool of homes from which you can choose then you can let the homes "speak to you".

Here's an example:

 

As of today there are 484 homes for sale in Durham. If your budget was $650,000 there are 244 homes to choose from. If you decided that you were only interested in detached homes now your have 121 options, 51 of which have 3 bedrooms. A lot of people who are looking at 3 bedrooms homes also want 3 bathrooms (one ensuite in the Master Bedroom, one in the bedrom area and one on the main floor). Now there are 12 homes to choose from, unless you want a pool.

That doesn't seem like many options, how am I ever going to find something that works for my family?

There is no question there is more demand than supply; however, that doesn't mean it isn't possible to find your dream home. It is crucial to meet with an experienced real estate agent who will put in the time to come up with your own decision matrix to ensure you have the greatest pool to choose from. Equally important is developing a proactive strategy for securing that dream house when it does hit the market.

 

Want your own decision matrix? Give me a call today so we can work together to get you in your new dream home!

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