The first thing potential buyers ask is usually “how much can I afford for a house or condo?” The answer to that question is based on two factors: how much of a down payment you have and how much a lender is willing to lend you. The higher the down payment, the less you have to borrow.
Getting pre-approved for a mortgage is the best way to start. Whether you’re a first-time homebuyer or you’re already a homeowner on the hunt for your next property, having a number from a lender lets you jump into your search knowing your price range, and ensures you don't end up falling in love with a place you can't afford.
Now, once you've figured out how much cash you've got to work with, the next big question is “what can I buy for my budget?”
Obviously, the bigger your budget, the more options you'll have. Toronto housing can be pricey, especially if you're looking to buy in a hot building or neighbourhood, or you want to live in a bigger unit.
Don’t forget to factor in condo maintenance fees
The asking price isn't the only thing you should be looking at. You’ll want to take a closer look at condo fees as well: higher condo fees can actually bring down the value of a unit since fewer people will want to buy it. So when you see a listing price that seems like it's a particular deal, don't forget to look at the monthly condo fees, too. Not only will they impact your monthly costs, if condo fees for a unit you’re thinking about buying are especially high, but that may also change the numbers you’ve been pre-approved for. (But don’t worry, condos.ca lets you set a search filter for the max condo fees you’re willing to pay.)
How much space do I actually need?
Another thing to consider is what kind of square footage you should be looking at. How much space do you need per person in a house or condo?
Before you get stuck on a number, however, it’s important to understand that square footage can be less of a factor than you might think in determining what’s “enough.” The layout is just as important. Big transitional spaces like hallways, entryways and stairwells can eat up a lot of usable room, so it's very possible for a 600 sf condo with a great open layout to feel a lot more spacious than a 1000 sf house that's all hallways and small rooms. A good layout is everything.
That said, according to the Engineering Toolbox, we need about 100 to 400 square feet per person of living space. That's a big range (300 sf vs. 1200 sf is going to be a pretty different experience), but it's a calculation that can help you figure out what square footage you can live in comfortably.
Do your research
The best way to figure out what you can get for your money is to just jump in and see what's out there in your price range. Use the search filters on condos.ca and property.ca to find listings in different parts of the city, and you'll quickly get a sense of how far your budget can go in specific areas.
Set your filters and draw a map of the areas you’re interested in.
If you want something bigger but have a smaller budget, you may have to consider living a bit further out. Looking to live in a sexy building in a knit neighbourhood? That may mean trading off space for location.
Here's a sampling of condos for sale in Toronto and the GTA right now:
Less than $350K
$350K - $500K
$500K - $650K
$650K - $800K
$800K - $999K
$1M+
Done your research and ready to start looking for real? Get in touch with an agent today.