March 15th, 2025, Mario Charron
Budgeting for a Larger Home in Ottawa: A Guide for Upsizers
Thinking about moving to a larger home in Ottawa? For many, upsizing is an exciting step. It’s a chance to find more space, enjoy a new neighborhood, or accommodate a growing family. However, it’s important to plan carefully. Budgeting for a larger home can seem daunting, but taking it step by step can make the process manageable.
Understanding Your Financial Situation
Before you start looking for a new home, you need to have a clear picture of your finances. This means knowing how much money you earn, what you own, and what you owe.
1. Calculate Your Income: List all sources of income. This might include salaries, business income, or any other regular money you receive.
2. Review Your Expenses: Write down your monthly expenses. Be sure to include everything: rent or mortgage, utilities, groceries, transportation, and entertainment.
3. Assess Your Debts: List any debts you have, such as credit cards, loans, or existing mortgages. Be honest with yourself. Knowing your debts helps you understand how much you can comfortably afford.
4. Evaluate Your Savings: Look at your savings accounts to see how much money you have available. This can help with a down payment or moving costs.
Setting a Realistic Budget
Next, decide how much you can spend on a new home. It is crucial not to overstretch your finances. Remember, buying a house means ongoing costs, not just the price tag.
1. Use the 28/36 Rule: Financial experts suggest spending no more than 28% of your monthly income on housing costs and no more than 36% on total debt, including the new mortgage. Use this as a guide to set your home-buying budget.
2. Consider Additional Costs: Remember to budget for insurance, property taxes, maintenance, and any homeowner association fees. These expenses often surprise new homeowners.
3. Plan for the Future: Think about your long-term goals. Are you planning to stay in this home for a long time? Do you antici ...