Many British Columbian's are house rich but cash poor.
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House Rich, Cash Poor
You've likely heard the expression house rich and cash poor. In today's soaring real estate market --it's not just a saying.
With a growing family, Shauna Nicholson wanted a larger place to call home. But she knew it would take sacrifice.
"If you live in the lower mainland you are going to be living to pay for your house," she concedes.
The Nicholson's made some smart moves when they bought their home.
"We got rid of all our credit cards, so we have one credit card with a very low limit just emergency purposes. Otherwise we use all Interac and cash. We buy things if we have the money," she confides.
When they bought their home in the valley, the Nicholson's wanted to put everything they could down on the mortgage but had to keep thousands aside for costs they hadn't considered.
"Property transfer tax, paying the lawyer fees, there's all those things," she lists.
The property purchase tax alone on a half million-dollar home is eight thousand dollars.
Money you don't want to be trying to scrape up afterwards. To pay off the mortgage sooner they're making bi-weekly payments instead of monthly and rounding up payments to the nearest 100 dollars.
"I just think the money works for you when you put it into your house right now," says Shauna.
But it's not without sacrifice, paying for a home means giving up unnecessary spending like having dinners out.
"For us we are happy with the way things are and we don't mind the sacrifice, so it's not so it's not as on top of my mind all the time," she says.
Her advice to others? Spend time figuring out all the costs of owning a home and
what you are prepared to do without. Decide what you can realistically afford and stick to that budget.
"The worst thing is to worry about money, to worrying about if you are going to be able to pay, your bills or keep your home. I think just don't put yourself in that situation it's not worth the stress," she concludes.
Having a family budget and sticking to it is critical when you own a home, especially having money set aside for the unexpected.
For information on how to avoid being "House rich - Cash Poor" contact http:/www.HudsonHomeTeam.com 778-869-7653