Buying your first home can leave you with a lot of questions and you may not know where to start! To help ease your mind, here are some amazing first time buying strategies I have picked up along the way.
Find Out What You Can Afford
Time and time again I have seen people go house hunting online without a clue of how much they can afford. They fall in love with a home significantly over their budget and are stuck feeling like nothing else can compare when they find out their true budget. The best thing you can do is to go to your bank and find out what you can comfortably afford. To do so you will need to determine costs associated with home ownership – insurance, taxes, utility bills, etc.
Use First Time Home Buyer Incentives
One of the best first time buying strategies is to know what is available to you as financial incentives. There are many federal government incentives to help Canadians purchase their first home. For example, the Home Buyer’s Plan allows first time buyers to withdraw up to $35 000 from their RRSP to use towards their first home. The Home Buyer’s Amount is a $5000 non-refundable tax credit that can be applied to certain qualifying homes. The First Time Home Buyer Incentive helps first time homebuyers to reduce their monthly mortgage payment without increasing their down payment. If you meet the criteria, you can apply for a 5% or 10% shared equity mortgage with the Government of Canada. There is also the GST/HST New Housing Rebate that provides qualified buyers a rebate on the purchase price of their home.
Apply For A Mortgage Pre-Approval
Not only will applying for a mortgage pre-approval help you understand what you could be approved for, it also instils confidence in sellers that you are a serious buyer. A mortgage pre-approval can hold your interest rate for up to 120 days once you’re approved.
Plan For All Home Buying Costs
An easy mistake to make is to think that the only costs involved in buying a house is the price of the property itself. You will also need to set aside money for closing costs. These additional expenses can total up to 4% of the purchase price of the home. Closing costs, as they are more commonly known, include home inspection fees, title insurance, adjustment costs, legal fees and more.
Get Help House Hunting
A real estate agent can help you from the beginning to the end of the house hunting timeline. By finding the right real estate agent who has excellent credentials, references, and knows your neighbourhood well you can find a true partner who will help you find a home that is ideal for you. Remember, as a buyer, the agent is usually paid by the seller so it may not cost you anything to use one.
These are just a few first time buying strategies that can help you this year. If you would like to learn more tips please feel free to reach out to me here. I’d love to help you find your first home this year.
