Our Guide To Purchasing Your First Condo in Victoria

Our Guide To Purchasing Your First Condo in Victoria

Purchasing the space you’ll call home is a big step. Buying condos in Victoria is an exciting opportunity. It can be freeing to have a home of your very own and can open doors to the purchase of a single family home in future or even lead to becoming an investment property.  Purchasing a condo is a big step and by doing your due diligence, you can decide if this is the right housing option for you. 

Prior to purchasing a condo in Victoria, you should understand what this type of home offers and what is involved to determine if condo ownership is the right step for you. 

Is A Condo in Victoria More Expensive Than A Home Purchase?

Not only are condos in Victoria generally less expensive than free standing homes, but their smaller overall square footage means less maintenance fees as you are only responsible for the upkeep of the interior of your property. You don’t have to worry about the roof, walls or even  landscaping. Because you only have to maintain the interior of your unit, homeowners insurance will also cost significantly less than a house. 

Yes, condos in Victoria typically charge HOA or strata fees which is an area that can cause rising costs. Keep in mind that the fewer amenities the complex has the lower the HOA fees should be. Swimming pools, dog parks, storage units, door men and gyms all cost money so be sure to let your real estate agent know what amenities you are looking for. 

Not sure how much you qualify for? Use our easy online mortgage calculator for a quick quote!

Checklist For Purchasing Your Victoria Condo

Condos are becoming increasingly popular amongst Canadian home buyers. With so many new developments popping up around Victoria, a condo is an excellent way to get your foot in the door of homeownership or as an investment property.

  • Choose your realtor

Hiring a professional real estate agent when buying a home can help you make smart decisions and avoid costly mistakes. Ask friends and colleagues for referrals to several prospective agents.  Look up their websites and online profiles to learn about their specialties, experience and client feedback.  Choose at least three  to learn more about who will work best for you. 

A mortgage pre-approval is a document from a lender conditionally offering you a mortgage and outlining the terms such as loan amount, payment schedules, and interest rate. A mortgage pre-approval letter is an essential step in the homebuying process. Without pre-approval, it may not only become difficult to determine your budget as well you may not be taken seriously by sellers, especially in Victoria’s competitive real estate market.  

  • If you’re buying a presale condo, make sure you understand the terms and conditions.

A presale condo is a contract between the buyer and developer to purchase a property before it is built. It is important that you understand what is being sold. While there are advantages, there are also risks and other issues that should be considered before signing that presale contract. Purchasers should always obtain advice from a lawyer and / or a licensed real estate agent before entering into a presale contract or assignment of a pre sale contract. Remember that lawyers and real estate agents have a duty to put you – the clients interests first. 

  • Research the neighborhood

Knowing more about the community you plan to join is a step you want to take to make sure that your dream home is located somewhere you’ll enjoy living long-term. Review neighborhood ratings by postal code, check the communities municipal websites, review schools and day care providers, research crime rates, study the property value trends. Spend some time exploring, go there and walk around, strike up a conversation with your potential new neighbors. 

  • Find out what the monthly strata fees are

Your monthly strata fee is money that the corporation uses to pay the common expenses of the development. Your individual fee is assessed by taking the total cost of the stratas expenses and dividing that by the square footage of your home. Strata fees vary greatly from area to area and building to building. You should learn how much money is being contributed to the reserve fund each year, if it is enough to cover unanticipated expenses and where money is being allocated so you have a clear understanding of what your fees are. 

  • Ask about utilities, how the condo is heated and cooled

You should confirm whether your fees include utilities such as hot water, heat and gas. 

The most common HVAC systems in condos are: Fan coil systems, condo heat pumps, packaged terminal air conditioning, ductless heat pump and high velocity air handler systems. Each has their own pros and cons, look into what is best for your needs and budget. 

  • Learn the strata rules and restrictions

According to the government of BC: all strata corporations must have bylaws and may have rules. The purpose of which is to affect the owner’s and tenants rights. Bylaws and rules are one of the ways that living in a strat is not the same as living in housing that is non-strata titled. These rules can be created to govern the use, safety and conditions of the common property and common assets. Rules can not govern the use of strata lots, only bylaws can do this. 

Understanding bylaws and rules is an important part of living in strata housing or owning a strata lot. 

  • If you’re purchasing to rent, get an accurate idea of monthly rental revenue

There are several questions to ask yourself when it comes to investing your hard earned money in a rental property. How much will the investment return? What does it cost? And more importantly you should be concerned with the value. Income from an investment related property is at a historical high. Determining the cost of and return on an investment property are just as important as figuring out its value. Looking at investment properties to buy is an exciting time, but you don’t want to overlook the cash flow for rental property equation during your search. 

  • Resale value and market trends

The resale value of Victoria condos can vary based on several factors such as location, market conditions, supply and demand, property features and common areas, standard features and changing view from future developments in the area. These factors pertain to both the exterior and unit interior as well as the surrounding neighborhood. 

  • Finally, consult with your lawyer

In a bid to save money, a homebuyer generally avoids appointing legal counsel at an early stage. However that can actually end up being more costly in the end. Once you have visited the property and gathered as much detail about the property you should show everything to a lawyer. Your sales agreement is an important document: it has all the details along with terms and conditions. Everything in the agreement is legally binding in a court of law. Lawyers will help ensure you are protected and understand: title exceptions, easement issues, seller disclosures, HOA’s, tenancy, deeds, acceptable use, enforcement of the real estate sales agreement and much more. Meeting with a real estate lawyer is an absolute must for your peace of mind. 

Pros of Strata Ownership and Condo Living

Strata living can be a beneficial home ownership choice for new homeowners, investors and those looking to downsize. From the lower purchase price to the tight knit community, strata properties come with a wide range of benefits that you don’t get with normal property ownership. 

Freedom from Repairs and Maintenance

The strata corporation must repair and maintain common property and common assets. Strata lot owners also have repair and maintenance responsibilities. Fulfilling repair and maintenance responsibilities also help the strata corporation and strata lot owners meet home warranty insurance requirements. Help prevent premature aging of buildings and assets with careful maintenance and care in operation. This proactive care will help you get the best value for your money and avoid being surprised with unexpected costs. 

Easily Customize or Upgrade Your Space

Creating a homey feel in a rental or small apartment is not easy, However if you live in a condo you can make it all your own. Now is the time to make all your home make-over dreams come true.  Take some time to explore the new world of vertical space storage, get the timeless kitchen you’ve always wanted. Throw a Murphy bed in the living room to convert it instantly into a spare room. Transform your space with lighting fixtures that turn your office into an art gallery. Smaller spaces also mean smaller budgets required to make your home renovation dreams a reality. Whatever mood you want to create the sky’s the limit and maybe even your view if you opt for the higher floors. 

Condo Ownership Is More Affordable

If you are looking for the easiest way to home ownership, buying a condo is the way to go.  Condos are much more affordable compared to single family homes. Whether a first time home buyer, downsizing or purchasing as an investment, purchasing a quality condo in Victoria is one of the best decisions you can ever make. 

Cons of Strata Ownership and Condo Living

Living in Victoria condos comes with a few downsides, while the benefits far outweigh the drawbacks, there may be a few cons to buying a condo that you should consider.

Strata Restrictions

Choosing to live in a condo means that you have to abide by the rules of the community. For example there can be restrictions on pet ownership, guidelines to where and when you can host events. Also, there could be a limit to the number of cars allowed per unit. Ensuring you know the rules and regulations when searching for a condo will ensure that the community aligns well with your lifestyle.

Less Privacy

The downside of a condo is the apartment style. There is the potential to hear and be heard in all of your celebrations and arguments. Living in a condo means having less expectation of privacy in areas that are of joint control, less control over your living environment including who your neighbors are, noise levels, and use of shared amenities.  

Monthly Strata Fees

Condos always come with a monthly fee on top of the mortgage. The luxurious amenities provided by condo complexes come at a cost to the residents, it’s important to keep in mind that these costs have a tendency to increase yearly.  To avoid the risk of pricing yourself out of your home, make sure you have increased fees factored into your monthly budget. 

Learn About Our Victoria Mortgages And Get Pre-Approved

Whether you’re looking to purchase your first condo in Victoria, curious about your mortgage pre-approval, or interested to learn more about the condo purchase process, Prime Mortgage Works has you covered.

Contact us today to discover just how easy we can make your Victoria condo purchase process.

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Things your Mortgage Broker wants you to know

The right mortgage broker can be a huge asset in your journey to homeownership in Canada. Mortgage brokers are there to guide you through the often confusing process of financing your home purchase and help you secure the best deal on your mortgage.

Here are things your Mortgage Broker wants you to know when working with them. Realtor.com recently outlined the top important points to keep in mind. While there is always much to consider, when making a mortgage application, these key points rank the highest of importance.

Call your broker with any and all questions first – Things Your Mortgage Broker Wants You to Know

Reach out to your broker first: Your broker is a valuable part of your real estate team, so don’t hesitate to contact them with any questions or concerns about your mortgage. Brokers want to be seen as partners in the homebuying process and should be your first point of contact for any financing-related queries. It’s always a good idea to check in with them during the homebuying process before making a financial decision of any type. Whether it be big or small, your mortgage broker will have the answer and are always happy to assist.

Understand the rules around down payments

Understand down payment rules: It’s crucial to have a clear understanding of the rules around down payments. For example, it’s important to know that borrowing money for a down payment is not allowed. Any funds received as a down payment should be documented as a gift, not a loan, to avoid jeopardizing the home purchase. Under Canadian mortgage, lending rules, is important to understand what options you actually have when it comes to down payment sources. The Last thing you want to do is render your mortgage offside while waiting to close on the home of your dreams.

Don’t make any sudden changes

Avoid sudden financial changes: While the loan process may be underway, it’s important to avoid making any sudden financial changes. Big purchases or job switches can potentially lead to the denial of your loan. If you are considering any changes, consult your broker first and be prepared to wait until after closing. Ideally, your financial situation needs to mirror until at least closing date as when you first submitted your application. Changes that you think are small, could be seen as material by the lender. Don’t be fooled, lenders often do last minute checks on credit and employment status right up until closing day.

Conclusion

In summary, working with a mortgage broker can greatly benefit your Canadian homeownership journey. Understanding their role and following their advice will help ensure a smoother process. Full disclosure of any, and all challenges is paramount during the mortgage application process. Often, we can help you navigate any bumps or bruises that we know about. However, it can be very difficult to explain to a lender something we were, unaware of. That could make the lending approval null and void. Remember to communicate openly, follow the rules, and avoid any sudden financial changes.

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2024 Property Assessments

Stable Values

The story for 2024 Property Assessments for British Columbia overall is stability. The assessed value of properties across B.C. has generally stabilized, with some outliers like Lytton, Haida Gwaii, and Tumbler Ridge experiencing significant increases in worth. According to the B.C. Assessment Authority, as of July 1, 2023, property values changed between minus 10% and plus 5% on average. In the Lower Mainland, the range was between minus 5% and plus 5%. B.C. Assessment’s lead assessor, Bryan Murao, stated that the overall housing market has generally stabilized in value across the Lower Mainland and throughout B.C. Most homeowners can expect modest changes in the range of minus 5% to plus 5%, which is notably less than previous years. For example, the average detached home in Vancouver saw an increase of 9% in value in 2022 and 16% in 2023.

Commercial and Development Values

Murao also mentioned that commercial and industrial properties are generally increasing in value at a higher rate than residential properties, particularly in areas like the Fraser Valley, where limited industrial land is driving up property values. In the Lower Mainland region, the overall total assessment values increased from about $1.94 trillion to nearly $2 trillion. Almost $27.2 billion of the increased assessments in the region are attributed to new construction, subdivisions, and rezoning of properties.

Residential Properties

In terms of specific areas, for single-detached homes, 2024 property assessments increased by 4% in Vancouver, Burnaby, and Coquitlam, with the average detached home price in Vancouver now at $2,209,000. The average assessed value of a detached home in Surrey remained unchanged at $1,609,000. The District of Hope experienced a 13% decline in assessed value, with the average detached home now worth $611,000. Notably, the value of detached homes in Hope rose 14% last year and 45% the year before during the COVID-19 real estate boom.

There were significant changes in Whistler, as the average assessed value of a detached home went down 2%, now sitting at $2,842,000. Last year, a detached Whistler home saw an increase in value of 11%, and 29% the year before. In the strata property class (condos and townhouses), the Lower Mainland saw varying performance across different areas.

Call us to discuss further and to Check your own Property Assessment NOW at bcassesment.ca

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Difference between a Home Inspection and Home Appraisal

Are you planning to buy your dream home? If so, you may need to apply for a mortgage loan. Before you take this big financial step, it’s important to understand the difference between a home inspection and a home appraisal to avoid any surprises in the long run.

Home Inspection:

A home inspection is a thorough examination of the conditions of a property, focusing on the current state of the various components of the house structure. Inspectors will check for any visible damage, such as leaks, cracks, and wear and tear on the building. Additionally, they will examine the electrical, heating, and cooling systems in the house. They will also look at the plumbing system and assess the condition of the roof, flooring, walls, windows and doors.

Home Appraisal:

A home appraisal, on the other hand, is a completely different process. It provides an estimation of the property’s worth based on current market conditions. Lenders require appraisals to determine an accurate evaluation of the potential value of the property, comparing it to the current prices of similar homes in the area. An appraiser will consider factors such as location, square footage, condition (based on the home inspection), and the number of bedrooms and bathrooms. They’ll also consider the age of the property, the lot size, and the unique features that may affect the home’s value.

The Difference Between Home Inspection and Home Appraisal:

A home inspection focuses more on the physical structure of the property while an appraisal is more concerned with its overall value. Both are essential when getting a mortgage, as lenders want to make sure they’re investing in a property that has been adequately appraised and inspected to ensure that it’s in good condition and can withstand the test of time.

Conclusion:

Ultimately, it’s imperative to keep in mind that both a home inspection and a home appraisal are crucial steps in the home buying process to ensure you are making an informed investment. Talk to your lender or real estate agent to make sure you understand the differences between these two processes and how they impact your loan approval. Being informed will help ensure that you can make an informed decision and find a home that meets your needs while being a sound financial investment.

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Canadian Mortgage Rate Forecast for 2024

Canadian Mortgage Rate Forecasts for 2024: What You Need to Know

Are you a Canadian homeowner or looking to invest in Canadian real estate? If so, chances are you’re constantly monitoring mortgage rates and trying to predict where they’re headed. While there’s no crystal ball to tell us exactly what will happen in the housing market, experts and economists can make educated guesses based on market trends, economic indicators, and other factors. In this blog post, we’ll take a deep dive into Canadian mortgage rate forecasts for 2024, including the probabilities of low and high rates, and what it all means for you.

The Bank of Canada has a significant influence on mortgage rates, as it sets the target overnight rate, which affects borrowing costs for banks. Based on current economic conditions and projections for the future, here are some potential scenarios for mortgage rates in 2024:

1. Low Rates:

Experts predict that the Bank of Canada will keep interest rates low until at least 2023, which could result in continued low mortgage rates for homeowners. If the economy continues to recover from the pandemic, we could see the government reduce stimulus measures like quantitative easing, which could cause rates to rise slightly, but they will still be historically low.

2. High Rates:

On the other hand, if inflation rises sharply and the economy overheats before 2024, the Bank of Canada may feel compelled to increase rates to curb inflation. However, this is seen as less likely by most economists.

3. Stable Rates:

The most likely scenario is that rates remain stable or rise slightly in 2024. The Bank of Canada has signaled that it plans to keep rates at historic lows until the economy fully recovers, which could take several years.

4. Variable Rates:

Another factor to consider is whether you have a fixed or variable-rate mortgage. If you have a variable-rate mortgage, your payments will fluctuate based on changes to the prime rate. While variable rates have been historically lower than fixed rates, they are more volatile and can increase rapidly if the economy heats up.

So, what does all of this mean for Canadian homeowners? If you’re planning to buy or refinance in the next few years, it’s essential to think about your long-term financial goals. While low rates may make it tempting to borrow more money, it’s critical to consider the potential for rates to rise in the future. Make sure you’re comfortable with your mortgage payments both now and in the future, which can be helpful in withstanding any interest rate hikes.

While we can’t predict the future with certainty, having an understanding of Canadian mortgage rate forecasts can help you make informed decisions about your finances, whether you’re a homeowner or an investor. As with any investment, it’s crucial to do your research and consider all options to ensure you’re making the best decisions for your financial future. Remember to consider your long-term goals and expectations and consult with a trusted mortgage broker to get expert advice on the best course of action for you.

BC Secondary Suite Incentive Program and Get a $40,000 Forgivable Loan

Gone are the days when a home serves only one purpose. With the rising costs of housing and the changing demographics, secondary suites are becoming more popular and essential. Many homeowners in British Columbia are converting their basements, garages, or even adding rooms to their homes to create additional living spaces. If you’re one of them, you can now take advantage of the newly introduced BC Government Secondary Suite Incentive Program. The program provides homeowners with a $40,000 forgivable loan for the construction of a secondary suite in their homes. In this blog post, we’ll delve deeper into the program, explaining the requirements, benefits, and how to apply.

What is the BC Government Secondary Suite Incentive Program?

The BC Government Secondary Suite Incentive Program is a new initiative aimed at providing support to homeowners who are building a rental unit in their homes. The initiative is funded by the Province of British Columbia and administered by BC Housing. The program provides a forgivable loan of up to $40,000 to eligible homeowners who construct a secondary suite in their primary residence. The loan is forgiven after 5 years, provided that the rental unit remains rented out for the full five years and meets all eligibility requirements.

Who is Eligible for the Secondary Suite Program?

To be eligible for the program, the homeowner must meet certain requirements, including:

• Own and occupy the home;
• Construct a new rental unit within their primary residence;
• The rental unit must meet local zoning and building code requirements;
• The rental unit must be offered for rent at an affordable rate to tenants with moderate incomes.

What are the Benefits of the Program?

The program provides several benefits to homeowners who take advantage of it. First and foremost, the forgivable loan of up to $40,000 can be used to offset construction costs of a secondary suite within a primary residence, making the process more affordable. Additionally, homeowners can generate rental income by renting out the additional living space, which can help them pay off their mortgage faster or supplement their income. Also, the rental unit may be suitable for family members or friends who can’t afford a rental that meets their needs. Finally, homeowners who take advantage of the program are contributing to the creation of more affordable housing options in British Columbia.

How to Apply for the $40,000 Forgivable Loan Program?

To apply for the program, eligible homeowners must first ensure that their rental unit meets all zoning and building code requirements. Next, they must complete the BC Housing’s Secondary Suite Program application form and attach the necessary supporting documents. The application will be reviewed, and eligible homeowners will be contacted with further instructions.

Conclusion:

The BC Government Secondary Suite Incentive Program is an excellent opportunity for homeowners in British Columbia to create an additional rental space in their primary residence. With the help of a forgivable loan of up to $40,000, building a secondary suite can be more affordable and accessible. The program’s focus on helping provide affordable rental housing for moderate-income renters is a critical step towards addressing the housing crisis in British Columbia. If you’re a homeowner considering adding a rental unit to your home, take advantage of this program to save money while investing in the future. Contact us for more details TODAY!

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Canadian Mortgage Charter

As part of their fall budget update, the Canadian government has recently introduced a new mortgage charter for the country. The charter is aimed at regulating the mortgage industry in Canada, an industry that has faced some turbulence in recent times due to rising interest rates and a slowdown in the Canadian housing market. While the new mortgage charter has been introduced with the aim of protecting the interests of homeowners and making it easier for them to navigate the Canadian mortgage industry, it also has its fair share of pros and cons.

The Pros

One of the main benefits of the new Canadian mortgage charter is that it aims to make the Canadian mortgage industry more transparent. This means that mortgage brokers and lenders will be required to provide borrowers with more information about the terms and conditions of their mortgage. This will make it easier for homeowners to understand the terms of their mortgage and avoid any hidden charges or fees. The charter will also help protect borrowers from predatory lending practices, which have been a problem in the past.

Another pro of the Canadian mortgage charter is that it will make it easier for borrowers to transfer their mortgage from one lender to another. This will increase competition within the industry and put pressure on lenders to offer better rates and terms to borrowers. It will also make it easier for borrowers to find a mortgage that fits their specific needs and preferences.

The Cons

While the Canadian mortgage charter has many benefits for borrowers, it also has some downsides. One of the main concerns is that the new regulations may make it more difficult for some borrowers to get a mortgage. This is because lenders may become more cautious about who they lend money to, due to the new regulations and guidelines. This could make it harder for some borrowers, particularly those with lower credit scores or unstable income, to find a lender willing to work with them.

Another concern is that the new regulations may result in higher mortgage rates for some borrowers. This is because lenders may pass on the extra costs of complying with the new regulations to borrowers in the form of higher interest rates or fees. While this may not be an issue for borrowers with strong credit scores and high incomes, it could be a problem for those who are already struggling to make ends meet.

Conclusion

Overall, the new Canadian mortgage charter has a lot of potential to help borrowers navigate the mortgage industry and protect them from predatory lending practices. However, it also has some downsides that could make it harder or more expensive for some borrowers to get a mortgage. As with any major regulatory change, it will be important to monitor the impact of the new mortgage charter on the Canadian housing market and make adjustments if necessary. In the meantime, borrowers should make sure to carefully read and understand the terms of their mortgage and work with a reputable lender to ensure they are getting a fair deal.

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Bank of Canada holds interest rate steady

Are you a homeowner or homebuyer who is juggling budgeting for your mortgage amidst an ever-changing economy? We have some news for you: The Bank of Canada has announced that it will hold its benchmark interest rate steady. This positive news could mean savings in your pocket and lower overhead expenses on housing if inflation. Assuming of course that as projected by the Bank, slows down this year. Read on to learn more about how this decision can affect you as a homeowner or prospective buyer.

The Latest Bank of Canada NEWS

The Bank of Canada held its breath, keeping interest rates at a steady 4.5 per cent, bracing for the impact of its previous hikes to settle. Economists were expecting this decision, after the bank’s announcement that it would take a break from raising rates. The bank had raised rates eight times between March 2022 and February of this year. Stemming from their aggressive campaign to increase rates after the pandemic’s early days, when they slashed the benchmark lending rates. With inflation soaring, Canada’s inflation rate reached its highest level in decades, peaking at over eight per cent in June 2022. This before cooling to just over five per cent by February 2023. Stay tuned for next week’s data on March where it is expected to show continued progress downward.

What’s Next for the Bank of Canada RATES?

The Bank of Canada has made the wise decision to hold off on any major policy changes. At least until further notice due to the cooling of inflation. The latest Monetary Policy Report predicts that the official inflation rate will dip to three per cent in the coming months.  Eventually, it is expected to reach the bank’s target rate of two per cent next year. Governor Tiff Macklem acknowledged the relief that Canadians will experience, but also emphasized that their work is not done until price stability is fully restored. The destination is clear and the bank is determined to stay the course.

Have Rate Hikes worked to battle Inflation?

The bank’s top officials are keeping a close eye on inflation. They indicate they will not hesitate to increase rates again if necessary. However, it is confident that the current rate hikes have been effective in achieving the desired results. Deputy Governor Carolyn Rogers did note that the previous increases have already slowed down consumption and restored economic balance.

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Mortgage Pre-Approval Survival Tips

Buying a home is an exciting experience and a significant financial decision. It’s important to take every precaution to ensure that it will be a successful purchase, and one of the best ways to do this is through mortgage pre-approval. Mortgage pre-approval gives you guaranteed access to the funds needed for your desired home loan, as long as you are approved by your chosen lender. To make sure your mortgage pre-approval process goes smoothly, we’ve gathered some useful Mortgage Pre-Approval survival tips that you should know. Read on to learn more about how you can successfully navigate the mortgage process with ease.

Finding a Home Before Getting Pre-Approved

The excitement of house hunting can easily cloud the importance of getting a mortgage pre-approval. Unless you plan on paying cash for the property, it’s crucial to prioritize this step. You wouldn’t want to fall in love with a dream home only to have your lender reject your application. Taking the time to get pre-approved first is the smarter way to approach the house hunt. Don’t leave your search to chance – get pre-approved and confidently begin your search for the perfect abode.

Do Not Use All Your Cash on the Down Payment

Buying a home is a major investment and requires a solid financial plan. Saving up for a down payment is just the beginning – there are other costs to consider such as earnest money, closing costs, and moving expenses. First time home buyers should not rely on the seller to foot the bill for all closing costs. Furthermore, owning a home comes with the added responsibility of maintenance and repairs, so it’s important to budget accordingly. It’s wise to leave some funds in savings to prepare for unforeseen repairs. Don’t let unexpected expenses catch you off guard – be prepared with a comprehensive financial plan for your home purchase.

Buying a Home is MUCH MORE Than the Monthly Payment

Buying a home is an exciting process, but it’s important to remember that there are costs beyond the down payment and monthly mortgage payments. Lenders often require buyers to prove they have funds for closing costs, which includes money for property taxes and homeowner’s insurance. If the buyer doesn’t make a 20% down payment, they will also have default mortgage insurance which will be added to the mortgage principal. And these are just the basics! Homeowners also face expenses like association dues and higher utility bills. It’s important to budget for all of these costs to ensure a smooth transition into homeownership.

No New Debt After Getting Pre-Approved

The news of being pre-approved for a home loan can give people a sense of invincibility. Suddenly, the world seems full of possibilities and obstacles seem conquerable. However, it’s crucial to remember that this pre-approval is based on the borrower’s current debt situation. Financing a new car or furniture may seem enticing, but it can actually jeopardize the pre-approval status. Any new debt can cause lenders to reconsider and potentially cancel the pre-approval altogether. So, it’s important to resist the temptation to make big purchases before finalizing the home loan process.

Do Not Try to Save Pennies by Doing Everything Yourself

For first-time home buyers, the excitement of purchasing their dream home can lead to foolish decisions like handling all real estate negotiations themselves. The consequences of skipping important steps like a home inspection and property survey could be catastrophic. This is arguably the most important mortgage pre-approval survival tip! A seasoned agent can help locate the perfect home, negotiate a fair price, and entertain any potential issues that may arise. Keep in mind, the agent representing the seller is working in their client’s best interest, not the buyer’s. That’s why it is critical for buyers to have their own agents to advocate for their needs.

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Tax-Free First Home Savings

The Canadian government has introduced a new and exciting program called the Tax-Free First Home Savings Account, which will launch on April 1st, 2023. The program is designed to help young people save for their first home purchase by offering tax savings benefits. Contact Callum Greig today to get the ball rolling on this initiative.

How it Works – Tax-Free First Home Savings

Under the program, eligible members can put away up to $40,000 per person or $80,000 per couple in a special tax-free savings account. The balance in the account can be accessed anytime without incurring taxes when it comes time to make your down payment on your first property purchase. This program is in addition to regular TSFA accounts which also enjoy tax-free savings status. AND just like an RSP contribution the Tax Free Savings is also tax deductible.

This program is great news for those trying to save for their first home. It will allow them to accumulate greater savings than with other programs that only offer tax credits or rebates. Plus, you won’t have to worry about paying taxes when you withdraw funds from the account for use as a down payment on your home.

Who to call – Tax-Free First Home Savings

In addition to the tax advantages of this first home savings account, members also have access to financial advice from mortgage brokers who are knowledgeable about this type of saving product and familiar with its various rules and regulations. This service can be invaluable when determining the best financing options available and applying for mortgages.

Bonus!

Individuals can also combine their Tax Free First Home Savings Account with other incentives such as RSP HB Plan. This will make it easier to access additional funds which will go towards their dream home’s down payment. Finally, prospective homeowners have more flexibility when planning their finances and making decisions around purchasing.

Are thinking of buying your first home and looking for ways to save money before taking out a mortgage loan? Look no further than the Tax Free First Home Savings Account. Inquire today to learn more about this incredible opportunity.  Plan ahead and start benefiting from these amazing tax savings benefits come April 1st 2023.