First Time Home Buyer's Guide

Pride of home ownership is the number one reason why Canadians desire their own home. There is no landlord looking over your shoulder. You are able to make home improvements knowing that any appreciation that results, will be to your benefit. Home ownership gives you and your family a sense of stability and security. It's making an investment in your future.


As a first time home buyer, there is a lot to take in. It is my mandate to help educate people about how to be prepared and ensure a positive experience!


Follow my 5 step guide:



#1. AFFORDABILITY

This is a big one folks! If you haven't already gone through the mortgage pre-qualification process, you will need to meet with a lender or mortgage broker. They will establish how much of a mortgage you will qualify for. Mortgage rates vary considerably and it is paramount that you shop around for the best rate, terms and options.

Our Mortgage Calculator will help you determine what monthly mortgage payment and the maximum mortgage you can manage. Note: if you are buying a condo, the amount of your monthly assessment has a direct impact on how much you can afford to spend on your mortgage.

First time homebuyers may want to take advantage of the federal government’s Home Buyers’ Plan. Under this plan, you may use up to $25,000 of your RRSP towards the purchase of a home. The money is tax-free as long as you pay it back in the next 15 years. 



#2. CEILING PRICE

This is an important time for you to really evaluate what you consider a comfortable mortgage amount. Take into consideration what you are currently paying in rent and ask yourself, is this comfortable? As a homeowner you will have the additional expenses of property tax, utilities, maintenance, and interest rates. 


Property taxes are due on a yearly basis (can be paid monthly) and vary based on location, property type and municipal needs. On the Sunshine Coast waterfront properties generally tender a higher tax than any other location. It would be wrong to generalize here as there are many variables but to use my house as an example, I live in Sechelt Proper (near DT) although not on the water and my house size is roughly 2500 sq. ft.;we paid $3,200 in property tax for 2016. 


Utilities including gas, hydro, and water will vary drastically depending on the house construction, size and source of heat. Again, using my home as an example, we have gas and radiant in-floor heating, all utilities in, for a cost of $190-250per month. 


For maintenance, it is a good idea to work in a percentage of funds. Unlike a rental situation where your landlord is responsible for maintenance, as a homeowner it is your responsibility to maintain the property and fix deficiencies. 


Finally, do consider future interest rates. it is always best to assume that that interest rates could rise by the time your mortgage term is up. If there’s not much wiggle room already, have a plan in place to ensure you can continue to afford your home. 


This exercise will give you a clear vision of what your top ceiling price should be. When there are no surprises, you will feel far less stressed about making that final decision.


#3. DESCRIBE YOUR PERECT PLACE?

My favourite question! Write down all the things you want and need in a house and have every member contribute to the list, even the dog! Keep the list handy because you will need it for my next step.



#4. FIND IT

Now give that list to a Licensed Realtor and let the fun begin! Finding your perfect place should be an enjoyable experience. I encourage you to dig in, get involved, read up and ask questions. The more you know, the more confident you will be, which translates into a great experience. I highly recommend interviewing several Realtors to ensure a good fit. Once you start looking, it is important to see a variety of homes and stay open minded. Tour the whole Coast, spend a day or two getting a feel for the different communities and ask lots of questions. 



#5. OWN IT 

This is an exciting time for everybody. Whether this is your first home or your sixth! It’s normal to feel anxious, excited and scared all at the same time. This is a huge step for you and your family. The next edition of my prepared homebuyer guide will walk you through understanding important contractual and financial terms and obligations that are sometimes not communicated to buyers. This information can be found under "before writing an offer".



I am always available and happy to answer your questions!



******* Important 2017 Update *******

BC government to offer down payment loans for first-time buyers

Premier Christy Clark unveiled a new loan program today to help first-time home buyers come up with their down payment.

The BC Home Owner Mortgage and Equity (HOME) Partnership program will offer qualifying home buyers loans of up to $37,500, interest and payment free, for five years.

The province will begin accepting applications on January 16, 2017.

To qualify, buyers must:

• be buying their first home;

• obtain a high-ratio, insured first mortgage for at least 80 per cent of the purchase price;  

• have a combined gross household income not exceeding $150,000;

• have saved a down payment amount at least equal to the loan amount;

• be a Canadian citizen or permanent resident for at least five years; and

• have lived in BC for at least the full year preceding their application.

The loans will be due in full if the buyer defaults on a payment, ceases to use the home as a principle residence or resells the home.

Key facts:

• The loans will match a home buyer’s contribution to a down payment up to five per cent of the home’s purchase price. 

• The maximum purchase price to qualify for a loan is $750,000 (excluding taxes and fees).

• After five years, buyers can either repay their loan or enter into monthly payments at current interest rates.

• Loans through the program are due after 25 years.


The above update was brought to you by the Real Estate Board of Greater Vancouver



Jillian Reinson
Jillian Reinson
REALTOR®