First-Time Home Buyer

Why Buy Now?

Buying a home is a big decision. If you’re ready to stop renting and start your homeownership journey, here are just a few of the advantages you’ll enjoy.

Cost Savings – Imagine you are paying $2,500 per month in rent. Over the next 10 years, you will have spent more than $250,000 and have no equity gains. Buying a house means that money goes toward your mortgage. In 10 years, your net worth will increase by approximately $150,000. This is why you may hear homeownership also described as a forced savings account.

Price Appreciation – Your home can increase in value, resulting in major returns on your investment when it’s time to sell. If you make a smart purchase, buying a home can be less expensive and more profitable in the long-term than paying rent.

Home Equity – Renting means paying someone else’s mortgage, whereas the payments you make towards your own home will build your equity and financial nest egg.

Security & Privacy – When you own a home, you’re secure in the knowledge that you can’t be evicted, and there is no landlord to raise the rent.

A Place to Call Home – From renovating whenever you want to truly feeling like a part of your community, there’s nothing quite like owning a home!

Do you want even more tips about finding and securing your first home and staying calm and confident throughout the process? We’ve created the resources below just for you:

• Our Ultimate Handbook for First-Time Buyers
• A Survival Checklist for First-Time Home Buyers
• What to Look for in a Home Inspection

Should You Wait or Buy Now?

Many people believe that they should wait for prices to drop or for their financial picture to change before beginning their search for their first home. If you look for it, there is always a reason to put things off.

Viewing this decision based on “time in the market” rather than timing the market will inspire you to take your first step sooner rather than later. The earlier you get started, the more equity advantages you can enjoy later.

The best time to buy your first home is when you can afford it rather than looking to outside circumstances. Starting small can lead to great things in your future.

Government Benefits for First-Time Buyers

Did you know that you might be considered a first-time buyer even if you have purchased property in the past? Some government incentives may be available if you have experienced a divorce or separation from a marriage or common-law partner, or even if you did not occupy a home you have owned in the last 7 years.

First Home Savings Account (FHSA)– You can save up to $8,000 per year into a dividends-paying investment FHSA designated for the purchase of your first home. There’s a $40,000 lifetime maximum, but your deposit, withdrawal and any earnings are all tax free when you buy a qualifying home!

Home Buyers Plan – This federal program allows you to withdraw up to $60,000 from your RRSP to buy or build a qualifying home. You’ll have 15 years to repay the funds to maintain the tax-free benefit.

First-Time Home Buyer Tax Credit – This federal credit allows you to get a small portion of your purchase back. You can claim $10,000 (non-refundable) when you file your taxes the following year, resulting in a total savings of $1,500.

GST/HST Rebate – First-time home buyers who are purchasing a brand new build could reclaim a portion of the GST/HST. When stacked with other incentives, this rebate can make your newly built or substantially renovated detached home, condo or townhouse more affordable than you realize!

For True First-Time Home Buyers Only

Land Transfer Tax Rebate – When you buy a home in Ontario, you’ll pay a Land Transfer Tax. As a first-time home buyer, you can instantly save up to $4,000 through the first-time home buyer rebate.

(The caveat is that the guidelines to qualify are much more stringent. You must never have owned any property anywhere in the world. You must also plan to occupy the home as your primary residence. If you use it as a rental, you forfeit the rebate.)

Steps to Buying a House for the First Time in Canada

Buying real estate begins with a plan. Knowing what to expect allows you to stay on track while being flexible to find the right opportunity.

Find a real estate agent to represent you – Arguably, this is the most important step. With professional guidance, you’ll know what to do to get the best value from your purchase. You’ll also have an industry expert to advocate for your needs at all times.

Get pre-approved for your mortgage – A clear budget is critical. Obtaining a pre-approval gives you an accurate estimate of how much you can borrow. Plus, you can lock in the best interest rates.

Arrange for your down payment – Currently, Canada’s guidelines are 5% for the first $500,000, 10% from $500,000 to $1.5 million and a full 20% on all properties exceeding $1.5 million.

Create your wish list – Deciding what features you want and need after setting your budget is the smart way to buy your first house. It allows you to be realistic while still achieving the best outcome.

Visit open houses and make appointments for showings – You’ve done your homework, and your efforts are about to pay off. It’s time to get out in person to see what homes are available and narrow it down to the best fit.

Negotiate based on your strengths in the market – When you find a home you love, your Realtor® will help you craft an offer that protects your interests. The seller may accept, decline or make you a counteroffer. Through it all, we will be here to help you make the best decisions.

Obtain a lawyer for the closing process – Before you take possession, your real estate lawyer will review the Agreement of Purchase and Sale, run a title search and set up title insurance.

Why Work With a Buyer’s Agent?

As a first-time buyer, you’re bound to have questions during all aspects of your transaction. A buyer’s agent is equipped to answer them—and help you achieve the best outcome possible. Here are a few more reasons to consider working with a dedicated buyer’s agent at Woolcott Real Estate.

More Listings – Access to the Multiple Listing Service® (MLS) and other exclusive databases allow agents to find more homes that match your needs.

Full Support – From arranging property showings to helping you obtain financing, a real estate professional can coordinate every step of the process.

Expert Advice – An agent will explain forms and agreements, discover helpful information about prospective properties and offer fully informed counsel.

Complete Protection – Your buyer’s agent will look out for your best interests and suggest strategic clauses for your agreement to protect you.

Ongoing Guidance – An experienced agent to act as your advocate allows you to move with confidence, whether you’re putting together a compelling offer or entering the final negotiations.

A home is a major purchase, as well as one of life’s most celebrated milestones. Understanding the process and expert guidance will help you make a sound financial investment.