Earlier this year, the Financial Post made a shocking headline: “Ontario housing shortage is the worst in the country…” Talk about a great start to the year.
Canada may not be the easiest place to buy a home. With a shortage of homes available and an increasing demand, it may be a huge problem for first-time homebuyers.
Though finding a home is difficult, it’s not impossible. Even if you may not be lucky enough to be a member of the bank of mom and dad, homeownership is on the horizon for you. Take comfort in this statistic reported by Re/Max:
“Over the last 20 years, the home-ownership rate in Canada has steadily increased, rising from 63.9 percent in early 2000 to 68.55 percent before the… pandemic.”
Thus, you can find your new home with the right mindset and team, here are some tips you can do to become a homeowner.
#1: Get Pre-Approval
This should go without saying but if you are truly new to the real estate journey, getting pre-approved is the first thing you should always do. This will give you a general idea of how much cash you are working with.
#2: Consider Being a Landlord
Albert Einstein once said, “in the middle of difficulty lies opportunity.” Indeed, while there’s plenty of difficulty in finding the right home for you, there’s also an opportunity at hand. Pay attention to properties that come with rental units, or spaces that could be one. Consider the basement, a tiny house in the backyard, or a spare bedroom. You could rent this out monthly or earn residual income via Airbnb!
Talk to your real estate lawyer about the legalities involved in making this side hustle. Canadian municipalities vary in their rules and regulations regarding secondary suites.
#3: Flee The Big City
We know this might be a bit of a surprise to urban dwellers, but moving to the countryside is a growing trend. Here’s why: when the pandemic hit, many Canadians left the big city for greener pastures. Also, work-from-home measures allowed workers to set up home offices from anywhere.
A house in the countryside may give you more square footage for a lesser price. However, be sure to consider all the other factors like the commute or nearby schools.
#4: Save For A Huge Downpayment
Save as much as you can for your down payment. The bigger the down payment, the smaller the mortgage, which can save you thousands of dollars in interest charges, not to mention the CMHC mortgage loan insurance if your deposit is under 20% of the purchase price.
You may have to endure and make short-term sacrifices, but your reward down the road will be a land with your name on it!
#5: See Beyond The Staging
Staging a home for a showing has become a standard feature of the listing process. There are a handful of tricks and hacks that a home seller and realtor can do to design the most alluring of houses. We say, enjoy it! It’s all been done with a homebuyer like you in mind. And as you take in the sights and smells of the staged home, always remember to see beyond the superficial. Get professional home inspectors and be meticulous.
#6: Co-Own with Family or Friends
Have you found the perfect home in the best neighborhood but can’t afford it? Here’s a solution that’s a tad bit unconventional: buy with friends. You can discuss taking a floor or wing if there’s enough space. Lenders accommodate this set-up with a term called, “mixer mortgages.”
While this is fun and exciting, you’re going to want to cover all grounds in a co-ownership agreement.
#7: Keep an Exit Strategy
A study done by the Canadian Association of Accredited Mortgage Professionals estimates the average Canadian will own 4.5 to 5.5 homes in their lifetime.
What does this tell us? An exit strategy should be part of your homebuying plan. Before you purchase your home, consider how the space can be easily improved when the time comes to maximize your sale.
#8: Write A Letter
No matter how much technicality and legalese are involved in real estate, finding a home is still an emotional experience. When you’re in a bidding war or trying to make an offer, adding a personalized letter could help you seal the deal.
As you write your letter, make the seller feel a personal connection with you. Share your real estate journey, tell them what you like about the home, and give them an idea of how their house would be with you in it.
#9: The Real Estate Lawyer is Your Friend
Even if you aren’t a first-time home buyer, your real estate lawyer has gone through this process more times than you. It’s not just bringing you to moving day, they have the working knowledge to help you avoid potential landmines. When you hire a real estate lawyer, you hire protection. What you get is someone who will represent your needs and negotiate on your behalf throughout the real estate purchasing process.
With trustworthy real estate law experts, you get peace of mind knowing that your interest and investments are protected.
Integris Law has years of experience protecting homebuyers and homeowners in Ontario. Connect with us today and start the journey towards your new home.
