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Happy New Year! So one of your goals for 2023 is to start saving to buy a home. But how is it possible to save when the costs of living are so high?! Luckily for you, I’m here to offer guidance through every step of the home buying process.
How much do I need for a downpayment?
We must first establish what you’re looking for in a home. With that in mind we can guesstimate the amount needed for a downpayment, which is in relation to the purchase price. Purchase price varies depending on specific criteria and areas of interest. A lake view home in Coldstream is worth more than a home in Armstrong.
See a chart from https://www.canada.ca/en/financial-consumer-agency/services/mortgages/down-payment.html
| Purchase price of your home | Minimum amount of down payment |
|---|---|
| $500,000 or less |
|
| $500,000 to $999,999 |
|
| $1 million or more |
|
Pay Off Debts
When the loan providers are deciding how much money to give you for a mortgage they take into consideration what kind of debts you carry. This could be credit card debt, student loans, car loans, line of credits, and others. One simple way to help your case – start paying them off. They want to see that you’re making a consistent effort to pay them off.
Set a Budget
This is a two part step – the first is setting the budget, the second is following it. Setting a budget to keep track of your daily, weekly, and monthly expenses is a great way to create accountability for yourself and family. I recommend setting aside a predetermined amount each month for your downpayment savings.
Sell Some Stuff
How much stuff do you have that is just taking up space? Why not clear your home and make a few extra bucks at the same time? There are countess virtual selling platforms that you’ve likely utilized in the past. Selling big ticket items like furniture in good condition, high end sporting equipment, and vehicles are a great way to obtain money quickly.
COMING APRIL 2023 – Consider the Tax-Free First Home Savings Account
The Canadian government has created a savings account specifically designed to help first time home buyers save for their down payments. This tax-free savings program allows for $40,000. Get in contact with your bank and check out the link below to find out if this savings account is right for you.
https://www.canada.ca/en/department-finance/news/2022/08/design-of-the-tax-free-first-home-savings-account.html
Talk to Loan Providers
The banks or mortgage brokers are here to help! Make an appointment with your lender of choice to jump start the process. They will use their expertise to provide pertinent advice tailored to your situation. The end goal is to protect you and your money.
My hope is that you have been provided with some clarity on first steps to buying your first home. Every situation is unique, to discuss yours specifically be sure to reach out. I am always happy to chat!
Shelby Huizinga
REALTOR®
Century 21 Executives Realty Ltd
“Finding home with Huizinga”
C: 778-212-5177
E: shelby.huizinga@century21.ca
