Have you reached that time in your life when it seems like purchasing your own home is the next step to creating the life you want for yourself? The move from renting to home ownership is significant and buying a home is probably the biggest purchase you will make. The process of purchasing a home is exciting, and, frankly, a little daunting! You need a good chunk of money, a little guidance, and a lot of education to get you started. Here is our guide for first time homebuyers to help you find and buy your very first home.
If you are looking to buy your very first home, The Eklund Group has the market insight, in-depth knowledge of Calgary communities, and the negotiating confidence to ensure that your investment is a smart one. Contact our team of Realtors® skilled in helping first time buyers find the perfect place to call home. Call 1-403-863-7434.
Step 1: Plan
Before you even start looking at Calgary homes, spend some time focussing on planning. Consider these important questions:
1. How much can I afford?
There are many useful tools online to help you figure this out. You need to take into consideration all the costs of home ownership including taxes, utilities, insurance, maintenance and repairs, as well as your monthly mortgage payments. You also need to consider your lifestyle and the things that are important to you like travel, dinners out, clothing, etc. Gaining some clear insight into your priorities and the true cost of buying will help you determine how much you can afford each month without becoming house poor.
2. How much do I owe?
Many people carry debt, but the amount you have can impact your ability to qualify for a mortgage and the amount of monthly expenses you can afford. Consider paying down any debt you have, especially high-interest debt.
3. How much can I save?
With your debt under control, saving for your down payment will be much easier. Down payment requirements can range from 5% to 20% of the purchase price of your home. The amount you are able to save will determine how much house you can afford. There are a number of incentives available to first time homebuyers:
- Home Buyer’s Plan: allows you to withdraw from your RRSP to use for down payment
- Home Buyers Amount: a $5000 tax credit that can be applied to certain homes
- First-Time Home Buyer Incentive: an interest-free loan from the Canada Mortgage and Housing Corporation (CMHC) of 5%-10% of the purchase price to put towards your down payment
Keep in mind that if your down payment is less than 20% of the purchase price of your home, you will be required to get mortgage insurance. This is an additional monthly cost.
4. How do I want to live?
Is your perfect first home a condo apartment or a townhouse? Do you want a brand new, single-family home in a growing development? Are you willing to put in some elbow grease to save money with a fixer-upper? Think about commuting times, amenities, and proximity to recreation and friends and family for a better understanding of the ideal first home for you.
Step 2: Search
There are three things you will need to search for in this phase of your journey:
1. A Realtor®
Your buyer’s Realtor® will be your ally and your guide as you navigate the complexities of finding and buying the right home for you. Your buyer’s agent is an invaluable source of market knowledge and community insight, and an expert at writing and negotiating a solid and favourable offer. Your Realtor® will have a robust network of partner resources like mortgage brokers, inspectors, contractors, lawyers, and seller’s agents that you can leverage.
2. A Mortgage
It is usually recommended that you are at least pre-approved for a mortgage before you begin looking at homes. This will offer some clarity about the price of home you are able to afford. Being pre-approved also means that when you find the perfect house, you can write an offer with confidence and it will streamline the process of removing the financing condition on your offer.
3. A Home
This is the most exciting part of the process. This is when you get to scour online listings, drive the streets of your preferred neighbourhoods, and have your Realtor® take you to tour your top choices. This is when you get to wander through homes and see if there is an emotional connection, a sign that this is the right first home for you.
Step 3: Purchase
Once you have found the ideal home for you, things become a little more complicated. You will need to write an offer, negotiate the contract, fulfill the conditions like home inspection and financing, finalize your lending, consult with a real estate lawyer, and more. Your Realtor® is a vital resource throughout this phase of the process. They will be able to advise you on a fair offer price, help you understand the results of your home inspection, and negotiate confidently on your behalf. When this “business” of real estate is completed, you will be the proud owner of your very first home.
Calgary’s Best Partners For First Time Buyers
Buying your first home is thrilling and terrifying. The best strategy to ensure that your first real estate investment is smart and protected is to partner with a skilled and knowledgeable Realtor® who can help you navigate the process. The Tanya Eklund Group is committed to an elevated first time home buying experience through education and transparency. When you are ready to consider purchasing your first home, reach out to us first. We are happy to share our insight and our connections to get you started on the right foot. Contact us online today or call 1-403-863-7434. We are not in the business of just selling you a house, but ensuring that we find the right home for you! Now, let’s go look at some houses!
Get a head start on the search for your first home by searching our Calgary listings here.
