Before you start shopping for your home, why not give some thought to your lifestyle, the features you need and want, affordability, and the neighborhoods you prefer. With that information you'll come closer to finding your perfect home – sooner!


What Can You Afford?

When preparing your budget, you will want to discuss what resources you can allocate to mortgage payments, living expenses, and other financial situations. As your Real Estate Advisor, I can either help or recommend you to a professional who can assist you in establishing a budget and reviewing your financial position. In addition they may suggest some alternative methods to obtain financing, either through traditional lenders or other institutions.

To purchase a home, a down payment of as little as 5% down is required. Fortunately, Canada Mortgage and Housing Corporation offers a federal insurance program designed to help Canadians purchase their first home at an affordable cost. If you choose to put down 20% or more, you will not be required to have any CMHC insurance. Your Real Estate Professional or Mortgage Broker can provide additional details on this program.

To prepare your budget, collect the following:

Credit card statements
Monthly rent or mortgage payments
Utility payments (gas, water, power, telephone)
All other monthly expenses (such as food, child care, dues, etc.).
Annual or semi-annual expenses (such as insurance, car repair, taxes).
As well allow for unexpected items such as medical emergencies, travel and education.
Non-fixed expenses (for example, medical expenditures) for the last year. This will give you an estimate of average expenses of this type. Records or an estimate of personal expenses (entertainment, travel, etc.)
Once you subtract your expenses from your total income, the amount left over is called your net worth. This will give you an estimate of your financial situation at present and will help you determine how much you can afford for a down payment.


Home Buying Needs and Wants

Similar to the list you develop to purchase groceries, why not develop your own list of needs and wants in a new home. This doesn’t mean you can not have what you want in your home, but rather, that you have a priority list of the most important features. You may not be able to obtain all the “want” items on your list, within your budget. You may have to compromise on a few items to stay in line with your budget.

Adequate square footage for comfortable living.
Sufficient bedrooms for your family
Sufficient bathrooms
Comfortable eat-in kitchen
Garage or basement for storage needs
Backyard for children’s play area
Easy access to school
Specific carpeting, paint, exterior color
Hardwood floors
Bay windows
Built-in entertainment center
Brass lighting fixtures
A pretty view

Try finding a happy medium of NEEDS and WANTS. That is, you will want to look for a home that includes all of your needs, with as many wants as practical, while remaining within your budget. Once you have this information in hand, your needs will be clearly defined from your wants. Having this knowledge will establish a clear direction for your new home shopping.


Consider Your Present and Future Lifestyle

Before you begin shopping for your home, reviewing your lifestyle, both now and in the future will make a big difference in the type of home you may need. You will save time. You will define your goals. You are likely to find the home you want, quicker, because you will not waste your efforts viewing homes that do not meet your criteria.

Look at your lifestyle right now. Are there some areas you would like to change? Consider your lifestyle a few years from now? Will it remain the same? Will your needs increase or decrease? Will you need a small or large home to meet your lifestyle needs? Perhaps the attic or basement can be converted into additional living space. Do you have preschoolers? In a few years they will be teenagers, perhaps looking to move out and establish their own home. Perhaps your children have already left and you do not need a large home. Do you have an idea of how long you would like to stay in your home? Two years? Five years?

Where do you spend the most time? Kitchen? Basement? Kitchens and family rooms are often gathering places. Be sure these areas are large enough. What about entertaining? Do you need extra space to accommodate family functions? Could you convert the basement into a family area? Do small children need a play area, or teens need a recreation area? How many bedrooms do you require? Some people like smaller spaces for children, a home office, or frequent guests. Bathrooms are among the busiest place in the home. Can the bathroom handle the traffic?

Think about your employment situation. Will you be changing jobs, or accepting a promotion with another company in another location? If you are transferred, could you sell your home quickly? On another work-related matter, how much time do you want to spend driving to and from work each day? Do you rely on public transportation?

While it might take some thought to answer these questions, the effort translates into a home more flexible and suitable to your needs. The answers could also affect your resale value when it comes time to sell or upgrade. Or, if you are planning to remain in your home for a while, a different home may be more suitable.


House Hunting Tips

You have established your budget. You have been pre-approved for a mortgage. You have contacted a Real Estate Professional to assist you with the purchase of a home. Now the fun, and evaluation begins. You will probably be looking at a few homes before you decide on the perfect one for your family. Before you decide to purchase that home you have absolutely fallen in love with, be sure to be objective in your decision. On appearance alone, the fireplace, the new flooring, paint job and new carpeting create a warm and inviting feeling. Yet, is the home really that perfect? Take a deep breath. Take some time to think about the bigger picture of the home in terms of your needs. Carefully consider whether this home offers the features that will last beyond the first impression. Here are some essential factors to consider:

Location is a significant factor in your choice of home. An established community, with a good reputation, a low crime rate and well-maintained homes, maintains home values. A garbage dump, industrious buildings disposing bad odours and major freeways surrounding your neighborhood are unattractive and disruptive to a peaceful lifestyle.

Also consider availability and cost of access to public transportation, major roads and highways. Consider the condition of public areas such as streets, sidewalks, parks and recreational facilities. Public services should also be established including street cleaning, snow removal, garbage collection, and emergency services. You will also want efficient access to medical services including hospitals, doctors and dentists. Be sure that schools and related school services are also within easy access. Recreational, shopping and entertainment needs should also be considered.


RRSPs Can Help First Time Home Buyers

Did you know that, as a first time homebuyer there is a federal program in place to assist you with the purchase of your first home?

Under the Canadian federal government's Home Buyer's Plan, you can use up to $20,000 in RRSP savings ($40,000 per couple) to help finance the down payment on your first home. The great news is that you actually have 15 years to pay back your RRSPs penalty free. This timeframe will give you plenty of time to get settled into your new home.

To qualify, your RRSP funds must be deposited for at least 90 days prior to the purchase of your new home. By working with a qualified agent like myself, I will help ensure that the required home purchasing documentation is completed with you. Prior to withdrawing any RRSP funds, you will need a home purchase contract.

Alternatively, if you have $20,000 in savings and these funds are not located in an RRSP, you may want to utilize the Home Buyer's Plan to its maximum advantage. You could consider transferring your savings into an RRSP, and then withdrawing them through the Home Buyers Plan to receive the tax benefits.

Not ready to buy for another few years? Consider the benefits of utilizing a Tax Free Savings Account. With a maximum contribution of $ 5000.00 per year, you can save for your future real estate investment. The great advantage of a Tax Free Savings Account is that you can withdraw anytime without penalty and most importantly its tax free! Before you make your financial decision, remember to always ask advice from an expert such as your financial advisor, lawyer and or tax specialist. These professionals can help determine which approach is best suitable for your financial situation.

CMHC - helping with the Canadian dream

Canada Mortgage and Housing Corporation (CMHC), plays a major role in Canada's housing industry. As a home buyer you can take advantage of the numerous resources available including home research services, market evaluations, and access to affordable financing options. Programs include; aboriginal housing, residential rehabilitation, adaptation for senior's housing needs, public and private partnerships, in addition to available grants and awards.

CMHC makes it easier for Canadians to obtain a home by providing mortgage loan insurance. For many people, especially first time home buyers, saving for a down payment is a challenge. When a home buyer has 20% or less of the purchase price to put down, a lender requires mortgage insurance for protection against any payment defaults. CMHC provides this insurance for you the home buyer, to limit the lenders' risk. The lender will then agree to finance up to 95% of the purchase price of your new home. You can then purchase a property with as little as 5% down! For example, if the cost of the home is $250,000, you only need a down payment of $12,500.

This allows you to become a homeowner, even if you don't have a large down payment put aside. You just need to meet the following conditions and home ownership can be within your reach:

• The home must be located in Canada and considered your principal residence.

•You must have a down payment of at least 5% of the purchase price.

•Your home-related expenses must not exceed 32% of gross household income which may include utilities, property taxes and condo fees if applicable.

• Your total monthly debt load must not exceed 40% of gross monthly household income. Debt such as personal loans, car payments and credit cards would need to be factored into this percentage.

• You must be able to pay closing costs equal to at least 1.5% of the purchase price. Closing costs may include lawyers' fees, GST, land transfers and more.


9 Biggest Relocation Mistakes & How to Avoid Them

1. Lack of information
Contact the chamber of commerce, tourism department, municipality or library in your new community. At the same time, compare salaries, cost of living, taxes and housing prices.

2. Home not priced and ready for showing
Before you sell your home, complete repairs. Often, it is the little things, like chipped paint, worn caulking and sticky doors that potential buyers notice. Have your home cleaned, including carpets. Have a Comparable Market Analysis (CMA) completed by one or two Real Estate Professionals to ensure a competitive price.

3. Not planning for temporary housing between destinations
You may need to set up temporary housing arrangements until the closing of your new home. This could take from a few days to a few months. If you need interim housing for a few days, perhaps staying in a hotel is the simplest solution. For housing longer than a month, you may want to consider an apartment with a short-term lease.

4. Not being pre-approved
Sellers are usually eager to negotiate with someone who has immediate buying power.

5. Not completing a professional home inspection
This applies for both the home you are selling and the one you are buying, although who pays for the inspection (buyer or seller) is negotiable in each separate contract.

6. Insufficient time to handle children’s concerns
During relocation a child could feel lost, sad, angry or confused. Sometimes, under the stress of completing so many details, the temptation is to get settled as quickly as possible so everyone feels at home. Talk to your children during the process. They will feel safe, cared for and comfortable. Acquaint your children with the new neighborhood. If possible, have them meet new teachers and other children in their new school before moving. Try not to move in the middle of a school year.

7. Not being prepared for culture shock
Sometimes, when people move from familiar surroundings to a new community, culture shock can manifest. Symptoms can range from headaches, stomach aches, impatience, sleep problems to anger. These feelings are all normal and do pass over time. It may be helpful to incorporate the old with the new. This could include taking classes, joining clubs and pursuing activities you once enjoyed. It takes about six to ten months for someone to feel “at home” in a new community.

8. Not using local, licensed professionals
Every area is different. Understanding the communities that make up your destination city, a Real Estate Professional can find you a home that matches your needs. You will save time and energy by having a professional do the work for you.

9. Not reading your employer's relocation policies
Read your employer's relocation policies carefully, for the amount of reimbursement. Keep good records and copies of your receipts, as moving expenses are deductible under certain conditions established by Revenue Canada.

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