The proverb "The best time to plant a tree is 20 years ago, the second-best time, is right now", sounds a lot like buying a home, doesn't it?
While I do believe that this adage is true, there’s no sense beating yourself up for not buying twenty years ago. Let's get real, the 2000s were a wild time; we had much smaller eyebrows, no smartphones, and we had to go to a store to rent movies. On a serious note, even in the last 10 years, maybe you weren’t sure you wanted to set down roots, or maybe you always intended to save more for a down payment, or maybe you were still a child. Regardless of the reasons, you’ve still got the second-best option available to you now.
Alright, enough nostalgia, let's get into why it is a good idea to buy now.
As with many first-time buyers, your primary concern may be having enough down payment. When most people think down payment, they think of 20% and the reality is that most of us don’t have 20% of the purchase price handy. However, if you are purchasing a home for $500,000 or less you only need a down payment of 5%. If you are looking at homes between $500,000 and 1 million then you will need to put down 5% for the first $500,000 and 10% of the amount between $500,000 and $1 million. This is much easier to attain. Did you know that you may be able to borrow up to $35,000 from your RRSP? That could certainly help get the home of your dreams.
You also might qualify for a first-time homebuyer tax credit which is a one-time $750 tax reduction. Most people assume that this credit is only for those who have never owned a home, but you might qualify if you haven't owned a home in the past 4 years.
Last week we mentioned why it is a great time to sell your home in the winter, but that also means that it is a great time to buy. You’re less likely to compete with other potential buyers when you write an offer. You may even be able to get into a new home in as little as five or six weeks from the start of your search.
Besides, owning a home can help you build wealth if you’re in it for the long term. Let's look at some numbers. In 2000, the average house price was $159,511, in 2010 it was $327,255, and just last month it was $547,071. Imagine what that number will look like in 20 years. That ownership will bring increased housing stability into you and your family's life.
So stop imagining, fill in your eyebrows, and call one of our amazing Realtors today!