Top 5 Expert Tips on Buying Your First Home Together in Ottawa
Are you and yours seriously considering buying your first home together in Ottawa this year? While the open houses and home decor boards on Pinterest can be incredibly appealing for first time homebuyers, there are an overwhelming amount of decisions to be made before signing off on your first home.
Our team at sat down with Shannon Lee Simmons, Canada’s leading financial expert and Founder of the New School of Finance, to talk more about saving for your first home.
Shannon runs a fee-only financial planning firm and is a regular contributor to CBC’s On the Money and Globe and Mail. Here are her top five tips for people looking to purchase their first home in Ottawa;
- Get Pre-approved. Get pre-approved for your mortgage before you buy a home! This is an important first step to ensure that your credit, savings, and income are all in the right place to set you up for home buying success.
- Put Money Down. Seriously consider waiting until you can afford a 20% down payment. Though it’s uncommon for most first-time homebuyers to have this high of a down payment available, you will thank yourself later when you are paying lower interest charges on your loan. Simmons recommends that a 10% down payment should be the absolute minimum for your first home.
- TFSA and RRSP. Use your TFSA or your RRSP for up to a $25,000 down payment on your first-time homebuyer plan. The Home Buyers Plan provides you with a tax and interest free loan that has to be paid back over 15 years.
- Remember Monthly Costs. First time homebuyers often forget about the monthly costs of sustaining a home. There are great costs that accumulate beyond just house insurance and your mortgage. Have you built an emergency fund for unexpected renovations?
- Calculate Closing Costs. Finally, don’t forget about all of those sneaky closing costs. For example, there is a rebate for first time homebuyers but you still end up paying a portion of the land transfer taxes. New School of Finance recommends that first time homebuyers prepare to pay 2% to 2.5% of the cost of house towards closing costs.
Are you searching real estate listings in Ottawa on the hunt for your dream home? Check out New School of Finance for their nationally acclaimed DIY online program “Can You Afford to Buy a Home” . When you’re finished crunching numbers, contact our team of expert Realtors® at Royal LePage Performance Realty and secure a top-quality real estate agent to help you navigate the many facets of buying your first home.