Benefits of home ownership?
Pride of Ownership
Pride of ownership is the number one reason why Canadians
desire their own home. There is no landlord looking over your shoulder. You are
able to make improvements knowing that any appreciation that results, will be to
your benefit. Home ownership gives you and your family a sense of stability and
security. It's making an investment in your future.
Appreciation
In Canada, especially in the last few years, homes have
appreciated considerably and in doing so have added substantially to owners net
worth. Unlike stocks and bonds, you get to live in your investment. Also, in
Canada your principal residence is exempt from capital gains taxes.
Mortgage Reduction Builds Equity
Each month, part of your monthly payment is applied to the
principal balance of your loan, which builds your equity. You can borrow against
a home's equity for a variety of reasons such as home improvement, sending your
kids to university or college, or starting a new business. Why pay-off your
landlord’s property when you can own your own?
Homeowners accumulate wealth for the future while enjoying the benefits of a
shelter that they have can use, improve and sell. Their home is a safe haven for
investment.
Are You Ready to Buy a Home?
First – do you have the financial resources? You should
have five percent of the purchase price of a home for the down payment, but
ideally even more. Are there other priorities in your life e.g. starting a new
business, which require your savings? If not, buying a home should be on your
radar.
Second – do you expect to stay in your new home for some
time? Moving can be expensive and you will want to build some equity before
having to relocate. Your job and home life should be stable.
What Can You Afford?
If you haven't already gone through the mortgage
pre-qualification process, you will need to meet with a lender or mortgage
broker. They will establish how much of a mortgage you will qualify for.
Mortgage rates vary considerably and it is paramount that you shop around for
the best rate, terms and options.
The
affordability calculator will help you determine what monthly payment and
the maximum mortgage you can manage. Note: if you are buying a condo, the amount
of your monthly assessment has a direct impact on how much you can afford to
spend on your mortgage.
First time homebuyers may want to take advantage of the
federal government’s Home Buyers’ Plan. Under this plan, you
may use up to $20,000 of your RRSP towards the purchase of a home. The money is
tax-free as long as you pay it back in the next 15 years. Ask your RE/MAX Sales
Associate for details.
Questions To Ask When Assessing Home Features
-
Do
you need several bedrooms, more than one bathroom, space for a home office,
a two-car garage?
- Do you want air conditioning, storage or hobby space, a
fireplace, a swimming pool? Do you have family members with special needs?
- Do you plan to have children? Downtown or suburbs?
Proximity to recreation or work.
- Do you need a substantial backyard? Pets?
- Is there adequate storage space?
- Will any remodelling be required to make the home
move-in ready for you?
- What service providers (cable, Internet, telephone,
Satellite) are available in the area, and is the house completely wired for
each? Can you hear me now – how good is the cell phone reception?
- How much are the yearly property taxes?
- How much do utilities run each month? Does the house use
gas or electric for the furnace, water heater, and appliances?
- How old are the major appliances, and which are included
with the house?
- Have there been any major repairs to the house, and if
so, when were they completed? For example, how old is the roof? Has water
ever damaged the basement or foundation?
- Ever had problems with insects, such as termites and
spiders, or rodents?
- Older homes need to be carefully examined - Windows may
need caulking or new sashes, bathroom tiles may need grouting, home may need
rewiring (planning on a hot tub or sauna?), a new hot water heater, or a new
furnace.
-
Location, Location, Location
- How far will you be commuting and what is the traffic
like? Factor in cost of fuel.
- Where will your children attend school and how will they
commute?
- Are there recreational facilities and parks close by?
- Are you close to family and friends?
- Is safety or high crime an issue?
- Is the property close to an obstacle or negative
influence? (i.e. an apartment building, shopping centre, school, radio
tower, power lines, LRT or railroad track, highway, airport or commercial
project).
- Access to schools, work, recreation, shopping centres,
public transportation, cultural attractions, libraries, churches and
hospitals
- Adjacent undeveloped land - what is proposed for this or
other green space?
- Heavy traffic can be noise nuisance and hazard for
children
- Distance from the unit to amenities, parking, walkways,
roads, public transit
- Does the neighbourhood reflect positively on the value
of the condo and your lifestyle choice?
- Does this neighbourhood, for any reason, have a poor
reputation?
- Is the future economic climate for the area good? Are
businesses moving in? Is there government investment?
- Are people moving in or out of the neighbourhood? What
is their age, income level, family size?
- Are there plans for this neighbourhood that you may be
unaware of (i.e. a future highway, a commercial development or a new housing
development) that will provide competition on resale?
Noise and Privacy
- Proximity to highways, driveways, parking lots,
playgrounds, trains.
- Proximity to elevators, garbage disposal, fire exits,
heating and air conditioners.
- How well is the building soundproofed.
- Visit at different times/weekends to check noise levels
and activity.
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