

Benefits of Home Ownership
1. Pride of Home Ownership
Pride of home 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 home 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.
2. 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 real estate investment. Also, in Canada your principal residence is exempt from capital gains taxes.
3. Mortgage Reduction Builds Equity
Each month, part of your monthly payment is applied to the principal balance of your home 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 5% of the purchase price of a home for the down payment, but ideally even more. If you put less than 20% down for a property under $1 million, your mortgage needs to be insured by Canadian Mortgage Housing Corporation (CMHC) and you will incur additional fees as it is considered a “high-ratio” mortgage.
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.
Our Mortgage Calculator will help you determine what monthly mortgage 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 home buyers may want to take advantage of the federal government’s Home Buyers’ Plan. This plan allows each first-time home buyer to withdraw $25,000 from their RRSPs to purchase a residential property without having to pay taxes at the time of withdrawal. This amount must be repaid over a period of 15 consecutive years.
Choosing a Property
You may be looking for a home to live in, a piece of land, or space for retail or commercial activities. Owning a home can mean a wide variety of things to different people. Typically your income level will determine the housing type most appropriate for you. Whatever you are looking for, make a list of must-have features and list them according to importance. It can be helpful to evaluate prospective homes against a prepared list of your desired interior and exterior amenities in order to make a rational comparison. Almost all property purchases require some level of compromise. So you may need to look longer and harder, or remove some of the must-haves from your list to find the property you want and need.
Questions To Ask Yourself
Community and Neighbourhood:
Types of homes
Single family detached home
A detached home does not share common walls with another residential structure and has its own front, back and side areas.
Duplex
A duplex includes two separate dwellings that are attached by a common wall (semi-detached) or located above one another. Duplex dwellings may also be subject to monthly maintenance fees for common assets.
Manufactured home
A manufactured home is a factory-built residential structure that may be movable from one location to another. It is usually kept in a rented space in a manufactured home park.
Apartment
An apartment is a single building that contains multiple dwellings usually joined by a common entrance and shared amenities like a parkade, elevator or hallway. Buildings can range from three storeys and upwards. Apartment owners are required to make monthly payments to maintain the building and shared features, known as condominium or strata fees. These fees are typically determined by the amount of space allocated to an owner and are clearly described in the property listing.
Townhouse
A townhouse is a group of dwellings that are joined together with common walls and usually have their own exterior entrance. Townhouse owners typically pay monthly maintenance or strata fees for the upkeep of common areas such as parking lots and landscaping. These fees are clearly described in the property listing
Types of ownership
Freehold
Freehold, also known as fee simple, is the term typically referred to as ownership of a home. In this case, the owner is in full control over the land and buildings on it, subject to any rights of the Crown, local land-use bylaws and other restrictions.
Strata title
With strata title, an owner retains exclusive use and ownership of a specific housing unit and shared use of common areas like elevators, hallways, entertainment rooms and garages. This is used for apartments, townhouses and possibly duplexes.
Bare land strata
A bare land strata plan pertains to the land only and does not include the structures on the lot. In this instance, the strata corporation has no interest in the buildings on the land, so each individual owner is responsible for all maintenance, repair and insurance for his/her individual lot. However, there are often common properties and shared amenities that are maintained by monthly maintenance fees, such as clubhouses, street lamps, private roads and on-site services such as power, water and sewer.
Leasehold
This is when an owner purchases the rights to use a residential property for a long but limited period of time. Leaseholds are typically set for a period of 99 years, but only the remaining term is available for purchase. At the end of the leasehold, the property can be returned to the original owner, which is usually the municipality or the First Nations. The shorter the remaining time left, the less a buyer will be willing to pay.
Cooperative
This is where each owner owns a share in the cooperative association and each shareholder is assigned a particular unit for living. Housing co-ops typically have rules that must be followed and the owners work together to manage the co-op.
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