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You’ve been working hard, planning and saving for years, and now you’re finally ready to take the next step towards homeownership. Congratulations! Purchasing your first home is a huge milestone but as exciting as it is, the process can also be stressful.
Luckily, there are lots of resources available to help first time home buyers in Kelowna on their journey to homeownership. In this guide, we will cover some important things to know before purchasing your first house, including what steps to take, financial assistance options and where to turn for help.
You may have money in the bank, but that doesn’t necessarily mean that you’re ready to start shopping quite yet. First, it’s important to do your research, get your ducks in a row and figure out what you’re really able to afford.
There are several costs associated with purchasing a home besides the down payment.
There are taxes and fees, then of course the ongoing costs of a mortgage, property taxes, insurance, maintenance and so on, plus regular life stuff like food, transportation and leisure.
And don’t forget about that rainy day fund! Homeowners need to be prepared to handle the unexpected, including potentially major repairs.
Now is when a visit to the bank or a mortgage broker will come in handy. These specialists work with clients to figure out what they can afford in a home and what the next step should be.
“A mortgage specialist can help walk first time home buyers through the process,” said Catherine Pynappels, a Mortgage Broker at LendingMax. “We will review their income, credit and be able to determine the purchase price that is most comfortable for them.”
A mortgage broker can also help clients get pre-approved for a mortgage, which helps give first time home buyers a better idea of what they are able to afford, among other benefits.
A specialist will also be able to educate you on the special options available to you as a first time home buyer, which we will touch on in the next section.
Your first home is usually your first big investment, which can be a tough goal to reach. Because of this, there are some programs available specifically for first time home buyers to help make it a little more attainable.
The First Time Home Buyers’ Program can save buyers up to $7,500 in property transfer taxes by reducing or eliminating the amount that needs to be paid.
“If they qualify, they could be exempt on paying the tax on properties up to a $500,000 value, and a partial exemption on properties up to $525,000 value,” said Pynappels.
If you’re a Canadian citizen or resident, have been living in B.C. for some time, and have never owned a home or received a first time home buyers’ exemption or refund before, it’s likely that you qualify. You can learn more about the rules and how to apply here.
The Purchase Plus Improvements Program allows the costs for renovations, such as a new kitchen, bathroom or flooring, to be built into the mortgage.
“This is a great program for the first time home buyers who have found a property they love, but needs a little TLC,’ said Pynappels. “You would need to have the estimates of the total renovation costs up front which would be submitted with the mortgage.”
The Home Buyers’ Plan (HBP) allows first time home buyers to withdraw up to $25,000 from their RRSPs to put towards a new home, tax-free.
To qualify, you must be a first time home buyer, which in this case means that you have not occupied a home that you or your current partner owned in the past four years. This means that even if you have owned a home in the past, you may still qualify.
There are a few rules that come with this one. The amount withdrawn must be paid back within 15 years with minimum payments required each year, and live in the home for at least one year after it is purchased. You can learn more about the Home Buyers’ Plan here.
Before you start looking, save yourself time by making a list of what you’re looking for in a home. Make a list of both your needs and wants, and make note of features you can’t live without and what you could compromise on.
Is there a neighbourhood you prefer? Would you like to have amenities within walking distance, or are you okay with driving everywhere? Is a large yard important, or would you prefer the conveniences of a condominium? How many bedrooms and bathrooms do you need?
These are just a few of the questions you’ll need to consider. This is a big decision so make sure you really think about what is most important to you.
Now it’s time for the fun part - searching for your new home! You can start by perusing online resources to get an idea of what’s out there, but most first time buyers choose to enlist a real estate agent to help them find the right home for both their lifestyle and their budget. Luckily, there are plenty of reputable realtors in Kelowna who would be happy to help.
With new developments popping up all over Kelowna, housing options for first time home buyers are always growing. Green Square is one great option for first time home buyers due to its size, amenities and convenient location in the lower mission.
We hope this guide helps you on your exciting journey to becoming a homeowner!
Using cutting-edge urban planning principles, Green Square offers incredible value and opportunity for Kelowna residents to live in a meaningful space with community gardens, tot lot, green corridors and walkways, contemporary architectural design, and beautiful open spaces. Opening onto Kelowna’s newest future park and next to Casorso Road Elementary School, the multi-phase project offers condos and urban townhomes. Green Square is over 70% sold. Register to learn more.
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