Volume 23 - Summer 2016

Affordability Innovations

It’s the quintessential dream for most Canadians: owning a home they love. But in today’s market, financial barriers often seem daunting — especially for first time buyers. That’s why Townline is introducing two exciting ways to help put home ownership in reach.

Located in the heart of Port Moody’s Oceanfront neighbourhood, The Strand’s first-of-its-kind Affordable Housing Program is a breakthrough in affordability. Thanks to a partnership between Townline Homes, BC Housing and TL Housing Solutions, qualified buyers can purchase a brand new home for 8% less than its appraised market value using an innovative down payment grant program.

We’re also in preliminary planning for another industry first — taking the traditional, single-family mortgage helper concept and giving it a fresh, new twist in the condominium market. Stay tuned for more details as we unveil them.

Get Ready for Home Ownership

Buying your first home is an exhilarating experience. It’s easy to get caught up in the excitement of gourmet kitchens, trendy bathrooms, and the thought of paying yourself rather than a landlord. Being proactive and well prepared is critical to ensure your purchase is a smart one. Here are a few insider tips to make the transition as smooth and worry-free as possible.Figure Your Finances

  • Get pre-approved. Typically you can borrow up to35% of your gross income, so tripling your annual family income is usually a rough estimate of howmuch mortgage you can expect. Remember that your total monthly payments (including items like car loans, credit card debt, property taxes, estimated heating costs, and 50% of your strata fees if you’re buying a condo) shouldn’t exceed 42% of your gross income.
  • Just because you qualify for a $400,000 mortgage, doesn’t mean you should get one. Decide how much you’re comfortable spending each month and stick to your budget. Remember, you want to be able to fall asleep in your home, not worry about how you’re going to pay for it.
  • Pro tip: the lowest interest rate isn’t always your best option. A lot can change in three to five years — marriage, your family grows, the kids move out, you land the dream job on the other side of the country — so flexibility matters. Looking at portability, penalties for paying off your mortgage early, even how your property is registered can save you money if your financial circumstances change.
  • Don’t forget closing costs like legal fees and incidentals like redirecting your mail or transferring hook-up for hydro and cable. If you opt to buy a brand new home, you’ll also be charged 5% GST — a cost some banks will finance but others won’t.
  • First time homebuyers can borrow up to $25,000 from their RRSP ($50,000 for a couple) toward the down payment on their primary residence. Funds must have been in your account for at least 90 days, and you must repay the full amount back into your RRSP within 15 years.
  • If you’re a first time buyer, a Canadian citizen or permanent resident, and have lived in BC for the last year, the Property Purchase Tax (PPT) is waived on brand new homes under $475,000. That’s a saving of up to $7,500 by buying new rather than a resale.

Perfect Home in the Perfect ’Hood

  • Make a list of everything that matters to you. Remember: this is about your lifestyle — not your friends’ or family’s. Do you want a yard, walk-in pantry, secure bike room, gym, or garden plot? Is being close to the SeaWall, shopping, transit, or good schools \ important to your lifestyle? Be really clear which are ‘must have’ features and which are negotiable.
  • Use the presentation centre’s display home. Cozy down at the eating bar or on the living room sofa and visualize where your furniture and art could go. If everything feels natural, this could be your new castle.
  • Unless you’ve already lived there, spend time hanging out in the neighbourhoods you’re considering. Visit at different times of day as well as during the week and on weekends. The funky-looking restaurant that’s closed in the morning could be a noisy neighbour when the late night crowd arrive.
  • Creative idea: if your condo comes with a parking stall you don’t need, consider renting it out —check the bylaws first. In downtown Vancouver, that can easily be a $150-$250/month bonus.

Due Diligence

  • Check the builder/developer’s history and reputation. Visit past projects to see how well they’ve stood up over time. Check with the Homeowner Protection Office for positive (and negative) reviews.
  • Read the disclosure statement — yes, every page of it. Get help from your Realtor, your lawyer, and your mortgage broker. Issues like bylaws, proposed strata fees, and proposed restrictions on things like pets or rentals all impact the enjoyment of your home.

Be Sure to Celebrate

  • Fun tip: mortgage payments usually don’t start until the month after you close. Put that first ‘payment’ aside for unanticipated moving expenses and celebratory pizza with wine or beer on moving day.

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