For First Time Buyers, Your Opportunity is Now!

One of the areas of strength in the Canadian real estate market this year stems from the anticipated sales to first-time buyers. Despite a significant slow down in the U.S. economy, and wide spread lay-offs in the Canadian manufacturing sector, our economy is still performing very well with a substantial number of new jobs being created resulting in strong consumer confidence. In addition, interest rates remain comparably low and a land trasfer tax rebate further helps first-time buyers achieve the dream of home ownership. Presently there is a good inventory of residential properties on the market both new and resale making this the ideal time for first-time home buyers to enter the market.
In many situations, renting a family home is more expensive than buying. Even with an 8 percent mortgage for a 5-year term, the monthly payments would be less than $1,200 per month. Compare this to renting a three bedroom apartment or condo or home in the area and it's easy to see that buying a home is a much more attractive alternative. If you take a $100,000 mortgage at the same rate and term, the payments shrink to less than $800 per month. Even better, if you're willing to accept a one-year term, the interest rate drops at least two percentage points. This would peg a $100,000 mortgage at only $650 per month and a $150,000 mortgage at around $975.
There is another important benefit to home ownership that often gets overlooked. Over the course of 25 years (the usual amortization period for mortgages), the total amount of money paid by many renters can actually exceed the amount paid by a home owner. This is due not only to the fact that mortgage payments can be cheaper than rent, but because rental fees generally increase over the long term. Of course, interest rates may also rise, but so probably will the value of the property. Therefore, additional equity will be gained. Add to this the reality that after a mortgage is paid off, homeowners will no longer make monthly payments while renters will continue to bear the burden for the rest of their lives. This savings can greatly impact your quality of life upon retirement.
These figures are only intended to illustrate the monetary advanatge of owning versus renting a home. The fact remains that money spent on rent is money gone from your hands forever. If you're one of the thousands of Ontario families caught in the cycle of paying rent and seeing nothing in return, now is the time to make a move. Buying a home can pay off in so many ways and with present conditions being so favourable, you can't afford to pass up the opportunity. I would encourage you to talk to a REALTOR® and find out just how affordable satisfying your desire to own your our home can be.