Answers for all of your Real Estate Questions

Home Buying Tips for Barrie ON

Buying a home is a big decision. Ask yourself 5 questions before you decide if you’re ready to own a home.

  1. Am I financially stable?
  2. Do I have the financial management skills and discipline to handle this large a purchase?
  3. Am I ready and able to take responsibility for all the costs that come with being a homeowner?
  4. Can I devote the time to regular home maintenance?
  5. Am I new to Canada? There are several extra home buying resources for newcomers to Canada.

Also consider the many pros and cons of owning versus renting a home.

Buying examples
ProsCons
Freedom to renovateOngoing costs including property taxes and insurance
Ability to build equity in a safe and secure investmentIncreased monthly payments if interest rates go up
Potential for rental incomePossibility of unexpected and costly repairs
Renting examples
ProsCons
Less maintenance and repair costsMonthly payments may increase year after year
Lower monthly upfront costsThe risk your lease won’t be renewed
Shorter-term commitmentPaying someone else’s mortgage

 

Are you financially ready to own a home?

Look into these 5 calculations and questions before you meet with your broker or lender.

  1. Compare how much you currently spend on expenses and debt payments with the amount you have saved or invested.
  2. How much can you afford to spend on housing each month without risking your financial health?
  3. How much do you need to save to pay for the upfront costs of buying a home?

    Upfront costs include:

    • the down payment
    • home inspection and appraisal fees
    • insurance costs
    • land registration fees
    • prepaid property taxes or utility bills (the buyer reimburses the seller or builder)
    • legal or notary fees
    • potential repairs or renovations
    • moving costs
    • GST/HST/QST on a newly built house or mortgage loan insurance
  4. How much would you be spending each month with home ownership expenses added to your current financial situation?
  5. What is your credit score? You can demonstrate your ability to consistently pay bills and debts with a copy of your credit report.

There are 2 affordability rules that determine how much you can spend on housing without risking your financial situation.

As a new homeowner:

  • your monthly housing costs should be at or under 32% of your gross monthly income
  • your monthly debt load (including your mortgage) should be at or under 40% of your gross monthly income

You can explore your budget options with the mortgage affordability calculator.