ShirleySteele.com : Homelife Glenayre Realty : FIRST TIME BUYERS

FIRST TIME BUYERS

There are few things as satisfying as buying your first home. It is a memory that remains bright over the years, no matter how long ago or how humble the beginnings. There is just something about buying your first home that is close to magical.

Quite apart from the emotional pleasure that usually comes from the drudgery making the leap from paying someone else's mortgage to the responsibility of paying your own, there are some real financial benefits from home ownership that you can not get from renting.

If that isn't reason enough to serious consider becoming a homeowner, consider the following.

As you can see, regardless of the monthly rent you are paying, you have no chance of ever seeing that money again. It has gone to enrich your landlord and impoverish you. We have seen cases of people who have rented from the same landlord for more than 15 years. They thought that they essentially owned the place. They were more than a little surprised to get 3 months notice to vacate and they became more than a little sick at the realization of all the money that they had simply thrown away.

Clearly, there are financial costs involved with purchasing a home that are significant and ongoing. However, paying a mortgage off over a period of years means that at least a portion of the principal is being paid down, bit by small bit. One day, the house is all yours. That will never happen if you keep renting.

As a matter of public policy, governments encourage people to become homeowners. Several programs are available to assist would-be buyers to enter the market. These are examples of the assistance available:

In B.C., the Provincial Government waives the Property Transfer Tax, a significant saving on most purchases.



The Federal Government allows the use of RRSPs in certain circumstances to purchase a home.



The GST payable on new construction is reduced on properties below a threshold amount



When conventional lending sources aren't available because the buyer doesn't have a large enough downpayment, CMHC offers a mortgage insurance program to assist buyers.

Buying a home is usually a good hedge against economic upheavals and the inevitable tectonic shifts in markets, both real estate and otherwise.

Over time, property tends to appreciate. If you are able to time the entry and exit points with some skill and luck, chances are that you will realize a significant capital gain over time. That will never happen if you keep renting.

You can improve your home and reap the rewards of your labour. The markets will generally reward you for your effort and creativity in the form of increased value of the property. That will never happen if you keep renting.

In all but the most extreme examples, renting simply doesn't make sense on any level.