This
year, Ontario consumers are can count themselves lucky in one important
aspect: they are living in time that offers unequalled opportunities to
realize the dream of home ownership.
Interest
rates are among the lowest in decades and the availability of housing
of
all varieties is at the highest level in years.
In
fact, in many situations, renting a family dwelling can actually be
more
expensive than buying. If you consider a $150,000 mortgage at 8 per
cent
for a 5-year term, the monthly payments would be less than $1,200 per
month.
Compare this to renting a suitable three bedroom apartment or townhouse
in many urban centres, and it's easy to see that buying a home has
become
an 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 as broad examples. The fact remains that
money
spent on rent is still money down the drain.
Regardless
of the number crunching, the bottom line is that owning a house is the
best way to assure the happiness and well-being of you and your family.
A home gives a family room to grow, and room to prosper.
The
best childhood memories many of us hold include Sunday dinners in the
family
dining room, retreating to the rec room when friends visit, or skating
on the backyard rink throughout the cold winter months.
If
you've made the decision to buy, the first person you should talk to is
a Realtor. These real estate professionals will help you with virtually
every aspect of your home ownership needs. From putting together a
'buying
blueprint' that details your specific housing requirements, to giving
advice
on what you can afford, a Realtor can cut through the complexities.
Constructing
a 'buying blueprint' is a critical step for first time buyers. In it,
you
will list items such as: how many bedrooms do you really need; is a
finished
basement a necessity or can you afford to wait; how big a yard do you
need;
and most importantly, where do you want to live? All these
considerations
will affect your ability to buy.
For
example, many first-time buyers will forego a property close to the
downtown
core in favour of a suburban or even a rural home. This can lead to
huge
savings which can be used to either lower the mortgage and monthly
payments,
or to acquire a bigger home for the same cost.
Opting
for a townhouse or resale home are other alternatives that can help
first-time
buyers escape the 'rent trap' and channel their funds into a solid
investment.
When
you've narrowed your requirements, a Realtor will scout properties for
you and make recommendations on homes that suit your needs. Once you
begin
viewing, your Realtor will accompany you, offering advice on matters
such
as the amenities of the neighbourhood, repairs or upgrades that could
be
necessary, building inspections, carrying costs and so forth.
So,
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--you simply can't
afford
to pass up the opportunity.
Ontario
Real Estate Association
Commercial
Listings
