Homeownership remains an important personal goal for Canadians, with close to 70% of households owning their home.
Whether you are thinking about buying your first home or contemplating a move to another, a home purchase is a big decision. You want to make the right choice, and may wonder when is the best time to buy, particularly if you are entering the housing market for the first time.
In brief, the best time to buy a new home is when it is the right time for you.
When considering homeownership, the most important factor is your personal “readiness”. Homeownership is for the long term. It is both a commitment and an achievement that reflects your aspirations and lifestyle, and offers a great deal of personal satisfaction, as well as financial stability.
External financial considerations, such as mortgage rates and house prices, fluctuate and will always influence your purchase at the time. Over the long term, homeownership is a sound investment that compares well with other investments. The sooner you get into your new home, the sooner you will begin to build equity and reap the financial rewards, as well as the personal ones.
Therefore, when you buy a home, the key consideration is if it is the right choice at the right time for you. Here are some questions to reflect on:
- Are you at the point in your life where the idea of homeownership is attractive and makes sense, both now and for the long term?
- Are you ready for the responsibilities of homeownership—taking charge of your home?
- Do you qualify for a mortgage, and how much? If you don’t know, there are plenty of easy-to-use mortgage pre-qualifying tools online. Or talk with your financial institution or a mortgage specialist.
- Do you have a handle on your own household budget? Can you manage the mortgage payments as well as other expenses that may come along with homeownership, such as maintenance costs and higher insurance fees?
- Do you have a down payment, e.g. savings or RRSP investments you can borrow from, as well as adequate funds to cover the closing costs, from legal fees to moving cost. Don’t forget—the larger the down payment, the less interest you will pay on your mortgage loan.
- If you currently rent your home, have you considered how far the cost of your rent would go towards owning your own home instead? Sometimes the difference can be less than you expect.
If you have answered yes, you are ready to talk with the new home builders in your community. Open the door to your new home—explore your options, find out what’s available and what’s involved. This could be the right time for you to buy!