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Sandy McManus Realtor Victoria, BC

No Time Like the Present to Buy a Home

Now is an excellent time to take the home-ownership plunge. Attractive mortgage interest rates, government incentive programs and an excellent supply of homes for sale are making the dream of home ownership possible for would-be buyers.

Consider Using Your RRSPs

You may want to take advantage of the Registered Retirement Savings Plan. The program allows you to use your RRSP contributions (up to $20,000 per person, $40,000 per couple) to buy or build a home. You must be a first-time buyer or at least not have owned a principal residence for four consecutive years in order to qualify under the plan. No income tax is deducted from these funds as long as they are repaid to an RRSP according to the government’s repayment schedule.

Different Mortgages

A number of different mortgage options are available. Under a conventional mortgage, lenders will loan you up to 80% of the appraised value or purchase price of the property (whichever is lower) to a maximum set by government regulation, and you must come up with the remaining 20% yourself. If you don’t have the 20% down payment, a high-ratio mortgage may be available that could provide most of the required funds. The proviso is that high-ratio mortgages must be insured and the cost falls to you. Check with your lending institution or mortgage broker to see whether you would be eligible for such a mortgage.

Variable-rate mortgages are usually offered for both conventional and high-ratio mortgages. If interest rates climb, you will pay more per month in interest; if rates drop, you will pay more off your principal. Fixed-rate mortgages, on the other hand, maintain the same rate of interest over the entire negotiated term.

Examine Your Needs

Defining your focus is important because there are plenty of housing options available in the Greater Victoria area. You will have to choose the property that is right for you from among new houses, resale homes, townhouses and condominiums. A REALTOR® will help you choose the one that best suits your current and projected lifestyle. They will accompany you as you view homes and provide you with all the pertinent information to make an informed decision. Many Canadians would agree that owning a home is one of the best investments they have made and helps provide financial security for retirement.