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Options for First-Time Home Buyers




By Mark McLean, TREB President

Considering the purchase of your first home? Like many of life's milestones there are points you have to consider such as market conditions, financing and more. Don't let these words daunt you, because we have damaged down the key items for straightforward digestion.

Market Conditions

Understanding conditions in the real estate market is a good initial step. Current conditions in the Greater Toronto Area resale market remain quite favourable for people looking to take step one onto the property ladder. The housing market in the GTA continues to be supported by improving business conditions, which have led straight to sustained job creation, a lower rate of unemployment and accelerating income growth.


Financing remains affordable as well. The average interest rate for a five-year fixed mortgage is extremely low from a ground-breaking viewpoint. To qualify to get an insured mortgage through your bank, today's low rates provide for very controllable carrying costs. Naturally, coming up with a down-payment for an average-priced home may appear difficult, but there are efficient strategies you can employ to make that mark in reach. See 'Ways to Save for a Down Payment' for more info.

Personal Finances

It is also vital to closely examine your individual circumstances, especially when determining what you are able to afford. Finance institutions will help you to decide what you can afford by working out your Gross Debt Service ( GDS ) ratio, an amount that includes monthly mortgage, tax, and utilities payments and a portion of condo maintenance ( if pertinent ).

Your GDS ratio normally shouldn't surpass 32 percent of your gross monthly revenue. A bank will also look at your absolute debt picture by working out your Total Debt Service ( TDS ) ratio, taking into consideration all needs like your monthly mortgage, automobile loan, credit line and credit card duties. As a rule, your TDS ratio shouldn't surpass 40 % of your gross monthly income. Be certain to explore of the financing options available through different banks establishments.

When determining a price range it's important to realistically consider various monthly costs, and to account for expenses related to the transaction including home inspection, survey and legal charges.


Once you are prepared to start your search, contact a REALTOR who will commit to representing your interests in writing, using a Purchaser Representation Agreement. More info on this significant document can be discovered at www.BRAFirst.com.

To discover a home suited to your lifestyle, be sure to explore a variety of different housing types and neighbourhoods with your REALTOR before narrowing your search.  REALTORS  have accessibility to information on market conditions in individual neighbourhoods, on future development plans and on a range of local comforts.

Your REALTOR might also supply info on a number of available government programs to help in making your purchase more cost-effective like the Five % Down payment Programme, the RRSP Homebuyers’ Plan, the First Time Home Buyers’ Credit, Land Transfer Tax rebates and more.

Once you have found the right fit, your REALTOR can use their expert negotiation skills to help you achieve a favourable agreement.

Specialized skills and knowledge make your REALTOR an invaluable resource, buoying your activities as you navigate through one of life's most critical decisions.