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Newcomer's guide to buying a home |
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Page 1 of 4 By Archie D'Cruz » Buying a home is a dream most new immigrants cherish. Unfortunately,
it's neither wise nor always possible to do so as soon as you land in
Canada.
Let's talk about the wisdom aspect first. It makes a lot of sense for
you and other working family members to find long-term or permanent
jobs before deciding on where to buy a house. After all, would you want
to travel three hours to and from work each day?
It also helps to first get settled into your new
environment, giving yourself the time to explore the various housing
options available to you.
Even those immigrants who feel they are ready to take the big step can
be frustrated by lenders turning down their mortgage applications
citing lack of a Canadian credit history. (A good reason to make owning
a credit card a priority for newcomers).
Unless you are willing to pay
the entire cost up front, or at least a significant percentage of it,
you might find it hard to buy a home in your early days as an
immigrant.
Which is probably just as well. As we said earlier, it helps to know
the real estate market well before making what could well be the single
largest investment of your life.
In this article, we will examine the decisions you will need to make
and how best to go about buying that dream home.
Isn't it cheaper to rent?
Most newcomers to Canada start off by renting an apartment or a house.
While your rent will probably be less than what you would pay as
mortgage each month, it will cost you more in the long run.
Let's take,
for example, an average two bedroom apartment which would cost about
C$1,000 a month to rent in any major city. Over a 25-year period, you
will wind up spending $300,000 in rent. Factor in the 2-5 percent
annual rent increases that are normal in the big cities and you can see
how much money you will be throwing away on a house you don't even own.
Shop around and for the same amount you will get a large four to five
bedroom detached home with a garden and backyard in a good city
location!
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