- Mortgage interest rates are currently at a record low, which makes your mortgage payment that much more affordable. In fact, you would be surprised at how it can make a difference. Depending on the amount of the mortgage it can actually be the same or less than rent.
- There is an abundance of home inventory currently on the market in Brandon which allows a buyer more selection and purchase prices are more reasonable.
- CMHC premiums are set to increase by approximately 15% on June 1, 2015 which can have an impact on the amount of default insurance you will pay if you have less than 10% down. If you apply for a mortgage prior to June 1/15 you will still qualify for the current premium regardless of the closing date. See more on CMHC website by clicking on this link. http://www.cmhc-schl.gc.ca/en/corp/nero/nere/2015/2015-04-02-1605.cfm
- There is a very low vacancy rate for rental accommodations in Brandon and renting is still relatively costly. The average rent for a 2 bedroom is approximately $800/month. The average sale price of a home with similar sq. ft. is approx. $150,000. A mortgage with PIT on this would be approximately $775.00 monthly (using 2.69% on a five year fixed rate with 5% down and taxes of $100/mo). At the end of the five year term you would have paid $22,107.00 towards the principal on your mortgage. Better in your pocket than someone else’s right? Oh, and don’t forget about the possible increase in value on the home over 5 years.
- If you don’t have a down payment saved up there are other options such as using RRSP’s under the First Time Home Buyers Plan and/or gifted down payments from immediate family. Keep in mind that you will want to have some savings for closings costs (approximately 2% of the purchase price).
These are some great points to keep mind but don’t forget there are other costs involved with owning such as maintenance and repairs on the property, insurance, taxes etc.
What do you think? Is buying your own home a good idea?
Article is Couresty of SHEILA COOPER - CENTUM MORTGAGE GROUP CORP.