5 Tips to Afford a New Home in Today's Real Estate Market
Despite a recent dip in demand, the Calgary real estate market is still one of the hottest markets in Canada. According to Statcan, for the third consecutive year Calgary is still the fastest growing city in Canada, with a 3.6% growth in population last year, with most of that growth being driven by international migration.
With continued robust population growth demand for real estate will continue to go up, with 2016 expected to see one of the biggest year-on-year hike in sales at 7.1%
In this kind of market real estate tends to get a little tight, and prices tend to go up. But this brings an interesting challenge for first time home buyers, or those looking for affordable housing: how can we buy a new condo in a hot market?
Here are five tips to make your affordable home search a little easier:
1. Buy a Condo
In a previous article we discussed why condos are so hot in Calgary right now, condos are a great way to buy a new home while still keeping costs at a reasonable level.
But buying a condo keeps home costs down in other ways - you save money on utilities because there’s less space to heat, and you also save yourself from the constant maintenance a single family home requires: shoveling snow, landscaping, mowing the lawn, weeding, fertilizing and painting your home’s exterior.
That’s peace of mind, woudln’t you say?
2. Find a Home Builder That Offers Great Incentives
If you’re a first time home buyer this is a big one. Trying to come up with enough cash for your first down payment is a pretty daunting task - even if you have been saving for a long time. Many builders, including Truman, offer monetary incentives that allow you to spend less on your down payment, or provide discounts on homes, or both.
For example, Truman has recently been offering discount vouchers for the amount of $1,500 for some of their newer complexes, such as Orchard Sky and 1741 (register on the Truman website to find out how to get your $1500 home buying voucher).
3. That Builder Should Also Partner With an Attainable Homes Program
In fact, both these organizations contracted Truman to build affordable homes, providing homeowners with as little as $1,100 per month in mortgage payments in some cases.
4. Don’t Be Afraid to Get In on the Ground Floor of New Condo Complexes
I know a lot of people are afraid of being the ones to buy that first home in the brand new complex or housing development. You don’t want to be one of the only occupied units in a complex that’s largely empty.
But this fear is unfounded, especially in this market. Let’s look at the plus side: when you get in on the ground floor you can take advantage of additional incentives or special deals the builder has offered to incentivize buyers.
Truman recently did this with their brand new Orchard Sky complex, offering a limited supply of ready-to-move-in condo units at a special discounted price!
A word of warning if you want to take advantage of these types of incentives: they disappear pretty quickly due to their popularity, so make sure to go early to the grand opening events or for a private showing with the sales agent.
5. Consider A Smaller Unit
A great way to find an affordable home is to consider the smallest possible unit you could find - including looking at one bedroom units. This option is actually more popular than you would think.
In fact, according to Truman Chief Operating Officer Tony Trutina, “We’ve seen the demand for one-bedroom units go up substantially over the last two years given that the cost of housing is constantly on the rise.”
If you have children that might not be feasible. But if you think you need a three bedroom home to accommodate your two kids, think again. Young children don’t necessarily need separate bedrooms. And in fact according to the experience of this New York City family (New York has got to be the most compact cities in North America), kids grow up to be happy, well-adjusted teens and adults despite sharing bedrooms.
Buying a home in a hot market can be a little intimidating in a hot market because of rising prices, but there are always ways to find affordable alternatives - especially if you take advantage of some of the incentives, programs, and insider tips for buying an affordable condo unit!