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Ok, so I think I need a house.

This could put a HUGE damper on my plans for the track and other dreams - but those can wait. A home is important.

So, anyone got any experience in this area?

I'm not making huge amounts of money just yet, so I'm probably looking around the $200k-and a bit mark. My wife is completely and utterly decided she wants a HOUSE not a TOWNHOUSE. So I may need to move out with you Langley folk.. :(

But other than the raw cost of the house, how much (aprox.) is the venture going to cost me? I hear theres a crap load of fees..
 

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I'm assuming your a first time buyer like I am. I don't know how much money you plan on putting down but as a first time home buyer 5% is the minimum. If your putting less then 30% down (I'm pretty sure its 30 check with the bank) you have to pay a CMHC tax (Canada Mortgage and Housing Corp.) With 5% down the tax is 3.75%, the more your down payment the less you pay. I can't remember exactly how much it comes down but if you put 10% down it will be less then 3.75%. Since your a first time home buyer you don't pay PST.

Another expense you'll have to look at is property taxes. Say you bought a place in June (like me) and the current owner has paid taxes until July. You have to reinburse the current owner Junes Taxes and then in July you'll have to pay the next years worth of property taxes. If you bought in December you'd have to pay him back from December-July then pay the next years taxes in July and so on....

You'll want to buy House Insurance, i'm not sure on rates for houses but my townhouse is only going to be $160 for a year to insure my contents for $30,000. Since I live in a townhouse I only have to insure my belongings and not the building thats covered under my strata.

Make sure you shop your mortgage rate around. I have a closed mortgage at 5.6% over 5 years. The bank paid for any fees like the $165 CMHC fee and the inspection, I think I could have done better but I never spent as long as I should have shopping around. Rates have climbed up 1/2% since I locked my rate in but shop around you never know what you'll get.



$200,000 Purchase Price
-$ 10,000 Down payment (5%)
+$ 7,125 CMHC Tax (3.75%)
$197, 125 Total mortgage

If you want to figure out an approximate monthly payment check out this link. Also if you pay biweekly as opposed to monthly you can shave a lot of time of how long it will take you to pay it off and the amount of interest you pay. For me bi-weekly wasn't an option, I'm paid bi monthly so those months with 3 payments would kill me right now.

http://www.remax.ca/cgi/frame.cgi?number=3000
 
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Regarding rates. If you don't need the security to know what your payments will be exactly you should go with a variable rate. There have been numerous studies done (if you really need I'll try to find a couple) that have shown that it is essentially impossible to time locking in your mortgage such that your costs are lower over the long haul. This is because variable rate mortgage's are typically about 2% less than the fixed rates. Therefore rates would have to go up at least 2% during the fixed term for you to start losing money and this doesn't take into account the money you saved while it was gaining that 2%. Also, if you lock in, you don't get any benefit to drops in interest rate.

Other costs (not stated by others), include the normal utilities, but these will be significantly more for a house. Also, plan to put about 10% of your mortgage away for maintenance. Think of it as your strata fees, but you're the only strata member.

Another good trick is if you know someone with a fair sized portfolio they may be willing to float you a downpayment loan (just like a mortgage). You can hide it from CMHC to avoid the insurance. They will likely charge you more than your mortgage rate, but if CMHC is 3.75%, well you do the math. I've done this (with a friend) for part of my fixed income portion of my portfolio.
 

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You should look into RRSP loans if you have much money in RRSP's, you can use that money towards a downpayment and I think its interest free.. you just make payments to re-imburse your RRSP. I'm foggy on the details, but look into it :)
 

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Langley ain't that cheap...well depends on the house I guess....but also figure on $$$ for lawn care :D:D, mortgage insurance ? also heating will be more $$$ and so will elect. $$ but hey atleast you will have a complete single, private garage to work on your bike :D:D:D
 
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the nice fee you pay for insurance to cmhc doesn't cover you, it covers the lender.
 

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Mr. Murphy said:
You should look into RRSP loans if you have much money in RRSP's, you can use that money towards a downpayment and I think its interest free.. you just make payments to re-imburse your RRSP. I'm foggy on the details, but look into it :)
You can use your RRSP tax free, but you have to pay it back over the next 15 years, which means that all RRSP deposits until then can't be claimed on your taxes.

A friend just bought a house in the Surrey area, 71st and something, nice house modern looking $250K with a swimming pool etc...so if you don't mind the surrey delta area, there are some good deals to be had.

If this is your first place you may want a town house, owning a house is alot of work. Personally I find owning a house to drain a lot of time, also keep in mind that everything for a house cost more, hydro for my house is $180 a month, property taxes are around $3000 a year, homeowners insurance for house and contents, plus riders for computer equipment etc... is $980 a year, lawn care is $100 a months for 8 months of the year, cleaning a house sucks.

There are pluses, garage, indoor storage for bikes in the winter, and the biggest one no #[email protected]#$ strata counsel to deal with. These political wannabes should all be shot.

Anyway, you sould look for a forclosure or a relocation sale, most realtors have these list and so do the banks. If you need help with a realtor let me know, I know a few. Take Jody's place for example. 5 years old, top floor, 1100sf, two bedroom, two full bathrooms, insuite laundry etc...asking $114000, this was a relocation sale and she ended up paying $94,000. There are some deals out there, but TAKE YOUR TIME.
 
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The other thing noone has mentioned is the paperwork and lawyers' fees. When I bought a house there was almost an extra $5000 in fees (and that was under the first -time buyers plan, which they don't have anymore!)

If I were to buy again, I would still be looking for a house, completely detached from any neighbours, stratas, W.H.Y.! It's a little more, but the autonomy to do your own thing is worth it.

Take your time & Good luck!
 

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pixie said:
The other thing noone has mentioned is the paperwork and lawyers' fees. When I bought a house there was almost an extra $5000 in fees (and that was under the first -time buyers plan, which they don't have anymore!)

If I were to buy again, I would still be looking for a house, completely detached from any neighbours, stratas, W.H.Y.! It's a little more, but the autonomy to do your own thing is worth it.

Take your time & Good luck!
Extra $5000 in fees? Wow thats nuts, my fees total are only $500, although I did fail to mention it because I'm not paying em, the seller is for me.
 

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pixie said:
The other thing noone has mentioned is the paperwork and lawyers' fees. When I bought a house there was almost an extra $5000 in fees (and that was under the first -time buyers plan, which they don't have anymore!)
You mean it's not included anymore?

There still is a 'first-time buyers' program.
 
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No, apparently there is no more first time buyers plan -- meaning anyone can pay the minimum 5% down, not just first -timers. (which is the way it was a few yrs ago) That's my understanding anyways.

Lenders like to still promote the "first-time" homeowner (better for business don't you know!)
 

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pixie said:
The other thing noone has mentioned is the paperwork and lawyers' fees. When I bought a house there was almost an extra $5000 in fees (and that was under the first -time buyers plan, which they don't have anymore!)

If I were to buy again, I would still be looking for a house, completely detached from any neighbours, stratas, W.H.Y.! It's a little more, but the autonomy to do your own thing is worth it.

Take your time & Good luck!
Everything about buying a home was best said under the first post on this forum. I just went through buying a condo (as Digi mentioned above), and realtor fees are N/A because you are the BUYER, realtor fees are only payable by the SELLER. I could recommend my realtor if you like Adam, seems like a nice honest guy, Digi and I both thought so, and he works in the Surrey area. As for lawyer/notary public fees, you should only pay about $500 for the transfer of the property into your name from the sellers.

You will have to pay the propery taxes and water/sewer/garbage fees though at the time of purchase and that damn CMHC tax, what a load of crap, where did that $5,000 of my money go to anyhow? Whoo hooo... to save the bank if I default on my mortgage, like I'm gonna do that. I have a perfect credit rating. They should make a lower percentage to those of us that have this and a surplus for higher risk clients. Ick. Oh well, no time to rant, its sunny outside and my boss is out of town today. :D Too bad I couldn't just leave, gotta answer the darn phones.
 
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