How we bought our first condo in Calgary:
In this article I will share our experience of buying our first condo in Calgary. Read on to find out how our experience was and how we bought a new home being immigrants in Canada.
My husband and I both came to Toronto, Ontario as international students in 2012. We went to the same college, met, fell in love and decided to move to Calgary, Alberta. In 2016 we finished our immigration and it was time to buy our first home. Looking at the house prices in Calgary, buying a condo was the best option available on the market. There were many challenges ahead of our decision to buy a condo, mainly because the economy was going down and people were getting laid off every day, we did not want to a risk buying an expensive house.
You must have heard that an international student pays almost double than that a Canadian pay for the tuition in Canada. Thus after our education stunt, we were broke right after graduation. I still remember that day when I just had $100 in my chequing account after paying for my last semester’s tuition.
3 Main Factors to consider before buying a condo
This goes without saying – you need to have mullah before you even start thinking about buying your own house. So the biggest chunk goes into –
- Down payment for first time home buyers in Canada (5 % of the cost).
- Paying CMHC (Canada Mortgage and Housing Corporation) – if you do not have the 20% down payment, you have to purchase an insurance for your mortgage.
- Monthly mortgage fees: You will need to pay a fixed amount of small fees to the bank biweekly, bi monthly or monthly once your mortgage starts.
- Property Taxes: This is a fee that you pay the city of owning a home. This is basically included in your mortgage.
- Condo fees / home maintenance cost: If you are buying a condo, you would need to pay monthly a small fee to the condo board as a maintenance. If you are buying a house, ensure that you set aside a small fee so that you have a reserve to take out if something needs fixing.
As you know better the location, more is the value of the house. You need to decide on what exactly are the factors that you need and what are the ones that you can compromise on.
- What location is better to live?
- Where will our condo grow in price?
- Will we be able to rent it out in future?
3. Documentation / Other Formalities.
Most of these things will be explained to you by your realtor. Things you need to know are –
- Condo document review?
- Bank documentation?
- Lawyer’s consultation?
- What is a home inspection
- Writing offer and condition?
We started our home search in June of 2017. We decided on going with a realtor and then got our pre approval done with TD bank. Since we both we working, the bank had approved us for an amount to buy a detached house. Initially we were proud of ourselves thinking that we could finally afford buying an actual home with our own garage, lawn and backyard!However after few days of research more into mortgages, it became clearer. We understood that banks usually approve for any amount considering your credit checks and your joined income. So if you actually end up taking the entire amount for your mortgage, you might end up living just to pay off your mortgage.If you ask then why would the bank approve such an amount? Reason – maybe for bank’s business reasons and of course the mortgage broker gets his commission just like your realtor!
But what if one of us loses our jobs?! So let’s say our worst nightmare became a reality. Few weeks after our house hunting my husband got laid off from his job.
We still wanted to give it a shot with just one person’s income. So we decided to go for a condo than a house as they were within our budget. Condos can range anywhere from $150k – $350k. First time home buying experience can be very daunting. Especially when you are new to Canada and do not have any prior experience in buying a home. It can be nerve wreaking when you find out that you cannot afford something that you always wanted! In our case we always wanted a house, but settled for a condo apartment.
Moral from the story – do a reality check of your worst nightmare before you get into mortgages. If you think there’s a way out then go for bigger liabilities like buying a house.
3 Steps that helped us overcome the challenges to buy our first condo in Calgary:
We knew that renting is just a waste of money and that we needed to build in our equity for a new home as soon as we can. So, we came up with a plan to cut down our expenses and made a goal for savings. As they say, if there’s a will there’s a way. We found our way by the following ways –
Most of our planning went into how we can get our 5% down and if we can afford paying monthly mortgage fees, condo fees along with our other basic expenditures. Check out the mortgage calculators online, they can give you a rough idea on what exactly your monthly mortgage would be. This gave us an estimate and helped us fixed the biggest missing item in our jigsaw puzzle!
2) Tax Filing
It is a huge advantage to save up some money for the down payment. Guys, CRA can be a lot of help when you get your tax filled. So ensure that you file your tax on time to get your money back. This money helped us to achieve at least 60% of our goal.
3) Cut down on spending.
This was a sacrifice for us. Less eating from outside, buying only the necessary things. So simple things like, writing down what exactly you need and then going to buy those things could actually help you save a lot of money. If not, you will end up buying things that you do not want it just coz it’s on “sale!”
Follow these 3 simple steps and you will be able to own your own place in no time!
Why it was a good idea to buy our first condominium?
- We pay ourselves instead of paying rent to someone.
- It is cheaper – almost half a price of a house.
- Our first real home. – Yes! Having a home is awesome!
We took a step to save up, and a risk of owning a property. It was the most rewarding decision in our life. Investing into your own place can be more expensive, but it is so much better to have your own property, even if it is just a condo.
Its 2018 now and honestly we are kind of living our dream. We are paying off the mortgage slowly but steadily and very soon we will venture on our new adventure of buying a detached home!
So folks save that money and start building your assets before it’s too late!
This website is dedicated to help you find your perfect house in Canada. This is the first is the first ever post and we are excited to read your comments!