From Renter To Owner: 8 Important Reminders Before Making The Transition

If you're renting now, you most probably dream of having your own house one day. In fact, you’re probably already looking into buying a property to your name right now. So aside from finding that perfect dream home, what else do you have to prepare for in buying your own place of residence?

Canadian Mortgage and Housing Corporation (CMHC) recommends that your monthly housing costs shouldn't exceed 39% of your gross monthly income (before deductions). The costs for these items include your mortgage payment, your property taxes, and your heating bills.

Here are 8 important reminders before making that renter-owner transition:

1. Make a Realistic Renter-to-Owner Timeline

After the tedious task of searching and even after your seller accepts your offer, you may think that the job is done. You're move-in ready! Not just yet. Be reminded that it may take around 30-50 days to close a home. You have to make sure that you time it right with the end of your lease. You don’t want it to be a renter-homeless-owner story!

2. Know the costs associated with homeownership

Moving into a new place can get expensive in more ways than one! From the upfront costs like security deposits and home loan origination, to ongoing prices such as mortgage payments and association dues - it adds up quickly. And that's not even including all of those other fees you'll need to consider for inspections, insurance escrows, surveys...the list goes on! Let's just say packing your wallet is part of the process when moving house.

Renting is a lifestyle choice for some, and owning is a better investment for others. Test your financial stability and decide whether you should own or rent instead.

3. Study Rent-vs. Buy Math

Homeownership is a complex puzzle. When considering whether to buy or rent, it's essential that you look beyond the usual costs like rental payment versus principal and interest - taxes, benefits of ownership should all be considered too!

4. Know Your Tax Benefits

Homeownership can seem expensive, but don't forget you're eligible for tax deductions! By taking advantage of mortgage interest and property taxes write-offs when filing returns each year, your taxable income could be substantially reduced.

5. Start preparing your credit score now

If you're looking to land the best mortgages, your credit score matters. Having a few extra cards in your wallet is an easy way to boost your rating and give lenders more confidence that you'll be able pay back on time. Don't just settle for one card – start building up now so you can reap those rewards down the line!

6. Research mortgage options

When you're searching for a home, don't forget to shop around for the perfect lender too! Comparing rates across loan types, location, purchase price and down payment can make all the difference - especially when your credit history is taken into consideration. Don’t settle – find that great fit today!

7. Prepare for more responsibilities

Taking care of your home is like taking care of a baby. From the tiniest maintenance issue to its solid foundation and everything in between, it needs protection from all kinds of risks - that's why insurance coverage as well as an emergency fund are totally worth considering!

8. Think long term

Moving house is a big step and there's so much to take into account! Location plays an important role, of course. You should also think about any potential renovation projects for the future - it can be like having your own little blank canvas in which you can create something totally unique. And remember those new neighbors? Chances are they will become lifelong friends if you reach out first…just don't forget that this isn’t just somewhere to live now; resale value matters too as life may throw another move at you down the line.

Ready to make the leap into homeownership? Be sure you know what your budget can handle and do plenty of research. Getting pre-approved for a mortgage first is key; shop around for competitive rates so you get the best deal!

As first-time home buyers, you can count on our team of local expert real estate agents here at Santa Sells Houses to guide you through the entire house-buying process, making each step of the process as easy as possible. Contact us and let’s discuss your real estate needs.