These days, it’s harder to get into the real estate market than ever before. The cost of houses, especially here in London, Ontario, are seeing record highs, the mortgage rules are getting tougher…and unfortunately, the average income levels haven’t increased enough to keep up with the fast-paced real estate market.
There are few things as rewarding as home ownership. And the good news is that it really is never too late. If you’re working with great real estate professionals—a solid mortgage broker and an understanding realtor—you likely can find a way to make it work. It might just take a bit longer than you expected, but I firmly believe that where there’s a will, there’s a way.
One of the best ways to make it happen is to find ways to save as much as possible for your down payment. On average, it can take a few years to save up for that first home, so the sooner you start, the better. There’s also a lot that you can do to speed up the process:
1. Pay off your credit cards first
Reducing your debt will help you qualify for a larger mortgage. As well, the money that you are saving from the massive cost of interest that credit card companies charge will be able to go directly into your pocket, increasing your savings right from the start.
2. Use a Tax Free Savings Account or an RRSP to save your down payment
If you are saving up for your first home, you can use your RRSP to help fund your down payment. If you would prefer to keep the cash easily accessible or this is not your first home purchase, a Tax Free Savings Account is a great place to store up for your down payment (just be sure to not go over the annual savings limits). This means that you can save AND save on taxes at the same time. Bonus!
3. Sell Your Stuff
Chances are, you have some stuff just lying that you never used, which would bring in some cash if you were to sell it. Whether it’s old jewelry, clothes, baseball cards, a guitar that’s collecting dust, or that extra set of dishes your mom didn’t want, you’d probably be surprised at how much money that stuff would bring in if you put it up on Kijiji, Ebay, or took it to a pawn shop. Hey, it also helps with the de-cluttering!
4. Eat In & Drink In
How often do you eat out? Grab take out for lunch? All that adds up quickly!
Learn a few new delicious recipes, brown bag it for lunch, and have your friends over for drinks (BYOB!) to see some serious savings start adding up. Hint: if you go meat-free for a couple nights a week, that will make a big difference to your grocery bill.
5. Get Real with Your Phone & Cable & Internet Bill
Are you spending a small fortune every month on your tech needs? It can take a bit of time to find a better plan, but it’s worth it. If you can save $40 month on your cell/cable/internet bills, that’s almost $500/year in savings.
There are lots of ways to save up for that down payment, which is why I can’t wait to share even more tips with you! Stay tuned for the next part of this series so you can learn how you can get into the real estate market even sooner!
Thanks for reading!
Your London, Ontario Real Estate Agent