Buying your first home can be intimidating and something that many people may never experience. It may be hard but it is not impossible.
We have a first time home buyer home discount available that could help you save up to 50% off the cost of home insurance when combined with a higher deductible. Let’s talk about some of the ways that first time home buyers can save to make it a little bit easier.
15 YEARS AGO VS. NOW
According to CMI Financial Group, the average cost of a 3-bedroom home:
• In 2009 was $371,000
• In 2024 is $733,000
Housing prices in Ontario have more than doubled in the last 15 years, making it very difficult for many people, especially young people, to buy their first home.
The key is to remember that although it is tough, it can be done.
HOW A FIRST TIME HOME BUYER CAN BUDGET AND SAVE
There are many ways to save money for a big purchase like your first home and although it may take time, watching your money grow can be very satisfying.
Here are a few ways to save:
- Automatic money transfers: you can set up your bank accounts to automatically transfer money from one account into a savings account for you. It is relatively easy to set up and you can control the amount of the transfers as well as the frequency.
- Curbing unnecessary spending: doing something as simple as spending less on going out to eat or buying things that you don’t actually need, can save you a lot of money in the long run.
- Cancelling unnecessary recurring payments: your bills need to be paid however you also don’t need a subscription to every streaming service out there so pick your favourite one and cancel the rest.
The same goes for phone applications! Everyone knows that productivity is at an all-time low due to these apps, but instead of scaling back, we sign up for more subscriptions every day! Cut back on the apps, and you will really notice how much more is left in your account every month!
GRANTS AND INCENTIVES
The Government of Canada has a few different incentives for first time home buyers:
- Non-refundable tax credit: a non-refundable tax credit of up to $1,500
- GST housing rebates: a rebate for some of the tax paid on the price of your home
- Home buyers plan: a withdrawal from your RRSP of up to $35,000 to use to pay for your first home
- First home savings account: with an annual contribution, you may be able to save up to $40,000 for a down payment on your first home
Talk to your financial advisor to figure out the best path for you to take.
Buying your first home can be daunting but it can be done. Talking to the right people such as a financial advisor, a mortgage expert and an insurance agent can set you on the right path towards reaching your goal.
Putting money aside and cutting back on expenses are two of the easiest ways to gather a nice nest egg. It is important to be reasonable about what you can allow yourself to save so that you don’t hurt yourself financially in the process as well as reasonable about the house that you can afford to buy so that you don’t end up house-poor right after buying your first home.
Erie Mutual Insurance proudly serves the commercial insurance, farm insurance, home insurance and auto insurance needs of members throughout Southern Ontario including Haldimand, Niagara and Hamilton.
Please don’t hesitate to contact us with any questions you may have about this or any other topic related to your insurance.
