Buying a Home
First-Time Homebuyers
Home Search Tips
First-time Homebuying Checklist: Top 10 things to consider when buying a home for the first time in Canada
The top 10 things you need to understand before buying a home in Canada.
Niamh GyulayContent Marketing Specalist
6 min read
Buying a home is one of life’s biggest financial decisions. Between mortgage options, government programs, and hidden costs, it can feel overwhelming figuring out where to start. Especially if it’s your first time going through the homebuying process.
To help you feel confident in your decisions, here are ten, easy to understand tips that every homebuyer should familiarize themself with.
Get pre-approved for a mortgage early
Before you even start browsing listings, talk to us about getting pre-approved. This will give you a much clearer idea of what you can afford, and thus, show sellers that you’re a serious potential buyer.
Pre-approval also locks in the lowest interest rates possible for a limited time, protecting you from rising rates before you find your dream home. Pine always gives the best rates, so reach out to one of our financial advisors to understand what is needed for pre-approval. Get pre-approved with Pine here.
2. Understand all the costs that come with buying a home
While your down payment is probably the largest cost you’ll have to budget for, it is far from the only one. Be prepared to pay closing costs, which will usually run you between 1.5-4% of the purchase price. These can include legal fees, home inspection costs, title insurance, and provincial or municipal land transfer taxes.
Setting aside extra savings for these expenses will help prevent unpleasant surprises on closing day. To find out what a realistic budget looks like for you and your financial situation, use our affordability calculator.
3. Take advantage of first-time buyer programs
There are several government programs designed to make homeownership more accessible for first-time buyers:
First Home Savings Account (FHSA) - Contribute up to $8,000 per year (for a lifetime maximum of $40,000) and withdraw tax-free for your first home purchase.
Home Buyers’ Plan (HPB) - Withdraw up to $60,000 from your RRSP to put toward your down payment. Plus, it’s tax-free as long as it’s repaid within 15 years.
First-Time Homebuyer Incentive (FTHBI) - A shared-equity program where the government provides 5%-10% of your home’s purchase price to help reduce your mortgage costs.
Make sure you explore which programs you qualify for, or they can significantly reduce your upfront costs.
4. Don’t max out your mortgage
It’s tempting to buy at the top of your pre-approved limit, but remember: your lender’s number doesn’t always align with your most comfortable budget. Leave room in the budget for property taxes, home insurance, maintenance, and potential interest rate increases. Buying below your limit gives you some flexibility and peace of mind.
5. Fixed or Variable? Know your mortgage options
Understanding the difference between mortgage types is key to long-term financial comfort. Visit our post about fixed vs. variable mortgages for an in-depth look at what is right for your financial situation, but here’s a very quick rundown:
Fixed- rate mortgages are for people that don’t mind spending a little bit more money in the long run in order to ensure consistent rates and payments.
Variable-rate mortgages are for those with a little bit more wiggle room, and are more comfortable risking slightly higher rates for overall lower cost.
6. Strengthen your credit before you apply for a mortgage
A higher credit score means lower interest rates and better mortgage options. Aim for a score about 680. To get there, pay your bills on time, reduce credit card balances, and avoid any unnecessary new debt before your mortgage application. Also, be sure to check your credit report for errors. Sometimes, a simple correction can make a big difference.
7. Budget for unexpected expenses and repairs
Owning a home means a lot of small expenses that can really add up if you’re not prepared. It’s always a good idea to set aside about 1-3% of your home’s value annually for maintenance and repairs. You really don’t want to be stuck with a much-needed roof repair or broken furnace, and no funds to replace or fix them. Planning ahead makes sure that your home stays in tip-top shape.
8. Research neighbourhoods, not just homes.
When you think “home,” you may think of a house with four walls and a door. When you’re looking for a home, you have to think about all the aspects of your new home, including the surrounding neighbourhood. Are schools important to you? Is being able to walk to a coffee shop on Saturday morning important to you? These may seem like small things to consider, but can really make or break your desired lifestyle. Some good things to consider when shopping for a home (and neighbourhood) are:
Commuting routes to and from work
Nearby schools
Nearby leisure amenities (sounds frivolous, but you will care about them when you live there)
Property taxes and utilities (sometimes, these can put you over budget!)
Future development plans (you probably don’t want to move into a pending construction zone)
It’s always wise to walk/commute to your potential new neighbourhood during the day on both weekdays and weekends, to get a real feel of what it would be like if you lived there.
Check out our Pine Homes app (now available in the App Store,) to explore schools near the homes you’re interested in, to help make an informed decision about your future neighbourhood.
9. Work with the right professionals
From real estate agents to mortgage brokers, you will need a lot of people to help you with your homebuying logistics. At Pine, we offer all homebuying necessities on one seamless digital platform. If you’re looking for professionals that have your best interests and lowest rates in mind, visit our Mortgage or Homes pages to get started on your homeowning journey today.
10. Never skip the home inspection
When you’re ready to buy a home, it might be tempting to skip the home inspection, as it may seem like an unnecessary expense. However, a home inspector knows to look for things that might not be top of mind when looking at a home. Things like cracks in the foundation, mold, or potential pest entry points, they see what others can’t. And while yes, it might seem expensive in the moment, a home inspection could potentially save you thousands of dollars in future repairs, and it could even give you leverage to negotiate price reductions or repairs before closing.
Buying your first home is very exciting, but there are so many things to factor in. Take some time to fully understand your finances, explore your mortgage options, and use the programs available to you to make your homebuying experience smooth and stress-free. Preparation, patience, and the right team like Pine’s comprehensive digital homebuying platform behind you, you’ll be unlocking the door to your new home with confidence.