Tips for first-time homebuyers: Q&A with real estate expert Robyn Lau
May 16th, 2012
Since opening the Trapp+Holbrook presentation centre at 668 Columbia Street, we have talked to many potential first time homebuyers. Although these buyers are excited about the idea of living at Trapp+Holbrook, they also have a lot of questions about buying their first home.
Purchasing can be a scary and intimidating experience, but according to local real estate expert Robyn Lau, it doesn’t have to be that way.
We also talked to Robyn about New West, and why there has never been a better time to invest in the Royal City.
Why should new homebuyers consider purchasing in New West?
New Westminster is in the midst of revitalization, which started a few years ago. The early results are apparent. The city truly is on its way back to its earlier title of the Royal City.
Located in the middle of five major cities, New West is accessible to downtown Vancouver and the rest of the Lower Mainland — all of it possible by transit. Amenities are abundant in this city: waterfront location with its board walks, new park, rejuvenated Quay and downtown shopping, just to name a few. The city’s proximity to downtown Vancouver by Skytrain makes the lifestyle here similar to that of Granville Island, but without the high real estate prices.
First time homebuyers are getting the conveniences they want at an affordable price point. Having the option of not owning a vehicle unless you truly want to is a huge benefit with today’s high gas prices and costs of maintaining a car.
New Westminster made a great decision to preserve and maintain the historical feel of its downtown core. Robert Fung of the Salient Group and his vision for the Trapp+Holbrook project reminds me of his Gastown vision. Mixing the old with the new fits right in with the rejuvenation of the downtown core. First time homeowners couldn’t ask for a better combination right now. New West offers the lifestyle and the opportunity for their investment to do well over the course of the coming years.
What should homebuyers pay attention to when they’re buying a pre-sale property?
Presale properties are a unique purchase. They offer homebuyers the ability to save enough for the down payment required to hold the purchase before the building is complete and they take possession.
When you’re purchasing a pre-sale property, you get the latest in design trends, newer and often greener concepts in developments, and the insight to the developer’s experience. Developer reputations are built on success, so look at past projects as indicators of the quality that you can expect.
When buying presale property, first time buyers should know how much of a deposit is required. Often, if you see deposits such as 20-25%, inquire if the developer is looking for a certain value of funds and sales, which indicates that they are looking for funding. Unless sales are strong and move steadily, your money could potentially be locked up for a considerable length of time until the building is constructed.
A strong project will offer 10-15% deposits and will often have a bank affiliated to it offering rate guarantees, which indicates that the banks have already done the filter test on the project and know that it should complete in the time frame projected.
If you have never been a homeowner before, first-time buying might seem intimidating. How do you know when you’re ready to own a home?
Everyone makes decisions based on various things. Often, it is the buyer’s own personal hesitations that create the lengthy process. Others will come in, make their own list of pros and cons then jump right in. Those purchases can happen literally over night.
For many, the decision making starts when you’re thinking that it may be time to get out of mom and dad’s house or asking ‘why am I renting and paying someone else’s investment when I could have my own?’. The first step in any major decision is the hardest, but when you’ve done it, it’s usually the most rewarding.
Determining the real cost of owning a home can be daunting. What do you usually tell clients when they ask about the total cost of buying their first home?
First time homebuyers should first determine if they can even afford their ideal home. I send my clients to a great mortgage broker and get the answers to that question before we even get started.
Most often buyers tend to want what their parents had, but setting realistic goals and expectations is an important starting point.
Consider the entire process of purchasing. Include the cost of inspection (if it’s a resale), deposit, and lawyer/notary fees. Be aware that you need to think of these things in addition to the mortgage.
Affordability is a key issue for many. Can you talk about some of the tax credits and incentives that are available for first-time homebuyers?
There has never been a better time for first time buyers to purchase. There are many incentives to buy, including the additional provincial government incentives on new construction, the lowest interest rates in history, exemption from paying the Property Purchase Tax up to a certain price point and the federal tax credit.
Today’s low interest rates, plus the ability to lock in that rate for 10 years, allows you to afford a lifestyle similar to what renting would cost while paying down a third of a 30-year mortgage. Also, the Canadian Mortgage and Housing Corporation has a program that will give qualifying first-time homebuyers a $5,000 non-refundable income tax credit amount on qualifying homes.
What top 3 tips do you have for first-time homebuyers looking to purchase this year?
Check with a mortgage broker to verify what you can qualify for.
Speak to a knowledgeable realtor about your interest in purchasing a place of your own. Don’t think that you can and should do this on your own as this is the largest investment you will make.
Look at what is keeping you from making a purchase. Friends or family experiences, concern over the market or just your own hesitations. History proves that real estate is always a tried and true investment. Don’t wait until the prices are too high.
We’d like to thank Robyn for taking the time to answer our questions! Be sure to talk to your real estate agent for more information about buying your first home.
Visit thliving.com for more information about Trapp+Holbrook and to register.
About Robyn Lau
Robyn Lau’s career in real estate really began when she started buying and selling homes at 18. After stints as a civil servant, a consultant, and a business partner, Robyn decided to finally take on her passion for real estate. She believes that every day is a great day in real estate. Visit robynlau.com for more info.