Once upon a time, no one questioned the financial decision of buying your own home. A sound investment and a step toward growing your wealth, homeownership was an obvious choice. But today, there is an increasing number of living arrangement options. With the rising costs of everyday life, people consider more carefully whether they prefer to rent or own. Are you on the fence? Wondering whether it’s worth making the leap to homeownership? I want to help you navigate through all the information out there and take a look at some of the critical factors that may help you decide between owning or renting. And if you do decide to buy, I’ll work to find you a home that you absolutely love - and nothing less!
For some, choosing to rent rather than buying might seem like a smart choice. If your rent is reasonable and predictable, you may be able to start saving money rather than spending it on the many costs of owning a home. However, the CMHC Edmonton vacancy forecast predicts a dive to 3.4% in 2020, down from 4.9% in 2019. This decrease means that there will be fewer rental options, leading to rising rent prices. Unlike areas with controlled rent, tenants are at a disadvantage when supply becomes scarce. Now, you might think that buying a home in a big Canadian city is out of reach, but you can forget about the crazy markets in Toronto or Montreal - here in the Edmonton area, buying a home is still very affordable! The monthly cost of renting a two-bedroom apartment can be higher than a mortgage payment in some cases. So, while Albertans might be feeling an economic crunch, a lower mortgage payment becomes all the more attractive. Unsure? My team and I can help you explore the reasons why homeownership is right for you!
What makes it a great time to buy in Edmonton?
Mortgage rates are very low - it doesn’t get much better than this, with the lending rate for fixed 5-year mortgages as low as 1.84%. Who doesn’t love to hear this kind of good news amid all the negative headlines? And for me and my team, there’s nothing better than seeing my clients’ excitement when they realize that they can afford much more than they ever thought! Not to mention the many first-time home buyers incentives that we can help you utilize.
While the COVID pandemic had people panicking earlier this spring, the market has shown incredible resilience in these unprecedented times. For the month of August, single-family home unit sales are up 22.98% from August 2019, so the market is still in full swing! However, we do expect a normal decrease through the fall, which might just be the perfect time to make a deal on a home that has stayed on the market all summer! Up until August, the prices for single-family homes have held relatively steady year-over-year, but duplexes are down 3.48%, and condos are down 2.23% - these might just be the perfect place to start considering an alternative to renting!
The supply of rental properties has gone up, but the population has also been steadily growing as it always has in Alberta. So, demand for these properties has outpaced supply. This leads to rising prices: the average monthly rent has gone up by about 1% in the last year. The CMHC says the rental cost of three-bedroom units increased by 1.6% in Edmonton from 2018. Some experts are even predicting increases of 3 to 5% this year. The lowest vacancy rates are for homes with 3 or more bedrooms, so larger households have the fewest rental choices at the moment, not to mention the highest rental costs. If your family needs a bit more room (especially if you’ve been stuck with each other all these long months!) then you might stand to benefit the most from buying instead of renting.
"We want to get to know you, your needs, and your budget to make sure that you feel confident about making this financial decision!"
Pros of Home Ownership
One monthly rent payment may be equal to (or even higher than!) a mortgage payment. The average rent right now is $1,144, but with a growing market for homes under $300,000, this could be comparable to a mortgage payment. Wouldn’t it be great to start putting that money toward building equity? It could just be the smartest move you can make for your future.
Another way that homeownership gives you an edge: homeowners qualify for more loan opportunities as your home could be an asset to draw on when you need access to credit.
And perhaps the best of all: you can finally have a place to call your own! Maybe you’ve been dreaming of laying down roots and finally being in charge of your own property. Your living arrangements can be in your control – not that of a landlord who could increase rent or sell their property with little notice. And hey, you never know what opportunities may come up when you enter the real estate market. Your neighborhood could be the city’s next hot spot, giving you the chance to sell for a profit and upgrade!
How do I know if I'm ready to buy?
There are tons of first-time homebuyers’ incentives available! We can help you navigate all possible avenues and support you by answering any questions you may have to find you the best option.
I work as part of a team, and our combined expertise means that we have seen it all: individuals and families in all kinds of situations looking to get a stake in the market. We strive to be as approachable as possible, and we want you to feel comfortable sharing your hopes and dreams with us, along with any hesitations you may have. More than anything, our approach is a personal one. We want to get to know you, your needs, and your budget to make sure that you feel confident about making this financial decision and ultimately increasing your wealth. With Mina’s and the Mozaic Realty Group, you are getting a customized experience!
So, as you consider what’s best for you and for your family, keep an open mind! Consider both sides of the argument, and let us show you what’s possible. Nothing would delight us more than helping you to find your happily ever after!
Mina Gayed Real Estate, 2333 90b Ave, #201, Edmonton, Alberta, Canada, 780.994.6462