Sorry, your browser doesn't support embedded videos.What Qualifies as a First-Time Homebuyer in Canada?Owning a home is a dream for many Canadians. It symbolizes stability and a personal milestone. But for those buying a home for the first time, the process can feel a bit overwhelming. Knowing the basics helps make the journey smoother, especially when figuring out if you qualify as a first-time homebuyer. What is a First Time Home Buyer?In Canada, a first-time homebuyer is typically someone who hasn’t owned a home in the past four years, including both the buyer and their spouse or common-law partner if purchasing together. Who qualifies as a first-time home buyer? Generally, it’s anyone who meets the four-year rule, meaning neither you nor your partner have owned and lived in a home during that period. However, there are exceptions—such as if you’ve separated from your spouse and no longer co-own a home, you might still qualify. Special cases, like having a disability, may also allow for different rules. Be sure to check the specific program requirements to confirm eligibility. To qualify as a first-time homebuyer in Canada, you must meet the following criteria: you cannot have previously owned a property in Canada or abroad. However, there are exceptions. It is possible to qualify as a first-time homebuyer again after owning a home under the following circumstances: If you have separated from and no longer live with a spouse or partner. If you purchased your first home more than four years ago, you may be able to make use of government programs to buy for a second time. It’s important to note that the above criteria may vary depending on the program you want to access as a first-time homebuyer. For example, some programs may have additional eligibility requirements or different definitions of what qualifies as a first-time homebuyer. For instance, the Home Buyers’ Plan (HBP) defines a first-time homebuyer as: “You are considered a first-time homebuyer if, in the four-year period, you did not occupy a home that you owned or one that your current spouse or common-law partner owned.”  As well, the rules surrounding opening a First Home Savings Account (FHSA) state: “You will be considered to be a first-time homebuyer if you did not, at any time in the current calendar year before the account is opened or at any time in the preceding four calendar years, live in a qualifying home (or what would be a qualifying home if located in Canada) as your principal place of residence that either: you owned or jointly owned or your spouse or common-law partner (at the time the account is opened) owned or jointly owned.” In addition to programs designed to make it easier to come up with a down payment, there are also provincial incentives designed to help with land transfer taxes. These, too, will have their own definition of what qualifies as a first-time homebuyer. In Ontario, for example, the eligibility requirements for the Land Transfer Tax Refund for First-Time Homebuyers are more stringent. “The purchaser cannot have ever owned an eligible home, or an interest in an eligible home, anywhere in the world, at any time.” In addition, “If the purchaser has a spouse, the spouse cannot have owned an eligible home, or had any ownership interest in an eligible home, anywhere in the world, while he or she was the purchaser’s spouse. If this is the case, no refund is available to either spouse.”Home Financing Guide for First-Time HomebuyersDown PaymentsA down payment is the upfront portion of the home’s price that you pay at closing. How much down payment does a first-time homebuyer pay? It depends on the home’s price. For homes under $500,000, a first-time homebuyer in Canada would need to put down at least 5 per cent. For homes priced higher than that, you’ll need 10 per cent for the portion above $500,000. Homes priced at $1,000,000 or more require a 20 per cent down payment. While making a larger down payment reduces the amount you need to borrow and lowers your monthly mortgage payments, many first-time home buyers start with smaller down payments to get into the market. If your down payment is less than 20 per cent, you’ll also need to get Canada Mortgage and Housing Corporation (CMHC) insurance, which protects the lender in case you default on your loan. Keep this in mind when figuring out how much down payment for a first-time homebuyer is needed. Look into a first-time homebuyer savings account. The First Home Savings Account (FHSA) is a tax-free way to save up to $40,000 toward your first home. Contributions to the FHSA are tax-deductible, and any withdrawals made from a first-time homebuyer savings account for purchasing a home are also tax-free; this helps you build up your down payment more easily. Mortgage Types and Rates When you’re getting a mortgage, you’ll come across two main types: fixed-rate and variable-rate. A fixed-rate mortgage locks in your interest rate for the entire term, so your payments stay the same every month, making it easier to budget. A variable-rate mortgage changes with the market, meaning your payments could go up or down depending on interest rates. While variable rates can give you lower payments at first, they carry the risk of rising over time. Which one is best for you depends on your financial situation and how comfortable you are with changes in payments. Many first-time home buyers in Canada prefer fixed-rate mortgages for the stability they offer, especially when they’re new to homeownership. Closing Costs  Besides the down payment, a first-time homebuyer should be ready for closing costs, which usually range from 1.5 per cent to four per cent of the home’s price. These include legal fees, title insurance, appraisal fees, and home inspection costs. You may also have to pay land transfer taxes, depending on your province. Some provinces offer rebates, so be sure to check what’s available in your area. Closing costs can add up, so it’s important to budget for them in advance to avoid any surprises. Credit Score and Financial Health Your credit score plays a crucial role when applying for a mortgage, especially for a Canada first time home buyer. A strong credit score can help you secure better interest rates and terms, saving you money over time. Check your score early and fix any issues before applying for a mortgage. Common fixes include paying down credit card balances, ensuring timely bill payments, and disputing any errors on your credit report. Typically, a good credit score in Canada is between 660 and 900. A Canada first-time homebuyer with a solid credit score in this range may also qualify for additional benefits and better financing options.  Mortgage Term Length and Amortization Another key decision for a first-time homebuyer in Canada is how long the mortgage term should be. Mortgage terms typically range from three to five years, after which you’ll need to renew, usually at a different interest rate, which could be higher or lower than your current interest rate. Mortgages are also amortized over lengthy periods, up to 30 years. A shorter amortization period means higher monthly payments, but less interest paid over time, while a longer amortization period offers lower monthly payments but more interest in the long run. It’s important to find the right balance based on your financial situation and goals. Debt-to-Income Ratio Lenders look at your debt-to-income ratio (DTI) to decide if you can afford a mortgage. This compares your monthly debt payments to your gross income. Keeping this ratio low by paying off debt before applying for a mortgage can help you qualify for a bigger loan or better interest rates. For a first-time homebuyer in Canada, this is especially important if you have existing debt like student loans or car payments. Future Property Value and Resale Potential Even if you’re not thinking about selling anytime soon, you should consider the resale value of your home. Things like location, nearby schools, and amenities can affect the value over time. Choosing a home in a desirable area can be a good investment, and thinking about the future resale potential is a wise move, even for a first-time home buyer. First Time Homebuyer Incentive Programs in Canada Buying your first home can be daunting; however, there are incentives for first-time homebuyers to make purchasing a home easier.  First Home Savings Account (FHSA): This program allows eligible individuals to save up to $5,000 per year tax-free to purchase their first home. Contributions to the account are not tax-deductible, but the interest earned on the account is tax-free. Home Buyers’ Plan (HBP): This federal program allows first-time homebuyers to withdraw up to $60,000 from their Registered Retirement Savings Plan (RRSP) to use toward a down payment. The money must be repaid to the RRSP within 15 years. Land Transfer Tax Rebate: In many provinces, first-time homebuyers can receive a rebate on the land transfer tax they pay when purchasing a home. The rebate amount varies by province, from part of the tax to all of it. First-Time Home Buyers’ Tax Credit (HBTC): The calculation amount for the Home Buyers’ Tax Credit (HBTC) is $10,000, resulting in a maximum tax credit of $1,500 for eligible homebuyers. GST/HST Housing Rebates: The sales of new homes are generally subject to GST/HST, and these tax rebates help to offset some of the tax you paid on your home. This particular rebate is not limited to first-time homebuyers. Remember that these programs’ eligibility criteria, maximum purchase rates, and other specifics can differ depending on the region or territory. It’s wise to investigate the programs that are accessible in your location to determine whether you are eligible and how you can benefit from them. Note that The First Time Homebuyer Incentive (FTHBI), a shared-equity mortgage program with the Canadian government, has been discontinued. The Canada Mortgage and Housing Corporation (CMHC) announced that no new applications will be accepted after March 31, 2024.  How RE/MAX Agents Help First-Time Homebuyers RE/MAX agents in Canada are licensed professionals who can guide first-time homebuyers. Here’s how a RE/MAX agent may assist you throughout your home-buying journey: Initial Consultation: meet with you to discuss your needs and preferences in a home, as well as your budget, timeline and financing options. Home Search: help you search for properties that meet your criteria using the Multiple Listing Service (MLS) and other resources. They may also suggest neighbourhoods, schools, and other important amenities that fit your buying profile.  Property Viewing: arrange property viewings and accompany you to each property, highlighting beneficial features and potential issues. Offer Preparation: assist with preparing and submitting the proposal, including negotiation with the seller.  Closing: help you navigate the closing process, which may include finalizing financing, arranging for a home inspection, and completing paperwork. Work with a RE/MAX agent to get clarity and support throughout the home-buying process. The post What Qualifies as a First-Time Homebuyer in Canada? appeared first on RE/MAX Canada.

Investing in a winter cottage in Canada can be a rewarding and financially sound decision, especially in sought-after locations like Muskoka, Ontario; Whistler, British Columbia; and Banff, Alberta. These areas are renowned for their natural beauty and winter activities, attracting tourists year-round and offering strong potential for rental income. If you’re searching for a winterized cottage for sale, whether as a personal retreat, rental property, or long-term investment, these regions provide the perfect blend of scenic charm and financial viability, making them ideal spots for owning a cottage in winter.What Is a Winterized Cottage?If you’re wondering, “What is a winterized cottage?” it’s a vacation home designed to handle the cold winter months. A winterized cottage is equipped with proper insulation, a reliable heating system, and sealed windows and doors to keep out the chill. The plumbing is protected against freezing through a combination of insulation, heating, and preventive measures, allowing you to use the cottage comfortably year-round.Why Should You Invest in a Winterized Cottage?Personal Enjoyment and Lifestyle BenefitsOwning a winterized cottage in winter provides an escape from the hustle and bustle of daily life. With Canada’s stunning winter landscapes, a cottage can serve as a cozy retreat where you can enjoy activities like skiing, snowboarding, or simply relaxing by the fireplace. The opportunity to create lasting memories with family and friends is priceless, offering a lifestyle upgrade that’s hard to quantify in financial terms.Potential for Rental IncomeIf you’re not planning to use the cottage year-round, renting it out during peak seasons can generate a significant income stream. With the rise of short-term rental platforms like Airbnb, there’s a growing demand for unique vacation properties, especially in popular Canadian winter destinations. Renting out your cottage during the months you’re not using it can offset ownership costs and even turn a profit.Long-Term AppreciationCanadian real estate has historically appreciated over time, and cottages are no exception. While the real estate market can fluctuate, the RE/MAX Cottage Report 2024 highlights that recreational property prices are expected to rise 6.8% in 2024. This makes a winter cottage not just a place to enjoy but also a solid long-term investment. Given that Canadian real estate prices have risen over the past 30 years, owning a cottage can contribute to your wealth accumulation.Diversification of Investment PortfolioReal estate is a tangible asset that can diversify your investment portfolio, balancing the volatility of stocks and bonds. By investing in a winter cottage, you’re securing a potential income-generating asset and diversifying your wealth, which can provide financial stability in uncertain times. Diversification is especially valuable if you’re looking to spread risk across different types of investments.Emotional and Legacy ValueBeyond the financial benefits, owning a cottage in winter can provide emotional value and serve as a legacy for future generations. It can be a place where family traditions are built and passed down, creating a sense of continuity and belonging. The emotional connection to a place can often outweigh financial considerations, making it a cherished part of your family’s history.Financing a winter cottage might seem challenging with today’s high mortgage rates, but it can still be a smart move with the right strategy. Prices for cottages tend to be lower in the colder months when demand dips, so you might snag a better deal on a winterized cottage for sale. Plus, if you rent it out during peak winter seasons, the extra income could help offset the higher financing costs. By considering a larger down payment or a shorter-term mortgage, you can make owning a cozy winter retreat both a rewarding and financially sound investment, even in a tough market.Ways to Protect Your Cottage in Winter Canadian winters are notoriously harsh, and your cottage needs to be well-prepared to withstand the cold, snow, and ice. Proper winterization is essential to protect your property.Safeguard Your Cottage PlumbingFrozen pipes are one of the most common and costly issues. As water freezes, it expands, which can cause pipes to crack or burst. To prevent this, make sure to drain all water lines and apply antifreeze designed for cottage water systems. Plus, insulating exposed pipes, especially in unheated areas, adds an extra layer of protection against freezing temperatures.Seal and Insulate Your CottageInspect windows, doors, and any other openings to ensure they are properly sealed. Weatherstripping and caulking can prevent drafts and moisture infiltration. Also, check your insulation in the walls, attic, and floors, and consider upgrading if it’s unable to handle extreme cold.Roof and Gutter MaintenanceSnow and ice can place a significant load on your cottage’s roof, potentially leading to leaks or even structural damage. Before winter sets in, inspect your roof for loose shingles or other vulnerabilities and make necessary repairs. Clear gutters and downspouts to prevent ice dams, which can cause water to back up under the roof and lead to leaks or interior damage.Chimney and Fireplace PreparationIf your cottage has a fireplace or wood stove, have the chimney inspected and cleaned before winter. Creosote buildup can lead to chimney fires, while blockages can prevent proper ventilation. Ensure your chimney cap is secure to keep out snow, rain, and animals. Stock up on seasoned firewood and check that the fireplace or stove is in good working condition for the cold months ahead.While significant capital is required to buy and maintain a winter cottage, the potential benefits—personal enjoyment, rental income, and long-term appreciation—can make it a good purchase decision. Carefully assess your finances to determine if cottage ownership aligns with your goals and budget. If the numbers work in your favour, a winter cottage could become a cherished retreat and a sound financial asset.Ready to find your perfect winterized cottage for sale? Our experienced agents specialize in winter properties and know the best locations to find your ideal escape. We’ll guide you every step of the way, from discovering hidden gems to negotiating the best price, so you get a property that’s both a joy to own and a smart investment. Contact RE/MAX today!   The post Why a Winter Cottage May Be a Great Investment appeared first on RE/MAX Canada.

Single-family homes are emerging as a strong investment, even with mortgage rates currently near double their 10-year average. Unlike the volatility of tech stocks, a single-family home tends to offer more stable and predictable returns. Experts agree that this type of property is likely to appreciate faster than a multi-family home, driven by a significant shortage in single-family housing and rising incomes. As interest rates eventually ease, the demand for a single-family detached home is expected to grow, potentially outperforming other property types in the long run.One of the key reasons single-family homes are such a sound investment is their broad appeal to a wide range of buyers and renters. If you are wondering, “Are single-family homes a good investment?” In cities like Toronto, Vancouver, and Calgary—where housing supply is particularly tight—single-family homes offer features like more space, greater privacy, and the potential for a yard—amenities that families, professionals, and retirees highly value. This demand makes single-family homes less likely to sit vacant and more likely to fetch higher rental prices compared to condos or apartments.Many Canadians are currently sitting on the sidelines, waiting for a better time to buy, but this strategy could be a gamble. The truth is, with a shortage of single-family homes and the possibility of rates dropping later this year, waiting might just unleash a wave of pent-up demand, driving prices even higher. For those ready to jump into the market, smart money is buying single family homes now, recognizing their immediate value and long-term appreciation potential. As mortgage rates trend downwards and core inflation stabilizes, 2024 could present a unique opportunity for buyers who act decisively, securing their place in a competitive market and reaping the rewards of rising home values.What is a Single-Family Home?What is a single-family home? A single-family home is a residential property designed to house one family or household. These homes are typically detached, meaning they stand alone and are not connected to any other dwelling, unlike apartments, condos, or duplexes. Single-family homes usually come with a private yard, garage, and often more space than other types of housing. These properties are commonly found in suburban and rural areas, but they can also be present in urban neighbourhoods, providing a range of options for various lifestyles.Why Are Single-Family Homes a Good InvestmentHigh Demand and Low SupplyOne of the strongest reasons to invest in single-family homes is the consistent demand they enjoy, especially in the Canadian real estate market. Smart money is buying single-family homes because, in major cities, the supply of these homes is limited while demand remains high among families, professionals, and retirees. This imbalance between supply and demand often results in lower vacancy rates and higher rental prices, making single-family homes a reliable source of rental income and a solid investment choice.Strong Appreciation PotentialSingle-family detached homes tend to appreciate faster than multi-family properties. As the demand for these homes remains strong and supply stays limited, property values are likely to increase over time. This makes single-family homes an excellent long-term investment, allowing homeowners and investors to build equity and secure financial stability.Easier Management and FinancingManaging a single-family home is generally simpler than handling multi-family properties. With fewer units and tenants to oversee, landlords can more easily manage maintenance, repairs, and tenant relations. This extends to financing as well; lenders often view single-family homes as less risky, offering more favourable mortgage terms to qualified buyers. The ease of management and financing makes single-family homes an attractive option for both new and experienced real estate investors.Flexibility in Rental StrategiesSingle-family homes offer flexibility in how they can be rented out, which is a key reason why smart money is buying single-family homes. Whether you’re interested in long-term leases or short-term rentals through platforms like Airbnb, these properties can adapt to various rental strategies. This allows investors to respond to market conditions and maximize their returns based on the most profitable approach at any given time, making single-family homes a savvy investment choice.Strong Resale ValueWhen it comes time to sell, single family homes often maintain strong resale value due to their enduring popularity. Buyers prefer these properties for the space, privacy, and potential for customization they offer. The continued demand for single-family homes ensures that they remain a valuable asset in the real estate market.Tax BenefitsA single-family home can offer various tax advantages, including deductions for mortgage interest, property taxes, and certain maintenance expenses. These tax benefits can significantly reduce the overall cost of ownership and increase the profitability of the investment.In Canada’s competitive real estate market, single family homes offer great potential for long-term value and appreciation. With demand outpacing supply, now is the time to make your move. RE/MAX agents are here to guide you through the process, helping you find the perfect home that fits your needs and budget.The post Why Single-Family Homes Are a Great Investment for Buyers appeared first on RE/MAX Canada.