Dear David,

I’ve been working for a few years since graduating from university, and have managed to save money by living with my parents. I’d really like to buy a house, but I’ve been watching the news and the real estate market looks a bit scary. Do you have any tips for new buyers getting into the market, and is this a good time to do so? – READY TO LEAVE THE NEST

DEAR NEST: “How do I get into the market” is one of the most common questions I am asked, yet it doesn’t have a definitive answer. Every home buying journey starts with a first step, and like many other smart young people, your first step was to move back home with your parents.

As parents, our goal is to get our kids launched successfully, which may involve the purchase of their first house. Lifelong friends of mine are helping their son to attain this dream by having him make monthly contributions to his RRSP (which may be used as a down payment) in lieu of rent while he lives at home. Family dynamics and strategies may differ, but at the end of the day, a longer stay at Casa Mom and Dad can give young people a chance to save for a brighter future.

Real estate market conditions are improving for first time buyers. We’ve seen a 1.75 percent drop in the Bank of Canada interest rate over the last six months, almost as if the government was dropping bread crumbs for buyers, a little at a time. As mortgage rates settle over the next few weeks, many buyers who have been sitting on the sidelines will start getting back into the market. The cost of home ownership is changing, so you’ve been waiting and watching the market, give your mortgage specialist a call to see what affordability looks like in today’s terms. Some quick mortgage math tells me that the payment to carry a $500 thousand mortgage is about $500 less per month these days than it was this past summer. 

Average sale prices have been fluid over the last couple of years. They seem to go up a bit, then down a bit, like you’re taking a drive down a road with rolling hills. Prices are currently at one of their lowest points we’ve seen since the end of 2022, and I suspect that once we get through the holiday season, people will start waking up to the fact that this is a good time to buy.

If you want to take the leap into home ownership but need a boost, I suggest talking to friends who might be in a similar situation. You may not be able to afford a home on your own just yet, but joining forces could get you into the market. With rents as high as they are in our region, you might want to consider securing a rental property with partners, while still living at home. It could be something as simple as a two-bedroom loft downtown, or a townhouse in the suburbs. 

PRO TIP: Do the math and crunch some numbers. Based on today’s average sale prices and monthly mortgage costs, getting a foot in the real estate market may be closer than you think. #Advice #AskDavid #TheNegotiator

David is a top-selling Broker in Kitchener-Waterloo Region. He works personally with you when selling or buying your home. Call or text today for your free home evaluation! 519-577-1212