The financial and legal commitment of both traditional and common-law marriage has provided a springboard to homeownership for centuries. And while the average age of first marriage in Canada is around 30, the average age of first home purchase has shifted even later to 36.1,2 No matter your age, there are some key factors that you should consider when you are ready to enter into your first home purchase together.
Affordability is Key
There’s no doubt about it—with home prices that just keep climbing, many first-time buyers feel that the deck is stacked against them when it comes to homeownership. But stepping onto the property ladder can be more doable than many realize, especially in today’s low mortgage rate environment.
While many buyers are holding out for their dream home, embracing the concept of a starter home can open a lot of doors. In fact, that’s a popular approach for first-time homebuyers to take. Fifty percent of first-time Canadian buyers report that they plan to eventually upgrade to a larger home.3
Chosen carefully, a starter home can be a great investment as well as a launchpad for your life together. If you focus on buying a home you can afford now with strong potential for appreciation, you can build equity alongside your savings, positioning you to trade up in the future if your needs change.3
Taking Advantage of Low Mortgage Rates
Canadian mortgage rates hit record lows in summer 2020, and while they are gradually creeping back up, now is still an ideal time to purchase your first home together.4 A lower interest rate can save you a bundle over the life of your loan, which can significantly increase the quality of home you can get for your money.
But what if both halves of a couple don’t have good credit? You still have options. First, boosting a credit score can be easier than you think—simply paying your credit cards down below 35% of your limit can go a long way.5 But if that’s not enough to raise your score, you might consider taking out the mortgage in only the better-scoring partner’s name. The downside is that applying for a mortgage with only one income will reduce your qualification amount. And if you take that route, make sure you understand the legal and financial implications for both parties should the relationship end.
Commute and Lifestyle Considerations
Whether you’ve lived in a rental together for years or are sharing a home for the first time, you know that living together involves some compromises. But there are certain home features that can make life easier in the future if you identify them now. The number of bathrooms, availability of closet space, and even things like kitchen layout can make a big difference in your day-to-day life and relationship.
Your home’s location will also have a significant impact on your quality of life, so consider it carefully. What will commuting look like for each of you? And if you have different interests or hobbies—say, museums vs. hiking—you’ll need to find a community that meets both your needs. Need some help identifying the ideal location that fits within your budget? We can match you with some great neighbourhoods that offer the perfect mix of amenities and affordability.
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