Today's Millennials or Gen Y kids born between 1977 and 1994 are not only having trouble earning meaningful pay cheques to put toward a mortgage, but the Banks have made it even tougher by tightening lending rules. Combine this with a 10yr Rise in house prices across Canada, it's no surprise Gen Y is finding it hard to buy their first home.
Five main obstacles facing Millenials today are:
Not qualifying for a mortgage
Lacking funds for a down payment
Not finding a home that meets their needs and budget
Not earning enough to afford the monthly mortgage payments
Another big obstacle is a little something called Student debt. Credit card debt is also responsible and it’s in large part due to their spending habits.
Here are some helpful suggestions for Gen Y Homebuyers-
Start Saving Early.
Create a “Down Payment Fund" by Setting up automatic transfers each month into a High Interest Savings Account. or Take advantage of the federal government’s Home Buyers’ Plan, which lets you borrow up to $25,000 from your RRSP.
Dump those high-interest credit cards!
Borrowing to buy a place to live in -is seen by banks as a much safer investment than credit cards... and interest rates are still at rock bottom.
Stop renting. Rent payments go straight into the pocket of the Landlord - and at the end of the lease, you have got nothing to show for it. Some Gen Y's are willing to move in with their parents temporarily or take a second job in order to acheive their dream of Home Ownership.
The key is start small. 75% of Gen Y's are Buying 500-600 sq ft Condos centrally located with stainless steel appliances and public amenities. Close to work and transit hubs. This eliminates the need for a car and extra expenses.
The strategy is to purchase new or pre-construction. Make small deposits that go towards your downpayment over a period of 2 years. And watch your investment Build equity by time your ready to move in.
For more information or to receive a list of new Condos- email us at Rogers TV or firstname.lastname@example.org